With a Changing Administration, is Now the Time for a Bold Re-Pitch of What Space can Deliver for the UK and the World?

By Sam Adlen
Co-CEO of Space Solar

At the launch of the UK Space and Defence Gateway at the Harwell Campus and ESA ECSAT, I left feeling more positive about the space sector than I have for a long time. The new group of leaders that were present from the European and UK Space Agencies, amazing astronauts, and inspiring, strong leaders from the Ministry of Defence, UKRI, the Sustainable Markets Initiative, and industry conveyed a sense of purpose, passion, and frustration that makes me think that maybe we are now in a position to do something different.  

On a panel ‘linking innovation to investment’ moderated by @John Abbott, I stressed the huge opportunity that the UK can grasp with the transformation in launch costs and capacity if we have the ambition and vision to embrace this future. First, some honesty about where we stand.

We need an honest and self-reflective appraisal of where we are in the UK. We’ve ended up with a fairly flat settlement and most are hard pressed to believe that space is viewed as a priority sector. This is understandable when set against other priorities and pulls on government funding and the efforts in achieving even this should not be underestimated.  However, is it surprising when the pitch has been for “the same but more”?

Yet our sector is at an inflexion point with the onset of heavy reusable launch. Against that backdrop of a hypergrowth space market and one where other nations are investing orders of magnitude more in recognition of the opportunity ahead (US reportedly now invests ~$60-$80Bnpa into space, Germany is committing €35Bn to a new space defence initiative), this is not an acceptable outcome and not one that reflects what space could deliver for the UK.  

Space today already provides an essential tool for measuring and optimising in ways needed for the 21st century but it is now moving to enable new tools for step change impact toward some of our biggest challenges – abundant energy, abundant compute, low carbon advanced materials production. Whilst always being respectful and grounded, space should be at the top level of any industrial strategy (not hidden) and backed to be a key building block for growth and impact.  

But we need a major mindset shift. The loudest voices in the UK and Europe are often stating why new things won’t work rather than asking how we can make them work. This change of framing results in such a different outcome. Over the last 15 years those voices have confidently stated, either through belief or vested interests, that small satellites, reusable launch and Starlink won’t work at various points. They have then delighted when the first products delivered have limited performance, been quieter when version 2 is better and silenced when the next iteration eats their lunch. It is a well-documented process and we need to change our mindsets so this does not happen again. Surely, we have now learned that the risk of not competing is higher than the risk of competing. 

The value placed on SpaceX at its IPO is a fairly good proxy for the way the world sees space.  That vote is not a vote for what space can do today but what space can deliver over the coming decades. SpaceX was trading above a $2Tr valuation on debut, a 1,000x increase from the $2Bnpa of private capital invested in space in 2013 when I first arrived in Harwell. This is not an apples for apples comparison. It does not matter as with changes like that the shift in how the world sees the space sector is clear. Space has good justification to argue that it has the potential to be the economic growth opportunity of the 21st century as heavy reusable launch develops – orbital datacentres, space-based solar power, next generation communications and observation systems, new materials and drugs developed in space, and ultimately new resources (once we actually get good at space through the learnings in building hyper modular structures in space as innovation is a numbers game and iteration improves performance). Many of these are trillion-dollar+ market opportunities and it is happening now.

• Musk is talking of being able to launch 100GW/year within 4-5 years.
• Space Power is a priority for the US DoD.
• SpaceX IPO focussed on orbital AI.

However much one might factor back any overconfidence above, we surely need to tell a different story now. Against the backdrop above and the public vote for what space can deliver through the SpaceX IPO, we should be confident in coming together to collectively pitch an optimistic but clear-eyed vision of what space can deliver for the UK, Europe, and for the world. To date there has been a strong lobby for “the same but more” but perhaps unsurprisingly that results in a settlement that looks largely the same. Is it time to pitch a different investment and impact story, one with step change investment for transformational benefits for citizens? Space should be a vote winner. As an island nation we do not have the factors of production of other nations but looking up can give us limitless options to square the circle between economic growth and sustainability, opening up radical new approaches for energy, compute, new materials and resources alongside all space delivers for security, resilience and growth today.  

Space can be a vote winner if we can be bold about what it offers as it gives the chance to scale and grow with reduced environmental trade-offs. There are real challenges for government in meeting the wants and needs of the nation in a land constrained environment.  Space can be something that unifies in what is often an area of contention e.g. between environmental concerns and looking after what we have, versus technical progress and economic growth. Government talks about wanting to be an AI leader but practically speaking, with the highest industrial energy costs in the developed world and energy the limiting factor for AI, we cannot deliver in a world where energy demand grows significantly (and yet voters will demand it if they see others are getting it). In scenarios where AI and robotics really scale to give benefits to all citizens, we potentially need energy solutions that can really scale to a 10x increase in energy demand (like space-based solar power and orbital datacentres). Generally, looking to space takes many of the environmental impacts and related tough choices in country up into space. There are of course still environmental impacts but as long as we ensure we are keeping both space and Earth sustainable in line with His Majesty’s Terra and Astra Carta, and with good end to end lifecycle analysis across Earth and space so the trade-offs are understood, the opportunities are broad. We will not want everything delivered from space but it can make a major contribution and offer high-value, exciting jobs/roles for the next generation and beyond even in the most extreme AI scenarios.  

