What are he signs that space tourism is gaining popularity ?
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Answer:
- 10 signs that mankind is getting closer to taking that next giant leap – recreational space
- On July 8, 2019, Virgin Galactic, a British spaceflight company that is part of Richard Branson’s Virgin Group, announced that it would merge with Social Capital Hedosophia (SCH), a special purpose acquisition company (SPAC) that was formed two years ago with the goal of buying a technology company. It raised $600 million and had about two years to make an acquisition or funds would go back to investors
- This merger will create the world’s first and only publicly traded commercial human spaceflight company.
- Following the merger announcement, Virgin Galactic said that it believes it has “overcome a substantial number of the technical hurdles required to make the company a viable and profitable commercial service.” It pointed out that its spaceship, VSS Unity, is the first and only commercial service thus far to have put people in space. The capital provided by SCH will give Virgin Galactic “the support needed to reach commercialization,” the company added, saying it has reached an “inflection point” in the development of commercial spaceflight for a safe experience.
- Wharton’s Erickson called the deal, which will close in the second half of this year, “a merger that suits both parties.” SCH will take a 49% stake in the combined company, while Virgin Galactic will be able to revive its space mission. The company was previously counting on a $1 billion investment from Saudi Arabia, but suspended the deal after questions arose around the death of journalist and Saudi critic Jamal Khashoggi.
- Erickson said SCH’s investment in Virgin Galactic is similar to putting money in “very early stage” and “very speculative biotech companies in which revenue generation is years away.” However, by merging with SCH instead of doing an initial public offering, he said Virgin Galactic could avoid “the scrutiny they would typically face in a two-week IPO road show.”
With this merger, Branson’s company will soon have access to lots of capital to invest in its space-tourism activities. After the deal closes, SCH founder and CEO Chamath Palihapitiya plans to invest another $100 million in the company. Palihapitiya is a Sri Lanka native with a net worth “rumored to be close to $1 billion,” a fortune he amassed as a senior Facebook executive when the company went public.
Virgin Galactic, which had two successful manned space launches earlier this year, already has $80 million in deposits from more than 600 aspiring space travelers in 60 countries, for a total of $120 million in potential revenue. Those customers reportedly include pop singer Justin Bieber and actor Leonardo DiCaprio. The company said it intends to offer customers a “unique, multi-day experience” including zero gravity and views of Earth from space. After this year’s launches, about 2,500 people have asked to sign up, Branson told CNBC in an interview.
And when it comes to competitors Jeff Bezos and Elon Musk, the space race is on. Blue Origin is planning a crewed space mission in 2019 and seeks to get people to the moon by 2024. Musk wants to take SpaceX to Mars and has set longer-range plans: ferry cargo by 2022 and humans by 2024, build a city in the 2020s and colonize the red planet in the 2030s. SpaceX is already carrying cargo shipments to the International Space Station on its Dragon spacecraft.
One of the keys to success is to “demonstrate safety and reliability,” said Iain Boyd, professor of aerospace engineering at the University of Michigan who also joined the K@W SiriusXM radio show. “If the first few space flights of any of these companies go well, “then people will come,” said Boyd. “But if anything goes wrong, it’s going to be very interesting to see if this kind of market can ride that out.”
Space tourism is not just a private-company endeavor. Fans of NASA (like Alyssa Carson) will recall that last month the U.S. government space agency announced it wants to let space tourists onto the International Space Station – for a cool $59 million per trip. This could happen as soon as next year, although limited to two separate trips per year. Welcome to the final frontier.
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