COLORADO SPRINGS, Colo. – Amazon billionaire Jeff Bezos has long said that he’s using his personal fortune to fund his Blue Origin space venture, and today he hinted at just how many billions of dollars he intends to spend.
“My business model right now for Blue Origin is, I sell about $1 billion a year of Amazon stock, and I use it to invest in Blue Origin,” he told reporters here at the 33rd Space Symposium. “So the business model for Blue Origin is very robust.”
Bezos threw out the figure half-jokingly, after noting that he typically doesn’t reveal how much he’s spending. But he made clear that his in-house space effort, headquartered in Kent, Wash., takes a noticeable chunk out of his estimated $78 billion fortune.
He said the development cost for Blue Origin’s New Glenn orbital launch system, which should be taking off from a Florida launch facility by 2020 or so, is likely to be on the order of $2.5 billion.
And then there’s the New Shepard suborbital rocket ship, which has successfully flown to space and back five times during uncrewed test flights launched from Blue Origin’s West Texas facility. The space-flown booster and a mock-up of New Shepard’s crew capsule are on display this week at the Space Symposium.
The crew capsule was the centerpiece for Bezos’ appearance today. “Hey, guys, if it’s OK with you, I think I’ll just go in first,” he said. With that, he climbed inside the mock-up – and made a reference to New Shepard’s namesake, NASA astronaut Alan Shepard, who became the first American in space thanks to a suborbital Mercury spaceflight in 1961.
“Can you imagine how Alan Shepard must have felt all those years ago?” Bezos said from inside the mock-up. “It must have been pretty cool.”
Bezos’ aim for Blue Origin is to follow up on a childhood dream, and have millions of people living and working in space. In recent days, the 53-year-old has freely acknowledged that he started up Amazon with a mind toward using the money from his success to fund Blue Origin.
But he doesn’t expect Blue Origin to be a not-for-profit venture forever: Once New Shepard starts flying passengers, perhaps in the next year or two, that’ll start bringing in revenue. And once New Glenn starts launching satellites, sometime in the 2020s, that could point the way to positive cash flow.
“I think it’s very important that Blue Origin stand on its own feet, and be a profitable, sustainable enterprise,” Bezos said. “That’s how real progress gets made.”
Last month, Bezos announced the first satellite launch contracts for the New Glenn rocket, but today he said he sees such contracts as mere stepping stones for his bigger vision.
“My singular focus is people in space,” Bezos said. “I want humans in space. And when you build something that has a high fixed cost, like New Glenn, to make the business model close, you have to use it for other things. And so our satellite customers are going to be a super-important customer base for us, because they’re going to help cover the costs in the early innings. I think ultimately, most of our flights will be taking people up into space.”
Bezos shied away from saying exactly what those people will be doing, but said that he expects lower-cost launches to be as disruptive for the space industry as Amazon’s innovations have been for the retail industry.
Will Blue Origin be as competitive in the space industry as Amazon is in retail? “Well, of course we’ll be just as competitive,” he said with a laugh.
He said Blue Origin would rely on the same formula that has driven Amazon’s success: a talented team, lots of money … and lots of patience. But he emphasized that money and smarts alone won’t lead to Amazon-level disruption in the space business.
“At Amazon, we had a lot of inventions that we were very excited about, and customers didn’t care at all,” he said. “And believe me, those inventions were not disruptive in any way. The only thing that’s disruptive is customer adoption. If you can invent a better way, and if customers agree that it’s a better way, then they will use that. That’s exactly what we’re trying to do at Blue Origin.”
Bezos said the disruption will take hold as Blue Origin, and other players such as SpaceX, advance their efforts to enhance rocket reusability.
“If we can make access to space low-cost, then entrepreneurs will be unleashed, you will see creativity, you will see dynamism,” he said. “You will see the same thing in space that I’ve witnessed on the internet over the last 20 years. And believe me, that’s fun.”
Other nuggets from Jeff Bezos:
- In the past, Bezos has said test astronauts might take their first flights on New Shepard in 2017. Today he said “I don’t think it’s going to be 2017,” but he still thought paying passengers could start flying in 2018. He emphasized that “we’ll put humans on this vehicle when we’re ready, and not a second sooner.”
- The price for a suborbital ticket to space hasn’t yet been set, and reservations aren’t yet being taken. When one reporter suggested that some tickets could be raffled off, Bezos replied, “I kind of like that idea. You want a marketing job?”
- Blue Origin is making “great progress” on New Shepard as well as on the BE-4 rocket engine that will be used New Glenn’s first stage. The BE-4, is due to be put through full-scale testing in Texas soon. Bezos said progress on New Shepard is “not constrained” by BE-4 activities. “Both teams are fully staffed,” he said. During an earlier space conference, Bezos said Blue Origin’s total employee count had passed the 1,000 mark.
- Bezos said that he and SpaceX founder Elon Musk are “very like-minded in a lot of different ways,” especially in their passion for rocket reusability, but there’s still a rivalry between them. When Bezos was asked what lessons could be transferred from suborbital to orbital boosters, he replied, “All boosters are suborbital. There is no such thing as an orbital booster.” (Musk, however, makes a big distinction between New Shepard’s booster and the Falcon 9’s first stage.)
- Following up on that comment, Bezos said “it might be interesting to build a small second stage for this New Shepard booster, because we could use it to put small sats into orbit.” But the primary focus for Blue Origin would continue to be suborbital trips for passengers and payloads.