Space – Not the Final Frontier

Blog

Aug 3

More Like A New Ecosystem Layer – More Exciting Than You Think

(What a next-gen space tech ecosystem catalytic incubator will be, because we are going to build it)

First, The Next-Gen Space Catalytic Incubator/Launchpad (yes, no acronym)

Space Tech (ST) is not just about space. It’s an exciting, unique, breakthrough layer for about 30 domains, mostly on Earth.

The incubator will focus on integrative impact solutions. It may do some focused Space Tech, but the big attraction, the giant profit pools are in the ecosystem impacts this carries with it, and the massive opportunities therein. We won’t always build from scratch; often, we will function as the best greenhouse. Ecosystem engagement and enterprise/government partnering will matter.

We will raise roughly $70M. We want to go big early, get the investment side done, and focus on the real joy of building/creating/nurturing, not the Sisyphusean torture of fundraising.

It is very early, but we have a potential location in the heart of the largest concentration of aerospace engineers on earth. We have a key leader targeted to run the incubator. A multi-lingual polymath with incubator experience, equally comfortable with tech, science, the arts, leading-edge experience, and funding. We also have the necessary collaborative catalytic leader able to go deep across the start-up world, enterprise, telecom/Edge compute, DoD, S&T, and business formation (i.e., me). We also have targeted part-time force multipliers, whom I know and trust personally, like:

a long-time commercial connector/smarty from the VC world,
a leading light in understanding LLM details/impact (former HBS Prof),
a genius emerging design person from a top studio
super smart board member from one of the most data-intensive geographically dispersed businesses on earth
a leading Integrative Innovation Professor,
a top former military innovation officer/CTO,
a former military branch CISO head
the smartest chip, satellite, comms CTO I have ever met
one of the most respected NASA scientists with deep practical tech/human interaction know-how
Gen Z insight hub and student of Infrastructure Poetics, i.e., how foundational infrastructure advancements/changes have ripple effects across various economic areas, social structures, and even frames of reference/thought. The Croton Aqueduct into NYC, completed in 1842, changed the trajectory of NYC. (on my way to see that person in Singapore right now).
deep healthcare, telecom, and scale construction leaders. Think of healthcare and scale construction as next gen smart ‘city/campus’ challenges
GenAI/Agentic AI platform leadership

Let’s time-travel to 1840-ish. We don’t want to build railroads or telegraph networks. We want to incubate lucrative breakthroughs around that new infrastructure and help that ecosystem impact grow.

Fifty years compacted into 10 with 8 times the population and 7 times the economy

So, this is really all about trains and the telegraph. Think 1840-ish to 1900. (Since then, the global economy has grown 7X and the population 8X).

The expansion of railroads and the telegraph in the United States was a transformative period that fundamentally reshaped the nation's economy and geography. While the development of these technologies was ongoing for decades, the most significant expansion occurred in the mid-to-late 19th century.

Timeline of Expansion

* Early Railroads (1830s-1850s): The first steam locomotives appeared in the U.S. around 1830, and by 1850, a significant network of some 9,000 miles of track had been laid, primarily linking cities on the East Coast.

* Transcontinental Push (1860s): The American Civil War was a catalyst for national unity and a key driver of westward expansion. In 1862, the Pacific Railroad Act was passed, chartering the Union Pacific and Central Pacific railroad companies to build a transcontinental railroad. The two companies' tracks met at Promontory Summit, Utah, in 1869, completing the first continuous line from coast to coast.

* Telegraph's Role: The telegraph developed in a parallel timeline. Samuel Morse sent the first message in 1844, and the first transcontinental telegraph line was completed in 1861, beating the railroad by eight years. The telegraph lines were often built alongside the railroad tracks, creating a symbiotic relationship.

* Full Network Expansion (Post-1870s): Following the completion of the first transcontinental line, a "railroad mania" ensued. By 1890, track mileage had exploded from roughly 9,000 in 1850 to over 150,000 miles, with several more transcontinental lines connecting the country.

Economic Impact

The economic impact of the railroad and telegraph expansion was nothing short of revolutionary.

While it's difficult to quantify the full impact, some estimates and key effects include:

* Massive Reduction in Transportation Costs: The cost of shipping goods fell by an estimated 50-70% in many regions. This made it economically viable to transport goods, resources, and people over vast distances, effectively creating a single, integrated national market.

* Industrial Growth: Railroads were a huge consumer of resources, driving the growth of related industries. The demand for steel for rails, coal for fuel, and timber for ties spurred innovation and expansion in manufacturing, mining, and lumbering. This period saw the rise of modern corporate entities and financial instruments to fund these massive projects.

* Agricultural Transformation: Farmers in the Midwest could now ship their crops and livestock to distant markets in the East, and eventually to international markets. This led to regional specialization in agriculture (e.g., wheat in the Great Plains) and the development of new technologies like refrigerated rail cars, which enabled the growth of industries like meatpacking in cities like Chicago.

* Urbanization and Settlement: Railroads dramatically accelerated westward expansion and settlement. They created new towns and transformed existing ones into major commercial hubs. Cities like Chicago and Kansas City grew into major population centers due to their strategic locations as railroad junctions.

* Increased Productivity: The telegraph, working in tandem with the railroads, enabled instantaneous communication across the country. This improved the efficiency of business transactions, coordinated train schedules, and allowed companies to manage complex supply chains. Without the expanded rail network, U.S. aggregate productivity in the late 1800s would have been significantly lower.

* Financial Innovation: To fund the massive costs of railroad construction, new forms of financing and investment emerged, including the widespread use of corporate bonds. Stock exchanges also grew in importance as a platform for trading these securities.

