Rocket Lab’s recent $275 million acquisition of Geost, a satellite payload provider, signifies its ambitious bid to secure a significant share of the U.S. military satellite market. CEO Peter Beck confirmed this aggressive strategy in a recent interview, hinting at further acquisitions. The company, previously focused on launching small satellites, is now rebranding itself as a “disruptive, nontraditional prime,” a full-service defense contractor.
Their competitive edge? Agility, vertical integration, and unparalleled manufacturing speed. Beck emphasizes the company's commitment to fulfilling U.S. government demands for cost-effective and frequent deployments: “We want to make sure that we are positioned to be exactly what the U.S. government is asking for,” Beck stated, “and that is, a new, disruptive prime that can deploy at a cost, in a frequency that hasn’t been achieved yet.”
This strategic acquisition spree began in 2020, with Rocket Lab acquiring five companies, each contributing essential elements to the satellite supply chain. These include Sinclair Interplanetary (satellite hardware), Advanced Solutions Inc. (software and guidance systems), Planetary Systems Corp. (satellite separation systems), and SolAero Holdings (space-grade solar panels). Furthermore, Rocket Lab is in the process of acquiring Mynaric, a German firm specializing in optical communications terminals crucial for satellite-to-satellite laser links.
The Mynaric acquisition, spurred by Rocket Lab's selection of Mynaric's terminals for its satellites in a $515 million U.S. Space Development Agency (SDA) contract, highlights their strategic approach. Beck explained: “We chose Mynaric as our optical terminal in our SDA program because we believed it was the best. It was the lightest and the highest performing terminal.” Addressing Mynaric’s past manufacturing challenges, Beck confidently added, “That’s just something we’re really good at.”
While Rocket Lab doesn't control the entire supply chain, they now possess a “large majority of the high-risk items that have caused issues in the past,” according to Beck. The next acquisition target, fueled by speculation, may be in the realm of satellite propulsion. Beck remained tight-lipped, simply stating, “Watch this space.”
Beck views the defense market as ripe for disruption, citing the SDA’s low-Earth orbit satellite constellations and missile-defense initiatives like Golden Dome as evidence of burgeoning demand for faster, cheaper deployments. He contends, “These programs are typically dominated by the large defense primes,” and emphasizes that “the way we’ve built these kinds of things in the past won’t work going forward.”
Despite this vertical integration strategy, Rocket Lab intends to continue supplying components to other contractors, ensuring the continued sale of Geost payloads and Mynaric terminals. The ultimate goal, however, remains the capacity to deliver complete satellite systems – from design and manufacturing to integration and launch – under a single umbrella. Concluding on the Geost deal, Beck stated, “This will not be our last acquisition. We’ll continue to build the scale and the capability of the company. The opportunities in national security are extremely large. So we want to make sure that we can play within those large opportunities. And this gives us a good anchor point to be able to do that.”