Technology, Connected - How NASA Created the Company That Replaced It

Episode Date: January 19, 2026

SpaceX reusable rockets and NASA’s commercial space economy are the focus of this Space to Grow book club episode, covering chapters one to three of Space to Grow: Unlocking the Final Economic Frontier. We trace how NASA moved from Apollo and the Space Shuttle era into commercial partnerships, why COTS and fixed-price contracts changed the incentives around ISS cargo delivery, and how SpaceX used iteration, vertical integration, reusability, and culture to cut launch costs. The episode also contrasts Elon Musk’s SpaceX model with Jeff Bezos’s Blue Origin vision, connecting low Earth orbit, Starlink, Mars ambition, United Launch Alliance, and private space companies to one larger question: how did space become a commercial market?--⁠Listen to every podcast⁠Follow us on ⁠Instagram⁠Follow us on ⁠X⁠Follow Mark on ⁠LinkedIn⁠Follow Jeremy on ⁠LinkedIn⁠Read our ⁠Substack⁠Email: [e-mail]----TIMESTAMPS(00:00) Trailer(01:02) Space To Grow(01:55) Incorporate Space Into Your Thinking(03:28) The Apollo Program Ends(05:43) The NASA Budget & Shuttle Launches(07:51) Bush & The Aldridge Commission(08:36) COTS (Commercial Orbital Transportation Services)(10:27) Blue Origin, Bezos & O'Neill(14:40) A Quick History Of SpaceX(18:23) Falcon Blows Up(20:24) Elon Sues The Airforce(22:04) SpaceX Launch Costs(23:45) The Honda Civic Of Space Rockets

2015, there was a resupply mission to the ISS. It blew up. NASA lost $100 million of cargo. And guess what? Six months later, SpaceX comes back and they land the rocket on a return mission. So you get freaking uppercut, punched to the gut, and within six months, you're doing something as amazing as landing a reusable rocket back at one-tenth of the cost of ULAs. And by 2017, $62 million per launch, down to $2,800 per kilo into space. Three years after that, 2020, SpaceX delivered astronauts to the ISS on a dragon. Last year, 130 launches all successful. Yeah, it's a proof of something. Disruptors and Curious Minds, Space Lovers.

We are back. It's book club time. and we have a new book, Space to Grow, unlocking the final economic frontier. And space is a place of unparalleled possibility for humanity, and it is in the midst of a revolution. Space activities, once predominantly government-led and century-controlled, are increasingly been driven by companies as well as governments,

by market forces as well as public priorities. And so it begins. Space to Grow, we're reading chapters 1, 2 and 3, Blue Origin, SpaceX, and the Insect, point, essentially a three-act history of NASA and the birth of the private space industry, led by a man that you all know very well. Jeremy, first thoughts before we start breaking down, the economics of the space industry. The line that pulled me in, incorporate space into your thinking. Those words were really interesting to me. And this is a really cool jump-off point

for people interested in the next market opportunity that is non-terrestrial, because I think access to it is going to get a lot better over the next five to ten years. It's an economics book essentially, isn't it? It's about the economics of space and the private and the public infrastructure that pays for it. Well, it starts off with, yeah, definitely a lot of economics in here. You know, we learn in public in book club, right? So teach me, teach me the first fundamental, theorem of welfare economics. Under certain conditions, the equilibrium of a competitive market is efficient. Those conditions include the absence of externalities, the ability to trade all goods and services, and all participants being rational, informed price takers. It's about supply and demand. It's about who pays for this infrastructure, why they pay for it, and what they do better than those who

end up not paying for it. So yeah, so given certain conditions market, the market forces work. There's a framework here, a three-step framework that they that they tease as we move into the inflection point section, establishing the market, refining the market, tempering the market. So that's like a little bit of a framework that they throw out there as we move into the inflection point. As you said, a nice little history of space. Essentially NASA, the Apollo program, came to an end. The American people and the world was so overwhelmed by 1969 that when it happened, there was such a come down. There was such an emotional come down that people, it's like people on January the 2nd after the New Year's Eve, there's just this, the blues kick in. And they lost interest

in space. What do you do? How do you follow that? How do you beat that? You can't. We do a tremendous job of coming to. together around something really big and really important. There's just great energy that builds. There's just great community that builds, this commonality, this liminality, this we're doing this together. And you hit the top of that. And it's just kind of like, ah, we did it. Well, now I'm going to go do my own thing and you're going to go do your own thing. And, you know, our, our connectivity is removed. The signal isn't connected anymore. And we wait for another big moment. But there's never this, Maybe we just don't have the energy to sustain the momentum of something that big.

