How did SpaceX revolutionize private spaceflight? My long-read Q&A with Eric Berger

By James Pethokoukis and Eric Berger

Uberbillionaire Elon Musk is a divisive figure. He’s the richest man in the world, known as much for his Twitter antics as his leadership of Tesla motor company. But could his lasting legacy be flying humans to Mars? That’s the hope behind his rocket company, SpaceX. To learn more about the company’s success and its founder’s vision for the future, I’m joined by Eric Berger.

Eric is the senior space editor at Ars Technica and the author of Liftoff: Elon Musk and the Desperate Early Days That Launched SpaceX.

What follows is a lightly edited transcript of our conversation. You can download the episode here, and don’t forget to subscribe to my podcast on iTunes or Stitcher. Tell your friends, leave a review.

Pethokoukis: What did you find so interesting about SpaceX that made you want to write a whole book about it? Why do you think it’s important?

Berger: SpaceX is the most dominant space company of the era — of today, of now, and of the future, most likely. The things it does are surpassed only by NASA and by China’s space agency. If you were to rank it, you would put it above Russia’s space agency and the European space program. And they’re only going to probably get bigger and more successful.

And so I really wanted to understand where they had come from because this idea of building low-cost access to space did not originate with Elon Musk. He’s not the first person to come along and say, “We should be the FedEx of space.” But he was the first person to succeed. And so I wanted to understand why that was. And so I did a little bit of research and talked to some people, and I realized that all of the things that made SpaceX successful today actually were set down in those first formative years from about 2002 to 2008. And there was a heck of a story to be told about the struggle to get the Falcon 1 rocket to orbit. And so that’s when I decided to write a book about the origin of SpaceX and focus solely on those beginning years and struggles.

So you said he was not the first to have this idea. Putting aside just for a moment what he did, were there other things that had happened over the recent decades that created an environment where this was even possible? Were there technological advances, or something with NASA? What was the ecology that even made SpaceX possible?

So if you go back to 2002 and you think about how technology was exploding in our lives, you had the internet really entering widespread use, Amazon was starting to grow — this predated social media, but basically the seeds of what had happened in the last few decades were occurring. And it was affecting all of these industries, right? Musk had been involved in PayPal. So you had banking, healthcare, all these industries disrupted. But if you looked at the aerospace industry, the United States was basically using rockets that were designed in the 1960s and 1970s, and the cost of launch of getting our satellites into space was going up, not coming down. And as a matter of fact, because of this, there was a contest to launch commercial satellites — so your DirecTV satellites, your communication satellites, marine navigation, those kinds of things. All of those were being launched in Europe and in Russia because those countries had much more robust commercial space launch industries.

Time exposure over the skyline of Cocoa Beach of the SpaceX Falcon 9 rocket carrying the 32nd batch of Starlink internet satellites. Via REUTERS.

And so this was the environment that Musk came into where there was really a dearth of entrepreneurial spirit in launch. It was basically the ability to put rockets into space. You had NASA with its Space Shuttle, and then you had Lockheed Martin and you had Boeing, and those were the horses you had to get into space. And so if you were a commercial company and wanted to start a business, you were paying literally hundreds and hundreds of millions of dollars to get your product into space. And so he came into it at a time when the industry was ripe for disruption.

Musk has talked a lot about Mars, but it seems to me that before him, every once in a while, it’d be like, “We’re going to the Moon,” or maybe “We’re going to Mars.” But it didn’t seem like we were really doing much to actually make that happen in a realistic timeframe.

Yeah. Going back to George H.W. Bush, there was the goal of going to Mars. And then it was to go to the Moon and so forth. And it was waffling back and forth. And NASA really wasn’t getting anywhere; it was spinning its wheels. And so when Musk founded SpaceX, initially it was in response to this fact that he looked at NASA’s plans and decided that they didn’t have what it was going to take to get there. Initially, when he first got involved in space, it was to try to generate public interest and to increase the funding for NASA, because he thought if only NASA had more funding, then surely 30 years after we went to the Moon we’re going to be able to go to Mars. But that wasn’t the case. And so pretty quickly he pivoted to realize that if humanity was actually going to go to Mars, he felt like he needed to get personally involved. Which seems really arrogant. But it may in fact come to pass.

