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Suppose I raise $10 million from venture capitalists for my rocket startup, what are the initial steps I must take (as a person with no experience of making rockets before) to ensure my companies growth in a successful gradual manner?

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    $\begingroup$ $10M will pay ten people pay and benefits for maybe 5-7 years. That doesn't leave any money over to get any hardware. $\endgroup$ – Tristan May 4 '20 at 14:26
  • $\begingroup$ How much would then be the threshold money to start with? $\endgroup$ – peaceHoper May 4 '20 at 14:27
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    $\begingroup$ @peaceHoper Well, Elon musk invested about $100 million from 2001-2006 of his private money into SpaceX. Falcon 1 would not achieve orbit until 2008, and that has only about half a ton worth of payload. That should give you an idea. $\endgroup$ – Polygnome May 4 '20 at 14:47
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    $\begingroup$ Most (90%+) startups fail so there's no way you can ensure its success. The business model of startup IMO is to spend money and build up company's value, then 1) if the company is solid, then become a real enterprise and profit by making stuff (SpaceX, Tesla, GoPro, top 1%), 2) sell the company's value back into money and recover investments and/or take profit (top 5%, check out Google's acquisition, e.g. Nest, Ring, Android, YouTube), 3) die (all others). $\endgroup$ – user3528438 May 4 '20 at 17:02
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    $\begingroup$ I think it would have a potential but not at big stuff like actual launches - but on modules; a small part that does what others currently do worse. A good magnetic bearing for reaction wheels. An inexpensive but very reliable, fast and small star tracker for use in cubesats. A reliable TEA-TEB ignitor that uses up half the current amount of the fluids to get the work done. Camera firmware for cameras like gopro, that handles the harsh changes in lighting in space better. Then sell that to space industry giants, building up funds for more ambitious projects. $\endgroup$ – SF. Jul 21 '20 at 19:11
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Two options:

  1. Become an investor in SpaceX. \$10M is not enough to start your own rocket company (it takes at least \$1000M), but it would be enough to be taken seriously as an investor in another company that has a record of success, yet still needs cash.

  2. Become a subcontractor. Build something that a larger company doesn't do themselves, but might be willing to buy from you. For example, one could start a company that makes space food.

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  • $\begingroup$ Space food is an interesting point. Need to produce food lasting long enough for manned Mars missions. As far as I understand, this is currently an issue. $\endgroup$ – Sergiy Lenzion Jul 22 '20 at 1:05
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Citing comments of @Tristan and @Polygnome:

$10M will pay ten people pay and benefits for maybe 5-7 years. That doesn't leave any money over to get any hardware.

Well, Elon musk invested about $100 million from 2001-2006 of his private money into SpaceX. Falcon 1 would not achieve orbit until 2008, and that has only about half a ton worth of payload. That should give you an idea.

I would add to them, that although $10 million is not enough for orbital rocketry, you can still join an already ongoing private rocketry project as a business partner or as an investor.

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  • $\begingroup$ @uhoh It depends on your contract with the investors. The example in the other answer, making a company for space food production, I see no reason why it could not work (except that maybe the venture capitalists won't see it profitable and they don't give their money). Getting money from them for investing it into other companies, yes it is far lesser likely but I believe it might be still possible. $\endgroup$ – peterh - Reinstate Monica May 5 '20 at 16:43

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