Closing Bell - Manifest Space: Capitalizing on Private Space Stations with Gravitics CEO Colin Doughan 8/22/24

Episode Date: August 22, 2024

A boom in private human spaceflight is on the horizon as more heavy-lift rockets come online. But at the ISS is set to retire in 2030, what is the future of space stations? Private players are stepping in to meet demand, with Gravitics, a Washington-based in-space infrastructure startup, a likely winner in the space. Founder & CEO Colin Doughan joins Morgan Brennan to discuss commercializing low-earth orbit, supplying hardware to commercial space stations, and its recent $125 million deal with Axiom Space.

Gravitics has big ambitions for building space stations. Current generation modules for space stations are at about four meters in diameter. These behind me are eight. And as we get new launch capability coming online from, like, say, the new Glenn vehicle that Jeff Bezos' company is building or Elon Musk's company building Starship. These new six and eight meter class vehicles are coming online, opening up new masses to orbit and expanded volumes. So this unit should have about half the volume of the International Space Station in just one of our units. Gravitic CEO and founder Colin Dawn wants the three-year-old startup to become the go-to hardware supplier for companies developing in-space infrastructure. Recently, it inked a $125 million deal with Axiom Space to do just that, make modules to expand Axiom's planned commercial space station. We're kind of the developer to other people's operators, or if you want, the Boeing to other people's United and Delta.

We'll provide you the infrastructure hardware. We will double down on those CapEx investments in our factory and give you turnkey scalability when you're ready to purchase them. On this episode, the serial space entrepreneur on how Gravitics is positioning itself for a commercialized low Earth orbit and how the funding landscape has changed since Dawn started out in the space business. I'm Morgan Brennan, and this is Manifest Space. Joining me now, Colin Dawn, the CEO and founder of Gravitics. Let's just start at the beginning. What does Gravitics do? Thanks, Morgan. Appreciate you having us on. Gravitics, as you can see behind me, builds very large space station modules and logistics products for the space ecosystem. So think

large infrastructure solutions for the growing space economy. Okay. And so you just referenced it. What are you sitting in front of right now? Where are you and what are the shiny, large, shiny objects behind you? Yeah, I love it. So we are up in Seattle and these modules are prototypes for kind of the next generation. Current generation modules for space stations are at about four meters in diameter. These behind me are eight. And as we get new launch capability coming online from, like, say, the new Glenn vehicle that Jeff Bezos's company is building or Elon Musk's company building Starship. These new six and eight meter class vehicles are coming online, opening up new masses to orbit and expanded volumes. So this unit should have about half the volume of the International Space Station in just one of our units. Wow. Okay. So you're going big with this. Company's pretty new. I want to get into the origins and that whole trajectory as an immediate need. They can't wait for those new vehicles to come online.

So we'll be building them a four meter. Our manufacturing approach makes it very flexible. So we can provide as far down as three meters, as far as large as eight meters in diameter to really fit any of the fairing sizes of launch vehicles, both today and into the future. Axiom's needs are going to be on the utility side for this first vehicle. And you can kind of think of our modules as kind of the Lego bricks of the future for space stations and for other in-space platforms. Our modules can connect together and allow station operators to scale over time, spreading that CapEx out so they don't need to invest all of that up front. We can help them scale over time, making those investments as they have customers ready to pay for them.

So when I think of Axiom, I think of one of a number of commercial space station developers who are collecting development dollars from NASA right now to potentially become a prime contractor to put one of these commercial space stations in orbit as the ISS is decommissioned. It sounds like you are looking to be a supplier to the prime contractors like Axiom of the world. Is that the way to think about it? Yeah, very much. We're kind of the developer to other people's operators, or if you want, the Boeing to other people's United and Delta. We'll provide you the infrastructure hardware. We will double down on those CapEx investments in our factory and give you turnkey scalability when you're ready to purchase them.

Okay. So with this partnership with Axiom, how quickly are you developing these modules? How quickly do they go to space? Yeah. So we'll have capability going to orbit this year, some of our components testing on ISS, and then we'll have their first units going up in early 27, most likely. Okay. And it's not an exclusive partnership. You're out there to work with anyone who's looking to build a space station. Absolutely. In fact, that's really our goal is to, you had mentioned the CLD program working with NASA to replace the ISS as it retires later this decade. We hope that our modules then begin working their way into all the station designs and really helping all the stations scale in cost-effective ways. Okay.