Well, you seem to suggest that the first goal was a little bit less ambitious. And so was there a particular thing that made him switch from “this is going to be an interesting experiment” to like, “I’m going to create an actual rocket company that is going to take people to orbit to the Moon and beyond”?

So from the outset, the very first people he interviewed to work at SpaceX, he told them the vision, right? And the vision was to put humans on Mars. This was back in 2002, but he wasn’t crazy enough to think that SpaceX was just going to rock up and build a rocket and launch people. You had to do it in a stepwise manner, and for a rocket company, really, the first step you have to take is demonstrating that you have the capability to do it. You want to be able to build a rocket and safely put a payload into orbit. And so that’s what the Falcon 1 was really all about. It was proving that SpaceX had the technical competence to do this. And when you go back to 2002, when they started out, no private company on its own had ever developed a liquid-fueled orbital rocket.

So what they were trying to do was really hard. Now, since then we’ve had Rocket Lab, we’ve had Firefly, we’ve had Virgin Orbit. We’ve had Astra just recently come along and either get to orbit or get pretty close. And so there have been more companies following in SpaceX’s wake, but they had to prove that they could do it. And then he could start to take the next steps that he felt were important to Mars. And really the most important step, Jim, and probably the most significant thing that they’ve done over the last decade was take the step toward reusable space play with the Falcon 9 rocket.

Was reusability originally part of the plan?

Absolutely. They put a parachute in the very first Falcon 1 launch, all the Falcon 1 launches had a parachute on top of the first stage. And the idea, which was very naive, was that the rocket would launch and the second stage would burn away, carry its payload away. And then the first stage would come back under a parachute. And actually they sent recovery ships out for those initial launches. And I talked to the SpaceX employees, actually an army ship that they hired, who went out there in the forlorn hope that they were going to get those stages back. That obviously came much later. But that was certainly part of the vision from the very beginning.

The word “desperate” is in the title. What were the desperate moments?

So there were several of them, but by far, the most desperate moment was after the third flight of the Falcon 1 rocket where pretty much everyone assumed they were going to be successful. They were already running out of money. And then that rocket went up and failed. That was the summer where Elon Musk was getting divorced, where Tesla was hemorrhaging money. And now SpaceX had just failed for the third time. Gwynne Shotwell said they had payroll for maybe six or eight more weeks, then the company was going to go bust.

And so that was a desperate period when they were leading up to the launch and they had one more rocket, the fourth rocket, they were going to launch, and then they were flying it out to Kwajalein. They launched from the small island of Atoll, beyond Hawaii, basically, if you’re flying from California. And as they were flying that first stage toward Kwajalein, it starts imploding on the C-17 aircraft. And so this was their last piece of hardware. So that was probably the most desperate moment when everyone on that plane thought they might die due to that imploding rocket. And then they were also concerned about losing the hardware. They were able, obviously, to salvage it. So that’s kind of what the story of the Falcon 1 is about, and sort of goes point by point through that just incredibly stressful and dramatic time.

To me, it’s just kind of incredible for someone who comes from his business background (classic Silicon valley software company) to go from that kind of company to something which is so physical. It seems like an incredible leap for a business person to do that. Or maybe they’re not as different as I think.

It was an incredible, incredible leap. Now it is true that software is actually a very important part of a rocket launch, because you can have the best hardware in the world but once it launches humans have no control really over the flight of that rocket. It’s got to be all on board: computer power responding to atmospheric conditions as it’s going up and gimbaling the engines and that sort of thing. So there was software involved. But absolutely, I mean, going from what is a purely digital, bits company to something where you’re dealing with physical hardware, blowing things up, very energetic — a rocket is basically a bomb. And that is part of the remarkable story of Elon Musk. Say what you will about his behavior online or whatever, he has a technical mastery of the things that he takes on.

A SpaceX Falcon 9 rocket lifts off from Cape Canaveral Space Force Station, FL. Craig Bailey/FLORIDA TODAY via USA TODAY NETWORK

There’s a saying, “We all stand on the shoulders of giants.” How much of SpaceX’s success is due to the rocket advances made by Apollo?

