FULL TRANSCRIPT

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Eric Cantor (00:00)

Welcome to the Space Investment Frontier. We are talking about a very exciting space, no pun intended one that's been in the news a lot lately. 680 billion is one of our TAM estimates that we're going to talk about why. That's woefully short of reality. and we've got a number of investors who who want to learn and and ask some good questions. So let's start with some introductions.

My name is Eric Cantor. I'm the CEO of Vincent, www.withvincent.com. We help investors navigate the private markets, which covers private credit, crypto, but you know, principally venture capital. And we've been doing a lot of work on pre-IPO lately, which some of the companies we're going to talk about today are are considered pre-IPO, others a little earlier, and a couple public companies too. We've got a great panel here of experts in the space.

why don't I start with Bradley Hatton Jones of Orbit2Orbit? do you wanna give a quick introduction on yourself?

Bradley Hatton-Jones (00:53)

Thank you, Eric. my name is Bradley Hatton-Jones, I'm the CEO and founder of Orbit2Orbit, and Orbit2Orbit is a space infrastructure company built out of the Gold Coast in Australia. And we are busy building reusable vehicles that fly between space stations to deliver cargo. we could dive a lot more into that a little bit later, but I think what I'll do is hand over to Aaron.

Aaron Burnett(01:17)

Yeah. Thanks for having the guys. It's fun. It's always fun to have these conversations and educate when we can. Aaron Burnett, CEO of Mach33. We do private investments and research into space and SpaceX and the kind of the expansion technologies that are coming.

Eric Cantor

Awesome. Thanks for joining both of you. we have other important folks here, namely the audience. So just give a quick profile of who is in the audience. we're mostly accredited investors, though not exclusively 7525. most investors here have done some pre-IPO investing. We'll we'll just call that private market investing. mostly not as their day job, but more, you know, more experienced and intermediate than beginners.

So we can talk to the audience as, you know, knowledgeable folks. And lastly, 50% of you plan to make new space investments in the next year. another 45% looks like your your mind isn't made up until after this call. So let's try to help you get to a yes or a no on that. As always, what we're about to talk about here is not investment advice. Anything you do in this space or anywhere should be based on your own plan, based on your financial advisor.

This is not investment advice. Great. So let's start the conversation with just kind of like where are we at in this market? So, you know, why space? Why now? and we've heard, I mean, everybody on this call probably talked with us a few weeks ago or a couple months ago about SpaceX going public. So we did dig into launch economics and the fact that launch is getting cheaper and cheaper and probably continues to move in that direction.

We've heard about the ISS and and the kind of next gen on that. There's a lot of defense stuff happening. And I think one of the themes we'll we'll probably talk about is is space part of the defense industry or is it its own sector? in the SpaceX IPO, we heard about these orbital data centers. So that's super interesting to a lot of people. And of course, just the the fact that SpaceX went public and brought, you know, major space company into

a realm where individuals can can invest in it directly. So maybe starting with Aaron, since you're more actively in the research side of this, what what do you see in this ecosystem now in terms of trends, insights? Wh where are we now in the development of this market?

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Aaron Burnett

You know, it's been building for a while. with SpaceX getting, you know, Starlink getting going and things like that back in like the early 2020s. if you were involved in the ecosystem for that since then, you you know, this was this all most of this stuff is old news. What's really happening is you've got a lot of people paying attention that weren't paying attention since basically since the last little spec bubble, let's call it, popped.

where there were some space companies in there and they didn't perform the way that people had hoped or whatever just the attention that people had kind of shifted to something else. and so the one of the reasons for that though, I think is it's effectively SpaceX going public. There's a lot of the space infrastructure that's there. And what you really see is AI the AI narrative and and like the the value that AI is creating is forcing people to pay attention to infrastructure.

Which is not what has been the exciting thing to talk about. CapEx Lite, you know, SaaS, where you just put money into marketing or whatever, and you basically put no money in and you didn't have to spend money to make money was kind of the the thing everyone wanted to look at and focus on. AI is realizing you have to build data centers, you have to do hard things. And SpaceX is the natural extension to all of that with their AI side of their business, but then also

building that into the space side of the business. So I think really what you see is kind of that that trend emerging and people just starting to, you know, take things seriously and realize that things like Starlink, the connectivity, the launch infrastructure, all that plays a role in how we build out this kind of next industrial revolution.

