Valued at $2.4 trillion, raking in $670 billion in annual revenue and earning $70.6 billion profit on it (according to data from S&P Global Market Intelligence), Amazon.com (AMZN +1.93%) ranks as the fifth-largest American company by market capitalization -- and the absolute No. 1 biggest consumer discretionary company.
Amazon's so big, growing so fast, and has such a big tech component to its business, that it holds a place among the so-called Magnificent 7 tech stocks as well.
Image created by JesterAI.
But did you know there's another company you might soon be able to invest in -- also built by business development genius Jeff Bezos -- that could make you even more money than Amazon.com?
It's true. According to Bezos himself, his new space company Blue Origin will one day be bigger than Amazon, worth $2.4 trillion or more.
Amazon's founder has Rocket Dreams
Washington Post space reporter Christian Davenport reveals this, Bezos's long-term plan for Blue Origin, in his new book Rocket Dreams: Musk, Bezos, and the Inside Story of the New, Trillion-Dollar Space Race, published by Penguin Random House's Crown Publishing Group last month. Over the course of 323 pages, Davenport tells the tale of how competing missions between SpaceX (which wants to colonize Mars) and Blue Origin, which wants to "build the road to space" more locally (i.e., between Earth and its moon), are driving both privately owned companies to ever-higher heights -- both figuratively and literally.
NASDAQ: AMZN
Key Data Points
How Blue Origin could get bigger than Amazon
Established in 2000, two years before Elon Musk set up SpaceX, Blue Origin started out small -- and slow. For the first 15 years of its existence, in fact, you probably didn't realize Blue Origin existed. It wasn't until 2015 that the company conducted its first spaceflight, a suborbital test of the tiny unmanned New Shepard rocket. But later that same year, New Shepard successfully launched and then landed back on Earth, one full month before SpaceX was able to accomplish the same feat with its Falcon 9 (orbital class) rocket.
Like Blue's gradatim ferociter motto (step by step, ferociously) suggests, Blue Origin is making steady progress -- in part by following in SpaceX's footsteps.
You may recall that 2015 was also the first year investors began thinking seriously about SpaceX as a potential investment. In 2015, Elon Musk announced plans to build a constellation of broadband internet satellites -- the concept that would eventually become Starlink. To get his idea off the ground, SpaceX invited a $1 billion investment by Alphabet and Fidelity, which valued the space company at $10 billion.
10 years later, SpaceX is worth $400 billion. That's a 40x gain in just 10 years.
Does Blue Origin deserve a SpaceX-size valuation?
Valuing Blue Origin is trickier. Whereas SpaceX has conducted multiple rounds of stock sales on the private market, details of which are regularly leaked, Blue Origin is funded almost entirely by its founder, Jeff Bezos, who is reported to be spending at least $2 billion annually to keep the company afloat. Still, various analysts who have tried to hang a valuation on Blue Origin estimate it might be worth $50 billion to $100 billion.
And what's 40 times $50 billion to $100 billion? That's right. $2 trillion minimum.
And potentially as much as $4 trillion.
Image source: Getty Images.
How to go from $50 billion to $4 trillion (hint: you need a map)
If you ask management at Blue Origin, it'll deny it, but Blue wants to follow in SpaceX's footsteps in more ways than just valuation. "SpaceX has shown how a commercial space company can be profitable, setting the standard for a resurgent Blue Origin," argues Davenport, and proving that "the commercial space industry [is] for real."
SpaceX owes much of its success to Elon Musk's decision to bid early on for government contracts to resupply the International Space Station (ISS) and, later, to help "American astronauts [fly on] American rockets from American soil" back to ISS, as former NASA Administrator Jim Bridenstine famously put it. These contracts functioned as government seed capital for SpaceX, giving it the resources it needed to develop ever-better versions of Falcon 9, and the supersized Falcon Heavy rocket, Starlink, and Starship as well.
In contrast, Blue Origin declined to bid on either of these two big contracts (known as Commercial Resupply and Commercial Crew, respectively), and it has increasingly lagged SpaceX as a result. The company only this year finally launched its first orbital-class rocket, New Glenn, and orbited its first few "Kuipersat" internet satellites as well. As a result, Blue Origin has fallen years behind SpaceX in launch cadence, in satellite volume, and in market capitalization.
As Bezos is quoted as telling his executives, "Elon's real superpower is getting government money." Going forward, Blue Origin intends to imitate that same strategy. "From now on, we go after everything that SpaceX bids on."
Will this strategy succeed in making Blue Origin "bigger than Amazon"? Only time will tell. At the very least, though, Blue Origin has now identified a strategy for competing, and it's one that's proven successful for its archrival. As Blue Origin racks up contract wins in national security launch, in lunar landers, and even in space stations, SpaceX finally has some competition in America's race to space.
