How Does SpaceX Make Money | SpaceX Business Model

How Does SpaceX Make Money

SpaceX is an American aerospace manufacturer, space transportation services and Communications Company established in 2002 by Elon Musk. SpaceX designs manufacture and launch advanced rockets and spacecraft with a mission to reduce space transportation costs and make the colonization of Mars a reality. Since its establishment, SpaceX has achieved lots of things and it becomes the first private company to launch, orbit, and then recover a spacecraft. Now SpaceX is valued at $74 billion and it’s a wonder to people, how SpaceX’s business works and how they make money.

Basically, SpaceX makes money by building innovative space exploration and communications technologies. SpaceX offers alternative options to government and military contractor programs for commercial launches of satellites. This is a huge income-generating source of SpaceX. With the innovative space operations, SpaceX is making about $2–3 billion per year in revenue since 2017.

How Does SpaceX Make Money

What is SpaceX?

SpaceX is an incredibly reliable brand that is officially known as Space Exploration Technology Corporation. SpaceX is an American aerospace producer and they also provide space transportation services for common people. Elon Musk established SpaceX with the aim of lowering the cost of overall space transportation and enabling humanity on Mars. SpaceX is the first aerospace company that funded the liquid-propellant rocket- Falcon 1, to reach orbit and successfully recover back. Currently, SpaceX is the leading private space transport company and they have become a pioneer in this industry. Accessibility, performance, and brand status are the three strong characteristics of SpaceX that are the main fraction behind the success of SpaceX.

How does SpaceX Work?                

Since its establishment, SpaceX has been collaborating with NASA with several projects including the transport of people and goods to the International Space Station and more. Recently, they made a $2.9 billion contract with NASA for the construction of a lunar lander to take the man back to the moon. So it is quite clear that the main base of SpaceX’s business model is delivering space transport to governmental and private organizations. SpaceX also specialized in rocket design and the development and launch of a satellite network. The SpaceX team created its first rocket, the Falcon 1, and completed its first successful flight in 2008. They have also build Falcon 9, Falcon Heavy, the revolutionary Starship, and the Dragon that can carry up to 7 passengers to and from Earth orbit. In fact, Dragon is the first private commercial vehicle to take US astronauts to the International Space Station. SpaceX builds the Falcon Heavy spacecraft costing around $90 and the Falcon 9 with a cost of $62 million. Though, SpaceX is saying they might be able to reduce the cost of commercial customer launches down to $30 million thanks to the reusability of some of the rockets.

How SpaceX Makes Money?

After reading the above information, it might be clear to you that SpaceX makes money by dispatching rocket missions to space and orchestrating satellite programs for its clients. In the year 2020, SpaceX was able to successfully transported two NASA astronauts to the International Space Station using their reusable Falcon 9 rocket. It was the first commercial manned launce by SpaceX. According to Forbes, SpaceX has made 15 commercial space contracts for an estimated $80 million per launch. These contracts helped SpaceX made $1.2 billion in revenue in 2020. Moreover, SpaceX is planning to launch its first all-civilian space flight in the last quarter of 2021 with four passengers but the price of tickets is undisclosed. Though, you can assume that the price might be in the millions. SpaceX is also selling beta access to its Starlink project and you have to pay $99 per month with the one-time purchase of a dish and router for $499. It is expected that SpaceX would offer internet service to airlines in the near future.

Business Model of SpaceX

SpaceX is the first-ever private company that gained the license from NASA for launching payloads and humans to space. SpaceX has a distinct business model along with bold successful strategies. We already know that the main target of SpaceX is to colonize Mars and with that target in mind, SpaceX is growing tremendously and getting ready to carry people to Mars. Since its establishment, SpaceX has performed dozens of space launches and it is their main source of income. Other sources of income for SpaceX are aerospace supplying, manufacturing, subsidiary, and distributing.

FAQs about How Does SpaceX Make Money

What are the top launch facilities operated by SpaceX?

SpaceX has made some exceptional success in the exploration and production of space transportation. SpaceX is operating 4 top launch facilities, they are – 

  • Cape Canaveral Space Launch Complex 40 (SLC-40)
  • Kennedy Space Center Launch Complex 39A (LC-39A)
  • Vandenberg Space Force Base Space Launch Complex 4E (SLC-4E)
  • Brownsville South Texas Launch Site

Who are the competitors of SpaceX?

Though SpaceX is the leading company in the Aerospace industry but they have some big competitors. ‌‌The biggest competitors of SpaceX are Virgin Galactic by Richard Branson and Blue Origin by Jeff Bezos. On the other hand, United Launch Alliance is the biggest competitor of SpaceX for defense projects. Other competitors of SpaceX are Boeing and Northrop Grumman.

Who is the target audience of SpaceX?

The main target audiences of SpaceX are the government and some private companies across the globe.

How much of SpaceX does Google own?    

Google owns around 8.33% of SpaceX. In exchange for 8.33% of SpaceX, SpaceX has raised US$1 billion in funding in January 2015. Google invested $900 million in SpaceX in 2015.

Who owns most of SpaceX?

Elon Musk owns most of SpaceX and he is still the largest shareholder and the CEO of SpaceX. According to Forbes, Elon Musk holds 48% of the total shares of SpaceX.

What is the valuation of SpaceX in 2021?

According to a private market valuation on February 2021, SpaceX is worth about $74 billion. It makes SpaceX a top-five global aerospace and defense franchise.

Does SpaceX get money from the government?

SpaceX is a privately funded company but it makes a profit from government subsidies and from using NASA (public sector) technology. So SpaceX doesn’t get money from the government but they make a profit from the government projects.

How much did Elon Musk invest in SpaceX?

Initially, Elon Musk had invested 100 million to found the SpaceX Company. Now, SpaceX Company is worth way more than the 100 million.

How much will Starlink internet cost?

Starlink users have to pay a one-time cost of $499 for the Starlink kit and then they have to pay $99 per month for the internet service.

How much does Elon Musk make a day?

Currently, Elon Musk is the 2nd richest person in the world with a total net worth of $180 billion. On average, Elon Musk made $383,000,000 per day.

Who are the investors of SpaceX?

SpaceX has some excellent investors. Some of the big and renowned investors of SpaceX are Founders Fund, Baillie Gifford, and Valor Equity Partners, as well as Fidelity, Gigafund, and Google.

Is SpaceX private?

Yes, SpaceX is a private-funded rocket manufacturer and transport services company. Officially, SpaceX is known as Space Exploration Technologies.

Does fidelity own SpaceX?

Yes, Fidelity owns 41.7 million worth of SpaceX stock and they bought for $135 per share.

Will SpaceX ever go public?

Currently, there is no plan from SpaceX CEO Elon Musk to make the SpaceX Company public. Elon Musk thinks that the short-term demands of shareholders conflict with his long-term ambitions. Therefore, he doesn’t want to make the SpaceX Company public.

Last Updated on August 7, 2021 by Magalie D.

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