The Space Barons
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“I’m tired of hearing that; it never comes true,” groused John Pike, a space analyst at globalsecurity.org, a think tank. “There have been no improvements of per-pound launch since John Kennedy was president.… I think it’s just going to be a good way to burn up a bunch of money.”
SpaceX and Rocketplane did seem a risky pair for NASA to bet on. Neither company had launched a rocket, and Kistler’s finances seemed shaky. It was unclear whether either of them would be able to come close to launching anything safely into orbit—let alone a spacecraft that would have to chase after the International Space Station, orbiting Earth at 17,500 mph. Skeptics inside NASA thought it was nuts, a complete waste of time and money.
To Musk, the supporters “were like the weird rebels within NASA,” he said. “They were given a project that everyone expected to fail, and they were just damn determined to make sure it didn’t. And they did so because they really believed that things needed to change. They did it for really good reasons. They cared about the advancement of spaceflight, and they really worked their asses off to help us succeed.”
But even they admitted they were bushwhacking into unknown territory.
“It was new to everybody,” said Marc Timm, a program executive at NASA. “The first meeting, we had no clue how we were going to do it. We had representation from legal, safety, Space Station, NASA Headquarters, and just sat down with a clean whiteboard and said, ‘How can we do this?’”
As daunting as it was, it was thrilling to be part of something completely new in an agency that had grown bureaucratic and stodgy, that was often far more comfortable saying no because it was unsafe.
Unlike the cost-plus contracts that sustained the traditional contractors, paying them even when they went over budget or over schedule, these awards were known as Space Act Agreements. The companies would only get paid once they reached certain milestones. By design, the money from NASA was not enough to keep the companies going on their own. They had to find additional outside investment, or customers.
If they didn’t, free market forces would take over, and they’d fail.
“Commercial companies had not done this before,” said Scott Horowitz, then NASA’s associate administrator for the Exploration Systems Mission Directorate. “There was a high risk in them being able to develop the capability, which was supposed to come online when the shuttle retired in 2010. As much risk as there was on the technical side, there was even more risk on the financial side. To be quite honest, the business cases were not that robust.”
For years, commercial companies, SpaceX chief among them, had said that they could build rockets more safely and efficiently than NASA. That it was time for the private sector to take over. This was going to be their chance to prove it.
“There’s a lot of people that have been running around for years in conferences, yelling and screaming, ‘Get out of our way! Give us a chance! We can do it for one tenth of the price, and much more reliably. And a whole lot faster and better than NASA,’” said Griffin, the former NASA administrator.
“They’ve been screaming that for years. This was like, ‘show me.’”
No one was more vociferous than Musk. And he reveled in the opportunity to prove himself, especially with the strict, “show-me” way the payments were structured. The bolder, the better, he figured. The arrangement, he knew, favored a scrappy startup like his, and, for once, put the less nimble, more risk-averse traditional contractors at a strategic disadvantage. They could play it safe. He had nothing to lose.
“The funding is milestone-based, so if we don’t achieve milestones, there’s no money spent,” he said at the time. “It’s not like a standard government cost-plus effort where the worse they do, the more money they get. This is the case where if we don’t do what we say we’re going to do, we don’t get paid. So it’s a no-lose proposition for the taxpayer.”
“I think the fear on the part of some people out there is not that we will fail, but that we will succeed,” he added.
For SpaceX, the $278 million was a windfall. The deal was like a “Good Housekeeping seal of approval” that gave the company credibility in the marketplace, recalled Tim Hughes, SpaceX’s senior vice president and general counsel. If NASA trusted them, then commercial satellite manufacturers could as well.
But for “a lot of people in the big aerospace world this was considered a token amount of money to placate these commercial guys so they could stop complaining to Congress,” Musk said, years later. “Just give them enough to hang themselves.… Let’s just give these annoying commercial people enough money so that they can fail, and then we can say that was dumb. We don’t have to do that again.”
SpaceX was still not regarded as a threat. Not by the Lockheeds and Boeings, which had large, multiyear contracts in hand that could sustain them as long as there was support in Congress. And while the program was a bold step for NASA, one that SpaceX and other startups jumped at, it was largely dismissed by the rest of the industry. Lockheed Martin, Boeing, Northrop Grumman all passed, not thinking that this new era would last.
They were focused on another NASA program that was a central part of the Bush administration’s official “Vision for Space Exploration.” Called Constellation, it was the White House’s grand plan to bring humans back to the moon by 2020 and eventually to Mars. Instead of just a few hundred million dollars at stake, the construction of a pair of new rockets, the Ares I and V, a lunar lander, and a spacecraft, the Orion, was a prize worth tens of billions over many years. In comparison, the COTS program was mere crumbs. COTS was a side program, carved out by Griffin; Constellation was the big program of record that the big contractors remained focused on.
“They screwed themselves because they were just arrogant and complacent,” Musk said later. “Look, Boeing doesn’t get out of bed for less than a billion.”
