On eve of first launch, Firefly revamps board of directors, may go public

As Firefly Aerospace nears the debut of its Alpha rocket, with a first launch attempt expected in mid-March from Vandenberg Air Force Base in California, the company’s chief executive is looking ahead to the future.

“The company is at an inflection point now where we’ve been in this hardcore development mode for Alpha,” said Tom Markusic, chief executive of Firefly, in an interview. “Our goals going forward are to transition from a development company to an operating company. And we’re also of course interested in the next growth phase of the company, which is to expand beyond launch vehicles and put increasing emphasis on spacecraft.”

To that end the company is moving to aggressively raise new funding and is shaking up its board of directors. Gone is Ukrainian Max Polyakov, and in are two senior members of the US government community. All of this comes as Firefly is expected to roll its completed rocket out to its launch site in California in two weeks and perform one or more hotfire tests. The company is projecting a launch between March 15 and 22.

Fundraising

Firefly seeks to become an “end-to-end” space company that can both launch payloads into orbit as well as provide a spacecraft to deliver materials to the Moon or elsewhere. To accomplish these objectives will require more capital, of course.

When the company faced a cash crunch in 2016—Firefly had to briefly shut down—a Ukrainian investor named Max Polyakov stepped in to provide about $200 million in funding. Markusic said about 10 percent of those funds remain, and the company is now seeking to raise $350 million. This will allow further development of a production line for Alpha, which can launch up to 1 ton to low-Earth orbit, and development of its successor, Beta, as well as a tug-like spacecraft.

Markusic said Firefly has not yet made a decision about whether to seek additional funding from private investors or pursue public options. The company has had interest from several special-purpose acquisition companies, or SPACs.

“We haven’t made a final decision yet,” Markusic said. “We have options for private rounds, and we definitely have a lot of interest from a few SPACs. So we’re really just evaluating the terms of the different offers and we’ll come to that decision as a board.” He expects the board will make a decision later this month.

Shuffling the board

Firefly also announced on Wednesday morning that it has changed the composition of its board of directors, which now consists of Markusic, Deborah Lee James, and Robert Cardillo. James, who will serve as chair of the board, has a long government career, including having served as secretary of the Air Force from 2013 through 2017. Cardillo was the sixth director of the National Geospatial-Intelligence Agency, serving from 2014 until 2019.

Both new board members bring national security gravitas to Firefly and are strong indications that the company intends to provide launch services, and perhaps more, to the US Department of Defense.

“These two new board members are clearly established individuals with a strong national security background,” Markusic said. “They can give our government customers complete confidence that the company is being controlled and directed by people that have the interests of the United States of America in mind. They’ve held the most senior-most positions you possibly can find in these areas.”

Among those no longer on the board is Firefly’s financial savior, Polyakov, who has dual Ukrainian-British citizenship. This is a substantial change, as it moves the company’s Ukrainian backer from a role as a key decision maker to that of a stockholder. Markusic said Polyakov has the rights of a stockholder but that Firefly’s board now directs the company. Concerns had previously been raised about Polyakov’s background in an investigation by Snopes, and having an all-American board of directors should bolster Firefly’s efforts to work with the defense community.

“I don’t want to emphasize any concerns, or anything like that,” Markusic said when asked about Polyakov’s departure from the board. “I just want to say we’re being proactive about aligning the leadership of the company with our government customer base, and having a board that optimally does that.”