The increasing privatization of the space industry brings a new generation of space companies with innovative and affordable solutions to the field.
When I was a kid the most popular fortune prediction in the Bazooka Joe gum wrapper was, “By 21 you’ll reach the moon”. Well over a decade later, I’m the closest I’ve ever been thanks to Grove Ventures’ recent investment in Ramon.Space. Over the past year we’ve been enthusiastically exploring the space-tech scene: We are at a turning point in the history of space exploration with new industries that are being born, and we are continuing to closely monitor the shifting dynamics in the field. “New space”, referring to the recent privatization and commercialization of the Space sector, isn’t a natural evolution of the market — it’s a real disruption to the multi-billion dollar Space industry.
The monopoly of space, held by national governments, is over. Over the past decade and in the last 4 years in particular, space has become more accessible, more private, and more entrepreneurial than ever. With private actors playing an increasingly important role bringing a new generation of innovative, affordable solutions throuough the entire launch vehicle, payload and launch infrastructure system — simplicity, reliability and sharply reduced costs are the new necessity
Money, Money, Money (or — Why Now?)
As always, cost is driving the leading space trends.
In a 2018 interview, Thomas Friedman explained how cost has always driven tech revolutions: Around the year 2000, a group of technologies were combined, to dramatically decrease the cost of optic fibers, which radically increased global connectivity. Suddenly the entire world could be connected. Around 2007, we could do everything faster: we could perform a huge number of complex tasks with a single click. This was enabled thanks to another dramatic cost reduction — of computing, storage and software.
Today, the world is becoming smarter — again, driven by, you guessed it, cost reduction. This time around, sensors’ prices are going down dramatically — you can add sensors, as in — ‘intelligence’, to anything: a fridge; a car; a T-shirt.
Similarly, the main driver behind the ‘New Space’ revolution is that getting to space has never been cheaper. The investment required to set an operation in Space has significantly decreased:
Per-kg launch costs, unchanged for over half a century, sharply declined — down from >$80,000/Kg for space shuttles to <5,000$/KG for low earth orbit (LEO), largely thanks to Elon Musk’s SpaceX.
It’s cheaper (and easier) to get there: Dedicated small launch vehicles; an increase in launch rates; and even a growing acceptance of rideshares (think Uber pool) into Space — all make the task of getting a payload to orbit seem as simple as an “add to cart” option.
The availability of low-cost satellites: Cubesats, SmallSats, Nanosats and others — that can be quickly built in scale — have ushered in the development of new use cases and business models.
Another major driver of the ‘New Space’ era is the exponential growth in Earth Observation (EO) data which permits endless business opportunities.
Consequently, we are witnessing more private investments in Space than ever before — in 2019 alone, over $3B were poured into Space startups.
Let’s Talk Numbers
We saw a 90% increase in Space revenues since 2013 and a 385% increase in satellites launched:
Between 2015–2019, $11B was invested in the startup Space eco-system, roughly 10x the annual pace of the preceding five years.
Since 2015, annual investment in Space reached over $2B consistently. 2018 was a record year with $3.2B in funding (by companies such as Boeing, Rolls Royce, Morgan Stanley).
Since 2018, there have been ~25–30 space-related investments each quarter.
Governments in the western world have allocated at least $10B a year in budgets.
Large satellite manufacturers invested heavily: Boeing acquired Millennium for $1B; Northrop Grumman bought Orbital-ATK for $9B; MAXAR purchased DigitalGlobe for $3B; Airbus invested $1B in OneWeb; and Thales gave Iridium Next a $2B investment.
37 VCs have a formal Space focus (invested in 3 space ventures since 2000 and 31 space ventures received an investment of 2 or more VCs over the same period. A growing number of investors are looking into improvements to fundamental technologies such as launch capabilities, high-performance computing, hardware miniaturization, etc.
Areas to Look At
From Internet services, IoT, image processing and big data analysis, we see new verticals, services and use cases. If you are into Space tourism or Space mining, there are opportunities there as well. 3 main areas to closely look at:
Downstream Data (AI, Big Data, Machine Learning/Deep Learning)
Space Computing (Storage, Cyber, Cloud, Telecommunication etc.)
Life supporting systems (Agritech, Biomed, Energy, Complex Materials)
AI applications are worth a pause. For the satellite industry, AI is one of the latest buzz terms. It could potentially have a significant role in many aspects, including system manufacturing, in-orbit management and adding value to applications. Earth Observation (EO) for example, is a classic — if not the most classic — use of satellite deployments; Images taken from above can be used for a wide range of use cases, from understanding the effects of natural disasters to espionage. AI in space opens up a new chapter in EO by adding scale, automated image tagging and map correlations — which combined can be used for entirely new applications, such as understanding the economic state of a third-world nation.
New Space, New Computing Needs
As in many other industries, Big Data is also changing the game in Space. Once we have maxed out our Big Data sources here on Earth, we should look up to the stars. As the complexity of missions and data usages increases, so does the computing needs. These require high-performance, cost-effective, programmable, low-power solutions.
Machine Learning capabilities, running on the Edge, are now required as the full data sets cannot be transferred to Earth; Software-defined capabilities, allowing to reconfigure a satellite already in orbit are becoming a must. Think about it: the lifespan of an average Geostationary Earth Orbit (GEO) satellite is 15 years. But operators rarely have business cases that will last for so long. So, the ability to remotely and affordably change a satellite’s mission — navigate it into a different position or even switch its functionality — is becoming key. These changes in satellite functions are made possible by new computing capabilities.
Why is This Rocket Science?
On Earth, high-performance, affordable, programmable, computing systems are practically a commodity. Space, however, introduces a completely different set of environmental challenges for computing systems:
Radiation: electronics in Space require resiliency as it is extremely vulnerable to radiation that can cause anomalies in its operability
Extreme temperatures are a major restriction on both the architecture and materials used.
Maintenance is almost impossible, posing strict requirements on robustness, redundancy, and lifetime of electronic parts.
And here is the tricky part. The more advanced your computing needs, the smaller the electronics, and the more vulnerable it is to the harsh space environment. Providers of integrated computing that’s radiation resilient, programmable, Earth-grade can be counted on one hand. Leading the list, developing the most advanced Space computing technology in the world, is Ramon.Space
Ramon.Space is providing integrated computing systems in space based on proprietary state-of-the-art core processors technology, space-enabled (Rad-Hard). The Ramon processors have participated in over 50 space missions, spent more than 50,000 days in space up to 400m km from earth and have recently been equipped on the Solar Orbiter, a collaborative mission between ESA (European Space Agency) and NASA to study the Sun, capturing the closest images ever taken of the Sun.
Look up — great things are happening.