It's like the end of Stand By Me, when they find the body and they're the greatest friends and they come back and they all go their own ways and they don't really see each other again. Wow. What a great analogy, dude. So comparing, comparing the landing on the moon to finding the body and stand by me, that's got to be something that hits pop culture SEO for sure. How do you connect that to? So NASA. We don't have the budget anymore, but we still need to continue this. So we'll build a space station and we'll build shuttles, reusable shuttles to get there. The excitement is reignited. Stand by my, stand by me too. But it doesn't really turn out as they wanted.

They spent too much money. The launch costs were ridiculous. The Apollo program had been a national priority and the flood of funding NASA received and reflected that at its high water mark in 1960. the agency received 6 billion or 4.4% of the federal budget. That share of the federal budget today is worth 268 billion, or roughly 10 times NASA's current allotment. But even before the Apollo missions were complete,

the agency's budget began to fall tumbling to only 1.2% by 1974. The vision of rapid and affordable reuse soon vanished rather than flying 60 missions per year. As projected, the shuttles were flying fewer than 10 across their 30 years in operation, the shuttles would average fewer than five launches per year. Later assessments determined that each launch cost $1.5 billion, meaning that each kilogram of cargo costs $60,000 in 2008.

That was, so 90,000 today. Yeah. And as we'll learn when we get into SpaceX, they were doing it for 2000. Yeah. When we look at getting into SpaceX chapter, kind of what they've done to launch costs is, is amazing.

So, yeah, so the excitement's gone, the enthusiasm's gone. So is the budget. And they're trying to do the shuttle program with this budget that's just kind of tanking, right? What did you think about Pete Warden? The self-licking ice cream cones? Yeah. Yeah. Yeah, I, you know, I read that.

And I was hoping to get more insight out of that in depth. But, you know, he just kind of talks about the monopolistic aspect of that. that and how innovation can't happen in that in that piece so you know we have the unfortunate shuttle disasters do you remember seeing those watching those at the time 100% I was in I was in class we're all sitting there watching the television and the explosion happens and no one says that that we're just like holy we're thinking in our brains like holy smokes and teacher like turned off the TV and you know did her best to maintain a little bit of I don't know something I remember that.

It was, it was, it was, it was, it was a big moment. And Columbia, 2003, that was the end, NASA said, okay, end of this, end of the decade, no more shuttles. And that was, that the seeds, that tragic events, led, sowed the seeds for what came next. Then you got 2004, George W. Bush and his vision for space exploration. and he later that year convened the Aldridge Commission. Basically said time to transform NASA in it. There's kind of two paths, weren't there? We got the path in the peg, or the two paths.

There was one on the one side. Let's go back to the 1960s, to the Apollo, to the mass ambition. Constellation. The other one, Constellation. That was called Constellation. The second one was open the gates to the private sector. Yeah, so you have this, this, hey, we're going to redo Apollo. Apollo was amazing.

Let's try to do that. in this constellation. They wanted to go back to Mars, they wanted to go back. They wanted to go to Mars. Didn't they? Right, right. They wanted to go back to Mars. Have you been?

Yeah. And then this other other program, COTS, what does that stand for again? Do you remember? Cop commercial orbital transportation services and 500 million dollars. That's all they wanted in 2005. NASA requested 500 million, I say only for a new. It's not very much when you compare that to the billions. which had come before it.

And the goal of COTS was challenging private industry to establish capabilities and services that can open up new space markets while meeting the logistics transportation needs of the international space station. So this transitions NASA from doing it all to kind of providing some insight and help for these teams. Insight over oversight.

COT's contracts followed a fixed price model rather than a traditional cost plus. So in a fixed price contract, NASA requests a service, for example, delivering cargo to the ISS for a set fee, it puts the financial risk on private companies. But the more the companies can keep their costs below that fee, the more profit they make. So, and that drives innovation, constrained drive innovation. I think that's what that's what that ended up doing. And with 12 years of COTS, it supported the development of two orbital rockets and cargo vehicles. And it was at half the cost of a single shuttle launch at $850 million for the development of those things.

