Closing Bell - Manifest Space: ISS Traffic Jam with Delalune Space CEO Rob Meyerson 5/4/23

Episode Date: May 4, 2023

The International Space Station’s calendar is loaded with human spaceflights this year— but with Axiom Space’s Ax-2 mission delayed, a traffic jam may be underway. Morgan speaks with Axiom board member and former Blue Origin president, Delalune Space CEO Rob Meyerson to discuss Ax-2, the future of manufacturing and the lunar economy. For more Manifest Space, listen and follow here: https://link.chtbl.com/manifestspace

Axiom Space's second private mission to the International Space Station has been postponed. New date to be determined. But it raises the new reality of a space traffic jam as a bevy of human space flights mark this year's calendar, from NASA's commercial crew missions to SpaceX's private Polaris Dawn. For Axiom, the big vision, though, involves contracted orbital flights to space stations in a one-stop shop, something Axiom board member Rob Meyerson describes as a subscription model for space. So governments who are or are not participating in the international partnership with NASA on the International Space Station have an opportunity to build their own human spaceflight program and scale it.

Starting with working with Axiom to advise on what types of research and development to do, moving on to flying their own astronauts like Sweden is going to do as part of the agreement that was just announced a few weeks ago with the European Space Agency and Axiom. Meyerson used to run Blue Origin, recruited by Jeff Bezos in 2003 to develop the company's vision for humanity in space, standing up various programs before retiring in 2018. Meyerson is now the founder and CEO of consultant firm De La Lune Space, and an investor in

and advisor of many startups. On this episode, we discuss what AX2 means for a commercialized Earth orbit, the future of manufacturing, and the economic case for colonization of the moon. I'm Morgan Brennan, and this is Manifest Space. Rob Meyerson, thank you so much for joining me today. It's such a pleasure to speak with you. Thank you, Morgan. It's really a pleasure to be here. Thanks for inviting me. You and I first met back in, I think, 2017, and you were running Blue Origin as the president at the time. A lot has changed since then. So maybe let's start with a

little bit of background in terms of Della Loon Space and all the different projects that you have your hands in right now, currently. Yeah, it's been exciting. Since leaving Blue Origin back in 2018, I've taken on a portfolio career, I like to call it. So it allows me to consult, advise companies, also invest, become an angel investor in the space and technology sectors. I serve on boards of directors. And then I'm also doing some of my own things on the side. So a lot of mentoring. I've been staying really busy and really excited to watch the growth of the space industry that I've been involved in

for decades now, so. And it certainly is growing. And I think the first place, there's a lot to talk about it. I think the first place I want to start with you is human space flight, because you are on the board of Axiom Space, which is poised to do its second mission to the

International Space Station, second time we've seen an all-commercial mission to the ISS. I guess just walk me through a little bit about the business model at that company and why these missions are so critical to a vision that involves commercial space stations and low-Earth orbit. Yeah, well, commercial space stations, I think, are important. I mean, if you step back and think, are important. I mean, if you step back and you look at exploration, I mean, we can do some things robotically. We send robots to Mars. We send robots to other planets. But humanity, we learn so much when humans are involved in exploration. And so throughout the history of the space program,

only a little over 600 people have ever flown to space. So this generation of space professionals is going to participate in putting the first 1,000 humans into space, the first 10,000 humans into space. So we're really at the very beginning of this human spaceflight journey. A commercial space station not only serves a human spaceflight, but there's also space research and development and space manufacturing, technology development, IT and computing type applications and things that a space station can do. And we've had this International Space Station on orbit for two decades now, where we've had continuous human presence in low Earth orbit. The next logical step for us is to have commercial stations take over where the government

has sort of said, we're going to move on to the next thing, which is going on to the moon and onto Mars. And there's an opportunity for commercial space stations to step in and for the government to be an anchor, important anchor customer, but one of many customers for those stations. Yeah, and along those lines, I know Axiom has plans to do the first deployment

of the first part of the space station, I believe in 2025 and then the next in 2026, but it's kind of in a unique position because it's been created by the man who essentially stood up the ISS and it has a relationship, a contract with NASA that no one else has in the marketplace, right? That's right.