Eric Cantor

Right. Bradley, what what trends are you seeing? What's exciting to you in this market?

Bradley Hatton-Jones (05:17)

This is the last couple quarters. just going back on what Aaron said, yeah, it isn't old it it's old news of what we're doing in space. SpaceX definitely did put a spotlight on what is going on and what's happening around over here. But I also think that there is a real trend of increasing activity around here in space. One of those factors you listed in your slide is reduced launch costs and that

does play a very high role in this because now lots of companies suddenly do not need to get these ginormous capital to and do their space projects which is really really good the other thing that was sort of touch and go on over there was ai has also it's not just going and saying we need data centers in space. Yes, that's fine. What AI has also done for the world is it's

helped to develop a lot of new technologies that have come on board. And with these new technologies that have come in place, we need a place to grow into that. And space is that natural evolution to grow into a lot of these new technologies to make that happen. We're seeing that across the board at orbit to orbit. We've got pharmaceutical companies that have been developing new drugs with the assistance of AI, material scientists doing the same thing.

And there's a just a lot of new types of sensors and growth coming out there. And so everybody now needs to get access into space. And so this is being a really good trend upwards. So yeah, the SpaceX kick of the door down on the launch costs, this is just the start. What we're seeing is just the very, very bottom of this curve. And I think that we're gonna see a lot of good growth happening in the next five to ten years in the space.

Eric Cantor (07:01)

Great. Well, as investors, that's our first question. What what's the growth that's gonna happen? And so you know, let's talk about the size of this market. And by the way, while while we get into this for this entire discussion, please feel free to drop questions in the Q and A. I see I see a few popping up. But if you drop in now, we can we can try to get to them kind of as we move through as opposed to saving all for the end when I'm sure we'll be rushed. So I don't know.

There's different estimates. Six hundred and thirty billion was the latest number I was able to pull off. you know, on the one hand, this is a trillion dollar market here. On the other hand, the the growth rates, at least in this chart, aren't that impressive, right? For a venture investor. I mean, prediction markets grew what, like nine thousand percent last year. AI obviously companies are growing every second, like by the end of this call, anthropic probably double as revenue. So where you know.

How big is this market? How big is it going to get? And are there things that we're underestimating here? Or is there a time frame that's more than a decade that that we want to keep in mind on this? Aaron, you want to start that off?

Aaron Burnett
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Yeah. yeah, I'll jump in. I mean, this was a conversation on X yesterday. All my days are merging together, so I think it was yesterday. And the one the the Goldman Sachs, I think was, just came out with their their number at 1.8.

By twenty thirty or twenty thirty five.

Bradley Hatton-Jones (08:18)

Eighty thirty five. Yeah, yeah.

Aaron Burnett (08:20)

Yeah. So that number used to be the same. I think it was very close to the same number. I for forget who it was, Myrolynch whoever, but it was like twenty forty. That was like a couple of years back. So if you've been watching and paying attention, this is like okay, they're just shifting this forward a little bit. And quite frankly, you're looking at numbers that are people that are paid to

be conservative and kind of look back and have some kind of anchor that they can point to. And then they basically put like a keger on top of it. All right. That's it's easy to predict and helpful. the better way to think about it is to just look at I think the kind of the physics and the stated goals and what's possible and what's not and is there money behind it and stuff like that. And then actually kind of forecast what's what's happening. So what you're seeing really is you know, the difference between someone who needs who's a PowerPoint maker who needs to kind of like, all right, like

I need something that I can defend in nice, nice, you know, linear growth. And reality is we're we're hitting some kind of exponential number. And it's very hard to predict when that is. The only thing is like you're trying to figure out when that kind of inflection is, and that's really the big one. and so one of the biggest reasons for that is is honestly the AI and and the compute that's gonna be thrown into space here and Starship. So you Starship where the upmass is hitting kind of an exponential, that's something you can kind of forecast pretty predictably.

It's very likely to happen in the next year or two. Then you've got Starlink, which they've already they want 10x more Starlinks going up. That's a predictable revenue driver. you can kind of get a sense of okay, what's the likely cadence for that? And that's, you know, again, one of these things. The AI compute on top of all that is like a big spending, big mass, big long-term revenue kind of driver potential. So all of these numbers are gonna like.

gonna be like, we were surprised, like who could have predicted this? You kind of can. You're just really depending, just really just comes down to the time frame. I expect that 1.8 is probably likely more likely in 2030, maybe even sooner, than this 2035. So it wouldn't be all that surprising it jumps half a decade up, or maybe even 2029, something like that. driven a lot by your Starlink, your orbital data center stuff. They'll be early at that time frame.

