Brainstorm Tech 2024: A Space Race to Profit
Kelly Hennig, Chief Operating Officer, Stoke Space Jaret Matthews, Founder and CEO, Astrolab Moderator: Jason Del Rey, Fortune
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00:00We have any space enthusiasts in here?
00:02Yes.
00:03Right up front?
00:04OK.
00:05I know we probably have some who are not as well.
00:07So I want to just set the context a little bit,
00:09set the stage a little bit.
00:12What has changed in the last decade or two that
00:15has spurred this private sector space race?
00:18Jared, maybe you can start for us.
00:20Sure, I think the most significant change
00:22was NASA's move away from owning and operating
00:26their own vehicles, like the space shuttle,
00:28and entrusting commercial industry to provide services
00:32for their needs.
00:33So for example, through their commercial orbital
00:35transportation system contract in 2008,
00:38that was the impetus to let SpaceX develop Falcon 9
00:42and Dragon, and ultimately ferry astronauts and cargo
00:45to the International Space Station.
00:47And now NASA just buys tickets on Dragon
00:50the way you would on an airliner.
00:51Wow.
00:52Expensive tickets.
00:53Yes.
00:55Kelly, you have any thoughts?
00:56Yeah, I would say, as well as that,
00:58the private investment in space as well.
01:00For a good number of years, the government
01:03was the main investor in space and the provider
01:05of the various technologies.
01:07And I think now we're seeing a growth
01:08in commercial applicability to satellites in space,
01:12as well as different types of industries in space as well.
01:16And as you see those type of commercial applications coming
01:19forward, then you kind of see just so much more investment
01:22in the private sector going there, and just huge growth.
01:26At an even higher level, why is this important?
01:31Why is this work, why is going beyond Earth important?
01:35A lot of money is going into this, right?
01:37I don't know if either of you, happy to hear your thoughts.
01:41I think, to a degree, the expansion of humanity
01:44beyond Earth to the moon and Mars is inevitable.
01:47And I think most people would agree on,
01:49you pick a time scale, 50 years, 100 years, 500 years,
01:52whatever it is, most people would agree that that's
01:54the case.
01:55And because it's within our current means,
01:58I think we actually have a moral obligation to do it now,
02:01to spread humanity and preserve the light of consciousness
02:05going forward.
02:07Inevitably, some calamity will befall Earth,
02:09be it nuclear war or pandemic or climate change.
02:13You're really bringing me down.
02:14Yeah, sorry.
02:15Yeah, I know.
02:16So I buy into this notion that to survive as a species,
02:22we really need to continue to move out amongst the stars.
02:27And honestly, I think that any technological advancement
02:30that you can make and any exploration that you can do
02:33is critical to just the growth of humanity itself.
02:36And so I think it's essential.
02:37As long as it doesn't come at the cost of the Earth,
02:39as long as you can do it in a very green and reusable
02:42fashion, I think it's a moral imperative, as Jarrett said.
02:46There's a long history of these investments providing
02:49tremendous benefits to life on Earth, of course.
02:51Cell phones, GPS, weather observation, et cetera.
02:55So the same will continue to happen as we push forward.
02:58You'll see advancements in pharmaceutical manufacturing
03:01as well as semiconductor manufacturing,
03:03taking advantage of the low gravity up there.
03:06So you'll just see large kind of advancements
03:08overall in various industries.
03:10So it sounds like you two have no doubt,
03:12like it's just a timeline question.
03:14Oh, yeah.
03:15Correct.
03:16And what's unique about this specific moment in history
03:18is you have two of the richest individuals on Earth
03:21Jeff Bezos and Elon Musk, through their companies
03:24SpaceX and Blue Origin, investing billions
03:27in creating the long haul transportation network.
03:30They're building Starship, the most powerful machine
03:33humanity's ever created.
03:35Can lift more than 100 tons into space.
03:39And those billions are being backed up by billions
03:42from NASA through their Artemis program.
03:44So there's something like $30, $40 billion
03:47going into developing these vehicles over the coming
03:49few years.
03:51And it's going to open up access to places like the moon
03:55at scale to enable industrial activity.
03:57So hey, wait.