Company is pretty new. 2021, I believe, is when you founded it. I guess walk me through how the decision to create a company focused on this came about. Yeah, so I am a serial space entrepreneur. So this sold my last space company, Altia Space Machines back in 2019, looking for that next step of what to build and really looking for perhaps thinking about like, from a domino perspective, what perspective, what can we tip over that can get some other things tipped over? And so we're at a pretty pivotal point right now for space development. With the ISS retiring, it had certain restrictions, either due to the fact that NASA

and other government agencies were the ones funding it, or just limitations in what could be launched with mass and volume limitations of today's rockets. And looking at what was about to come online with Starship and what SpaceX is offering, who could maximize that payload faring of that next vehicle? And what you see behind is really us asking the question, if we don't maximize that payload bay, someone else will. And so what could we do with dramatically more mass and dramatically more volume available in orbit? You know, it's almost a cardinal sin within aerospace to think about ignoring mass as a driver for your designs. But we're just about there.

Moving from something like, say, 16,000 kilograms lifted to low earth orbit today in a Falcon 9 to 50 plus thousand kilograms available very soon. I mean, we're talking significant increases in mass and volume just around the horizon, so around the corner. So we want to be ready to be able to provide for that kind of future. And who's going to want that kind of future? I mean, I think it's kind of a key question, right? We know that low Earth orbit is being opened up to commercialization, but what is the business case for that commercialization? Yeah, great question. So let me describe just a little bit of the current way that work gets done on the International Space

Station. Now, this would be a little bit of a caricature, but it'll make the point. I have an interesting idea. I want it evaluated for maybe its commercial merits or its technology merits on orbit. So I take my cool experiments. I get in line. If I'm in the US, that line is maybe two years long to go up to the International Space Station in Europe. Maybe it's a little bit longer,

five to seven years to be able to go up. I go up to the space station. I perform my experiment. I send the bits down to be evaluated. Maybe if I'm lucky, I actually get a Dragon spacecraft to return my experiment to the ground. I have a well-stocked lab on the ground that then evaluates that technology. And then I iterate and get back in line. Now, maybe I can cheat and the second time through, I get brought to the front of the line, but it's still a very long process. What if I can bring that well-stocked lab into orbit in the first place?

Now, all of a sudden, I'm doing that iteration cycle multiple times in a week. This totally changes the game. We are right now at the cusp of an incredible future. But if you kind of open the app store for space applications, that app store is rather limited. Many things are intriguing, but so many businesses are still pre-commercialization. We've got exciting developments on crystal growth and fiber optic cable and knee meniscuses and heart tissue and so many really powerful things. Can we get it from exciting potential to an actual business to make that happen? We have to be able to bring that

equipment to that next level to be able to shorten the R&D cycle when we're in evaluation period and move more things into commercialization to fill that app store with those money-making ideas. What you see behind you is the facilities that will enable it on orbit. And it's going to be that next generation launch vehicle to be able to lift that much mass to be able to really power it in the first place. So if you make it, they will come. How big is this market going to be? Do we have any idea, any sense yet? Well, we know for sure that NASA is going to take a heavy portion of those existing ISS dollars and portion them into it. So we will have significant NASA investments. Additionally, we're seeing a large amount of DOD express interest in the capabilities that you're seeing

from us. Additionally, you're going to see then that growth beyond that into those nations that are saying, well, wait a minute, maybe we need to step up and have a presence in space as well. So this is going to be the beginning of something far bigger. The ISS will, by retiring it, what replaces it will be significantly larger than what it was before. How quickly can you make one of these modules? And I guess how many, you just think this deal with Axiom, but are you taking incoming calls from other companies? Very much so. We're also hoping to be able to announce soon the joining of our solutions into several of the other players that will be bidding on CLD for Phase 2.