(In response, Boeing noted that “Apollo and the programs that inspire all space enthusiasts would not have been possible without Boeing. At the turn of the 21st Century, before Musk entered the space business, Boeing was building the International Space Station with NASA, where we’ve kept astronauts safe and continuously on orbit for over seventeen years.” And the company said that “while others talk about aspirations and hopes, we actually do things in space and will deliver on our commitment to America’s journey to Mars. That’s what we get out of bed for.”)
Looking back on it, Griffin said he was surprised that the legacy contractors “did not see the handwriting on the wall that there would be in the future some commercial space enterprises.” They all had the “muscle mass,” he said. They were the “trained athletes on the field,” who could have “undercut even the best entrepreneurial firm” had they chosen to bid on COTS. Had they wanted it, the prize was theirs for the taking.
Griffin saw a lesson that could be taught in business school. NASA, the customer, was indicating it was moving in a different direction. But its traditional contractors ignored it, or didn’t take it seriously, or weren’t nimble enough to move with it. That created an opening. A small one. A mere crack a couple million dollars wide that was easy to ignore when they were marching through a gilded, billion-dollar doorway.
“The entrepreneurial firms can exist only if the larger established contractors create a niche for them,” Griffin said. “If I’d been running Boeing or Lockheed or Northrop, I would not have done that. I would not have allowed a fledgling competitor to invade my space.”
TWO YEARS LATER, however, the invaders were stumbling. The insurgency that COTS was supposed to foment was flaming out in SpaceX’s failed launch attempt, and subsequent delays, which fueled doubt and a lack of funding that put Rocketplane Kistler out of business. The millions that NASA had awarded the company as part of the COTS program were not enough to sustain it. And now the space agency was forced to go out and find another company to participate in the program, as critics questioned whether these young, inexperienced companies were worth NASA’s time and investment.
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br /> After its 2006 failure, it took SpaceX a year to fly again. This time, on March 20, 2007, it performed much better, flying to 180 miles, well past the edge of space. Its second stage separated, and the onboard camera showed the booster falling back toward the ocean below. In the control room, the SpaceX employees could see the curvature of Earth and the blackness of space.
“I’m going to watch that video for a long fucking time!” Musk said. “Congratulations, guys.”
But then, before the second stage could get to orbit, the second stage started wobbling uncontrollably before it fell back to Earth.
“This was a pretty nerve-racking day,” Musk said afterward. “The rocket business is definitely not a low-stress business, that’s for sure.”
Still, he found solace in the fact that the rocket had indeed made it to space. “I don’t think I’m disappointed,” he added. “In fact, I’m pretty happy.”
As he later pointed out, it was a test flight. The whole point was to see how the system worked, and root out any problems.
On August 3, 2008, the third launch attempt also came just short of getting to orbit. At stage separation, the first and second stages collided, causing yet another failure.
Publicly, Musk remained resolute. “SpaceX will not skip a beat in execution going forward,” he said. “We are in a very good financial basis here. We have the resolve. We have the financial base. And we have the expertise.”
He added: “For my part, I will never give up, and I mean never.”
Despite those rosy predictions, the truth was, SpaceX was hurting. Musk was burning through the $100 million he had invested of his own money, while it had also earned a $20 million investment from Founders Fund, the Silicon Valley venture capital firm started by Peter Thiel, who knew Musk from their early days at PayPal..
The challenge “was really keeping the company going financially while we were struggling. That was my contribution primarily,” SpaceX president Gwynne Shotwell recalled. “I didn’t get to do as much engineering as I would have liked to, but continually convincing customers to invest in SpaceX, and to take the risk associated with buying launches from us. I was focused on keeping the company alive, keeping people paid while we were struggling and getting through it. Because I knew we’d get through it. Technically, I knew we would get through it. It was a matter of could we get through it financially and stay stable.”
The three failures were “really incredibly painful,” Musk said later.
If this fourth launch didn’t work, “we would have ceased to exist. I was out of money.”
LESS THAN TWO months later, on September 28, 2008, SpaceX tried again. To prevent the first and second stages from colliding, the engineers adjusted the timing ever so slightly.
“Between the third and the fourth flight, we changed one number, nothing else,” said Hans Koenigsmann, SpaceX’s vice president of mission assurance. “That was the time we needed to separate the two stages.”
That was the technical solution. Tim Hughes, SpaceX’s general counsel, had a more superstitious one: adding a pair of four-leaf clovers to the mission patch. Throughout NASA’s history, the agency had created patches for each launch, artistic talismans that captured the spirit of the adventure while, hopefully, bringing luck. It was a ritual that dated back to Mercury, Gemini, and Apollo, and on through the shuttle. Astronauts were like ballplayers, believing that the power of symbols and a certain set of rules, however absurd—never step on the foul line—bequeathed success, a line drive up the middle, or not dying in a fireball just off the launchpad.
Knowing the importance that symbolism and superstition had for its astronauts, NASA allowed its crews to design their own patches. For Apollo 11, which would become one of the most recognizable, the astronauts decided to omit their names in a self-effacing gesture, though listing the crew members had been the practice in the past.
“We wanted to keep our three names off it because we wanted the design to be representative of everyone who had worked toward a lunar landing,” said Michael Collins, a member of the Apollo 11 crew. “And there were thousands who could take a proprietary interest in it, yet who would never see their names woven into the fabric of a patch. Further, we wanted the design to be symbolic rather than explicit.”