So it worked, right? It worked to kind of prove. It worked pretty quickly. Like the first contracts were awarded in 2006 to rocket plane Kistler. What a name. Sounds like a punk band. It does sound like a punk band, doesn't it? And the space exploration technologies corporation better known as space. The first chapter throws a lot of SpaceX stuff out. Let's hit that in chapter three. So let's move on to Blue.

So Blue Origin, you have a young Jeff Bezos speaking of the moon moment, speaking to the Apollo moment. He's, what, five years old, watching the TV with his family. And, you know, he speaks about this a lot, as referenced in the book. That was a pivotal moment for him. He wanted to help humans figure out space to save humanity. This big grand mission that was sparked. by the Apollo.

A pivotal moment for many people, but not everybody ended up with their own space company and biggest internet retail website in history. I didn't know this, but he also went to university, didn't he? And he had a particular professor at university. Was it that guy? So, Mark, are you done making fun of me for referencing High Frontier? No, it's he, it does. seem to come up a lot, Mark. It just seemed to come up a lot. And when we get deeper into Blue Origin

and Blue Origin and SpaceX's contrasting visions for where humanity should go in space, Jeff Bezos is essentially he's, he wants to build Gerard O'Neill's infrastructure, doesn't he? Big fan. Yes. So Blue Origin starts out as this like think tank that that's funded by Jeff Bezos. The pivotal moment there is he ends up hiring a guy named Rob Meyerson, former NASA guy, that starts to put a little structure around this little experimental pool that he keeps throwing money into. Some of the initial explorations I thought were really interesting that they referenced. One was like a catapult to launch satellites into space.

One was some kind of laser beaming thing as some of the fun ideas that they pursued initially. I like the nice little Easter egg among the early. earliest employees was Neil Stevenson, the author of the cyberpunk sci-fi novel Snow Crash. So that was quite interesting and probably related to some of those more wacky ideas about getting things into space. So this goes from Think Tank to like, all right, let's figure out how to launch paying customers into the atmosphere. Bezos Meerson and the Blue Origin team pursued a new shepherd quietly.

The press almost always referred to the company as secretive. at a non-descript facility near Seattle, as well as a vast swath of land in West Texas that Bessos had purchased as a family ranch and a launch site. Just love the idea of buying family ranch and just go to the estate agents. Yeah, need space for a launch site. Yeah, make sure when the rocket blows,

we got enough space to dissipate everything and owe to have billions. Okay, so we talked about Cots earlier and what that did to open up the idea of commercial innovation in space industry. The next version of that is this like commercial crew program, right? Commercial crew integrated capability, the very catchly CCI cap. I didn't know this. CCICAP.

C-C-I-C-A-P. Government acronyms, man. I think they need, what they need or needed was Neil Stevenson back then, working for NASA to come up with better names. Fair enough. It asked participants to propose a complete end-to-end design encompassing spacecraft, launch vehicles, launch services in ground and mission operations and recovery for crude missions.

The deadline was set for 2016. The Blue Origin folks. Did they go? Did they put forward a question? They stood on the decision for a minute. And they decided at the last minute not to not to not to pursue that. But guess who did? We'll talk about in a bit.

How much was Bezos involved in that decision? Because there's a line later on in the chapter where you think maybe he didn't sign off on it completely. It was a bit annoyed that they rejected it, didn't they? Because SpaceX ended up with a nice hefty check. All right. On to SpaceX. It's so quick. It's so recent.

When all these dates, basically from 2003 is when it started, but 2005 was caught, SpaceX didn't really get involved until 2006. It's so quick, but so recent, isn't it? It's such a, it's 10, 20 years, max. Yeah. All this has happened. A lot's happening. Actually, the show we recorded this week, in fact, was our guest was the engineer who designed the Raptor rocket system. So listen to that one too and you can hear from him directly.

Thinking on paper. Dot XYZ. We're getting better at plugging, Mark. Getting better at plugging. People should be listening. We're interviewing rocket scientists from SpaceX and NASA one week. Neutral atom quantum quantum computing CEOs the next. Get involved, people.