Mike Cefardini is the CEO and co-founder of Axiom Space. There's no one in the world who's more qualified to run a commercial space station company like Axiom, and he's doing a wonderful job. The contract you mentioned is the port contract which NASA awarded, I believe in early 2020. And that was really a turning point for the beginning of the Commercial Space Station Development Program

or CLD, Commercial LEO Destinations Program that NASA has. Since then, they've awarded three more contracts to three other companies who are building free flying space stations. So Axiom is starting with a module on the International Space Station, and they'll build from there and then separate. These other companies are building free-flying stations where they'll start with their own module in free-flying and low-Earth orbit,

and they'll build onto it from there. So two different approaches, both viable, but the leadership at Axiom certainly is unique in their qualifications. Yeah, to the extent, I guess you can discuss it. I mean, what should we expect from this AX-2 mission then? Well, AX-2 is exciting. It's the second Axiom space mission. It'll fly as early as next month. There is a kind of a bit of a traffic jam at the space station right now, so they're working hard to find a date. And Peggy Whitson, a very, very highly qualified NASA astronaut who has retired and come to Axiom, is leading the mission along with John Schaffner and two astronauts from

the Kingdom of Saudi Arabia. We expect to see them all perform their own independent research and development, some research funded by others. I think we'll see similar exciting results from that as we did with AX1 just a few years ago. I think to me, one of the most fascinating things in the near to medium term is this notion of creating a one-stop shop for countries that didn't have access to space or human space flight before to be able to do so now through Axiom. It really sort of speaks to the democratization, for lack of a better term, of low Earth orbit. Yeah, that's such a great point, Morgan. The Axiom Space Access Program,

which they just announced at Space Symposium, is an opportunity for, it's like a subscription model for space. So governments who are or are not participating in the international partnership with NASA on the International Space Station have an opportunity to build their own human spaceflight program and scale it, starting with working with Axiom to advise on what types of research and development to do, moving on to flying their own astronauts like Sweden is going to do as part of the agreement that was just announced a few weeks ago with the European Space Agency and Axiom, to even a future where a country might sponsor all or a portion of a space station module for their own research and their own opportunities. So Axiom Access allows you to

sort of scale, you know, dip your toe in the water, so to speak, on human space flight and then grow that over time. It's a really exciting opportunity to, you know, because there are so many new countries that have their own space agencies, Australia, Portugal, Greece, new space agencies that are being announced all the time, Azerbaijan, that are kind of growing, joining the market and recognize that space is important for their national goals. So as we do see this commercialization of space and just sticking with the theme here of human spaceflight, what does it mean in terms of this marketplace, broader marketplace that is emerging? Because obviously you have these orbital missions from Axiom, you have SpaceX working on private missions, and then of course, contracting out with NASA and the like. Then you also have this

whole suborbital sector too, including Blue Origin with New Shepard, which I know you were instrumental in pioneering and developing. And then, of course, Virgin Galactic, which it says it's still on track to launch commercial service in the coming months. Yeah. And there's evidence that they're, I mean, they just flew again recently, last week, I believe. You know, the commercial human spaceflight market is really, really exciting. I think it starts out on the suborbital side with New Shepard and Virgin Galactic and some of the others, like Space Perspective, giving people a glimpse of what space is like. What does the Earth look like from space? What does our environment look like from space?

And how do you communicate that? of communicating the fragility of our human being in our environment by giving others, giving people an opportunity to go up and experience it. So it's not just about billionaires or high net worth people going and doing that. It's about ordinary people. That's why I'm so excited about how this suborbital market has sort of taken hold in its first year, it's sort of slowed down. And that's, I don't like to see that. I'd like to see that continue, but I think 30 astronauts flew on New Shepard in the first year.

After the first human flight, you had the first husband and wife couple, you had the first father and son, you had the first oldest woman, the oldest man, the youngest man, you had the first, the oldest woman, the oldest man, the youngest man. You had the first Mexican woman astronaut. You had, I mean, you had all these firsts. It's just really interesting. And it just goes to show back to this early numbers, only 600 people have flown. So you have an opportunity for people to really be first in a category and inspire others by sort of taking that mantle, that stage.