Yeah. I mean they did stand on the shoulders of giants. Tom Mueller, who Elon hired to be his Chief of Propulsion, had worked at a company called TRW for more than a decade and had learned to build engines there. And so he brought a lot of knowledge with him. Some of the other earliest hires came from places like Boeing.

And the Falcon 1 rocket was really not revolutionary at all. The thing that was novel about it is that SpaceX tried to build it really cheaply, right? So they wanted to see if they could use off-the-shelf flight computers versus a $3 million component they might buy from somewhere. And they wanted to see if they could build a rocket with a couple hundred people instead of a couple thousand people. So it was really trying to vertically integrate that process, make it much more efficient, and bring down the cost of launch as much as possible. But the Falcon 1 rocket was a very simple machine. It was a first stage engine, a second stage engine. There was nothing revolutionary about it. That would only come much later with the things that they did with the Falcon 9.

Tesla was coming up at the same time as SpaceX and demanded a lot of time and attention. What can you say about Elon’s involvement in SpaceX, especially in those early years?

I mean, he was all in. I think he would spend about half his time with SpaceX and about half his time with Tesla, but he is absolutely a workaholic. He gets up late in the morning and then he works until midnight or later, most days. And he was all in, Jim. He hired the first 3,000 people at SpaceX; he interviewed them all personally. He put a premium on identifying people he thought would be good engineers and not good engineers at SpaceX, and hiring all those who would be good. And he was not there at all of the engine tests in Texas. He wasn’t there at all the launches in Kwajalein, but if he wasn’t there, he was watching via video connection and putting in his inputs, which of course were stern at times.

Yeah. What kind of a boss is he?

He’s an extremely demanding boss. He asks his people to do the impossible and then when they jump over whatever hurdle is before them, he’ll give them another, even more challenging task. And he expects the people who work for him to work for long hours and to work very hard. But it’s not like the people who worked at SpaceX feel like they’re being taken advantage of. They realized that SpaceX had a demanding work environment and they were willing to commit. I think a lot of these were young people: 20, 25, just out of college. Some of them didn’t even complete college and they started at SpaceX. They were willing to trade those really vibrant years of their life because they felt like they were making meaningful progress. They were working on hardware every day.

They weren’t pushing paper, and they got stock options. And so if SpaceX succeeded, they succeeded financially and to a very great extent. So it just was like if you wanted to work for the best, that was the place to go. But it was a really difficult place to work. And Elon can be a bit mercurial in his management style, but it’s also super flat lined. If he made a decision that you thought was bad and you could convince him that it was bad, then he would change his mind. And if you needed a hundred thousand dollars for this part, because it was really the only way to solve this problem, he would make that decision instantaneously. And if you had a problem, he said, “Email me, whatever time of day or night, and I’ll get back to you.” So he wanted to help his engineers solve the problems. And he was very much involved.

This is a completely different kind of business than what he did before. Why does that not really hamper him, not being a rocket engineer?

But he learned that. He read all of the books, he talked to people in the industry, and he made mistakes. And so he gave himself a good education on that pretty quickly. That’s one of his skills, I think: When he sets his mind to something, he very quickly takes that information and processes it. I think that sometimes he thinks he’s an expert in a lot of different things, but when he really puts his mind to it, he does gain expertise.

Astronauts wave while departing the crew quarters for launch aboard a SpaceX Falcon 9 rocket on a mission to the International Space Station at the Kennedy Space Center in Cape Canaveral, Florida, U.S., November 10, 2021. REUTERS/Joe Skipper

And actually, I think his software background gave him one really important advantage going into rockets. So, for a long time, the way this hardware was built was through a methodology called linear design. And so that’s maybe where you would spend two, three, four, five years looking at design schematics, trying to figure out what on your rocket would not work, and making the perfect design, then finally building the hardware and building one and having some confidence that it was going to work. He brought his software mentality, which is where you write some code and then run the program and find the bugs, debug it, and run the code again. Maybe there are a few more bugs. And then the software works. He brought that iterative design method to rockets, and so they lost some Falcon 1 rockets when they got to orbit.

