Henry Vanderbilt on XCOR’s Bankruptcy

XCOR CEO Jeff Greason inspects the Lynx main engine after a hotfire test while Chief Test Engineer Doug Jones looks on. (Credit: XCOR)

Space is hard. Space startups immensely so.

XCOR’s decision to file for Chapter 7 bankruptcy on Tuesday marks the end of a company that seemed to be in perpetual start-up mode since its founding 18 years ago. Lacking a billionaire backer with deep pockets and a thick Rolodex, the company attempted to develop revolutionary rocket engine technology and a suborbital space plane with funding that would be a rounding error for the giant aerospace primes.

So, how far did it get? What might bidders find valuable when XCOR’s assets are auctioned off? And what problems might have helped to cause the company’s fatal plunge into insolvency?

Henry Vanderbilt has a few ideas on these subjects. Henry is an XCOR shareholder who worked at the company back in the day. He went on to found the Space Access Society, whose conferences were a highlight of the year for the New Space community until recently.
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XCOR Files for Chapter 7 Bankruptcy

Lynx suborbital space plane (Credit: XCOR)

MOJAVE, Calif. – Troubled XCOR Aerospace, a pioneer in reusable rocket engine technology, filed for Chapter 7 bankruptcy in federal court on Wednesday, according to court documents.

The filing will lead to the liquidation of the 18-year old company, whose engine technology was designed to power the two-person Lynx suborbital space plane XCOR was building. The vehicle, which was designed to take off and land on a runway, was only partially completed before most work on it stopped last year.

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Down to the Wire to Save XCOR From Chapter 7 Bankruptcy

Lynx cockpit view. (Credit: XCOR)

XCOR has a matter of weeks to conclude a deal with a potential partner or face liquidation under Chapter 7 bankruptcy.

In an Oct. 19 interview, Michael Blum, a member of the board of directors of XCOR who took over as chief executive at the end of June, said the company has been in discussions with potential strategic partners and other investors interested in its propulsion technology and Lynx suborbital spaceplane, but those negotiations have taken longer than expected to finalize.

“Our time is slowly running out,” Blum said. The XCOR board and its major shareholders have been providing a “minimum amount of capital” over the last several months to keep the company going and pay its bills, but said their patience is running out. “Once that happens, the future gets very bleak.”

XCOR has been in discussions with a number of potential partners and investors, Blum said. One approach has involved discussions with strategic partners, including an unidentified large aerospace and defense company primarily interested in XCOR’s propulsion technology and related intellectual property.

XCOR has also been in talks with investor groups. One such group, he said, is particularly interested in XCOR’s Lynx suborbital spaceplane as a means to quickly get into the space tourism market. XCOR has been working on the Lynx for several years, and the prototype vehicle is about two-thirds complete. A second group, Blum said, is in the industrial and manufacturing sector that is already familiar with XCOR.

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Last of XCOR’s Founders Leaves Company

Doug Jones

MOFFETT FIELD, Calif. (DSI PR) — Deep Space Industries is pleased to announce that Doug Jones, formerly chief test engineer at XCOR, is joining the company’s growing team as director of propulsion systems.

“We see Doug as one of the top rocket engineers in the country, and a great addition to our first-class team of small-spacecraft engineers,” said Bill Miller, the chief executive officer of Deep Space Industries.  “He will be helping us develop the high performance, inexpensive propulsion that is critical to radically lowering the cost of deep space exploration.”

Mr. Jones has designed, built and tested over a dozen different rocket designs for a wide range of customers, including two manned vehicles. Doug has decades of aerospace engineering experience ranging from liquid rocket engine design to vehicle system optimization, and has flown aboard a rocket aircraft multiple times while serving as flight test engineer during the development of the XCOR X-Racer.

“Doug Jones is joining DSI at the perfect moment to lead our in-house development of the high-performance propulsion system for our Prospector series of deep space missions,” said Grant Bonin, DSI’s chief technology officer. “We couldn’t be more excited.”

Editor’s Note: And then there were none. Jeff Greason, Dan DeLong and Aleta Jackson preceded Jones out the door. There are no more founders at XCOR.

