COLORADO SPRINGS — Aerospace Corp.’s commercial space office, established to facilitate connections between startups and government technology buyers, is seeing a surge in activity. 

With a downturn in venture capital, a growing number of companies are turning to the government for opportunities, Aerospace CEO Steve Isakowitz told SpaceNews

Aerospace is a federally-funded nonprofit based in El Segundo, California, that provides technical guidance and advice to military and civil space agencies.

In light of a somewhat cooled-off space economy, “more and more we’re finding that companies that had been raising rounds of funding are now looking much more to the government as an important customer,” he said.

As a result, Aerospace’s Commercial Space Futures office, created approximately one year ago, has been inundated with an increased workload. The office serves in a go-between role, assisting the U.S. Space Force and other agencies in identifying potential commercial solutions that align with national needs. 

It also conducts due diligence assessments of companies interested in working with the government and provides guidance to startups on how to navigate the intricate regulatory environment.

Companies interested in working with the Space Force send email queries through The Aerospace commercial office is part of a team that handles those inquiries. Additionally, Isakowitz said he personally gets a lot of calls and emails requesting assistance “on a whole range of matters.”

Small businesses and startups are asking for help on regulatory issues and evaluating their products. They also are looking to “better understand what it is the Space Force or the intelligence community are looking for,” he said.

“We have so many requests,” he said. “You don’t want to say no to anybody, but there’s only so much we can do.”

Opportunities for DoD to capture tech

The space economy in 2022 saw private investment decline by 58% after a record $47 billion invested in 2021, according to Space Capital, a market research firm. 

The economic climate, while not great for venture-funded startups, is a “great opportunity for the government to try to leverage what’s happening out there” and tap valuable technologies, Isakowitz said. 

DoD and the Space Force have created a large ecosystem of organizations that fund research and prototyping projects, including the Defense Innovation Unit, SpaceWERX, AFWERX and the Space Enterprise Consortium

These organizations want to work with new entrants in the industry, he said. That is driving Aerospace’s workload doing due diligence on these companies, he said. “The government is constantly asking questions.” 

Program offices want to know if technologies being pitched to the government are more than just a PowerPoint slide. Beyond the technical maturity of a product and the financial health of the company, the government also asks for a review of companies’ cybersecurity practices and supply chains. 

Concerns about launch sector

Isakowitz, who previously led the commercial spaceflight company Virgin Galactic, said recent financial trouble experienced by launch services provider Virgin Orbit is a reminder of why DoD wants a diversity of suppliers. 

The small launch sector is especially volatile and there are always risks that a supplier could go out of business, he said. Aerospace for years has promoted the use of standard interfaces for small satellites and cubesats so they are compatible with different launch systems. 

“You want to have that assured access to space and be able to move your satellites across multiple providers,” said Isakowitz.

Sandra Erwin writes about military space programs, policy, technology and the industry that supports this sector. She has covered the military, the Pentagon, Congress and the defense industry for nearly two decades as editor of NDIA’s National Defense...