And if you see what they’ve done with the Starship program in south Texas, that is 100 percent an iterative design method. They’re losing hardware, but it’s okay. It’s like they’re losing it by design. They’re learning from each of those flights, and the rockets are cheap to build because they’re making them out of stainless steel. So this idea of iterative design and being willing to fail, I think, does come from that software background. And it’s been pretty advantageous for SpaceX coming into a much more traditional field.

What was the timeline he imagined versus how it sort of played out?

So the original launch schedule they had was actually to launch at the end of 2003. The company was founded in May 2002. And he actually posted little signs above the urinals in the men’s bathroom saying, “We’re going to launch by the end of 2003.” That was what the schedule was working down toward. Now, they didn’t make it, but they were on the launch pad at the end of 2005. And they actually ended up launching in March of 2006 for the first time.

You mentioned his goal of going to Mars. Why is that his goal? In a very deep way, why is he doing what he’s doing?

Yeah. It’s a good question because in 18 years he has completely disrupted the launch industry and built, as I say, the most efficient space company in the world. They’re winning all sorts of NASA contracts and contracts from companies to launch stuff, for in-space services. And no one does it faster, better, or cheaper really than SpaceX anymore. They’re very dominant. But he hasn’t rested on his laurels there and actually is already trying to disrupt the rocket, the Falcon 9 that he built that has done the disruption. And I think that’s because his goal is Mars. So why his goal is Mars — it’s because when he does companies, they have a big mission. Tesla’s is clearly to make electric cars cool and reduce our planet’s dependence on fossil fuels.

And I think SpaceX’s mission is very clear. He’s concerned about the long-term future of humanity, and he figures that sooner or later if we stay on Earth, something bad is going to happen. And that could be runaway climate change. That could be an asteroid hitting the planet. That could be like a much deadlier pandemic. That could be nuclear war. That could be global population stasis and then decline. And so he’s looking and saying, “We need to be a space-faring species,” and “We need to be a multi-planetary species.” And yeah, there aren’t any other planets in the solar system that are remotely as good as Earth. And we’re probably going to have to go to other stars to find them, but you’ve got to take the first step. And the first step for him is learning to live on Mars.

But has Musk’s focus on Mars opened him up to criticism that it’s all a science-fiction vanity project? Jeff Bezos faces a lot of criticism, too. But when he talks about space, his attention is on creating a space economy. For Musk, it seems existential.

It is. I mean, it is existential for Musk. I think the real difference between Elon Musk and Jeff Bezos in space is that Elon has actually delivered. Bezos, for all of his tremendous success with Amazon and commerce and AWS, his company, Blue Origin, has really been a massive disappointment in this space industry. Yes, he succeeded earlier this year in going into space on his suborbital New Shepherd system, which is a fine piece of engineering, but that’s 2 or 3 percent of the energy in that launch system that you actually need to make it to orbit.

Billionaire American businessman Jeff Bezos speaks with his brother Mark at a post-launch press conference after they flew on Blue Origin’s inaugural flight to the edge of space, in the nearby town of Van Horn, Texas, U.S., July 20, 2021. REUTERS/Joe Skipper

And SpaceX has now flown more than 120 orbital missions. It’s flown humans to orbit five times. And they are just so far ahead of Blue Origin in everything they’ve done. As expansively as Bezos talks, and I think his vision is great — basically trying to move heavy industry off the surface of planet earth so it can be a garden for humanity, but he’s also interested in getting humans out into space to make sure we’re a space faring-species and sort of growing — it’s far less credible to me, what he’s talking about, than what Elon is, because Elon, as I said, is actually doing it.

How far ahead of Blue Origin is SpaceX?

I mean, a decade, at least. Blue Origin is finally building their orbital rocket. It’s called New Glen. It’s a big, impressive machine, but I can’t see it being ready before 2024. And then they’re going to have a learning curve, I think, in making it reusable. The Starship vehicle that SpaceX is building is probably going to fly early next year for the first time, to orbit or get close. And then they’ll iterate quickly. We talked about iterative design. By the time New Glen comes out, Starship will already be flying and established as a much more capable vehicle. So SpaceX is just way ahead of Blue Origin. And it’s unfortunate because you’d love to see two really thriving, privately invested companies that are both pushing reusable space flight.

