NC-bound Boom Supersonic attracts more famous investors, albeit at a lower valuation
A Colorado startup committed to build and test supersonic passenger jets in North Carolina announced it has raised $100 million from some of the country’s most prominent tech investors to pay for its bespoke aircraft engine.
In a Dec. 13 post on X, Boom Supersonic CEO Blake Scholl listed Paul Graham, Reid Hoffman, Michael Moritz, and OpenAI founder Sam Altman as “major investors” in a new round of financing that will “fully fund” the initial prototype of Boom’s promised engine, called Symphony.
“I invested more in Boom than I’ve ever invested in a startup before,” Graham, who co-founded the prestigious startup incubator Y Combinator, wrote Sunday on X, where he has 1.9 million followers. “But this company is important for America. They’ll also make a huge amount of money if they succeed. No one else is anywhere near having a supersonic airliner.”
Under Graham’s post, X and Tesla owner Elon Musk responded, “I hope they succeed.”
Scholl acknowledged Boom raised its latest $100 million through a down round and recap, meaning the private company’s valuation had fallen since its previous financing round in 2021. Raising funds at a lower valuation, Scholl said, “created a buying opportunity for investors” that “leaves the company in a stronger financial position.”
“While no founder ever wants to do a recap, I remain focused on our mission,” he wrote. “Humanity needs and deserves supersonic travel. And I continue to believe Boom can be one of the most significant companies of the 21st century.”
The company declined to share its current valuation on Monday. With its latest haul, Boom has now raised more than $800 million.
Down rounds benefit new investors while shrinking the equity of founders and initial investors, said David Gardner, a founding partner of Cofounders Capital in Cary.
“It’s a bittersweet thing,” he said. “It means you did raise capital and you do have a chance of making your company successful, although you’re going to own a lot less of it.”
Scholl founded Boom in 2014 to reintroduce passenger supersonic flight, a service halted when the Concorde last flew in the early 2000s. Graham and Altman were among the company’s early investors.
In January 2022, Boom pledged to build its first assembly plant at the Piedmont Triad International Airport in Greensboro where the company promises to employ at least 1,761 workers and invest $500 million by 2030. If successful, Boom will receive more than $121 million in future tax benefits between North Carolina and Guilford County.
In June, Boom cut the ribbon on its 179,000-square-foot “superfactory” in central North Carolina. Under its incentive grant, the company will begin hiring workers at the Greensboro site in 2026.
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Engine maker changes and supersonic target date
Boom plans for Symphony to power its prospective airliner Overture, which the company aims to have certified for passenger travel in 2029. With projected capacity between 64 and 80, Overture promises to shuttle passengers at twice the speed of today’s commercial airliners over water and 20% faster over land.
Finding engine makers hasn’t been without challenges. Boom unveiled Symphony in December 2022, months after its original engine partnership with Rolls-Royce collapsed. At the time, Boom said three firms would provide design, manufacturing, and maintenance support for Symphony. In July, Boom announced one of these firms, the Arizona engine maintenance company StandardAero, will assumed a larger development role.
In an email to The News & Observer, Boom spokesperson Laura Hein said the jet maker will assemble and test engines at StandardAero’s facility in San Antonio, adding the company plans to complete its first engine core tests on Symphony by late 2025.
As Boom funds its future engine, the company is also approaching supersonic speed. On Friday, the company completed the ninth flight of its XB-1 test jet in California, reaching a new top height of 27,716 feet and top speed of Mach 0.87.
Boom says the XB-1 will achieve Mach 1, or the speed of sound, early next year.
This story was originally published December 16, 2024 at 5:14 PM.
CORRECTION: This story has been updated to clarify that the three firms announced to work on Symphony in December 2022 remain with the project.
