Determining Success for Smallsat Launchers
September 26, 2019 by Leena Pivovarova | NSR
With so many small launch startups racing towards
success on a global scale,
the stakes have never been higher to cut through the
noise and evaluate all initiatives for
probability of success before committing to a launch
partner. Well-informed decisions will be critical to all
industry players involved (investors, smallsat
operators, brokers, and partners) as they will have
far-reaching consequences. So, what factors need to
be considered and analyzed to help tip the scales when
making these decisions?
NSR’s
Smallsat Launch Vehicle Markets, 2nd
Edition report provides a comprehensive
analysis and comparative assessment of the leading and
emerging smallsat launchers by using critical metrics
such as technology readiness, price, unique launcher
capabilities, and market advantages and risks.
Venturing beyond obvious assessment criteria such as
price and mission-specific requirements can get muddy,
as the smallsat industry continues to expand every day.
The costs of launch for any given satellite mission have
traditionally dwarfed all other business spending,
and this trend continues today despite the seemingly
greater availability of options. This underlines the
significance of
examining the whole business for long term viability,
despite the instinct in picking the cheapest option that
might not ever make it to orbit. So far, of the 130+ new
small launch vehicles that are in development today,
only Rocket Lab and a couple of Chinese rockets have
successfully made it to orbit. If there is one thing
that is certain, it is that most of these small launch
startups will not survive.
In evaluating any initiative in a highly competitive
field, a unified strategy in playing to unique strengths
of the technology and matching it to a specific business
opportunity is highly important. In an ideal situation,
all business choices and partnerships should be
strategically aligned to boost those unique
strengths if the initiative is to succeed. Government
contracts and research grants such as SBIR awards can
help boost credibility, as well as gather industry
momentum and support. Furthermore,
signed (contracted) customers or partners of
all types are another strong indicator to examine and
gauge. A word of caution, however – Letters of Interest
(LOIs) and other non-binding agreements indicate early
stage conversations and
should not be mistaken for real customer commitment.
Other concrete factors to examine are
workforce and leadership team, funding, regulatory
approvals, and facilities as
these are all significant indicators of how
trustworthy the company is and how far along it is in
the development of its launcher technology. Development
timelines for launch initiatives vary, however drawing
data from a successful actor such as Rocket Lab can be a
helpful “reality check” – it took Rocket Lab ~$300M and
12+ years to get to orbit.
Bottom Line
Gauging the probability of success of dedicated smallsat
launch startups is not an exact science by any means –
all factors discussed aim to assign some bearing for
comparison in a highly uncertain and risky environment.
Despite all being positive,
each of these factors are not
significant as standalone events. However,
if brought together by a unified strategy and given a
chance to build momentum, these factors signal powerful
potential of long-term success.
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