First victim of SVB collapse: Richard Branson’s Virgin Orbit files for bankruptcy

The bankruptcy of SVB caused the first major financial collapse in the space technology sector since Richard Branson’s Virgin Orbit Holdings filed for bankruptcy.

The satellite launch company has failed to secure the long-term funding needed to recover from a failed rocket launch in January. In fact, it is a victim of the collapse of the SVB, which has penetrated into the field of new technologies and, accordingly, into space technology, an area that particularly “hurts” the United States.

The Long Beach, California-based company has filed in the Delaware County Bankruptcy Court of the United States seeking to sell its assets after announcing last week that it would lay off 85% of its 750 employees. In its filings, the company lists assets and liabilities ranging from $100 million to $500 million.

The company has not shown any profit since its founding in 2017. It develops rockets to deliver small satellites and is part of Sir Richard Branson’s business empire, which includes Virgin Atlantic and space tourism company Virgin Galactic. In January, Virgin Orbit made its first satellite launch attempt, which ended in failure. Rocket company LauncherOnewhich was launched from a Boeing 747 aircraft, reached space, but not the desired trajectory.

collapse Silicon Valley Bank (SVB) directly influenced a number of space companies that relied on him for investments, loans, and traditional banking services. The Silicon Valley Bank was known for its involvement in early stage startups. RocketLab, Astra, BlackSky, Planet, Redwire, and Space Perspective were among the many space companies that used SVB for traditional banking and/or investments and loans.

Rocket Lab said in a report filed with the Securities and Exchange Commission (SEC) on March 10 that the total amount of cash and cash equivalents and liquid securities in SVB as of December 31, 2022 was approximately $38 million, which is approximately 7.9% of the company’s reserve.

On March 13, AstraSpace filed with the SEC that about 15% of its cash, along with letters of credit, is held at Silicon Valley Bank. AstraSpace also said it is actively pursuing deposit accounts with new banking partners to diversify its banking relationships.

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