And I think we'll see a lot more of that. We also see that with Inspiration4, and we'll see that with the Polaris Dawn missions this summer, of course, being flown with SpaceX and led by Jared Isaacman. He's done a fantastic job of promoting the benefits of human spaceflight and pushing the envelope a little bit in what can be done. So that's very exciting to see. But I think the most important thing on this is I think for this market to grow, it's very, very price sensitive. And so we're not going to see the kind of growth that I would like to see until the

price really comes down. And that's going to come through competition. I mean, the suborbital flight tickets, you know, they're now sort of in the million dollar range. You need to see that price come down into the hundreds of thousands of dollars. And maybe, you know, maybe the first flight of, maybe flights of Starship with humans, you know, in the future is certainly going to help that. Maybe that's the answer. I still think that's a few years away, but it'd be nice to see some competition in those markets. It's coming from Boeing, and it'd be nice to see other companies enter the human spaceflight market as well. Yeah, you raised such a key point, and I think it's one that I come back to a lot in my

discussions about the space industry and the space economy. And that is, I mean, we can talk about human spaceflight and it's very splashy and it's really fascinating. It's these momentous milestones when you see these missions happen. But the economic case for it and how you make it sustainable on a commercial level and how you make it accessible to a broader swath of the public. I mean, this seems to be we're at this moment where I don't know, it's almost like a tipping point, maybe, where it's like the economics have to work out in a meaningful way for this to actually become finally, finally become sustainable. And I wonder how you think about it, especially now that you're you're an investor in different parts of this industry. Well, it's and I and I haven't invested in human spaceflight businesses. Those are few and far between. And

unfortunately, the size of check I can write is not going to make a big dent in one of those companies. But the launch market, I think, by contrast, has really grown. and the growth of mega constellations, you know, Starlink and Amazon Kuiper, OneWeb is here to stay. You know, I think that those businesses are far enough along where they're going to get deployed, they're gonna get operated and their respective operators are gonna find ways to get value, extract value out of them. The launch market and the human space launch market are two different things. And what I mean by that is, for example, Amazon Kuiper using ULA's Vulcan launch vehicle to launch is a real enabler for ULA. It grows ULA from a primarily national

security space launch business into a balanced portfolio of national security and commercial. And so you're going to see that by the end of the decade when Vulcan is launching, you know, very often to deploy the, you know, a portion of the Kuiper satellite constellation, that's going to help them lower costs, improve their operations, or both. But that doesn't make a huge impact. It doesn't have a huge impact on the human spaceflight market. And so that tipping point or turning point you talk about, we really need other countries to start to step into this market and um and it's taken a long time for commercial crew

nasa's commercial crew program to take hold with with spacex dragon and and soon boeing uh starliner uh we need to see other other companies and other countries step into that that market as well um and of course we talk about the vulcan rocket, Blue Origin engines. And that's another key part of the discussion, right? It's sort of the industrial base. And the fact that we saw it kind of eviscerated and not a lot of competition. And now, as we've seen this commercial space era unfold, what that means in terms of the manufacturing capabilities and what's out there and what needs to enter the marketplace? Kind of taking a step back, all the money that's gone into launch for Vulcan, for New Glenn, for Ariane 6 over in Europe, and then all these startups, Rocket Lab, Relativity, ABL Space, Firefly, all of them need a strong network, a strong industrial base. And they need it in the

US because these are for the US companies, they need suppliers in the US, they can't really go overseas to do that. So the one thing that's been lacking in this part of the economy, the machine shops, the companies that build valves and components and electronics and wire harnesses is digital transformation. Many of these companies operate on pen and paper or, you know, an Excel spreadsheet. And so we all need these components. The billions of dollars that's flown flowed into these new launch companies. A significant portion of that is just basically passing through down to these lower tier suppliers.