03:58It's not just billionaires who are doing that.
04:01We're looking at space transportation as well.
04:03So vote for like the little man here.
04:06Sure.
04:07We like the little guy too.
04:09And gal.
04:11So why don't we get a quick look of what
04:14you're working on at Stoke.
04:17And maybe you can help talk us through
04:19as we look at this video of what we're watching here.
04:22OK, sure.
04:23Let's cue that up, please.
04:26You want me to go now?
04:27Oh, you can go now.
04:28OK.
04:28So this is our rocket.
04:29We're obviously launching there.
04:32And there we are with the stage separation.
04:34So there you see our first stage breaking away
04:36from our second stage.
04:37That is our second stage.
04:39Our second stage right now is fully reusable.
04:41So it will come down.
04:43We also have many different uses for it
04:45as well as an on-orbit mobility vehicle.
04:48Here you see it landing on the moon.
04:50That base heat shield that you see there is incredibly robust.
04:54So it allows us to land in austere environments
04:57and not suffer from things like regolith or sand.
05:01And you'll see it landing here, I believe as well, on sand.
05:04So any of that dust that's kind of kicked up
05:08doesn't necessarily hurt it in any kind of way.
05:10So it's much more easily reusable.
05:14I wasn't aware that was the one we were showing.
05:16Oh, well, surprises are always welcome.
05:18Sometimes good and sometimes not.
05:19But you rolled with it.
05:22And the importance of reusability, it may be obvious.
05:25But can you just spell that out for us?
05:28100%.
05:29So if you think about airline travel,
05:32the idea that you would throw away
05:34a plane after you use it once is just silliness, right?
05:38You just wouldn't even think of it like that.
05:40So we need to think about rockets the same way.
05:42The way to bring down the cost of launching satellites
05:46or rovers to space is actually to reuse them.
05:50And reuse them not just once every couple of months,
05:53but to reuse them over and over again very, very rapidly.
05:56And so with our second stage, we're not using ceramic tiles.
05:59We're not using an ablative heat shield.
06:01We are instead using a regeneratively cooled heat
06:04shield, which is, you saw, it was that kind of metal shield
06:08that you saw.
06:09It's incredibly robust.
06:10It allows us to very quickly turn over and send
06:14another rocket to space.
06:15Last thing before we cue up Jarrett's video,
06:20what is the timeline of this?
06:23So that was not current reality, what we saw, correct?
06:27That was not.
06:28OK.
06:29What is the timeline where you're working
06:31on to have an actual launch?
06:33To have an actual launch?
06:35The end of next year.
06:36End of next year.
06:38Jarrett, I think we're going to get a look at your,
06:43I'm going to forget the technical term,
06:45I'm going to call it a rover.
06:46That's fine.
06:47And why don't you walk us through,
06:49as we watch this video, what we're looking at
06:52and timeline as well.
06:54Sure.
06:55At Astrolab, we're building Flex, or the Flexible Logistics
06:58and Exploration Rover.
06:59And Flex is designed to be the most versatile platform ever
07:02sent to the moon.
07:04Flex is unique, and it has a number of modular interfaces
07:07that allow us to do a wide range of activities
07:09and serve a wide range of customers.
07:11So it's built to not only conduct science and exploration,
07:14but also deploy infrastructure, like communications
07:16and power infrastructure.
07:18But it can also support Artemis astronauts.
07:21And as you mentioned in the intro,
07:22we recently won a significant NASA contract to do just that.
07:26And the idea is this Flex will serve
07:29as a catalyst for the lunar economy
07:31to help build out industry.
07:32And essentially, our initial business model
07:35really is doing last mile logistics on the moon.
07:38You talk about the UPS of the moon?
07:41Yeah, exactly.
07:42So if you think about, again, Starship, for example,
07:45can put 100 tons of cargo on the moon.
07:48And so we're working to solve the last mile
07:52problem for all that cargo, get that out
07:54to its final destination, set up, and maintain.
07:58Someone asked me last night, who are you delivering packages
08:01to when I told them about the UPS on the moon pitch?
08:05But there is a long-term plan there, right?
08:08Absolutely.