Gibson: Cancellation of ULA Contract Led to Recent XCOR Layoffs

John (Jay) Gibson

Former XCOR CEO Jay Gibson told the Senate Armed Services Committee this week that the cancellation of an engine contract by United Launch Alliance led the struggling Mojave-based company to lay off its remaining employees last month.

“We were a subcontractor, and in the days of continuing resolutions we felt like we had a commitment from our prime” for funding that he said would last a year or more. “With less than 30 days notice, we were told that funding was terminated.”
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XCOR Lost ULA Engine Contract

Lynx engine hot fire. (Credit: XCOR)

Despite laying off its 21 remaining employees, XCOR Aerospace isn’t dead yet. But, it’s not in real good shape, either.

It turns out that a major blow to the company was the loss of a contract with United Launch Alliance (ULA) to develop an upper stage for the Vulcan booster.

The primary impetus for the layoffs, Acting CEO and XCOR Board member Michael Blum told me, is the loss of a contract for engine development that the company had with United Launch Alliance. “The proceeds should have been enough to fund the prototype of Lynx [the company’s planned spacecraft], but ULA decided they’re not going to continue funding the contract. So we find ourselves in a difficult financial situation where we need to raise money or find joint developments to continue.” ULA declined to comment.
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XCOR Lays off Remaining Employees

Lynx engine hot fire. (Credit: XCOR)

Struggling XCOR Aerospace has laid off its remaining employees in Mojave, Calif. and Midland, Texas.

“Due to adverse financial conditions XCOR had to terminate all employees as of 30 June 2017,” the company said in a statement. “XCOR management will retain critical employees on a contract basis to maintain the company’s intellectual property and is actively seeking other options that would allow it to resume full employment and activity.”

The move follows the news last month that CEO Jay Gibson was leaving the company after President Donald Trump nominated him for a high-level position at the Department of Defense. Gibson left the company at the end of June.

XCOR hired Gibson in March 2015 to replace founder Jeff Greason. The objective was for Gibson to focus on the business side while Greason focused on completing construction on the two-seat Lynx suborbital space plane.

That arrangement did not work out. By November, Greason and two other founders, Dan DeLong and Aleta Jackson, had left the company to found Agile Aerospace.

Greason, DeLong, Jackson and Doug Jones founded the company in 1999 after being laid off from Rotary Rocket.

In May 2016, XCOR laid off about 25 employees — roughly half of its workforce — and suspended work on the Lynx. The company has since refocused its energies on its rocket engine work.

XCOR had been working on an upper stage for United Launch Alliance’s Vulcan launch vehicle.

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Jay Gibson Out at XCOR, In With Trump Administration

John (Jay) Gibson

Jay Gibson’s two-year tenure as president and CEO of XCOR appears to be at an end.

On Friday, President Donald Trump announced his intent to nominate Gibson to be deputy chief management officer of the Department of Defense.

The announcement describes Gibson as “most recently” having been XCOR’s president and CEO. However, a source says he is still at the company.

The nomination is subject to Senate confirmation.

XCOR hired Gibson in March 2015 to replace founder Jeff Greason. The objective was for Gibson to focus on the business side while Greason focused on completing construction on the Lynx suborbital space plane.

That arrangement did not work out. By November, Greason and two other founders, Dan DeLong and Aleta Jackson, had left the company to found Agile Aerospace.

In May 2016, XCOR laid off about 25 employees — roughly half of its workforce — and suspended work on the Lynx. The company has since refocused its energies on its rocket engine work.

UPDATE: XCOR board member Michael Blum issued the following written statement:

“Jay Gibson is still at XCOR but will be leaving shortly for a tremendous opportunity to serve his country in a very senior role at DoD. He has been a great CEO whose leadership and experience has guided XCOR through ups and downs.”

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XCOR Loses Co-Founder Aleta Jackson

Aleta Jackson DeLong (Credit: Mike Massee)
Aleta Jackson DeLong (Credit: Mike Massee)

“She was the den mother to the XCOR family, and we loved her – but not as much as she loved us. I miss her.”

Doug Weathers
former XCOR employee

XCOR lost one of its four founders on Sunday.

