Will SpaceX go bankrupt?

Starship Mk1 at Boca Chica, next to SpaceX's first rocket, the Falcon 1

Suppose, just suppose, the new stainless steel Starship doesn't work.  Maybe it  breaks up on re-entry, because it's a monocoque construction and needs interior ribs.  Maybe putting ribs in it will make it too heavy.  Maybe the welded joins aren't strong enough to withstand the pressure differential between the fuel tanks and space.  Maybe, it's a ship which is going into production long before it's needed.  (Though, frankly, I think, if it works, it will leads to a massive increase in space launches, because it'll be so cheap.)  Maybe the heat shield tiles peel off like they did on the Space Shuttle.  Maybe switching to stainless steel from carbon fibre composite was a serious mistake and SpaceX will have to start from scratch again.

Now I'm not saying I believe all this.  But just suppose Starship is a failure. What would happen to SpaceX?  Well, Musk is on record as saying that SpaceX is devoting less than 5% of its resources to Starship/Super Heavy.  Its Falcon 9 launches are profitable.  Thanks to re-usability, it could cut its charges and still make a profit.  It would survive.  It would be a bitter disappointment to SpaceX and to Musk and to all us Mars tragics, but SpaceX isn't betting the company on Starship.  In fact, because stainless steel is so much cheaper than carbon fibre, to the extent that perhaps Starship could be built for under $10 million, it was a bigger bet before. 

So that's the downside: less than the cost of a single Falcon 9 ($60 million) wasted if Starship fails.

The upside is that Starship works. 

In the pictures from Boca Chica, Starship looks like something out of a SF story.  But the first planes built weren't the smooth, shiny monsters they are today.  You could see where the aluminium had been beaten and nailed into shape.  You could see the rivets.  Yet aircraft went from things covered with painted canvas to the Airbus A380 or the Boeing 787, from contraptions that were dangerous and expensive to safe and cheap.  The chances are that Starship will work.  My doubts about the monocoque construction are the doubts of a non-engineer.  Musk and his team of engineers know what they're doing.  The proof of that is Falcon 9, Falcon Heavy, Dragon and (shortly) Crew Dragon.

The other risk is that there is no market, that this mammoth machine is just too grand for the limited demand for launches.  But the demand for launches is limited by cost.  If the cost of lifting a tonne to LEO (low Earth orbit) falls one hundred fold, as it will if Starship is successful, the demand will explode.  If nothing else, Starship will be able to take people up into orbit for a week's "spacecation", and do it profitably.  A bit of a come down from starting a Mars colony, but nevertheless, survival.

And if Starship is safe, and works, and is re-usable, it will be irresistibly cheap to NASA and ESA and anybody who wants to get to Mars and the Moon.  NASA/ESA/Roscosmos will simply buy berths and cargo space on Starship to start their own national bases on the Moon and Mars.  The first bases will be scientific, but they will develop into refuelling stations, to fuel the ships that will travel to mine the asteroids.  There will be space stations orbiting around Mars, and ships heading out to or back from the asteroid belt will refuel there.  There will be space stations orbiting the Earth, and space manufacturing will start. 

The upside is huge.  Right now, Musk says that SpaceX will just build the ships to get us to Mars and the Moon.  After that, it's up to everyone else to get things working.  But SpaceX will have improved or developed technologies such as life support systems, food growing, extracting CO2 from the air (which will work just as well here as on Mars, and which is desperately needed on Earth), spacesuits, Martian/Lunar powerplants.  These will be sellable.  And the logic of gravity wells suggests that the Mars-Earth spaceships will be built in orbit, docked at a space station, then will travel from Mars to Earth and back without ever entering an atmosphere.  The Starship shuttle will lift passengers and cargo and fuel from Earth or Mars to the space stations, and then the SpaceX spaceliner will carry passengers in luxury from the space stations orbiting round one world to space stations orbiting the other.  In all these endeavours, SpaceX will be the market leader.  It will have learnt how to build in space, to work in space, to travel across space, and that will be hugely profitable.

So there it is.  SpaceX isn't betting the shop, as Tesla did with the Model 3.  For just 5% of its resources, it is building the base for a massive expansion of space-related business over the next 20 years.  That seems like excellent odds.  SpaceX won't go bankrupt, it'll thrive.