Today’s space industry is dominated by:
- Rockets
- Research
- Satellites
But are you familiar with newer segments of the industry? Here are five awesome business models that will get more people thinking off-world — and these ideas have nothing to do with Mars colonies.
1. Tourism
What makes space tourism so interesting is not that it’s tourism but that it’s gonna be big business. Rocketry and satellite communications companies are huge. Tourism will be huge too. Space tourism is also the first consumer space enterprise, which means a few things.
First, a wide variety of people will try it. They’ll all be wealthy, initially, but they’ll have different occupations and backgrounds. Versus other space enterprises, which largely serve highly specialized customers.
Second, a large number of people will try it. It’s affordable enough for a millionaire. Virgin Galactic has 700 people ready to pay $250k for a suborbital flight on SpaceShipTwo. And their XB-1 supersonic aircraft will debut $5k pond hops for elite business travelers at the end of 2017. With few competitors, Virgin Galactic may see the 10 million millionaires on Earth as a big enough market to start with.
2. Global business intelligence
Earth-facing satellites aren’t just for three-letter agencies anymore. The earth observation market is expanding from defense surveillance applications into commercial applications in two cool ways:
By monitoring ship and aircraft signals
Spire Global in San Francisco watches radio data from seafaring ships to track “90% of global trade” for shipping and logistics companies. As of 2017 they’ll also be observing flight traffic, recording aircraft positions every 15 minutes. That will make lengthy post-crash searches a thing of the past.
By taking pictures and infrared sensing every week
Planetary Resources likes the term “hyperspectral” imaging. Their network of ten satellites facilitates agricultural monitoring and fossil fuel surveys. Plus they let investors analyze it all for financial forecasting purposes. The Seattle-based company closed a $21m Series A round in May 2016.
The San Francisco-based Planet (formerly Planet Labs) is even further ahead. Planet just acquired Alphabet’s Terra Bella to add their satellites to their already large satellite network. Plus, Planet is launching 88 satellites on Valentine’s Day 2017. They already partner with farmer apps like FarmLogs and run a self-service platform for ordering imagery based on address or GPS coordinates.
What’s hard about global imaging is getting satellites into proper orbit. To image every bit of the earth, you need at least some of your network to take what’s called a polar orbit — and that’s expensive. (Satellites have gotten cheaper, but not that cheap.) It’s physically harder to get into a polar orbit (90°) than, say, something closer to the ISS (51.6°). An ISS-like orbit can launch from Florida and take advantage of the momentum of Earth’s rotation. Polar orbits have to go straight north, with no assist from rotation. This can double the launch cost.
3. Solar system resource utilization
Many entrepreneurs want to be first to grab the loot in our solar neighborhood. That loot being: heretofore-unimaginable quantities of gold, silver, platinum, and other precious metals. For example, some asteroids have been estimated to contain up to $5 trillion worth of platinum.
Mining the moon
The moon might have large quantities of Helium-3, which would be useful for building powerful fusion reactors. China has declared they’re going for it.
Mining the asteroid belt
Planetary Resources (mentioned above) and Deep Space Industries are working on identifying mineral-rich asteroid targets now. I’ve mentioned Made In Space on this blog before, and they landed a NASA contract in July 2016 to figure out how to turn asteroids into spacecraft.
To be clear, 2017 is too soon to actually take receipt of any of that delicious space platinum. But if you’re looking to invest or work in the space industry, watch those three closely.
4. Garbage duty
This may be the least-recognized application of commercial space technology so far. What makes it interesting is how essential it is for functioning commercial operations. Debris and space trash pose a danger to future commercial development in space. (See NASA’s debris primer for context and Wikipedia’s Kessler syndrome article to get the fear put in you.)
A few different companies I know of want to deal with our orbital garbage:
Astroscale wants to make satellite debris collectors to remove dead satellites from orbit. The Singapore-based company has raised $42m so far.
Effective Space Solutions comes at it a different way: they’re looking at how to extend the life of old satellites by creating their own craft that will dock with a non-functional satellite and fix it. They’ve secured what looks like their first deal to provide life extension services for a satellite company, starting in 2018. Orbital ATK’s Mission Extension Vehicle will do this too; they’re a bit further ahead.
5. Insurance
This often-boring industry gets exciting when paired with the high risk and high reward nature of space. Risk like SpaceX’s launch pad explosion in September 2016. Reward like skimming off the world’s trillion-dollar businesses.
Commercial space enterprises are insured by multiple overlapping policies: for pre-launch, launch, operation, and third-party liability.
Spacecom had a $200m satellite sitting on that SpaceX rocket when it exploded during pre-launch tests. Not only did the explosion slow Spacecom’s pending acquisition talks to a crawl, but it also will drive up launch insurance premiums by as much as 100%.
A few space insurance players: Pembroke, Aon Plc, XL Catlin, Willis, Beazley, Israel Aerospace Industries.
Explosions and premium hikes may sound like bad news, except the insurance industry is already well entrenched in the space industry and learning fast. Insurance is so important and so expensive that it can delay launches. More on how the business works here.
Special thanks to Schuyler Erle, whose excited ramblings inspired part of this post.
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