Loretta “Aleta” Jackson DeLong passed away in Midland, Texas, after a losing a battle with ovarian cancer. She was 68.

Aleta had founded XCOR in 1999 with Jeff Greason, Doug Jones and her partner and future husband Dan DeLong. The four had been laid off from Rotary Rocket and decided to found XCOR.

I got to know Aleta during my interactions with XCOR. She was an extraordinary person. I will miss her spirit.

One of her former XCOR co-workers, Mike Massee, published a moving tribute to Aleta on Facebook. I’ve reproduced it below with his permission.

By Mike Massee

Aleta Jackson
Aleta Jackson

Yesterday I lost a very good friend and the world lost an extraordinary and unique woman.

Loretta L. Jackson, or Aleta as we all knew her, had the fortune to participate in the entire breadth of the modern space age beginning with Gemini and ending with the founding or operation of no less than three successive NewSpace companies.

Born in 1948 in Tuscon, Arizona, a young Aleta became an engineering intern at McDonnell Corporation in the mid-1960s. She was a draftswoman who was also called upon to help fit instruments into the Gemini space capsules on account of having very small hands which could fit around the tight spaces.

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XCOR Partners with Immortal Data on Shipslog Data Acquisition System

XCOR_SXC_logoMIDLAND, Texas, Nov. 28, 2016 (XCOR PR) –  XCOR Aerospace and Immortal Data Incorporated have entered into a  licensing agreement having Immortal Data  further developing and commercializing the ShipsLogTM software,  the data acquisition system for the XCOR Lynx Space Plane and its engine test stand.  After enhancement and integration, ShipsLogTM will be a key element of a tail to nose aerospace data collection, storage and display solution offered by Immortal Data.  Development efforts will begin immediately at Immortal Data facilities in Midland, TX, a facility funded by Midland Development Corporation, at the Midland International Air and Space Port.

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Program Updates from ISPCS

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

NASA and various commercial companies gave updates on their programs during the International Symposium on Commercial and Personal Spaceflight this week in Las Cruces, NM.

What follows are summaries that include:

  • suborbital programs (Virgin Galactic, Blue Origin)
  • commercial cargo (SpaceX, Sierra Nevada Corporation)
  • commercial crew (NASA, Boeing, ULA).

The summaries are based on Twitter posts from attendees. A big thanks to Thanks to Tanya Harrison (‏@tanyaofmars), Frank Slazer ‏(@FSlazer), Jeff Foust (‏@jeff_foust), Michael Simpson ‏(@SpaceSharer), and Melissa Sampson (‏@DrSampson) for the coverage.

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A Note to Readers….

mojave_tower_sunset_smHi everybody.

As I had previously disclosed, I was working on a book project about XCOR Aerospace. That is no longer the case. I have therefore taken the disclosure statement down from the website.

The end of the book project had several causes. One is that progress on the Lynx at XCOR was extraordinarily slow over the years I’ve been here in Mojave. It was hard coming up with a narrative given the way things were going. Ever watched a desert tortoise move? It was a lot like that. If you haven’t, trust me. They’re very s-l-o-o-w-w.

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Glasgow Prestwick Official Visits Midland

orbital_access_logoThe Midland Reporter-Telegram has an account of a visit by Glasgow Prestwick Airport and Spaceport Business Development Director Mike Stewart’s visit to the west Texas city to discuss cooperation. 

Glasgow Prestwick Airport wants to become a spaceport. It also hosts Orbital Access, a company owned by Stuart McIntyre that is working on an air-launched satellite delivery system.
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A Closer Look at Which Space Companies U.S. VC’s are Investing in

Falcon 9 launches the Dragon CRS-9 mission to the International Space Station. (Credit: NASA)
Falcon 9 launches the Dragon CRS-9 mission to the International Space Station. (Credit: NASA)

NASA’s new publication, “Economic Development of Low Earth Orbit,” consists of a series of papers that examines a number of important policy questions that will be of rising importance as NASA transitions human spaceflight in LEO to the private sector.

One of the papers, “Venture Capital Activity in the Low-Earth Orbit Sector,”
has detailed information on what U.S. venture capitalists have invested in. Key excerpts from the paper follow.
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