And it's fragile and it's unreliable. The investments in digital engineering and digital transformation need to come. And I've been spending personal time in this area. One of the companies I've invested in is Hadrian Automation in Southern California. Another company here in Seattle is Olus Robotics. I'm working with the University of Texas, El Paso on their advanced

manufacturing Build Back Better grant. And then I just closed out a mentorship program with Creative Destruction Lab here in Seattle on their advanced manufacturing stream. So I'm spending personal time in this area because I'm passionate about it. And I think that we can't advance here in the U.S. without significant investment in the industrial base. It's pretty incredible that we can't advance here in the U.S. without significant investment in the industrial base. It's pretty incredible that we're literally having a conversation about rocket science. And in the same sentence, it's pen and paper and Excel spreadsheets. There's companies out there that have invested in this. And it takes, you'd be surprised, you know, the people in the industry, they tend to have this,

I'll just create my own tool. Those tools are built on Excel spreadsheets and Wiki pages, checklists. And so then you see, you know, new companies that get formed, many of them founded by great engineers, you know, coming out of companies like SpaceX and Blue Origin that are doing things a different way. You know, Stokes Space here in Seattle has actually announced that

they're going to sell their enterprise tool that they've developed internally. It's called Fusion. Epsilon 3 out of LA, former SpaceX founder, building, you know, and selling a checklist tool. And she's gotten great, great traction. Another company I advise is called Pruitt Ridge, where they're doing a digital engineering tool, also founders from SpaceX. So it's exciting to see new founders coming in who have spent time in this new space industry. And now they want to share what they've learned

with a broader group of companies. Are there areas that you're very excited about or that you'd be looking to make investments in or mentor in? Oh, I'm really excited about the moon. I think that we're going back. In the next three years, there's a dozen contracted missions to go to the moon. So while, you know, the I-SPACE mission, you know, earlier last week, didn't quite get there. They were close. We'll learn more about what happened there, but they've, you know, it's sort

of strengthened, you know, their resolve about going and companies like Intuitive Machines and Firefly and Astrobotic and iSpace, Blue Origin, SpaceX are all going to the moon. And there's an opportunity for, you know, new companies to start to build on top of infrastructure like the lunar landers, the lunar rovers, the commercial spacesuits that Axiom's building, buying those things as a service and focusing on bringing new value to a future in-space economy. So scientific operations on the moon, lunar resources, lunar tourism are all kind of future businesses that can be built now that you don't have to worry about designing and building your own lunar lander. And I think that's exciting. That's

something that a big program like Artemis in the U.S. and overseas really, really helps with. It can inspire, but it also brings investment that invests in that industrial base that I talked about. Why is it so important to go to the moon and have a lasting presence in the moon? I mean, what's the business case for it? What's the economic case for it? Because we are putting so much money, the U.S. and allies and China too, and everybody's putting so much money towards these efforts. And then, of course, on the commercial side and with the investment as well,

what's so compelling about it? Why is this so important? Well, I think there's still a lot to be learned. The moon is our nearest neighbor. It is three days away. It can be a stepping stone to Mars. We can learn a lot exploring the moon, both scientifically and about the human existence to take that next step and go on to Mars. I think that is what the Artemis mission is designed to do, to go back to the moon to stay and then go on to Mars. The answer to your question about economics is not always clear. What is the unit economics, economic value of going to the moon? I think that's to be determined.

There will someday be an in-space economy where people are buying propellants in space and buying construction materials, and it'll certainly be cheaper to source those on the moon than bring them from Earth. There's scientific value in terms of what we can learn about the creation of the moon that will help us understand how the Earth was created, but also there's talk of a lunar-based radio telescope that can help us learn about the entire solar system and help us see things that we can't see from Earth or from space-based telescopes, at least of the size we've been able to launch. So I think there's a lot of things. There's a lot of things to be learned. I think that geopolitically, you know, we know China is very focused on the moon.

They're focused for economic and social reasons. And I think that continues to put sort of pressure back on U.S. and Western governments to continue investing. And I think those investments we learned from Apollo, those investments have a long tail in terms of benefit to humanity. And the idea that we're going to go and stay this time is really, can be really inspiring for future generations of engineers and scientists and space professionals. 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.