So what was the key thing he was able to do that NASA was not able to do?

Yeah. I mean the big things — I’ll give you a couple examples of how they’ve really cut costs, but the big reason is that he went for vertical integration. So his goal was to build as much of the rocket as possible in house to cut down on suppliers and to cut costs at every opportunity. NASA’s problem is that it answers to Congress for funding. And Congress is much more interested in the single NASA center or the single major aerospace center in that person’s state or that person’s district. And so their goal when they look at NASA’s budget is not efficiency, it’s “How do I maximize dollars that are going to my field center or my aerospace company?”

And so when you look at a big rocket project that NASA’s building called the Space Launch System, it very proudly says, “We have suppliers in all 50 states,” right? “And thousands and thousands of suppliers. And isn’t that wonderful?” And SpaceX is like, “No, man, we’re trying to build as much of that rocket as we can. And we’re trying to build it out of the cheapest possible material and get it to orbit as quickly as possible.” And so you end up with a rocket, the Space Launch System, which is probably going to cost about $3 billion per launch.

Is it reusable?

Not at all. It’s expendable. It can fly at most once per year. And SpaceX is aspiring to build Starship so that the first and second stage are both fully reusable and can launch every day, so that its cost is the fuel plus some reuse — so maybe 50 million, 20 million, with a lot more lift capability than the Space Launch System.

I want SpaceX to have a competitor, but that does not sound like a real competitor.

You do want SpaceX to have a competitor. And that’s why the only real competitor probably is going to eventually come from the private industry. And I don’t know if that’s Blue Origin or a company like Relativity Space, but there are some potential competitors. And just one other example, Jim, that’s not theoretical, but is practical: When NASA was looking for a replacement for the shuttle to transport cargo to the International Space Station, it ran a competition, and SpaceX and another company called Orbital eventually won those contracts. And so NASA did that. SpaceX built the Falcon 9 rocket and the Cargo Dragon spacecraft to get supplies to astronauts in the space station. NASA did its own study to find out if it had independently developed that capability using its traditional contracting methods. They found — and this is NASA’s own study — that it would’ve cost four to 10 times more than what SpaceX did it for.

To create that capability?

Yes. To recreate that capability.

How much cheaper can SpaceX get cargo to orbit than previous rockets that were doing it?

Well, it’s difficult to do apples to apples. Right now they’re a little bit lower, but the fact that they’re starting to get to reusing the rockets is what ultimately is the game changer to drive down costs down the road. But just in comparing crew costs — carrying astronauts, not delivering cargo to the space station — Boeing and SpaceX both got contracts in 2014 to deliver that service. And everyone thought Boeing would be first because they were the blue bud. They’d been a NASA contractor for decades. They had all this experience.

They got 4.2 billion; SpaceX got 2.6 billion, and SpaceX first flew humans in 2020. So about a year and a half ago, and they have now flown five missions, four of them to the International Space Station. And they’re launching about every three months on Cargo Dragon. And Boeing probably will fly its first human mission maybe at the end of next year or early 2023. So SpaceX will have beaten them by two to three years for about 40 percent less money. And so that’s, again, just kind of an example of how they’ve been able to do things more efficiently because they kind of came in with a clean sheet and with this idea of vertically integrating.

If we had this conversation 10 years from now about what SpaceX has been doing, what do you think they would have accomplished? What Elon Musk says they’re going to accomplish is always pretty big. It’s always pretty exciting. But what do you see happening? What’s your best forecast there?

So the caveat, I think, on SpaceX is they’re now launching people for NASA, and that is a hugely important undertaking. And if there is some kind of accident, I think there will be a real pause in the United States on the idea of commercial space flight, because while NASA had accidents, they had two in 135 flights with the Space Shuttle and they took multi-year pauses to stand down and reassess that. And so assuming that SpaceX is able to safely get astronauts to and from the space station, I think really the sky is the limit. (I mean, the sky is not the limit, right? Space is the limit.) But if you look back at the early days of SpaceX, Musk was limited by funding, right? He had a hundred million. He put it into SpaceX. He could hire a couple hundred people and they could build a single rocket.