And defense. Defense basically every new every new assets in orbit creates vectors of attack, multiple vectors of attack and multiple vectors for defense and all this other stuff. So if you have a hundred thousand satellites there, you now have a lot more things to be worried about if you're in the defense space and China's moving very quickly. China just landed a rocket. Was it today now? Like again, my days are all merging together. they just

Bradley Hatton-Jones (10:55)

Channel end of the rocket on the barge, yeah. Yeah.

Aaron Burnett (10:58)

Well they landed the on the barge like a couple of weeks back, but today they landed on land so for the first time, like in the in the desert. So they're they're kind of you know pushing and you know catching up, so to speak. China's not slowing down for any of this and they're putting a lot of money into it. So I think those are reasons you see that move substantially forward. And the question is like, is it is the inflection in three years or five years or seven? I think those are your your decision points.

Is there a single, let me just piggyback on that and pull in a question in from from the audience, is there a single technology innovation that could create that inflection or the collection of many actors sort of iteratively leveling up?

I'll just like get my my like towel onto my thing and then pass over to Bradley. But like the Starship's definitely an inflection like that's a requirement. You can't put any of this mass up there without without Starship. So I think it really will come down to Starship initially. There are other launchers that are coming in, but functionally in the next ten years is they're gonna feel incremental, I think. So realistically it's gonna be like the big thing is Starship. That has to be it's an unlocker. Everything else is downstream of that.

So it's an unlocker, but then the compounding growth where you really start to see exponential is probably the combination of Starlink and Star Mind, which is the orbital data center stuff. Again, because SpaceX has the money, they have the cost advantage, they can just drive as much as they want, but they unlock everything else off of that, right? That's all the other infrastructure that's happening from a private markets investment perspective. You're thinking about where you play in that, like these kind of offshoots that are coming from like this map.

Like you're you're living in its wake to some to some extent, particularly in the next five to ten years. But this will be a massive, you know, market opportunity. So I think it's Starship primarily as like the big first domino to fall. Then everything else kind of downstream then.

Bradley Hatton-Jones (12:57)

The Starship becomes that first domino. But I think if we're talking about the space economy as a whole, it's probably not one magic technology that ends up becoming this big inflection point. It's really this enormous growth that happens on these multiple curves. They're all moving simultaneously. What if I had to choose something that was specific to this, I would say that we need to have a look at what does this start looking like in a full

in orbit economy. Right now, most spacecraft or space assets are these effectively these islands in space. They are designed to not interact with anybody or any arbitrary technology. But once you start introducing all of these assets in space where you start servicing them across the low earth orbit spectrum, they start working together, they start supporting each other, that's when you start having the scalable markets.

And for any economy, what you need is you need a logistics system. And so bit of a plug here, but that is what orbit to orbit is busy building towards. We're busy building that infrastructure economy where we've got vehicles that are going to tie a lot of these systems together. We're going to be supporting Starship. We're going to support all of these data centers in space. So I think that is really where we're going to start seeing a lot of this technology sort of come out. And like I said, it's not one.

particular magic system that comes online, but it is the collection of now getting all of these systems to start working together. I think is going to be really big for us.

Eric Cantor (14:33)

Got it. So let's kind of double click on that. I mean, you're talking about these different curves of different pieces of the economy starting to work together. So let's look at, you know, where the value could accrue. So so what are those levels? right? Because you're what you're saying is like orbit orbit's working at different market as Starship. You're not competing with them. You're you're a different layer of the value.

Bradley Hatton-Jones (14:53)

We're

enabling supporting them. Yeah, yeah. Yeah.

Eric Cantor (14:56)

Exactly. So let's try to create a I mean the same way that in in the AI, again, not to be labor AI, but like you've got your data center, you you've got your metal, right? Your your your data centers, you got your chips, you got your inference, you got your consumer apps. There's kind of this value chain that can be articulated. Let's try the same thing for space. So maybe I don't know, do you do you have an example?

of of something of an app that can illustrate these different components and different companies and technologies working to you know deliver a solution. you want to start on that one, Bradley?