Neil Armstrong didn’t want the word eleven spelled out, as it was in the original design, because non-English speakers wouldn’t be able to read it. So, instead it would go by the numeral, 11.
SpaceX, now desperate for what could be its fourth and final flight, was willing to believe wholeheartedly in the power of the patch. It needed all the luck it could get. The four-leaf clovers were added to the patch.
THIS TIME THE Falcon 1 rocket got to orbit in a flawless flight that was perfect from the countdown to stage separation, which ended with a crescendo of cheers from SpaceX’s more than five hundred employees.
The company had broadcast the launch on the web, in a flawed, rudimentary real-time show anchored by amateurs whose enthusiasm and passion were genuine—they were SpaceX employees, after all—but who were ill trained for the rigors and length of almost an hour on air.
The moment Falcon 1 had achieved orbit, the commentator declared that “Falcon 1 made history as the first privately developed launch vehicle to reach Earth orbit from the ground.”
He then took a moment to explain the long and improbable odyssey that had led to this feat:
“SpaceX has designed and developed this vehicle from the ground up, from a blank sheet of paper they’ve done all the design, all the testing in house. We don’t outsource, and we have achieved this with a company that is only now five hundred people. And it has all occurred in under six years.”
For this launch, Musk was in California with the bulk of his team, not in Kwajalein. He emerged before the throng in a nondescript polo shirt, trying to rise to the occasion for his cheering employees standing around him three and four deep. Some had brought their children to the factory to witness the launch, and they hoisted them on their shoulders for a better view of Musk. But he was utterly overwhelmed and at a loss for words.
“That was freakin’ awesome,” he managed in a halting cadence, then stated the obvious: “We made orbit.”
After thanking his team, he said, “There were a lot of people who thought we couldn’t do it—a lot actually.” He let out a little maniacal, take-that laugh of redemption, before continuing.
“But as the saying goes the fourth time’s the charm, right? This really means a lot to SpaceX. Getting to orbit, that’s just a huge milestone. There are only a few countries that have done it. It’s normally a country thing, not a company thing. It’s an amazing achievement.”
As the words left his mouth, it was as if just then, for the first time, he realized the enormity of the accomplishment—it was what countries had done. And as that notion settled in, he once again became speechless.
“My mind is kind of frazzled,” he stuttered, exhausted. “Man, it’s definitely one of the greatest days of my life, and probably for most people here. We’ve shown people we can do it. This is just the first step of many.”
The Falcon 1 would lead to the Falcon 9, an even more powerful rocket—with nine engines, compared to one—that was under development, he said. And then there was the Dragon spacecraft, a capsule being designed to take cargo to the International Space Station. That was the next prize, the natural follow-up to the COTS program, which, after all, was supposed to help develop the capability to at least fly supplies—food, equipment, science experiments, toilet paper—to the station.
It was as if the opening of this one door would lead to another and then another, achievement begetting monumental achievement, one small step, leading to one giant leap springing outward to a point on the horizon that only he could see.
What else was possible?
“A lot of things,” he said, allowing his mind to wander into the future.
“Ultimately,” he said, “I think even getting to Mars.”
AT THE END of 2008, SpaceX got a gift two days before Christmas: a $1.6 billion contract from NASA to fly cargo in its Dragon spacecraft on as many as twelve flights to the International Space Station. For SpaceX, it meant that the company had finally arrived, and had been given NASA’s full, unmitigated endorsement. These would be real missions—delivering thousands of pounds of supplies to the space station—feats that would require the company to successfully launch its Dragon capsule to orbit, which would then fly and dock with the space station, traveling at 17,500 mph. It was an achievement that had been accomplished only by nations, and only a select few—the United States, Russia, Japan, and the European Union.
When Musk got the call from NASA, he was overcome. The last few years had been a struggle, filled with failed launches, even a divorce. But now six years after founding his space company, he had been vindicated. And when the NASA officials finished telling him that SpaceX had won the contract, he unceremoniously blurted out, “I love you guys!”
He also changed his login password to “ilovenasa.”
WHILE MUSK WAS charging ahead, Bezos was still moving slowly, taking small, deliberate baby steps. More than a year after Blue Origin had flown Charon, the massive dronelike vehicle powered by the four jet engines acquired from the South African Air Force, the company was ready to fly again, this time with something that looked like a big, white gumdrop, a flying, flat-bottomed Humpty Dumpty.
Before dawn on November 3, 2006, a cold morning in West Texas, a flatbed truck rolled the vehicle out of its hangar to the launchpad. And as the sun came up, turning the distant mountains purple, employees and their families gathered in the bleachers, some with blue cheerleader pom-poms, ready to watch the launch on a jumbotron.
The vehicle they had come to see was named Goddard, after Robert Goddard, the father of modern rocketry, who in 1926 became the first to ever launch a liquid-fueled rocket. He was a builder and a dreamer, who in 1919 wrote a paper, “A Method of Reaching Extreme Altitudes,” published by the Smithsonian Institution, that touched on the possibility of developing a rocket to reach the moon.