Some employees were shocked and offended by Virgin Orbit’s decision to furlough them while they look for funding. They felt like they had been abandoned by the company and that their hard work was undermined. Others saw it as a chance to take some time off and recharge their batteries, grateful for the stability the pause provided. It remains to be seen whether Virgin Orbit will be able to resume operations without additional financial support, but for now, its workers are anxiously waiting to see what happens next.
With Virgin Orbit’s debts now totaling over $500 million, many questions remain about the future of the spaceflight company. Virgin Orbit’s only revenue stream comes from NASA contracts, and those contracts are set to expire in 2020. Without new contracts from NASA or significant financial restructuring, it seems unlikely that Virgin Orbit will be able to stay afloat much longer.
Virgin Orbit went public via a merger with an SPAC, but the resulting transaction did not result in as much money as was thought. This may have been due to poor execution by Virgin Orbit’s team, which may have missed opportunities to raise more capital or to better package the company for sale. Despite this initial misstep, Virgin Orbit remains a promising young company with a bright future.
In order to maintain its explosive growth, Virgin Orbit has had to resort to various measures which have included issuing new shares and using debt financing. The company anticipates that it will need an additional $250 million in capital by the fourth quarter of 2022 in order to continue its operations. This situation has raised concerns among some investors who are worried that Virgin Orbit may not have enough cash on hand should it face any unforeseen challenges.
The Virgin Group appears to be providing a significant financial rescue package to Rocket Lab, with the aim of keeping the small launch company afloat. The $20 million investment was a secured note, meaning that Branson’s Virgin Group has first priority for nearly all of the company’s assets, including its aircraft. With competition in the space race heating up and companies like SpaceX raising record amounts of capital, it will be interesting to see how Rocket Lab fares in the future and whether or not Branson’s investment offers some degree of protection.
The company hit yet another major stumbling block at the beginning of this year when its much-anticipated launch from Cornwall, U.K., failed due to an issue with a fuel filter in the rocket’s second stage. The failure, which came after a string of successful missions, resulted in a total loss of payload. Although morale within the company has been low ever since, they are still determined to continue their mission and achieve their ultimate goal – reaching space.
The surprising news of a staff furlough at ABC in the midst of widespread C-suite capital mismanagement is just the latest evidence that something needs to change within the company. Management’s cavalier attitude toward spending and debt has not just led to layoffs and reduced paychecks for staffers; it has also put fundamental safety nets at risk, including protections against imminent bankruptcy. The fact that a furlough was necessary to bring this matter to light shows that management is not working hard enough or thoroughly enough to protect its employees and maintain stability within the company.
Virgin Orbit is a small but highly respected spaceflight company that has been at the forefront of commercial space exploration. However, recent reports indicate that the company may be shutting down indefinitely, leaving many employees without a job. While this is definitely disappointing news, there is still a lot of opportunity in the space industry for anyone with exceptional skills and desire. If Virgin Orbit does close its doors, it’s important for everyone who worked there to look for other opportunities as quickly as possible so that everyone can benefit from Virgin’s legacy.
