Book: Virgin Galactic’s President Moses Believed Company’s Flight Projections were a “Pipe Dream”

Richard Branson’s space tourism company used similar numbers to go public on the New York Stock Exchange. Were investors duped?
Michael Moses

by Douglas Messier
Managing Editor

Nicholas Schmidle’s book about Virgin Galactic and SpaceShipTwo is coming out on Tuesday. In an essay he wrote for The New York Times, he recounted how Virgin Galactic President Michael Moses didn’t believe the company’s own flight projections when they were presented to him by its then-chief financial officer.

At one point, I was leaked a cache of internal documents. Some revealed the depth of Virgin Galactic’s oftentimes shaky grip on reality.

In 2013, Mike Moses, at the time Virgin Galactic’s senior vice president for operations, was sent an email containing a chart from Virgin Galactic’s chief financial officer at the time, Ken Sunshine. The chart showed a radical uptick in flight operations, projecting 75 flights in 2015, 194 in 2016, 229 in 2017 and 264 in 2018. “No chance in hell,” replied Mr. Moses, who is Beth’s husband. “These numbers are a pipe dream.” (Mr. Moses, through a representative, declined to comment on those emails.)

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SPACovirus Sweeps Space Sector

Richard Branson celebrates the first Virgin Galactic trade on the New York Stock Exchange. (Credit Virgin Galactic)
Wall Street’s latest easy money craze has attracted a growing number of space companies. But, just because they can go public, should they?

by Douglas Messier
Managing Editor

Seven space companies have gotten caught up in the SPACovirus sweeping through Wall Street. The impact on the space industry is going to be interesting to watch.

A SPAC is a special purpose acquisition company. It’s a publicly traded investment firm that, with outside investors, acquires or merges with another company, and then takes the acquisition public under its own name.

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Virgin Galactic Chairman Chamath Palihapitiya Sells Entire Personal Stake Worth $213 Million

Chamath Palihapitiya (Credit: SCH)
  • Move follows Palihapitiya’s sale of shares worth nearly $98 million in December
  • Virgin Galactic shares continued weeks-long decline after news broke
  • Palihapitiya indirectly owns a large stake through Social Capital Hedosophia

by Douglas Messier
Managing Editor

Virgin Galactic Chairman Chamath Palihapitiya has sold 6.2 million personal shares in the suborbital space tourism company worth about $213 million. The sale zeros out his personal stake in Virgin Galactic.

The move follows Palihapitiya’s sale of 3.8 million shares worth $97.8 million in December. The nearly $311 million gain is more than triple the $100 million he personally invested in Virgin Galactic when it went public 16 months ago.

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Richard Branson’s Virgin Galactic Goes Public With Extravagant Promises to Keep

Richard Branson wears the SpaceShipTwo flight suit. (Credit: Virgin Galactic)

by Douglas Messier
Managing Editor

After 15 years of making extravagant but unkept promises to fly more than 600 “future astronauts” to space, Richard Branson must now please an entirely new group of people who are usually much shorter on patience: shareholders.

Following the completion last week of a merger with Social Capital Hedosophia (SCH), the British billionaire’s Virgin Galactic suborbital “space line” will begin trading under its own name on the New York Stock Exchange (NYSE) on Monday.

Going public now is an unusual move for a space tourism company that hasn’t flown a singlet tourist to space since Branson announced the SpaceShipTwo program in 2004. Some might see it has putting the cart before the horse.

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Virgin Galactic Adds Members to Board of Directors

WhiteKnightTwo and SpaceShipTwo take off at 7:11 a.m. PST from the Mojave Air and Space Port. (Credit: Kenneth Brown)

New York, USA, October 10, 2019 (Virgin Galactic PR) — Social Capital Hedosophia Holdings Corp. (“SCH”) and Virgin Galactic today announced that Wanda Austin, Craig Kreeger and George Mattson have agreed to join the board of directors of Virgin Galactic Holdings, Inc. (“VGH”), the company resulting from the pending business combination transaction involving SCH and Virgin Galactic. The board appointments are contingent on approval by SCH’s shareholders and the completion of the business combination between SCH and Virgin Galactic.

