Richard Branson's Virgin Orbit crashes 23% as the company files for bankruptcy after failing to raise new funds

• Shares of Virgin Orbit plunged 23% on Tuesday.
• The space company, founded by Richard Branson, filed for bankruptcy this week.

Shares of Virgin Orbit plummeted 23% on Tuesday after the space company filed for Chapter 11 bankruptcy this week.

Founded by billionaire Richard Branson, Virgin Orbit's fortunes sank after a failed rocket launch in January, which sent the company searching for additional cash. Last week, the company axed 85% of its staff after a series of failed funding attempts and said it would suspend operations for the foreseeable future.

The stock began the year trading around $1.85. It was hovering near $0.15 Tuesday afternoon.

"While we have taken great efforts to address our financial position and secure additional financing, we ultimately must do what is best for the business," Dan Hart, chief executive officer of Virgin Orbit, said in a statement after the filing.

Hart added: "We believe that the cutting-edge launch technology that this team has created will have wide appeal to buyers as we continue in the process to sell the company. At this stage, we believe that the Chapter 11 process represents the best path forward to identify and finalize an efficient and value-maximizing sale."

Shares of Branson's other space-focused firm, orbital tourism company Virgin Galactic, were also down Tuesday, trading about 12% lower at $3.40 per share.