How SpaceX Almost Went Out Of Business

How SpaceX Almost Went Out Of Business

Founded in 2002 by Elon Musk, SpaceX has not had the easiest journey to success. Being a rocket company a lot can go wrong in the development process. Specifically, it can be extremely challenging to develop working rocket technology and have enough funding for the journey.

Due to a dwindling amount of money and multiple failed rocket launches, SpaceX nearly went bankrupt in 2008. The company was barely saved by the successful launch of its Falcon 1 rocket. With three failed Falcon 1 launch attempts prior, it was very likely if the fourth had not been a success the company would have gone out of business.

The rocket business is one of the hardest to get started in. Not only do you have to develop often unique and complicated technology but failure is very expensive. If something doesn’t go right it usually ends up in a massive explosion and loss of everything you worked on. This is the exact reason why SpaceX almost failed in 2008.

SpaceX Initial Development

SpaceX was originally founded in 2002 by Elon Musk. From the very beginning of the company, Musk had the goal of getting to Mars. However, a lot of development needs to happen before you can get anywhere near the red planet. One of the first things SpaceX started to work on was the Falcon 1. Unlike a lot of the rockets we see from SpaceX today, the Falcon 1 was not reusable at all. Instead, it was a fully expendable rocket meant to bring around 600kg into low Earth orbit. Additionally, the rocket was meant to cost about $6 million per launch.

SpaceX Funding

SpaceX is privately funded. In the development of the Falcon 1 rocket and SpaceX’s multiple engines, all the money was private capital. Along with a good portion of Elon Musk’s money, this is all they had. At the same time, Musk was working just as hard on Tesla. He had made the decision to split his money between both companies and hope for success. This decision was risky because it meant both companies could fail. The other outcome however was the possibility of both companies becoming successful. Along with Musk’s money, the company had some additional funds from private investors. The problem was the company had not been successful up to this point and the money was running out.

Failed Falcon 1 Launches

Multiple failed Falcon 1 launches put the company right on the edge of bankruptcy and almost put SpaceX out of business. The first Falcon 1 launch took place on March 24th, 2006. This was a crucial launch for SpaceX for many reasons including it being the first launch of their Falcon 1 rocket. Prior to the launch, there were 3 scrubbed attempts. The intention of this launch was to go to orbit with the rocket carrying a U.S. Air Force satellite on board. Soon after the rocket cleared the tower or around 30 seconds into the launch the rocket blew up. This was a major setback for SpaceX but they worked to improve the rocket and try again.

Just about 1 year later on March 20, 2007, SpaceX tried again with their second Falcon 1 launch attempt. This attempt had the same goal of reaching orbit and had better results than the first launch attempt. After clearing the tower the rocket continued to accelerate and head to its designated orbit. However, once the rocket was getting close to the correct speed for orbit something went wrong. Late in the second burn of the launch, there was a roll control anomaly. The anomaly affected exactly how the booster controlled itself during flight. This slight error ended up sending the rocket and payload on an incorrect path. It’s suspected that the second stage ended up re-entering Earth’s atmosphere somewhere above the Pacific Ocean rather than staying in orbit. This was another big setback for SpaceX but they were not hopeless yet. Elon Musk even mentioned after the launch that the issue was something pretty straightforward to address.

Finally, on August 3rd 2008, SpaceX had its third launch attempt of the Falcon 1. After addressing previous issues and working hard on the rocket, SpaceX was confident in its launch vehicle. The rocket was carrying a satellite for the Pentagon and was meant to reach orbit. Similar to the previous launch the rocket had success early after liftoff. The problem arose around two minutes and 20 seconds later when the rocket stages failed to separate. This obviously was a big issue and ended up stopping the rocket from reaching orbit. This was the third failed attempt in a row for SpaceX and each launch was presenting a new problem.

SpaceX’s Last Chance

Each of the previous failed launches had hurt investors’ confidence in the company and used up more of SpaceX’s limited funding. One of the hardest parts about a rocket company is the complexity and funding. You need a lot of money to build rockets and if something goes wrong you lose everything you worked on. Additionally, it is extremely hard to get into orbit. These factors combine to make a private space company a very difficult venture. SpaceX needed this fourth launch attempt to be successful. With the companies money running out it was their last chance. On September 28th, 2008 SpaceX launched its Falcon 1 rocket for the fourth time. This launch unlike the previous was perfect and it ended up reaching orbit. This launch made history due to the Falcon 1 becoming the first privately built booster to reach orbit. The success of this launch brought a lot of confidence in the company and additional funding. SpaceX had done the impossible against all odds and succeeded.

Today’s Success

Looking at SpaceX today they have come a long way. Soon after the success of the Falcon 1 SpaceX began working on a partially reusable rocket called the Falcon 9. SpaceX knew from very early on that the future of the rocket industry was partially and fully reusable rockets. SpaceX began testing its grasshopper prototype and trying to launch and land boosters. The company then built its Falcon 9 and has had major success so far. With over 100 successful launches the company has done the impossible. Not only did they make the rocket partially reusable but also capable of landing on a drone ship. SpaceX went on to create the Falcon Heavy and even send NASA astronauts to the International Space Station and back. Finally, SpaceX is working on its revolutionary Starship rocket. Meant to be fully reusable, if successful, could end up being the future of the space industry. With SpaceX winning an almost $3 billion dollar contract from NASA and more, they do not have a lack of funding like in the beginning.

Conclusion

While SpaceX has been extremely successful in the last few years, it did not always look like that. After years and a lot of money invested, SpaceX developed its Falcon 1 rocket. This rocket however did not have the smoothest start. With 3 failed launches SpaceX was right on the brim of bankruptcy. If the fourth launch had failed it is very likely the company would have gone out of business. Thankfully the fourth launch was a success. This saved the private space company and propelled them forward to greater achievements. SpaceX is now one of the leading private space companies in the industry and is making great strides for the future of space exploration and development.