We should be confident.  We have 50,000 great people and strong capabilities in the sector at a time of a new industry cycle and a time of reimagination and rebirth. We have leading businesses in key growth areas for the sector (materials, energy, healthcare). We are also strong in the capabilities needed moving forward – robotics, AI, materials, semiconductors and more.  We can provide a great growth story and options to reindustrialise across all regions. Let’s offer the incoming administration a vision for what space can deliver if we are ambitious.  It has nearly always been the case that we overestimate what we can do in a year but underestimate what we can do in a decade. The latter will definitely be the case in a fast-moving AI enabled world. Let’s offer a plan to government to match.  It’s about positivity and creation for those working now, and outcomes and jobs for those nearer the start of the journey. In these times of huge uncertainty in which we live, voters want a vision beyond tomorrow for where we are heading. Space should be a proud and visible part of that.

Of course, this all builds on what we can deliver today and immediate needs must be met. However, rather than just competing for incremental outcomes in well-established and competitive markets, let’s augment this and move purposefully toward the step change capabilities that can be delivered across all areas of the space sector if we move to new concepts with higher power, larger aperture, greater revisit, higher performance and other new paradigms enabled through heavy reusable launch. 

The potential benefits extend across the sector, including new options for communications and Earth observation. This also offers timely new defence capabilities such as radar solutions genuinely capable of monitoring cis-lunar space, power instantaneously delivered for operations wherever it is needed, and whole new ways of delivering science outcomes. What can the research community do with large solar sails, massive telescopes, and orders of magnitude more power versus incremental research with satellite architectures that have not evolved all that much since the 1970s?  

If we can support the development of the next generation of tier 1 businesses (compute, energy, materials, healthcare) we can also address the structural challenges in the UK space sector and create a vibrant sector and supply chains in a sector that will be opened up by the increased agency that AI can offer. Classic business school literature, such as from Michael Porter, says that you need the demanding customers in country, otherwise the minute you turn the R&D tap off, businesses are gone. The absence of in-country, demanding customers is a real issue here in the UK, particularly if you look at ISAM (In-orbit Servicing, Assembly, and Manufacture) where we have world leading businesses in servicing, refuelling and debris removal. ISAM is the bucket that most of the major opportunities above currently sit under although this market nomenclature will likely evolve over time. If we support the leading businesses we have in energy, materials, healthcare etc then we create the tier 1 businesses/customers that mean the UK derives the benefits of supply chain support, and the amazing supply chain we are building now stays if R&D funding is reduced or turned off.

It will not be a linear path and stimulating those new markets would benefit from being managed like a VC portfolio with investment growing (or not) subject to milestones. If we push for things that are hard, it is not without risk but we should have confidence that the portfolio result will be a no-regrets move with limited downside and options for stellar benefits and returns.

I am a firm believer that governments should shape markets rather than just address market failures but through history it has generally been private capital that makes the big changes happen. Doing ambitious things is challenging for governments with so many stakeholders to please.  However, private capital needs confidence from government. We need to do this together.

Three things we should do:

• Bring the right voices from public and private capital together to develop a roadmap that builds toward orders of magnitude more investment based on milestones delivered in developing new space solutions in energy, materials, healthcare and compute.  Take the VC approach to business growth toward growth of new space enabled industries.  Importantly, as there are major terrestrial needs, much of this can be financed privately with government stimulus and government as a customer (versus much of what we are doing today which continues to demand government funding alone). Government can bring its huge range of wider levers into play across the roadmaps from regulation to partnerships.  With a business centric view, Government can support vehicles for long-term growth that can crowd in public and private finance and stop us always being just the brick builder (supply chain) rather than the house builder (tier 1) with the supply chain too.
• Leverage the One-Government approach for space.  If the One Government approach can leverage budgets from communications, healthcare, energy, etc toward space it can be transformational from a growth perspective versus taking the terrestrial solution – government and citizens get the solution they want but with the side benefit of enabling the massive economic growth opportunity in space.  
• Do it now.  If we don’t move now the barriers will be very high (but they are high for others if we do move).  As we are looking at major space infrastructure, there are some high barriers to those that don’t move first.  These include cost of capital (very hard to be a new entrant when someone has come down the cost of capital curve), orbital slots and spectrum.

The days of apologetically pitching space, with challenges in communicating the benefits, should be put behind us. Now is the time for leaders to propose bold, intelligent use of risk capital to create the foundations and options for a positive future for all citizens enabled by space.  

The UK Space and Defence Gateway can be a key catalyst, bringing together the people and organisations that can work together to give each other confidence to invest at scale and go together in creating a safe, secure, sustainable future enabled by space.  

I left the event with a stronger belief that the new leaders of the sector are galvanised to come together to promote the outcomes and optimistic futures space can deliver – a nation with chutzpah, compassion and cosmic opportunities. Let’s bring together the coalition of voices for what space can be, not what it is today.