Virgin Galactic, a startup founded by British billionaire Richard Branson, currently preparing for space flight next year, has earned a partner with Boeing as the airplane maker invests $20 million in its space travel program set not only to fly customers to outer space but also make global travel at hypersonic speeds.
In a statement, Branson said, "This is the beginning" of an important partnership "for the future of air space and travel."
Virgin Galactic chief executive George Whitesides said that Boeing's investment serves as "a catalyst" that will lead to "broader and deeper collaboration."
Brian Schettler, senior managing director at HorizonX Ventures, an arm of Boeing, says Virgin Galactic and the industry are at the final stretch of testing the space tourism industry adding that HorizonX "feels good about going to into operation" in 2020.
Whitesides also added that they can now "start" with some of the engineering, financial and technological questions "that need to be put in place."
He also pointed out that the company's teams "have been talking" for some time and when it comes to Boeing, its "broader capabilities are unmatched" in its mobility and experience in human spaceflight and they're "over the moon" with the collaboration.
This deal also allows Boeing and Virgin Galactic to explore airline travel that will make possible a trip across the globe in only two hours.
The company is aware this will take years to materialize.
To join this space startup, Boeing will make its investment through HorizonX Ventures.
Schettler, when asked why Boeing invested just now said that they "see this great, momentous occasion" for both sides.
Next year, as part of the National Aeronautics and Space Administration's commercial crew program, the first customers, which will happen to be astronauts, will get flown from the International Space Station.
Once Virgin Galactic goes public, Boeing will have a minority stake because its investment is in return for new shares.
The moment the merger closes, Virgin Galactic's valuation will be $1.5 billion.
Virgin Galactic is going public by year-end as part of a merger with Social Capital Hedosophia Holdings Corp that will own 49 percent of the merged company.
The announcement of Virgin Galactic to go public, to raise US$800 million, was announced in July.
Schettler said that the deal is "to catalyze a bigger partnership and align the companies" for high-speed travel and commercial access to space.
Virgin Galactic will be the first human spaceflight company to go public.
Virgin Galactic plans to list on the New York Stock Exchange.