08:10What's unique about NASA's program Artemis, which
08:11is the follow-on to Apollo.
08:12Yeah, can you quickly explain what
08:14the program sets out to do?
08:15Sure, so Artemis is a sister of Apollo in Greek mythology.
08:18But Apollo was all about beating the Russians, flags
08:22and footprints, getting there first.
08:25Artemis is about going there to stay,
08:27and so actually developing a sustained presence of humans
08:29on the moon in perpetuity.
08:32And so that, of course, is going to require
08:34a lot of logistics and support.
08:37But also, they've structured their program in such a way
08:40that it's going to encourage commercial activity as well.
08:42So our contract, for example, is a service-based contract.
08:45What does that mean?
08:46That means we're Uber to NASA.
08:51So they get mobility services from us, right?
08:54They don't own and operate our vehicle.
08:56It's our vehicle.
08:57So we can provide those services to anyone who wants to pay.
09:00And because SpaceX and Blue Origin are really
09:03solving the long-haul transportation
09:05problem at scale, and Stoke and others.
09:08She's going to get you.
09:08I'm going to keep doing that.
09:10Same in the same sentence.
09:12Soon, the economics of getting tons and tons of cargo
09:14to the moon will become palatable.
09:17And that will enable industry to take off on the lunar surface.
09:21So there's a symbiotic relationship
09:24between Artemis and commercial industry here.
09:27I want to get some audience questions as well.
09:30Everyone who said they were space enthusiasts,
09:32I'm counting on you.
09:33So whenever anyone has a question,
09:35please raise your hand, and we'll get to it.
09:38I do want to know, Kelly, specifically.
09:41So SpaceX is also developing reusable rocket.
09:46I guess one question is, how does that
09:50impact your small company or not?
09:53And then, who is going to win this race?
09:58And if you consider it a race.
10:01Sure.
10:02So first of all, I want to say that SpaceX
10:03has paved the way for us.
10:05They have really enabled the growth
10:08that you see in this industry.
10:09And they've been pretty much trendsetters.
10:13So we do not aim to compete with SpaceX.
10:16We absolutely believe that there is a place for both of us.
10:18A little bit?
10:19Like a tiny bit?
10:20Well, sure.
10:22If we would beat them to actually full reusability,
10:23I would definitely tout that.
10:26But I believe that they will probably get there first.
10:30You can see a number of their launches
10:32and how quickly they are iterating on that
10:35and how successful they've been.
10:38And so I definitely think that there's a place for both of us.
10:41We will be, they'll be, as Jarrett had said,
10:44much more of the large freight, huge kind of movement.
10:49But you'll also have a place for much smaller type of things,
10:53like think of your transporter van or your sprinter van
10:57that Amazon kind of employs.
10:58And so that's really where we see our sweet spot,
11:01is much more of a very direct and targeted, I would say.
11:07Yeah, what's a use case that you're
11:10imagining for something your rocket would be carrying
11:14or a business that would be partnering with you?
11:16Well, I would say with Starship, you're
11:18going to have a huge number of satellites
11:21that you're going to deploy at once.
11:23And so with us, you're going to kind of deploy,
11:26not necessarily the entire constellation,
11:27but you're really aiming to deploy a plane of satellites.
11:31So a bunch of satellites that are
11:33in a very similar type of location.
11:36And you could do that much faster.
11:37So you don't have to.
11:39And the goal of whoever was providing those satellites
11:41would be what?
11:42It would be Earth observation.
11:43It would be communications.
11:44It would be all of those types of things.
11:47And so we would be able to directly kind of deliver that,
11:50as opposed to waiting for a number of them
11:53to aggregate on the launch pad before you
11:54can fill up that entire volume and then send it into space.
11:58Sounds complicated.
11:59It sounds complicated.
12:01Well, it's rocket science, right?
12:02It is rocket science.
12:03Do we have any questions?
12:06Otherwise, I could keep going.
12:08Right here.
12:11You got a mic coming.
12:13No, it's OK.
12:14Just tell us who you are.
12:16Thanks.
12:17Healy from Boom Pop.
12:18Thank you so much.
12:18This is so, so fun.
