Velo3D Founder and CEO Benny Buller joins Yahoo Finance Live to discuss the supply chain backlog affecting the company and its involvement with SpaceX's Starlink installations.
AKIKO FUJITA: Well, in just over an hour, SpaceX is set to launch 46 Starlink satellites into space. It comes as Reuters reports that the European Space Agency may hire SpaceX now that it's lost the Russian Soyuz rockets. Joining us now to discuss is Velo3D founder and CEO Benny Buller.
And Benny, it's good to talk to you today. You've made some headlines this week with a big stock move on the back of your recent quarter, a 60% jump in revenue. And of course, you signed SpaceX as your first customer earlier this year. For those who aren't as familiar, talk to me about where the company stands in the space race.
BENNY BULLER: Sure. So Velo3D is a supplier of additive manufacturing technology. It's a manufacturing technology to produce parts. And we have been selling our solution since early 2019, late 2018. And SpaceX, indeed, has been our first customer since 2018, since Q4 2018.
When you look at the space market in the US, and particularly the private race space that is raging right now, a lot of those customers, I would say most of them, a lot of those companies, most of them, have been leveraging Velo3D technology to benefit. And really, many of them rely on our technology for some of the designs and disruptive designs that they are making.
RACHELLE AKUFFO: I mean, and this is very innovative. A lot of people, when they first thought of 3D printing, you wouldn't necessarily think of materials that could be going into space. What sort of growth is your company seeing right now?
BENNY BULLER: Yeah, so we-- if you look at this quarter, Q2 2022, in the last five quarters since Q1 2021, we grew 15 times. So we are seeing a quarter over quarter growth of anywhere between 20% and 60%, as we had this quarter, so very, very fast growth. Really tough for us to keep up with the demand. And--
AKIKO FUJITA: Let's talk about--
BENNY BULLER: Go ahead.
AKIKO FUJITA: I was going to say, let's talk about the headline that we got this morning out of Reuters saying that Europe is now looking at SpaceX as a potential replacement for those Russian rockets, just given where things stand right now because of the Russia-Ukraine war. I mean, you're very familiar with the company. How do you think SpaceX is positioned to step into that role if, in fact, that's the way things go?
BENNY BULLER: Yeah. I don't hold myself an expert on this, but I think one thing is very obvious, and this is a phenomenal company that have been able to accomplish a lot of things. And if you look at the volume of launches that this company performs compared to the rest of the world combined, they are very naturally positioned to step into this hole and fill it very successfully. So I'm extremely confident that they can do this well.
RACHELLE AKUFFO: And we've seen companies obviously trying to struggle with input costs because of inflation and also finding labor to meet the demand. How are you faring in those spaces?
BENNY BULLER: Yeah, so right now when-- if you look at this, we had a tremendous demand in terms of our growth. And if you look at our actual growth, we could have grown even faster had we not have these supply chain issues. The supply chain issues more than the labor shortages is a massive constraint on growth.
We have shortages in many, many components, particularly in electronics components. And this has been a struggle to get those components, kind of a door-to-door fight. And this is definitely slowing down the growth relative to what it could be.
AKIKO FUJITA: Yeah, I mean, what kind of slowdown are we talking about? If you are saying that you are-- you've got delays, you just can't get the supplies in place, I mean, how bad of a backlog is it?
BENNY BULLER: So if you look at our results this quarter, had we not have these supply chain delays, if you look at the actual machines we started to build, we would ship about 1 and 1/2 times compared to what we did. If you look at our backlog, our backlog is about 2 and 1/2 times compared to what we did this quarter. So it's a very significant supply chain shortages that definitely affect the rate at which we can deliver product.
RACHELLE AKUFFO: And obviously, SpaceX, the biggest name that a lot of people know, but then you also recently partnered with Hartech Group as well. Talk about some of these partnerships that you are working on and how they fit into the broader strategy for your company.
BENNY BULLER: Yeah, so if you look at our company, about 80-- between 80% and 90% of our sales so far have been in the United States. A lot of that has been in the private space race, but we also are doing a lot of work with commercial aviation, with defense, with power generation, with semiconductor, with oil and gas. And when you look at the defense market, we have not been very strategic about going after the defense market. And this partnership that we announced recently is the way for us to go into this business and be more strategic in how we approach this market.
If you look at the general business vector for this company, for Velo, we have developed the US market very successfully for us. The next thing for us is to do the same thing in Europe. The European market is about the same size as the American market, but we are just in a very early embryonic stage there. And these last few months have seen very great successes in the European market, so I'm very excited at the momentum there.
AKIKO FUJITA: Finally, Velo's a publicly traded company, but when you think about space companies overall, a majority of them are still privately held. And we have heard about the slowdown, especially in venture capital funding. How do you think that's going to slow down the space race overall? What do you see as the big impact on that end?
BENNY BULLER: Yeah, so I think if you look at the previous bust-- boom and bust cycles, in particular around innovation and venture capital, this points of a reduced funding, the soft points of crisis, usually without the weaker players and strengthen the stronger players. So we are going to see during this cycle of consolidation, and we are going to see stronger players emerging in a better spot. So usually, even in these hard times, strong companies can find funding and can move forward. So the companies with the better technologies-- technology and better leadership will emerge from that in stronger positions.
AKIKO FUJITA: Yeah, something we've heard over and over that strong companies will find a way even in an economic downturn. Benny, it's good to have you on today. Velo3D CEO Benny Buller, appreciate your time.