SN Profile | Steve Jurvetson, Managing Director, Draper Fisher Jurvetson (DFJ)
Steve Jurvetson loves rockets. The well-known Silicon Valley venture capitalist, who attended camp at NASA’s Kennedy Space Center as a child, shares images of the rockets he launches in Nevada’s Black Rock Desert on a Flickr Photostream.
For many years, however, Jurvetson could not find any space-related investments worthy of serious consideration. “The business case just did not pencil out for venture capital as far as I could tell,” Jurvetson said in a series of emailed exchanges with SpaceNews correspondent Debra Werner.
That changed in 2009 with DFJ’s investment in Space Exploration Technologies Corp. (). The success of SpaceX and its impact on launch prices are sparking a boom in entrepreneurial space activity, Jurvetson said. In 2012, DFJ provided financing for Planet Labs, a San Francisco startup with plans to launch a constellation of 28 Earth observation satellites. DFJ currently is negotiating a deal with another space company Jurvetson declined to name.
Jurvetson, who sits on the board of SpaceX and Tesla Motors, both founded by Elon Musk, also donates money to space-related organizations, including the B612 Foundation, a group preparing to map near-Earth asteroids, and the Lunar Orbiter Image Recovery Project, an effort to create a digital archive of data drawn from the analog tapes of Apollo missions.
You’ve mentioned your desire to travel in lunar orbit. Why?
I am motivated by the photographic opportunities and widened perspective that distance can afford. I am not personally interested in suborbital flight, but would expect to spend some time in low Earth orbit before heading to the Moon. I have flown the Zero G flights, and am not looking to space for the weightless experience. My dream is to orbit the Moon in a low orbit, lower than Apollo 10, soaring over the lunar landscape in an extended spacewalk — seeing so much detail with a good set of lenses, and Earthrises over the rugged horizon with a wing-suit perspective — rather than landing to be confined to a small region with limited views. These missions will not require the training, career dedication or luck of catching the right mission assignment before Apollo ends; rather, the longer we wait, the cheaper and safer it should be, hopefully falling into the comfort zone for many of us.
What firms or technologies are paving the way for the dramatic decrease in the cost of space access?
It’s primarily SpaceX’s effort to make the booster fully and rapidly reusable, with propulsive landing, as seen with their Grasshopper test vehicle. Since the Dragon spacecraft is already reusable, the vast majority of the cost of the rocket could be amortized over many launches. For small satellites, there are many different efforts underway to provide launch services optimized for that scale, and given the sheer number and diversity of approaches, I assume some of them will succeed. More immediately, the standardization of secondary payload opportunities is a boon to small satellites. We have seen some launches use what I affectionately call “stowaway” pricing, where the marginal cost to add cubesats is negligible.
What business opportunities are created by the reduced cost of space access?
While all existing markets benefit from lower cost of access, we have been thinking about what new opportunities emerge that would not have been reasonable before, and how might one rethink the entire process flow and product framework for a given capability like Earth observation. If we start with the assumption that launches will cost well over $100 million because the satellites are large and need a whole launch vehicle, then satellite designers need to recoup that minimum cost of entry over many years. The design exercise inevitably migrates to an expensive satellite with station keeping and space-proven technology choices. The technology age compounds with long design and build cycles and seven- to 10-year operational lives. Without low-cost access, concepts like disposable satellites, for testing and then service deployment, would seem absurd. When you lower the cost of access — directly through reusability or indirectly by shifting to small satellites — a boom in application innovation ensues, just like it did with optical fiber paving the way for the Internet and cloud services that followed.
Many companies are eager to launch small satellite constellations. What made Planet Labs stand out?
We look for passionate entrepreneurs with unique ideas to change the world. It starts with the people. I first met [Planet Labs’ founders] while launching rockets in the Black Rock Desert with my son. The NASA scientists came to test-fly a Google Android phone as a proto-satellite. We kept in touch as they left NASA and started development in a Silicon Valley garage. Their passion creates an infectious enthusiasm for the future, and their commitment to humanitarian causes and open data distances them from a typical “spy satellite” orientation. They started the design exercise from the radical extreme of the PhoneSat project. Their approach stood out as a unique departure from all that we have seen. While their design is radically different from PhoneSat, their philosophy of using commercial components in agile space development is similar. This has allowed Planet Labs to design and test five generations of satellites, including two orbital launch successes, before they even decided on a company name. We have never seen a company go so far with just our seed financing. Later this year, they will have at least 28 satellites in orbit, the largest remote sensing constellation ever launched.
Why is that significant?
It enables unprecedented Earth observation. Existing imaging markets want better frequency and coverage. If you push it far enough, entirely new markets will arise. Every farmer could have access to the imaging data that rich farmers exploit today; commodity traders might pay more for timely rollups of global crop health; illegal fishing or deforestation could be caught in the act; natural disaster responders would have before-and-after imagery. With open data, applications developers can come up with all kinds of analytic cloud services from this blanket of big data. The list of use cases goes on, but in the broadest sense, as the founders of Planet Labs like to say, rapid cadence imagery will help us become a sustainable steward of spaceship Earth.
What other types of space-related businesses are attracting or are likely to attract venture capital funding?
So far, we have seen venture capital funding of Earth observation at various scales and we would expect it to extend to the data integrator and applications layer. We have seen angel funding of novel launch vehicles, asteroid mining and space tourism/transportation. Some have even found Kickstarter support for small satellites. I am interested in a rethinking of broadband constellations with a similar line of reasoning as we used with remote sensing but with more complexity in the ground station and market development. Since we prefer businesses that can iterate early with customers on the path to a grand vision, I am also interested in space projects that begin with terrestrial applications, such as synthetic biology (for a Mars sample return with in-situ gene sequencing, beaming back the code to instantiate living versions on Earth), microwave energy beaming for unmanned aerial vehicles before rockets, even compact fusion.
Are you seeing growing interest among venture capital firms in investing in commercial space startups?
Yes, we have found surprisingly broad interest in Planet Labs and SpaceX, but unfortunately there are many more investors addicted to the sugar buzz of popular consumer technology than the sea change of hard technology. And we find fewer still exploring sectors that have not yet demonstrated success, to boldly go …
How is your firm’s investment in SpaceX working out?
SpaceX is truly breathtaking, financially and inspirationally: cash-flow positive for six years; $4 billion of contracted revenue; inspiring the nation; and building the technology to make life multiplanetary. Every entrepreneur seeks to change the world. Elon doesn’t stop there. There are other worlds out there, beyond the frontiers of the imagination.