That's NASA's ISS replacement program. So, yes, very much interested in others within the industry saying, excellent, we see the value here. We see that Gravitic solutions are going to be the right answers. And what we love about the Axiom partnership is it's very much a walk before you run. So we need that early partner that's willing to take that step with us to then be able to kind of prove to the industry, okay, great, this has been validated now, and I want to be able to get on board to be able to see those cost savings, to be able to see, like you were mentioning, that speed to be able to manufacture as they need, and I think really

importantly, to be able to remove from their books, not have to carry on their balance sheet, the cost to maintain a station building factory when they really are just looking to be able to build an initial set of capabilities, we can provide that to them. Okay. So let's talk about that factory piece of it. How big does the factory need to be? How quickly can you produce these? What are you looking to ramp to as we do start to realize this commercialized low earth orbit world? How does this play out over the coming years? Yeah. The way to see our modules is a mix of real estate as well as logistics supply. Because if I can bring up one that's equipped as a well-stocked lab, to use my

example from before, I also can pack it to the gills with cargo and resupply. And so that means that we're going to need a lot of these units, whether I'm providing you something that's going to stay on orbit for decades or whether something that's going to stay on orbit for just weeks or months. We're going to be going through a lot of units on the production side. Four meter units are going to be something that we can build here in the Pacific Northwest in our current facility. They are roadable, so that makes it easy for us to be able to build them and then ship them wherever they're needed throughout the country. When we get to six and eight meters, we're going to need to build

those most likely at the launch site. So for now, thank Kennedy, but as other nations be able to start offering Starship and New Glenn launches or other locations within the U.S. offering Starship or New Glenn launches, we'd be the U.S. offering Starship or New Glenn launches, we'd be able to build there as well. Mainly because six and eight meters is really, really hard to transport across the country. So six meters, you might be able to use a very specialized airplane, but in most cases, and definitely when we get to eight meters, it's best to be able to build them at Kennedy, be able to integrate them. So the really cool insides of whatever you wanted to use the inside for, manufacturing able to integrate them. So the really cool insides of whatever you

wanted to use the inside for, manufacturing, et cetera, all right there. And then we move it right out to the launch site and up it goes. The construction of our units is very quick. We can build them in under a year per unit. The challenge that we have is going to be that integration step because that's really where the secret sauce is. Whatever the unique use case of that module is where the time is going to be. And that's really customer dependent. Okay. When we talk about integration, I mean, what does that look like? What goes into that? What is the secret sauce there? Is it just the bespoke nature of the product you're rolling out to the customer? We have quite a few kind of like go through the catalog and we're happy to show you, oh, great. Here's something that gives you, you know, six, 10, 12 different sleeping compartments if you wanted a habitat, let's say.

But as soon as we start talking manufacturing, then we have a different conversation. We're saying, OK, you're developing this currently on the ground and here's your equipment. And now we need to help you fit it into a module and make it appropriate for launch into space in ways that account for all the challenges with CG and other things that the launch vehicle is going to require of us as well as power needs and all the other things that are going to be required for us to be able to provide for these machines that will operate on orbit. Now you mentioned the fact that you're a serial space entrepreneur.

How much has this industry changed since you first set out and built your own company in it? It's really exciting to look when we were raising capital 10 plus years ago for the first startup. For many VCs, there wasn't a category for space investments. Maybe there was the concept of deep tech, even if it wasn't called that. But now, you know, just about every US VC firm has that category is looking for new ways to deploy capital that are exciting. And the opportunities to be able to have a story that is attractive to VCs because they understand the

opportunities here is exciting because it just didn't exist a decade ago. Hmm. So what does that mean in terms of near-term milestones or steps for your company. You are venture capital backed. You did just ink this partnership. I guess what you'll be watching for next? Excellent. Yep. So we are raising the next round of capital. In addition to that, we're powering forward with our critical design review, which will occur next year. And then on into the build cycle, as I mentioned, getting these first units on orbit for first unit on orbit for Axiom. And then the other units that will come after that by necessity to be able to keep up with their needs. So it's going to get very busy in here very quickly. And we're looking forward to that. All right. Well, Colin Don, thank you so much for joining me, CEO and founder of Gravitics. Thanks, Morgan.

That does it for this episode of Manifest Space. Make sure you never miss a launch by following us wherever you get your podcasts and by watching our coverage on Closing Bell Overtime. I'm Morgan Brennan.