He is no longer constrained, really, by funding. When you look at what they’re doing in Texas with Starship, they’re putting more than a billion dollars a year into development of that facility. And it is impressive. And they’re able to hire, and Musk has personal wealth if the company ever needs financing, but he can just go to the private capital market to get funding whenever he wants, because they’ve been successful. And so with the caveat that they continue to safely fly humans for NASA, they probably will be getting fairly close to launching humans to Mars, which sounds crazy because if you gave NASA its current budget plus 50 percent, they would be nowhere near putting humans on Mars in the next 15 or 20 years.

Do you think having a geopolitical competitor in China, who is pushing forward in space, makes it less likely that we would take a pause, for fear of losing the next space race?

Yeah. China is our only serious competitor. There are others, but they are the big one that we’re trying to stay ahead of. And the only reason we are ahead, frankly, is because of companies like SpaceX, but also it’s the commercial space industry in the United States that really is keeping our advantage at this point. It’s these bright people with private money getting government contracts. It’s really kind of a nice synergy. So the risk you say there is from human space orbiting. I think another big risk is orbital debris. And if we muck up lower-Earth orbit, like we had the Russian test with Cosmos 1408 blowing up. . . So it’s serious. Like we’re putting up these mega constellations, which are important for commerce and are benefiting life on earth. But if we get too many cascading debris events, then you may render some of those orbits really unusable.

SpaceX’s SN15 and SN16 stand near the build site on October 19th, 2021 in Boca Chica, Texas. Photo by Reginald Mathalone/NurPhoto

And I think that’s another big threat, but I think the horse has left the barn in terms of commercial space. But I do know that there are lots of people in Congress. . . Again, we talked about protecting personal fiefdoms and districts and home field centers. And SpaceX has put pressure on a lot of those. If SpaceX were to have some kind of catastrophic accident, you would see a lot of pressure from Congress, sort of the naysayers coming forward saying, “Hey, we need to reign in Elon Musk, he’s unsafe at any speed.” That kind of rhetoric, probably.

What does American space flight look like in 2021 without Elon Musk? If those critical moments that you described had been catastrophic, or if he decided to take that PayPal payout and just go buy an island, what does this sector look like now in the United States?

It’s a great question because I think people had always seen the potential of a commercial space industry. And there had been moments in the 1980s when you thought that maybe we’re at the beginning of some kind of commercial space, then it went bust. You can trace it — you can go back and look at 2009, 2010 and see private investment in space flight companies just start to go straight up. And it’s entirely attributable to the fact that SpaceX was flying its Falcon 1 successfully, and then getting a contract from NASA and then flying the Falcon 9 successfully. And that was really the moment, I think, that commercial space flight became a thing with SpaceX’s continued success as a lot of other companies come in and say, “We’re going to be the next SpaceX of satellites” or of launch or whatever.

And it’s just really given confidence, I think, to investors that, “Yeah, some of these companies are going to fail, but some of them are going to hit it really big. And I don’t want to miss out on that next industry.” And so commercial space probably still is a thing without SpaceX, but it’s certainly a much less vibrant ecosystem. And so many companies are either marketing themselves as a SpaceX or benefiting from the low cost launch services that SpaceX is providing that it would just be a much more boring, much less vibrant industry.

My guest today has been Eric Berger, author of Liftoff, Elon Musk and the Desperate Early Days That Launched SpaceX. Eric, thanks a lot. This has been outstanding.

My pleasure, Jim.

James Pethokoukis is the Dewitt Wallace Fellow at the American Enterprise Institute, where he writes and edits the AEIdeas blog and hosts a weekly podcast, “Political Economy with James Pethokoukis.” Eric Berger is the senior space editor at Ars Technica and the author of Liftoff: Elon Musk and the Desperate Early Days That Launched SpaceX.

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How did SpaceX revolutionize private spaceflight? My long-read Q&A with Eric Berger