six, five, four, three, two, one--

The space race isn't just global superpowers

duking it out for bragging rights

and technological supremacy anymore.

Private companies, lots of them,

are rushing to commercialize not just the final frontier,

but the act of getting there.

I am a sports guy, this is like March Madness to me.

It's one and done, I got one shot to get to the end

or else I'm either gonna fail, run out of money,

or be gobbled up by someone else.

And whoever figures out

how to make launch safe, affordable,

and convenient is going to take the next giant leap.

We choose to go to the moon in this decade

and do the other things,

not because they are easy, but because they are hard.

60 years into the space race,

the way we leave Earth has changed remarkably.

Zero, all engine running.

Liftoff, we have a liftoff, 32 minutes past the hour.

Space seemed like a vast, black desert,

but now we're ready to make the desert bloom.

I'm talking about opening space up to business,

to private enterprise.

Opening space up to commerce

and experimentation and development.

Why?

To improve the quality of life on Earth.

25 years after Ronald Reagan

signed the Commercial Space Launch act,

the desert has begun blooming.

I think if you're a young person in 1969

and you saw people walking on the moon,

and 50 years later, we still haven't gone back,

I think that's a little disappointing.

I think they took that, their hopes and dreams

of their youth, and are applying it to today's marketplace.

And I think they're having a fantastic success.

In the world of rocket launch,

there are two very distinct races going on.

The first are the large rocket companies

like SpaceX, Virgin Galactic, and Blue Origin.

Jeff Bezos has reportedly invested billions

already in Blue Origin and will invest billions more.

Liftoff.

SpaceX has also raised billions of dollars

and acquired very large contracts from NASA as well,

in order to fund both development and operations

of its vehicles.

Liftoff of the SpaceX Falcon-9 rocket.

But they aren't the only players in the game.

There's a heated race picking up

between small and medium launch companies.

There's a subset of the community

not named SpaceX, not named Blue Origin,

trying to figure out, okay, how we get there fast?

Companies like Rocket Lab,

Relativity, Firefly, and Virgin Orbit.

Right now, there are more than 100 small launch companies

competing not just to get to space,

but to see who can get there most reliably,

cheapest, and then repeat it over and over and over again.

And ideally, end up with their business in the black.

Because in time, new industries rely

on these launch companies getting payloads into orbit.

And any missteps can spell disaster.

Not just for a rocket, but an entire company.

There is a $200+ billion commercial space industry

right now today.

There are a couple of huge markets

that have been very profitable.

The most profitable is the satellite industry.

In 2018, the global space economy was estimated

to be around $360 billion.

$277 billion of that is the satellite industry,

which has actually grown over $100 billion

over the past decade.

And for those satellites to get to space,

they need to be launched on a rocket.

Global launches in 2018 increased by 46%

over the number of launches a decade ago.

In many respects, it's never been easier

to put a satellite into space,

in terms of the cost and the availability of rockets

to ride into orbit.

And a new era of smaller, cheaper satellite technology

is creating this boom.

Once a year,

out in a desert north Utah,

the Small Satellite or SmallSat Conference, comes to Logan.

It has all the trademark features of an industry trade show,

bright lanyards, tons of swag,

but the deals happening here are carving out

what the future of the space economy will look like.

I've been coming to this conference for 20 years

and seen it grow from 300 people to over 3,000.

So, it is exciting to see that transition

as we move into the next phase.

Traditional satellites are often

powerful behemoths, the size of school buses,

costing hundreds of millions,

if not billions of dollars to build.

Today, the proliferation of smallsats,

CubeSats, even nanosats,

can cost as little as $10,000,

and can be built with similar hardware

that goes into your cell phone.

They range from the size of a Rubik's Cube

up to about the size of a dorm room refrigerator.

And so that's a big difference.

And so, some of these launch ventures

want to launch a few dorm-size refrigerators,

and others want to launch dozens of CubeSats.

And so, they're trying to divide the market that way.

Those satellites are providing imaging of the Earth,

they're potentially providing telecommunications services,

and they're attracting quite a lot of investment

in 10s, hundreds of millions of dollars,

even billions of dollars.

The Earth's insatiable need for communications

and internet is really what's driving

this huge number of satellites that are going into orbit

in the next five to seven years.

