SpaceX to “rescue” Velo3D with $8 million licensing and service deal
The collaborative agreement will also enable SpaceX to modify and improve Velo3D's technology for its own internal use
After playing a key role in helping the company get off the ground (which is its specialty) Space Exploration Technologies Corp. (SpaceX) is now assisting Velo3D to stay afloat in a very challenging moment, as the company’s value collapsed and its shares have been delisted from the NYSE index. SpaceX will pay Velo3D $5 million to license its technology and the two companies will officially collaborate to drive advancements in metal additive manufacturing.
SpaceX has been at the forefront of aerospace innovation, developing advanced rockets and spacecraft that have revolutionized space exploration. The company founded by Elon Musk was a first-adopter of EOS metal AM technology and later became one of the very first major customers of Velo3D, helping the company bring its own highly innovative metal PBF systems to market.
This new agreement between the two companies is designed to help SpaceX utilize Velo3D’s technology in its manufacturing processes, particularly for rockets and spacecraft components. The agreement allows SpaceX to license and integrate Velo3D’s proprietary technology for internal use, while providing Velo3D with financial compensation and certain control over the usage of its IP.
The heart of the agreement revolves around Velo3D’s granting of a non-exclusive, royalty-free, perpetual license to SpaceX. Specifically, SpaceX can make, reproduce, and modify Velo3D’s technology for use in its operations. The company can create derivative works based on Velo3D’s technology and distribute the technology internally within its organization. Importantly, SpaceX’s use of the licensed technology is restricted to its own internal operations related to rocket and spacecraft manufacturing, ensuring that Velo3D maintains control over the external distribution of its technology.
Velo3D retains full ownership of its intellectual property. This includes any improvements or modifications made by Velo3D to its technology within the 12 months following the agreement’s effective date. However, SpaceX retains ownership of any improvements it makes to the technology during its use. These improvements do not need to be shared with Velo3D, allowing SpaceX to build upon the licensed technology for its internal purposes without losing control over its innovations.
The agreement also grants SpaceX the right to sublicense Velo3D’s technology under certain conditions. Specifically, SpaceX may sublicense the technology to affiliates or third parties, provided that these third parties are not Velo3D’s competitors. The sublicenses must be limited to providing services to SpaceX itself, meaning that sublicensed entities cannot use the technology for independent purposes outside SpaceX’s business.
In addition, the deal stipulates that Velo3D will provide support services to SpaceX. These services include engineering support to help SpaceX effectively integrate and utilize Velo3D’s technology in its manufacturing processes. The specific details of the services are outlined in Addendum A of the agreement. Velo3D agrees to provide ongoing improvements and updates to the technology, ensuring that SpaceX can benefit from advancements made by Velo3D over the initial 12 months following the agreement.
For this, SpaceX will pay Velo3D a total of $5,000,000 for the license to use its technology. This amount is payable in two equal installments, triggered by specific delivery milestones outlined in the agreement. In addition to the license fee, SpaceX will pay $3,000,000 for the support services provided by Velo3D. This fee is based on the actual services rendered and will be invoiced on a regular basis.
