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Astra aims to reach new heights in Nasdaq debut

July 1, 2021, 10:17 AM UTC

Good morning,

As billionaires like Jeff Bezos prepare to take a trip into space, the San Francisco-area rocket startup Astra Space is set to make its debut on the Nasdaq Global Select Market. But the company is sending small satellites, not people, into space. 

“We are a commercial business,” Astra CFO Kelyn Brannon says. “We’re not going to Mars. Our spacecraft could deliver a special coffee to the Space Station or drop something off on the moon. We have that capability.”

Formed in 2016, Astra will become the first space company to trade on Nasdaq. Astra will begin trading today under the ticker ASTR and ASTRW for Astra warrants, with a valuation submitted to the SEC of approximately $2.1 billion. 

The company didn’t go the traditional IPO route. Astra announced in February it would merge with Holicity, Inc., a special purpose acquisition company (SPAC) backed by Craig McCaw, Bill Gates, and others. Holicity’s shareholders voted on Wednesday to approve the merger. Astra raised $500 million in cash proceeds, which includes $300 million of cash held in Holicity’s trust account, and a $200 million private investment in public equity led and managed by BlackRock. CEO Chris Kemp and Astra’s management team will lead the combined company.

Going public via a SPAC was “a very expeditious way to raise money,” Brannon says. “Space businesses are incredibly capital intensive,” she says. The funding helped to “accelerate our business plan by having the capital sitting on the balance sheet,” Brannon explains.

“All of a sudden as a young company, you don’t have funding risks anymore, which means now you get to focus on execution risks,” she says.

Astra CFO Kelyn Brannon/Courtesy of Astra

A former head of finance at Amazon.com, Brannon previously led Calix, Inc. and Arista Networks, Inc. through the IPO process as CFO. After joining Astra in December 2020, she believed going public “was exactly the right thing to do.”

“I thought [Astra] wasn’t ready from an infrastructure perspective but was ready from a maturation of the business model,” Brannon says. Astra reached space for the first time December 15 with the launch of its Rocket 3.2 vehicle from Kodiak, Alaska. The rocket’s hardware and software performed well, so the technology was ready, she says. 

Astra may build rockets, but it doesn’t sell rockets, Brannon says. It provides a space services platform in which its 40-foot-tall rocket can help customers to launch their satellites into orbit. Its services allow “nascent companies to come up with a concept, and get into space in months, not years,” she says. 

In June, Astra acquired Apollo Fusion, an electric space-propulsion company in order to reach new destinations in space. The launching of small satellites has the potential to collect data and information to “make this a healthier Earth,” Brannon says. Astra has more than 50 launches under contract, “delivering customer payloads into low Earth orbit” in the summer of 2021, according to the company.

Why will Astra be attractive to investors? “The space economy is really a massive opportunity,” Brannon says. “And we love our potential to be a big part of it, and to help drive it, and to create long-term shareholder value.”

Next on Brannon’s agenda is focusing on the expansion of workspace in Astra’s factory, “so we can drive towards building a rocket a day,” she says.

See you tomorrow.

Sheryl Estrada
sheryl.estrada@fortune.com

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