12:20One of the things that I always think about in venture
12:22investing is, you know, it's like the time horizon can only
12:25be so far out for them to invest in it.
12:27And it feels like you have two things that
12:29are kind of wild here.
12:30One is a pretty distant time horizon.
12:32And the second is, I assume, really expensive lines of code.
12:35Because if it's up there, it can't really mess up.
12:37So how do you think about that when
12:38you're thinking about investments in ROI
12:40and just all the work you're doing?
12:42Feels like it's a big bet.
12:46Yeah, well, first I would say it's closer than you think.
12:48So we have a commercial contract to go to the moon
12:52on one of SpaceX's early Starship missions.
12:55And our contract window opens at the end of 2026.
12:59So in the space business, that's tomorrow.
13:02And also, you know, the Artemis program is already underway.
13:06They've already conducted Artemis 1.
13:07Artemis 2 is coming up in the next 6 to 12 months.
13:11Astronauts will be back on the moon in what year?
13:14Right now, the advertised date is 2026.
13:17Advertised?
13:18These things have a way of changing over time.
13:20But it's within the time horizon of venture, you know, for sure.
13:26Kelly, do you have thoughts on the investment?
13:28Oh, you asked about the time horizon.
13:30Then you also asked about once it's up there
13:33and not being able to make changes.
13:36So mine comes back.
13:39So we can iterate in that way.
13:42But to Jared's point, I would say in these types of time
13:46frames, it's right around the corner.
13:48So to your other question, I worked at JPL early
13:50in my career.
13:52And we routinely sent up software patches to Mars.
13:56So you anticipate needing to do that, and it's OK.
14:00It's OK, yeah.
14:02One question about, you already have some,
14:05you talked about working with SpaceX to send a rover.
14:08Whether or not you continue working with NASA directly,
14:12you will send a rover with SpaceX up to the moon, correct?
14:16Correct, yeah.
14:17And you have customers already who are paying you to do what?
14:22Well, yes, so we actually signed about a dozen deals
14:26with commercial companies to go with us
14:27on our first mission, which is a purely commercial mission.
14:30That's the 26 mission.
14:32One is, for example, Hewlett Packard Enterprise.
14:35It's a Fortune 500 company.
14:37They are already doing edge computing
14:41in space on the International Space Station,
14:42and now they want to do it on the moon.
14:44So that's one use case.
14:46But what's interesting is actually
14:47the diversity of use cases that our customer base has.
14:50There's a cluster in resource-based business
14:54models, so taking the resources on the moon,
14:57be it titanium, aluminum, rare earth metals, oxygen, water,
15:00and creating value from those things.
15:03The moon is about the size of Africa,
15:05it has the same surface area as Africa.
15:06So I really liken this opportunity
15:09to essentially continental in scale,
15:12in that we're standing on the shore,
15:14we're watching these vehicles get built that will take us
15:17there at scale, and we're opening up
15:20access to this huge place that has
15:22lots of valuable resources.
15:24So anyway, going back to your question,
15:27we have people in the resource utilization space,
15:29basic science, including a company putting up
15:31a greenhouse, data services, as well as construction,
15:35people interested in building habitation or landing
15:38pads on the lunar surface.
15:39And a lot of those customers are actually
15:41our customers, because they need to actually have materials
15:43brought up there, or they need to have things brought back.
15:46Wow.
15:49You two have a direct partnership yet,
15:51or would there be any reason for that?
15:54Not yet, but I'm certainly open to it.
15:56We're going to try to make some business.
15:58At a very high level, for people in the room who may never
16:01work in the space industry, may just be enthusiasts,
16:05how is some of the work you're both working on,
16:08how will it materially affect our lives?
16:12Can you give us some realistic use cases or changes
16:17in our life here on Earth?
16:20Well, I think, as Jared had mentioned before,
16:24you think about GPS.
16:25Everybody uses GPS right now, but that
16:28was enabled by, basically, satellites
16:30that you have in orbit.
16:32If you think about Earth observation,
16:33when you look at weather, or resource management for farming,
16:37or even disaster relief, all of those things
16:39impact us daily, but we don't think
16:41about where that data comes from and how it's generated.
