Space startups argue for more agile business models

by
Companies pursuing emerging technologies are getting funding from venture investors but also are looking for U.S. government support

WASHINGTON – The U.S. government could address supply chain problems by embracing nontraditional business models and manufacturing approaches, space entrepreneurs said April 22 at the Miami Tech Week conference. 

Technologies such as highly automated production and in-space manufacturing could help the United States become less dependent on fragile supply chains, these executives said. Companies pursuing these emerging technologies are getting funding from venture investors, they noted, but also are looking for U.S. government support.

“I just think it’s a huge defensive and strategic advantage if you have a large commercial manufacturing supply chain operating in low Earth orbit,” said Delian Asparouhov, co-founder of Varda Space Industries.

The two-year-old startup has raised $53 million to develop deployable factories to make products in space that can be brought back to Earth. It won a $25,000 prize from a Space Force accelerator, as the military is interested in the company’s reentry payload capsules to bring cargo back from space. The company plans to use Rocket Lab’s Photon satellites as the platform for the space factories.

Asparouhov said the current supply chain crisis should motivate the U.S. government to invest in in-space manufacturing to reduce the nation’s dependence on China and Russia. 

Chris Power, CEO and founder of Hadrian Automation, said the U.S. aerospace industry is hampered by legacy production methods and is dependent on sources of supply that were offshored decades ago. 

Hadrian recently raised $90 million to build largely automated factories to produce components for rockets, satellites, aircraft and drones. 

“It’s become clear with situations like Ukraine and the covid pandemic that the supply chain is increasingly more important for our customers to meet their goals,” Power said. “They’ve got to be able to build stuff really fast.”

“The aerospace supply chain has been terrible for years and it’s getting worse,” Power said. A shortage of components, for example, makes it difficult to do iterative design and development of new satellites. “If you’re an aerospace engineer and you can only get parts once every 10 weeks, you’ve got like four iteration cycles a year,” he said. If that happened in software, engineers would “only edit code four times a year. It’s completely ridiculous.”

If a company or the government suddenly needed 100 satellites, an agile supply chain is key to spin up capability, said Power. 

John Gedmark, CEO and founder of satellite communications startup Astranis, said the aerospace industry “has been the same way for a very long time. This is going back to the beginning of the first space age when you build these massive satellites that take many years to build and each one costs hundreds of millions of dollars.”

The company offers small geostationary satellites as an alternative to traditional spacecraft. An architecture with many small satellites on station, either active or as spares, sitting there on standby is more attainable with low cost satellites, said Gedmark. “And also having large numbers at the ready on the ground that you can launch very quickly,” he said. “It’s a completely different architecture than we have traditionally had in space.”

Gedmark said the government can help the industry by “recognizing when there’s a new tool there that they could put in their toolbox that they didn’t have before.”

If the government decides it wants to buy a service, industry needs a long-term commitment so “businesses can plan around it,” he said. “That’s the most important thing, setting up that commitment to buy these products and services.”

The ideal partnership model is NASA’s commercial crew program where the government buys rides to the International Space Station from SpaceX and Boeing, he said. “We would love to see more examples of programs like that where NASA partners with private industry.”