Yeah, who can hang with this? Who can hang with this? All right. Let's run through a quick history of, of SpaceX. There are four core principles that the authors outline as to, you know, why SpaceX is so important. Hit me with the facts, Jeremy. Number one. So they drove launch costs down 90% from the days of the shuttle.

That's pretty, pretty awesome. And the way they did it was by breaking stuff. They failed a whole bunch, right? And almost ran out of money a few times. You know, 15 years after launching, 15 years after starting, the company, they're dominating the market. What are they, do you have any data on, you know, how many, how many launches they had this year?

135 in 2025 all successful, mostly delivering Cargo. Cargo. Starlink up into the atmosphere. I'll talk about Starlink in a minute because I think it's important and crucial to their story. Back to the bold, Joe. Back to the bold. So here's some of the intangibles. Well, no, this is number three.

So they're the most valuable. What about number two? Dominates launch after 15? Yeah. Clearly the most valuable new space company, right? And, you know, their talks of IPO and all of that stuff happening potentially this year, more of the intangibles. They trained this new group of space entrepreneurs, right, and inspire a bunch of others to start companies and do things. We talked to our guest this week who's doing space-based solar power originally designed the Raptor rocket. So he came out of this SpaceX org, right? And lastly, Like the PayPal Mafia, they're talking about the SpaceX Mafia. SpaceX is directly trained, a core group of space entrepreneurs, and indirectly inspired countless more. In 20 years' time, we're going to wake up and, yeah,

they're all going to have begun life at or because of SpaceX. Absolutely. And then, you know, lastly, basically prove the market approach, market-oriented approach to space can work. But what I thought was really interesting, did he originally, when he wanted to do this, he wanted to try to, buy rockets from Russia? Was that?

Yeah, he went to Russia to buy some rockets and the Russians up to the price as he was there and they flew back. It was too expensive and on the flight back. He's like, we can build these ourselves.

And if they go back. That's a pivotal moment. What if Russia was like, hey, you know, we're going to, we want to jump on this. Here's, here's some rockets.

Sliding doors moment. Thanks Russia for not wanting to sell your rockets for too much money because SpaceX might have gone a different path. Who knows? And they nearly didn't make it, though, did they?

They started to build their Falcon rockets. They had to go to some little atoll in the Middle Pacific. They couldn't afford to launch anywhere else. They took it there. The first one blew up. The second one blew up. The third one blew up. They only had the funds for three launches.

100 million. I think they had Elon's money. 100 million of Elon's money. And then they raid, they said they scrapped together 350 million. Like, yeah, I don't think you scraped together, scraped together 350 million. raised 350 million, right? The third one, like, we're walking away. And then Elon's like, hold on, I've got a shed over here.

We've got a bit, we've got a few bits and pieces. We can probably kind of get some it together. And Peter Thiel calls up and, yo, hey, Elon, I've got another 20 million. Let's try one more. And Elon's like, yeah, I've got, like you said, got some parts in the shed. Let's cobble some shit. And they botch it together. And then on the plane over to this atoll in the South Pacific.

somewhere, the pressure gets to it because they've bubble wrapped it and it starts to deform. So they put someone inside the rocket to knock out the dense. They land it. They're like, Elon, it's not going to work. It's like, fix it. They fix it. And it succeeds. It goes up. It, it separates. It gets into orbit. And within about six months, they've got a few billion dollar contract with NASA to send cargo up to the space station, I think. Yep. Absolutely. And we were talking Falcon, one, right? With the three tries. So 2010, we're in Falcon 9. Falcon 9 has nine times the capability that Falcon 1 had in 2010, which was how many years from that Falcon 1 launch, the one that worked? 2008. Yeah, two years later, nine times more power. Falcon 9 was 160 foot. Nine times the power

of its predecessor, the Falcon 9 would be able to haul 20,000 kilos into space. So we, we, we, we, talk about calcified systems a lot on this show, Mark. The stodgy old guard that is trying to protect and justify their way of doing things. 2004, Elon Musk challenges the stodgy old guard because the Air Force was finding ways to use loopholes to continue to use the United Launch Alliance, which I guess was Lockheed and Boeing together. And he's like, listen, listen A-holes. You know, you're saying we're opening up competition, you're using loopholes to continue to feed your buddies. What was the outcome of that? He sued the military and they essentially rescinded and said, okay, from here on out, it's open.