16:44So I would say all of us, whether you're
16:46using Google Maps, or you're using some sort of comms,
16:52all of that is afforded by what we do,
16:56and the efforts to put things in space.
17:00Do you have any extra thoughts, Jared?
17:01Yeah, I think any activity happening in space
17:03ultimately has to benefit life on Earth.
17:05Otherwise, it's not going to create value, right?
17:07And so all of our customers and partners
17:10who we're working with are building business models
17:12with that as a foundational principle.
17:16We have one customer who is going,
17:19their plan is to use lunar resources to actually reverse
17:22global climate change by building
17:24a sunshade between Earth and the sun,
17:27and lowering the global temperature.
17:29So their TAM has a Q in it.
17:32They don't specify if it's quadrillion or quintillion.
17:35At that point, it doesn't really matter,
17:37I think, once you have a Q in your TAM.
17:40And so, yeah, ultimately, I think
17:42any activity is going to benefit Earth.
17:45Otherwise, we wouldn't be doing it.
17:47Any other questions?
17:49We have one right here.
17:51There's a mic coming up to you.
17:53Please just tell us who you are and your affiliation.
17:56Hi, Betsebe Madani-Herman.
17:58I'm the Global Head of Research at Philips.
18:00We do health care, but I applied to be an astronaut years ago.
18:03So there is the space enthusiasm.
18:07When it comes to basic science, so physics, bio, et cetera,
18:11is there a breakthrough you're looking forward to that
18:14would make a material difference in the work you're doing?
18:17Is there something that, if that was solved,
18:19your engineers and scientists would be just so stoked?
18:22I thought you did.
18:25Actually, no.
18:27At this point in time, it's just engineering,
18:31at least to accomplish what our immediate goal, which
18:34is full reusability.
18:35It's just hard engineering at this point.
18:38Yeah, I would agree with that.
18:39No miracles need to happen.
18:40We have the means.
18:41And as I started out by saying, that's
18:43why I think there's a moral imperative to do it,
18:45because it's within our means to do so.
18:48I think we had another question over here.
18:50We have another mic.
18:56Hi, Lisa O'Connor with Accenture.
18:59And I started in space a long time ago, very short stint.
19:05I had a question about, you mentioned GPS,
19:07and that's one of the services many of our companies
19:10are co-dependent on, whether we're in logistics
19:13or just moving around ourselves.
19:15I think of space as a little bit of a contested place,
19:18because we don't sort of have agreement
19:20into what should be happening there, let alone on the moon.
19:25Can you talk to that, to how that
19:27might impact what you're doing?
19:33No one wants this one.
19:34That means a good question.
19:36I would say space is definitely contested.
19:39If you look at some of the national security strategies,
19:41you hear about space being talked about as a war fighting
19:45domain, you see the establishment of the Space
19:48Force and the Space Combatant Command.
19:51So it is definitely a contested environment.
19:55For us, we will follow the US government's lead
19:59in what that means, and provide as much help
20:02as we can to the US to help with national security.
20:08So specific to the moon, what I think's interesting
20:10is the rise of China.
20:12And they've been very successful as of late,
20:14landing on the moon and even returning samples
20:17from the moon.
20:19And so there is a bit of a race going on in terms of who
20:22can create the most value.
20:23Particularly, there's areas of strategic interest
20:27at the south pole of the moon, where
20:29you have accumulations of resources
20:32that are very interesting.
20:34And there isn't a lot of law in place
20:41to govern how that space is used.
20:43There's the Outer Space Treaty from the 60s,
20:45which basically dictates that people operate
20:48in a non-interference basis.
20:50But the interesting thing on the moon
20:52is that, well, what does interference mean?
20:55If you land something on the moon and you're operating it,
20:58does that mean you can declare a huge exclusion zone?
21:00Because if someone else lands near you, the dust they kick up
21:03is going to destroy your existing assets.
21:08So there's an opportunity for some country
21:10to do a de facto land grab in these areas
21:13of strategic interest by just putting spacecraft down
21:18on the moon and operating them.
21:20Well, we're out of time.
21:22But I could go really deep on that last answer
21:26maybe next year or the year after.
21:28Thank you so much to both of you.