Two new reports on growth fundamentals for New Space companies highlight the importance of smaller investors in start-ups clustered in tech-heavy regions.
The Paris-based research group Euroconsult analyzed 20 North American space start-ups for their challenges to date, current market power and future prospects, focusing primarily on companies involved in low-Earth orbit activities such as satellite communications. In the report, circulated July 14, it identified more than 40 investors in the companies, mostly clustered in Seattle; Silicon Valley; Washington, D.C.; and Vancouver, Canada.
Success factors included the early securing of “an anchor customer to provide some comfort to investors about the market possibility.” Even earlier, it’s important for start-ups to target market-demand sweet spots in their business plans, the report noted, while later critical issues include managing R&D operations with a firm eye on market applications.
A few days before Euroconsult issued its report, NASA on July 11 published a commercial space analysis dubbed “Economic Report on Low Earth Orbit.” The space agency touted the success of its programs in supporting New Space companies such as Hawthorne, Calif.-based SpaceX and Dulles, Va.-based Orbital ATK. Both are NASA contractors for cargo-shuttling missions to the International Space Station.
“As contracted commercial suppliers, these companies and the Commercial Crew Program companies will also have the legal right to sell flights of their vehicles to other customers, opening up opportunities for broader LEO commercialization,” NASA noted in its report.
In 2011, NASA established the Center for the Advancement of Science in Space, which has helped seed dozens of space research projects, many involving work aboard the ISS. But the agency added that future LEO research and exploration missions likely will use privately developed habitation modules that operate in low-Earth or lunar orbit, such as those currently being tested by Las Vegas-based Bigelow Aerospace.
Reusable rockets represent another area of potentially watershed area of development, NASA said. SpaceX, Seattle-based Blue Origin and others have had substantial success in early testing of such rockets.
“The new capability may have a significant democratization and commercialization effect, potentially enabling low-cost access to space for entrepreneurs, scientists, educators, and the general public,” NASA said.
To maintain continued growth in coming decades, the commercial space segment should sustain a healthy relationship with the venture capital community, while policy makers should develop a clearer roadmap for supporting efforts in the sector, the agency said.