Forget about launching shit into space. Suing the military and winning? Is that maybe more powerful? I don't know. He was applying for these contracts before Falcon 1 actually got into space. So he's up against Boeing and locking. Keene and, you know, they must just have thought, who is this, who is this little insect doing this? What are you talking about?

Obviously, publicly, they have to acknowledge him. And then, yeah, 10 years later. Let's run, run this down real quick. So in 2015, there was a resupply mission to the ISS. It blew up. NASA lost $100 million of cargo. And guess what? Six months later, SpaceX comes back and they land the rocket on a return.

mission. So you get you get freaking uppercut, punch to the gut, and within six months, you're doing something as amazing as landing a reusable rocket back at one-tenth of the cost of ULAs. So at that point, I guess, I guess, I guess the Air Force like, yo, okay, maybe they were right. Maybe the market forces work, right? And by 2017, $62 million per launch, down to $2,800 per kilo into space. Three years after that, 2020, SpaceX delivered astronauts to the ISS on a dragon. Last year, 130 launches all successful.

Yeah, it's a proof of something. So the authors, they don't do bold. They go into italics on this, but there are four key pieces of the puzzle that they think for SpaceX's success, iteration, vertical integration, economies of scale, reusability as one, and then culture. So running through these really quick... Where have you heard that before at thinking on paper as regards to Elon Musk, Jeremy? Those exact same four steps. Was that on our show yesterday?

Last, the electric stack. Oh, vertical integration, 100%. Yeah, very close. At Tesla, that's exactly what he did at Tesla. See, we're tight. We're. We're connecting, we just connected a dot live. I don't know who else does this, guys. Yeah, we're there. Nobody. Nobody. So iteration just really quickly, I thought the Ferrari Honda comparison was pretty cool, simple, light, cheap, and be famous for your failures.

It doesn't have to be the machine that the Ferrari is. It's just got to be hyper-reliable. He says the Ferrari is super expensive, but unreliable. I don't have a Ferrari, and I'd like somebody who has a Ferrari to confirm if they are unreliable. but he says that Farrie's very expensive, unreliable, you can buy a Honda Civic, and I guarantee you that in a year it won't have broken down. I'm going to build the Honda Civic of space rockets.

Right, there you go. There you go. All right, so vertical integration. So comparison to ULA, United Launch Alliance, they've got hundreds of subs all over the country. SpaceX is committed to in-house development. 70% of their components were in-house for SpaceX at the time of the writing of this book. Economies of scale and reusability.

Elon Musk says, thrown away a rocket after one uses like chucking an airplane after the first flight. Interesting thought. Cost breakdown. The fuel was about 200K. And the remaining costs for the rocket were in the manufacturing.

60% for a potential reusable stage. 20% for the second stage. 20% for the nose cone. So they focused on that 60% and were able to do some pretty cool stuff. Culture. How important is culture, Mark? The last one. I think culture is incredibly important. I don't think that they would have achieved half of what they have without the culture.

SpaceX was and is laser focused on its long-term mission reaching Mars. A lot of other space companies are trying to win contracts, said Jonathan McDonald, an astrophysicist at the Harvard-Smithsonian Center for Astrophysic. SpaceX is trying to get to Mars. That mission was baked into the company's everyday. culture, according to the many SpaceX alums and meters with whom we've spoken over the years. It's inspirational. It's grounding. It's wow. It's got everything that they need it. There are a couple things I want to talk about in future chapters, but Starlink, I think, is such an important thing here as a

key element to fund this mission to Mars. We're going to talk about that a little bit more in coming episodes. We're going to talk about Starship. We're going to talk about how SpaceX influences the supply and demand curves. There's a lot here. We also have some very, very special ex-NASA guests coming on the show very soon. I'll tell you what. Big stuff. Big stuff. Get on the rocket now.

Friends and neighbors. We've got some big stuff coming. This is exciting. I'm fired up. I know you are, Mark. So far so good with the book. I'm excited and I'm glad we chose it. Chapters to come.

Stay curious. Be disruptive. Keep thinking on paper. And reading books with us. Read books with us. Read books with us.