Virgin Galactic to lose funding from its billionaire founder

Richard Branson on a Virgin Galactic test flight in 2021.
Richard Branson on a Virgin Galactic test flight in 2021. Virgin Galactic

Richard Branson has said he will no longer invest any money in Virgin Galactic, the space tourism company he founded in 2004.

The surprise decision, first reported by the Financial Times, caused the company’s share price to fall sharply on Monday.

Branson told the Times: “We don’t have the deepest pockets after COVID, and Virgin Galactic’s got $1 billion or so.”

He said that as things stand, Virgin Galactic “should have enough money to do its own thing.”

Virgin Galactic flew its first commercial passengers to the edge of space in June and has followed up with four additional commercial flights. The most recent happened early last month, but just days later the company announced it was reducing its workforce and suspending commercial flights for 18 months over the next year in an effort to save money, while it Is developing a big aircraft. To carry more passengers into space than the current vehicle, which can carry six paying passengers at a time.

Before the suspension, Virgin Galactic had planned to fly its sixth commercial mission in January, followed by a seventh in the second quarter and possibly an eighth in mid-2024. Virgin Galactic CEO Michael Colglazier said that for the remaining flights, Virgin Galactic will fly. Focus on high revenue opportunities. This means private passengers could be asked to pay a premium rate of up to $1 million, more than double the current seat price of $450,000.

The new, larger vehicle, called Delta, should be ready in 2026, and Virgin Galactic says it has enough funding to continue operations until then. At that time, Delta plans to launch commercial flights, attracting new revenue in the process.

However, the FT reports that some analysts believe Virgin Galactic will need additional funding from investors a year before Delta is ready, possibly in 2025.

The Virgin Galactic flight experience includes a rocket-powered flight close to the Kármán Line, an area about 62 miles above Earth that is generally considered to be where space begins. Passengers can enjoy stunning views of the Earth and minutes of weightlessness inside the cabin before heading back for a runway landing.

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