Standard Oil, SEARS, Singer, U.S Steel, and a tsunami of economic growth, including services, came out of this period.

In today’s AI-intensive, cloud native, deeply interconnected world, the opportunities connected to the Space Tech (ST) ecosystem are of course even bigger, not to mention the 8X population growth and the 7X growth of the global economy.

Being the smart, catalytic incubator purposefully focused beyond ST is a rich vein to mine.

Space Tech is about to Hit an Exponential Curve – You Know, Up Like a Rocket Ship

Capacity - we are just at the start of a 100x five-year increase in capacity for getting useful objects to space. We have had a 10x cost improvement over the last decade partly because of increased supply but also because of structural, design, materials and operating model improvements. Capability per Kilo - this is in part due to constantly improving tech and its gravitional pull towards miniaturization. This is a 10x to 1000x improvement over the next decade that started a couple of years ago.

Network Effects – one telephone is not useful. Two are slightly useful. In a few years we will have massive networks that interoperate and assemble different cpaabilitie sto fit demand needs. These will be space networks with 10,000 elements 5x to 20x more powerful than what we started with.

Ecosystem Afterburners - we don’t send things to space so I can lie on my back with my eight year old daughter in Kent and watch satellites zip across the night sky. Which was very cool. We send them as value adding parts of an ecosystem. It’s hard to measure but my best guesstimate is the innovation side of the ‘space ecosystem’ has grown 20x in the past decade. From Globestar to CubeSats to LiDAR from space, to space internet to all the cool launch advances. That was before the recent quantum leap in AI (LLM) and before the quantum leap of high utility Quantum kicks in in 2027/28.

The Beginning of the Curve and Acceleration - imagine the birth and growth around the expansion west of the railroads/telegraph. We are at the beginning of that curve. This will be turbocharged by a continual improvement flywheel born from all the data this throws off and the advent of LLM based tech – GenAI/Agentic AI plus smart Edge Compute.

ST Ecosystem Level Change

Think of these things as parts of an ecosystem fabric connecting with twenty domains on earth and changing the actual economic infrastructure we all use.

1. Advanced Earth Intelligence Systems Everything from hyperspectral imaging and real-time AI-powered analytics

2. Satellite Mega-Constellations & Next-Gen Communications - SpaceX (Starlink), Amazon (Kuiper), and OneWeb- thousands of small satellites in interconnected networks. These supercharge ultra-fast, low-latency, always-on, everywhere communications/intelligence. The nose dive in operating cost structure and unit marginal costs is a huge disruptor in and of itself. This tech follows an exponential curve. Cables in the ground, even fiber optic, not so much.

3. Space-Based Manufacturing & Materials Innovation

Microgravity will deliver breakthroughs in pharmaceuticals, fiber-optic cables, composite materials and learning (yes, learning). Think cost structure and quality/output orders of magnitude improvement. Think new, i.e: new industries, solutions, directions.

4. Space-Based Solar Power (SBSP)

Orbital solar arrays could beam electricity down to receiving stations on Earth, potentially providing clean, round-the-clock renewable energy. If successfully commercialized, SBSP could transform the global energy market by making energy accessible anywhere

5. Advanced Propulsion, Robotics, Materials – this leads to mining (asteroids/moon) – estimates for the mining segment are in gazillions of dollars.

Exponential Change is Often Confusing. Humans Do Not Think Algebraically

(Okay, the math genius CTO of Ocient in Chicago probably does, but most don’t)

If you look back for 10 years in terms of adoption, impact, utility, and cost structure, Space Tech (ST) has a steep ski slope curve. If you go 5 years into the future, those 10 years look flat, and the next 5 are the hockey stick curve up. The same happens another 5 years out.

The anchor technologies behind the 4th Industrial Revolution (original paper from Davos 2016) are IoT, XR, Cloud, and AI. Three graphs below show what that looks like. It is easy to believe because we have all seen that. Think of that same tripartite rocket ship curve just barely underway for ST. The graphs below are something every board here on earth should be aware of. Pay special attention to the Y axis.

This is the framing the leadership needs to understand. Here are two simple charts from an interactive lecture I did in November 2021 at the marvelous Naval Postgraduate School in Monterey, CA, in the Innovation in Design program, where they still let me give talks. It was anchored in explaining the 4th Industrial Revolution that came out of Davos and the underlying tech thinking. The first chart shows what those technological paths looked like, looking back from 2021. The second chart is what I said they will look like just four years into the future, i.e., 2025.

I have added a new third chart, looking back from 2030. This is what boards have to contend with. Note the vertical axis and what it measures.

The same two initial graphs were also in a chapter I did in a book on technology and Special Ops Forces in Jan. 2021, published by the Center for Global Security Research at Lawrence Livermore National Lab and Special Operations Command. The third is from guest lectures at Booth and Kellogg. While seen together, these seem realistic if not obvious. But at the point before any of the hockey stick curves, most leaders, boards, strategists, and nations do not think concretely about preparing and consequently are not prepared. The destructive side of a massive creative destruction cycle shouldn’t really be a surprise.

One More Thing for Later

Thinking about the ST ecosystem and how it plays with the emerging set of technologies and devices that constitute the Low Altitude Economy (LAE) may also be lucrative, especially given how nascent the LAE is. I think only China at this point is intentionally thinking about this is public-private partnership modalities, but it is definitely coming. I personally believe the LAE will be tightly coupled to terrestrial robotics and autonomy, especially the transport layer. The target location for the incubator already has an approved Vertiport. But that is just something to keep on the radar for now.

One small step for man, one huge step for the LPs in this.

Toby Eduardo Redshaw