Rocket Lab's Satellite Strategy: Constellations, Lasers & Thrusters [Peter Beck interview]

**Peter Beck** (0:00)
You know our style, like if there's a great team and a great product, we'll go and try and acquire them. If there's no great team and no great product, then we'll go and make it. So that's exactly what we did.

**Madison Malone** (0:12)
SpaceX has something like this in their Starlink division.

**Peter Beck** (0:14)
If you're building any kind of constellation of scale, then you're going to have electric propulsion. If you're doing any communication work, you're going to have laser terminals.

**Madison Malone** (0:21)
So reading between the lines, this looks and feels like Rocket Lab putting all of the building blocks and pieces of the puzzle together to eventually announce your own constellation.

**Peter Beck** (0:29)
Of course, and that's always been the plan here, we were building the Interim Space Company.

**Madison Malone** (0:33)
Let's talk about the moon and Mars. Two of your competitors, SpaceX and Blue Origin, they have kind of refocused more immediately on the moon in line with NASA. Does that kind of clear the path for Rocket Lab to go all in on Mars?

**Peter Beck** (0:47)
I don't really see it like that, I mean...

**Madison Malone** (0:50)
Well, thank you so much for your time. Good to see you as always.

**Peter Beck** (0:52)
My pleasure.

**Madison Malone** (0:53)
There has been so much news coming out of this company. It's almost difficult to keep up at this point. I just wanted to kind of run through some news updates with you. I wanted to start off with this SEC filing. I don't typically concern myself with CEO compensation because I think you'd agree that performance is certainly more important, but this was a little hard to ignore. Just to reiterate, you voluntarily cut your salary to a dollar, forfeited about 22 million USD in unvested RSUs to instead have that money poured back into the company's strategic priorities and R&D initiatives. What's the message you're trying to send and to who?

**Peter Beck** (1:30)
I don't think there's any message there. I'm just being very practical about it. Like if you take my salary and bonus and stock, that employs a lot of engineers. And those engineers, we can do lots of things with, and we can create more value.
And I'm already incentivized enough. Like I have a large shareholding in the company, and if we create more value through hiring more people and doing more projects, then ultimately I benefit anyway. So, it's kind of, to me, it was just pointless to have that, and it's just more practical to put it back into the business and create more value out of it.

**Madison Malone** (2:05)
How many neutron engineers or other engineers could you hire?

**Peter Beck** (2:09)
Well, I was probably about 15 or 20 engineers if you took the whole thing. So, that's a much better use of capital, for sure.

**Madison Malone** (2:16)
Let's talk about electric propulsion, because you just announced Gauss, if I'm pronouncing that correctly, you just announced Carl Friedrich Gauss, the mathematician. Could be wrong, but he did the on-orbit calculations, is that what he was known for?

**Peter Beck** (2:27)
Yeah, and also a whole lot of magnetics. So, yeah.

**Madison Malone** (2:30)
Now you have one.

**Peter Beck** (2:32)
I do.

**Madison Malone** (2:32)
Can you show us?

**Peter Beck** (2:32)
Yeah, as requested.

**Madison Malone** (2:34)
Thank you so much for bringing this along. Now, it looks little, but I held it before, it's actually quite weighty.

**Peter Beck** (2:39)
Yeah, so, I mean, there's a lot of coil and magnetics in it, so there's a little bit of mass up the nose there. But this particular one is one that we've fired for hundreds and hundreds of hours, hence the reason why you can see the beautiful sort of colouring.

**Madison Malone** (2:56)
Yeah, because the one in the initial video was quite plain silver. Yeah, whereas this one's obviously doing the quick-freezer ringer.

**Peter Beck** (3:04)
Yeah, and the difference with an EP engine is that, or an iron engine is that it runs for a very long time. So, we have these sitting in vacuum chambers just running day after day after day after day, for hundreds and thousands of hours.

**Madison Malone** (3:18)
So, tell us about the initial idea for this. You obviously saw an opportunity in electric propulsion globally. I know that you considered acquiring a business, but instead you decided to build your own product and production line. Why?

**Peter Beck** (3:31)
Well, so, it goes back to, we have a number of projects in spacecraft and build that have EP propulsion systems on board.
And if we look back at those projects, past and current, one of the biggest pain points has been EP. And just the scale supply of reliable and good EP just doesn't exist in the industry. And you know our style, like if there's a great team and a great product, we'll go and try and acquire them. If there's no great team and no great product, then we'll go and make it. So that's exactly what we did. And yeah, so there's, like any Rocket Lab product, we make it for ourselves and we make it for everybody else. So hopefully, this will unlock a bit of the constraints around EP and alleviate some of the pain that the whole industry is feeling.