There's gonna be thousands, if not 10s of thousands

of new satellites in orbit in the next five to seven years.

The question is, are they able to actually provide

business services that will be successful?

The idea is that entirely new

business models as well as revenue streams

will be propped up by the data these smallsats collect.

The imaging and data collected from these smallsats

will be used by everyone,

from hedge funds to telecom giants to the US government.

Just think of how much the photos you can get

with your Android or iPhone have improved

from the first generation to the current generation.

Similar things happening in smallsats.

Market research says smallsat manufacturing

will nearly double by 2020,

with nearly 8,000 new smallsats in space by 2026.

The issue is always, small satellites have

a lot of capability, but there's not a good,

affordable way to get them into orbit.

And that's where the small launch companies

see a promising business.

The fact that a small launch vehicle

is much cheaper in total than a large launch vehicle

on the order of five or $10 million,

as opposed to $50 to $100 million,

and there are more customers.

Say you have a smallsat

that you want to launch into orbit.

Think of the big companies like SpaceX as a bus,

and the small and medium launch companies

like Rocket Lab as a taxi.

With large launches, you're at the back of the bus,

after the needs of what's called the primary,

which is the main payload on the rocket,

like a big government satellite.

Your smallsat is just piggybacking off that primary

since they bought the majority of the rocket.

With small launchers like Rocket Lab,

you and your smallsat can dictate

more of your terms on when and how you'll fly.

And you'll pay for the whole ride.

So booking a taxi for a smallsat

gives you more flexibility about when

and exactly where you want to go into orbit.

But it's more expensive.

Sometimes a ride share on a big rocket

and the chance to save on your launch expense

is more suitable depending on the satellite,

its mission, and the budget.

Far more important is the orbital inclination

or the angle of the satellite's orbit

relative to the equator.

It's much easier to move a satellite

into a higher or lower orbit than to change its inclination.

And that's why all launch customers

have to decide how their mission priorities

and budget can align when choosing how to get to space.

It's getting to the point that hitching a ride

on the really big rockets,

it works for some people,

it doesn't work for all business cases.

And so you've got smallsat ventures that say,

we want our own rides.

Those customers will determine

which of these small rocket companies succeeds

and which of the companies will fail.

This is not the internet,

where you build up a huge userbase

and then you figure out how to monetize them later.

Launch doesn't work that way.

You've gotta built up a backlog of customers.

Out of the more than 120 small

and medium-size launch companies out there,

just one is successfully launching rockets

for customers right now.

And that is Rocket lab.

People can actually walk on up to us and we'll fly them.

That's a great competitive advantage to have over,

you know, folks that are still developing a vehicle.

Peter Beck's Rocket Lab has raised

over $280 million from outsider investors,

with a valuation of more than one billion dollars,

and is currently flying a rocket every 30 days.

It looked what the hardest thing to do

was to go from zero to first successful orbital flight.

But really, going from first successful orbital flight

through to producing one every month

has been an equal amount of stress and energy

and complexity and toughness.

We obviously, we've completed our test flights,

and moved into full commercial operations

with the first flight of its business time.

And then straight on the heels of that,

we flew our NASA mission, and now we're, you know,

we're building and launching one vehicle

every sort of 30 days, every month.

And while other rocket companies

are looking to build their customer base,

Rocket Lab can't meet the rising demand for launches.

Our biggest issue is we can't broaden out profits.

That is our challenge.

We've built four and a half acres of new factories

and, you know, we're pushing in every direction we can

to build more capacity.

We fear that there aren't, you know,

we are the only dedicated solution available

on the marketplace right now.

You know, at an affordable price.

And so, what we see, a tremendous amount of demand.

So the demand is there, that's not the issue.

The issue is figuring out how to provide reliability,

scale, and cadence, while keeping prices as low as possible.

And each company has its own approach.

Every company has a unique way to building their rocket.

You know, whether they're using liquid,

solids, fuels, or a combination of the two.

Whether they're 3D printing their stages,

everyone has their unique approach to getting to a rocket.

However, the bottom line is good business in space

is exactly like good business on Earth.

A focus on customers, incremental successes,

and a vision that's supported by a real business model

is what works in space, just as it works on Earth.

One of the companies who believes

they have a successful business model is Firefly,