Satellite and rocket launch industries will ultimately consolidate, says the CEO and founder of Rocket Lab, Peter Beck.
The aerospace company, which builds small rockets to send satellites to space, announced a merger with Vector Acquisition Corp (VACQ) on Monday to go pubic on the Nasdaq.
"My personal view here is, there will be a small group of companies that will survive in small launch, and a small group of companies that will survive in the medium to large," Beck told Yahoo Finance Live.
"Ultimately companies will consolidate down to being satellite and launch companies," said Beck. "Having both the launch element and also the spacecraft element is hugely important."
Beck expects companies like Rocket Lab will push into the space applications market, which entails all the services and data that comes from space to help on earth.
We've always been good at picking the market niches. We picked up the small launch and kind of own that categoryRocket Lab CEO Peter Beck
Rocket Lab has deployed some 97 satellites for governments and private companies across 16 missions.
The company plans to use the proceeds of the SPAC deal to develop a larger vehicle called the Neutron tailored for mega constellations, deep space missions and human spaceflight.
"We've always been good at picking the market niches. We picked up the small launch and kind of own that category," said Beck.
"If you look at what's actually happening within the industry, 80% of all the satellites that are going to be launched here in the next decade or so are these bigger constellations, but one thing that's missing in the industry is a launch vehicle to successfully deliver all of those constellations," said Beck.
"Hence the reason why there's a real need in the marketplace for a medium lift launch vehicle to service that," said Beck.
The merger is expected to close in the second quarter of 2021. At that time Rocket Lab will be listed on the Nasdaq under the ticker symbol "RKLB."
Ines covers the U.S. stock market. Follow her on Twitter at @ines_ferre
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