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The private equity firm that made Paul Allen’s dream come true

    Hello everyone. Elon doesn’t want to buy Twitter now because it can’t count its bots. You’d think an AI guy like him would let the robots speak.

    The clear view

    Stratolaunch was based on a dream. Paul Allen, the unspeakably wealthy co-founder of Microsoft, grew up fascinated by space exploration and devoured books such as science writer Willy Ley’s visionary rocket books. In the early 2000s, Allen funded a project known as Spaceship One, which entangled the X-Prize as the first private company to send a human into space. He later licensed the technology to Virgin Galactic, which built its own transport vehicle to send Richard Branson into suborbital ecstasy. Meanwhile, Allen, frustrated by what he perceived to be NASA’s embarrassment, decided to get back into space travel. He hired legendary aircraft engineer Burt Rutan to design a giant aircraft carrier that could launch satellites and other spacecraft into the sky. With its double fuselage and a wingspan of 385 feet, the Stratolaunch aircraft, later named Roc, was a breathtaking sight in its own right, doubly so for its mission to lift its payload to the sky. In 2018, I traveled to the Mojave Desert to see the world’s largest aircraft with my own eyes.

    But when Allen died in November 2018, following a third bout of the lymphoma that had haunted him for decades, his space dream also died. While Stratolaunch is still alive, it has no designs to cross the Karman line. It is now an unabashed defense contractor, specializing in what the UN Office of Disarmament Affairs called “a new and destabilizing strategic weapon”: hypersonic technology that propels programmed aircraft at speeds of Mach 5 and above.

    Here’s how that happened. After his death, Allen’s holding company Vulcan, which included Stratolaunch, sports teams and an AI think tank, fell into the hands of his sister Jodie. Apparently, she had no desire to keep an aerospace venture, offering Stratolaunch to buyers for $400 million, much less than her brother’s investment. It was unclear whether there would be takers for the world’s largest aircraft. Richard Branson, chronically underestimating Allen’s contribution to his own space venture, jokingly offered a dollar.

    But a mysterious buyer emerged: Cerberus, a private equity firm named after the mythical three-headed dog that guards the gates of hell. When Vulcan made the sale in October 2019, Stratolaunch not only withheld the purchase amount, but also who bought it; reporters discovered the identity several months later through SEC reports. Perhaps that was because Cerberus, run by co-founder Stephen Feinberg, has some baggage. It once tried to create a personal arms force called the Freedom Group, picking up gun makers like Remington and Bushmaster. In 2012, Cerberus tried to get rid of the group after a mass murderer used a Bushmaster to slaughter 20 schoolchildren and six teachers in Sandy Hook; it eventually moved the assets to its Remington company, which went bankrupt in 2018. Moreover, Feinberg once joked that if one of his employees had their picture in the paper, “We’ll do more than fire that person, we’ll kill him.”

    After purchasing Stratolaunch in late 2019, the private equity firm expanded its workforce from 13 employees to more than 250 and focused its mission specifically on hypersonic vehicles. These were considered potential payloads during the Allen era, but they were secondary to launching satellites and a possible manned vehicle called Black Ice. Using a hypersonic craft carrier vehicle has its advantages; Roc can launch his rocket-propelled payload across the ocean, where the deafening sonic boom wouldn’t be so distracting. Feinberg himself is knowledgeable about the defense institution and served under Donald Trump as the head of the president’s intelligence advisory board. In December 2021, Stratolaunch won a contract from the Missile Defense Agency for a feasibility study on how the US could take countermeasures against hypersonic attacks. Stratolaunch builds its own hypersonic missiles, codenamed Talon. The first is intended for a single launch – after the test it will fall into the ocean. The second is a reusable hypersonic vehicle that will retain key data after testing. For now, the intention is defensive, to mimic the behavior of potential attack missiles. But Stratolaunch doesn’t rule out a future role in making offensive hypersonic weapons.