Richard Branson’s Virgin Orbit Declares Bankruptcy

Tough Times Virgin Orbit

On March 30th, 2023, it was announced that Virgin Orbit would cease operations “for the foreseeable future.” This announcement came after the company failed to secure funding.

On the very same day, in an all-hands meeting, it was announced that the company would be laying off a significant portion of its workforce. According to CNBC, Virgin Orbit’s CEO said, “Unfortunately, we’ve not been able to secure the funding to provide a clear path for this company.”

Regarding the layoffs, the company is set to let go of all but 100 employees. The company later disclosed that the layoffs would constitute 675 positions or around 85% of the workforce. Hart also said that the company would provide all employees with a severance package.

This will involve a cash payment, an extension of benefits, and support in finding a new position. Also included is a “direct pipeline” set up with sister company Virgin Galactic for hiring according to CNBC.

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On 4th April, the satellite launch company filed for bankruptcy protection in the US. In a statement on the matter, Dan Hart said, “While we have taken great efforts to address our financial position and secure additional financing, we ultimately must do what is best for the business.”

So, How Did Virgin Orbit Get Here?

On Monday, January 9th, 2023, Virgin Orbit was leading a historic mission in the UK. The mission in question was supposed to be the first satellite launch from British soil.

According to The Guardian, a converted Boeing 747 called Cosmic Girl took off on launch day (Monday) night and headed out across the Atlantic. While over the Atlantic, released a rocket as scheduled. The rocket was carrying 9 satellites. 

Shortly after, a statement was released from Virgin Orbit claiming that “an anomaly” had occurred. The anomaly led to the rocket not reaching its destination. Later it was announced that both the rockets and satellites were lost.

This incident began a domino that ended up with the company declaring bankruptcy three months later. The Guardian reports that while the founder Richard Branson has invested over $70m (£56m) since then to keep the company alive, his efforts have been in vain.

A lack of investors to fund the company eventually led the company to seek bankruptcy protection under Chapter 11. This is designed to allow the company to continue to operate under a reorganized plan until the company can get a buyer.