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Social Capital Hedosophia to Vote on Virgin Galactic Merger on Oct. 23

The second SpaceShipTwo is carried aloft by WhiteKnightTwo on its first captive carry flight. (Credit: Virgin Galactic)

NEW YORK, Oct. 10, 2019 (SCH PR) —Social Capital Hedosophia Holdings Corp. (“SCH”) announced today that it will hold its extraordinary general meeting (the “Extraordinary General Meeting”) at 12:30 p.m., Eastern Time, on October 23, 2019, to approve, among other things, the previously announced business combination (the “Business Combination”) with TSC Vehicle Holdings, Inc., Virgin Galactic Vehicle Holdings, Inc. and V4GH, LLC (collectively, “Virgin Galactic” and, together with Vieco USA, Inc. and Vieco 10 Limited, “VG”). The Extraordinary General Meeting is scheduled to be held at The Westin Palo Alto, located at 675 El Camino Real, Palo Alto, CA 94301.

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Virgin Galactic-Social Capital Hedosophia Deal Goes Further

A view from inside the cockpit. (Credit: Virgin Galactic)

At a meeting on Monday, shareholders of Social Capital Hedosophia (SCH) gave approval to the public company to move forward with an $808 million merger deal with Sir Richard Branson’s Virgin Galactic.

“Holders of 66,333,089 of the Company’s ordinary shares, which represents 76.9% of the ordinary shares outstanding and entitled to vote as of the record date of August 8, 2019, were represented in person or by proxy,” Social Capital said in a document filed with the Securities and Exchange Commission (SEC).

The shareholders approved two resolutions. The first extends the date for completing the merger from Sept. 18 to Dec. 18, 2019.

The second resolution “extends the date on which the Trustee must liquidate the trust account established in connection with the Company’s initial public offering” if the SCH and Virgin Galactic do not complete the merger by Dec. 18.

Under terms of the deal, SCH would own up to approximately 49% of the combined space tourism company, which would be publicly traded. SCH founder Chamath Palihapitiya would become chairman of the board.

For more details about the deal, read the announcement here.

It’s Showtime for Virgin Galactic’s Latest Cash Infusion Plan

Richard Branson with the pilots of SpaceShipTwo. (Credit: Virgin Galactic)

CityAM reports that Sir Richard Branson’s $808 million deal to merge Virgin Galactic with venture capitalist Chamath Palihapitiya’s Silicon Valley investment vehicle faces a crucial vote of confidence on Monday.

Would-be shareholders will vote on whether to back the entry via investment vehicle Social Capital Hedosophia (SCH), or whether to withdraw their cash entirely.

SCH was formed in 2017 and already trades on the New York Stock Exchange. It plans to merge with Virgin Galactic, bringing the space travel venture onto the market in an unconventional move which would avoid the traditional risks of an Initial Public Offering.

The deadline for this is fast approaching, and looks set to be missed, however, which would see SCH go into liquidation.

In that case, investors get back $712m (£578m) next week. They will vote tomorrow on whether to allow this to happen or whether to postpone the deadline for a merger until December and subsequently keep their cash in the Virgin Galactic float.

Virgin Galactic and Social Capital Hedosophia announced the merger, actually a reverse acquisition, two months ago. The deal would see Palihapitiya become chairman of the company and Adam Bain join the board. Bain previously served as chief operating officer of Twitter.

Virgin Galactic is currently spending about $16 million per month ($190 million annually),. according to a presentation filed with the Securities and Exchange Commission (SEC).

Virgin Galactic previously received an investment of $390 million from an Abu Dhabi’s sovereign wealth fund. Branson broke off a MOU with Saudi Arabia for a $1 billion investment with an option for $480 million more in Virgin Galactic, Virgin Orbit and The Spaceship Company.