Khosla Ventures early bet on a space startup pays of big


Indian-American billionaire Vinod Khosla’s Khosla Ventures had made strategic early investments on Rocket Lab, an American aerospace manufacturer and small satellite launch service provider, that are paying off big time now that the company is public.
Between 2013 and 2020, Khosla Ventures invested in across several Rocket Lab funding rounds worth $28.2 million, and now the VC holds just over 115 million shares of Rocket Lab’s common stock.
According to a disclosure with the Securities and Exchange Commission (SEC), Rocket Lab’s closing price of $14.50 a share on Tuesday, the Khosla stake is worth $1.67 billion.
Rocket Lab’s stock is up more than 40% since the company closed its SPAC merger and debuted on the Nasdaq on Aug. 25. The company’s shares rose as much as 6% in trading Wednesday, on track for its fifth consecutive day of gains.
Khosla is poised to benefit even more if Rocket Lab’s stock continues to climb: A clause in its Rocket Lab investment entitles Khosla to an addition 9.3 million shares if the stock’s closing price is at or above $20 a share for at least 20 days between Nov. 23 and Feb. 21.
The venture capital firm is among a number of investors benefiting from a flurry of space companies going public this year.
Six space companies have closed SPAC deals so far in 2021 – Rocket Lab, AST & Science, Astra, Spire Global, Momentus, and Redwire – and several more are expected to go public by year-end, with deals in progress by BlackSky, Satellogic and Planet.
The first space company in this latest generation to go public through a SPAC was Virgin Galactic, and founder Sir Richard Branson has benefited by selling more than $950 million of the company’s stock in sales.