Bradley Hatton-Jones (15:32)

So just trying to come up with a c nice clean example for you. But there it I don't know of any one app, any one system. It's all layered. and it's it's all these different technologies working side by side with each other. So do you want to maybe ask the question in a

different way just so that we can try and land on an answer that I think everyone would be happy with.

Eric Cantor (15:59)

Well like if we we had that slide with I think crop monitoring, right? So I'm assuming some company is launching the vehicle. some company is pr making it run and there's different pieces talking to each other. Yeah, we're trying to understand where the different

like layers are. You talked about Starship being a launch vehicle. There's some satellites. There's what you guys do. So just maybe like paint that picture a little bit more for our investors.

Bradley Hatton-Jones (16:27)

Sure. So, you know, we've got a whole bunch of different technologies out over there. We could use crop monitoring is a pretty good one. a lot of the times these companies end up building satellites that have these monitoring systems. These monitoring systems are shared across multiple different apps, different types of software companies, and they end up, you know, sharing our time to these different technologies to build.

speaker-2 (16:53)

Yeah.

Bradley Hatton-Jones (16:55)

this

That is a very, very, you know, bespoke area and purpose. And that would not be used for anything else, like defense, for example, defensive security, climate and resources. They would all have their own specific assets in space to do this. And then they would then market towards these other companies in enabling that and building that out. But yeah, there's not one sort of application in there. What we can do and we we can say with some confidence is that

We are getting very good at dual use technologies and trying to get a lot of the companies to almost layer in their different sciences. We've seen that big growth in that when it comes to NASA and the European Space Agency and understanding a little bit more about what's happening on Earth. And I know that's a bit of a science side of thing. It's less about the the money side, but what that has enabled and unlocked for a lot of people is

Once that research was done, or it still is going on, we have realized very quickly that, well, hang on a minute. We can use the same sort of technology and same sort of growth to unlock massive markets, massive improvements in our system. And so then you get companies like Fleet Space, for example, who's got these assets in space that are helping mining sectors and all the rest of it. That's not necessarily technology that they've ended it up.

growing and developing just out of the blue. This is all going and saying, I can actually tap into, you know, all these different technologies that are floating around in space with my application, with my software, and then enable an entirely new market to take place. So there is a significant amount of growth happening out there. And I think it is a little bit of that untapped or unappreciated market where it's

We are busy building quite heavily. We're busy layering things in and with that grows a whole bunch of new opportunities.

Eric Cantor (18:52)

Aaron, do you want to just take a stab at seeing how explaining how this value chain kind of offers

Aaron Burnett
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yeah. This is an age old problem, right? Like it's like people have a very hard time grasping space because it's not an industry. It's a place. It's a domain. And so everything can move into space in a way. Like almost pretty much anything you can imagine. It's it's really a question of when and all this other stuff.

So in other conversations that was happening on X in the last twenty-four hours or so, given this conversation of like, you know, it's a growing market and all this stuff, like I think a thing to help like anchor yourself is to like envision you go back in time and you are you know a sixteen hundreds economist or investor trying to argue about the the Western hemisphere's value, and the only thing you can understand is like you know, the current UK GDP.

And you can't envision anything bigger than that. And the reality is you zoom forward, you know, 400 years or whatever, and you're like, wow, this is you know, this is a very it this is obvious, right? In hindsight, this looks obvious that, you know, a big growing economy can happen and humans expand and so on and so forth. so over the so the real question in front of us is okay, like if you can understand that concept, the concept the humans exp expand and they bring, you know, capitalism and economies with them.

The question is like how fast is that gonna happen? And so for a long time, as we investors have gotten more quarter to quarter specific and thinking about like what's gonna happen, you know, soon and on the next twenty the last twenty years have all been about like again, kind of like social media and like magically creating money out of nowhere. what you're really seeing is I think basically the AI revolution has drum has created a massive acceleration on top of the information age. And ultimately you could even argue it's like

It was like the last thing as as part of the information age, right? It create it turned information into intelligence, and now we're creating these crazy productivities, which is really accelerating the need for everything else and expansion. And ultimately at the end of the day, the thing you need to expand is energy and mass. And this is exactly why I know this is like little physics E, right? Like E equals energy squared kind of thing.

But ultimately those are your core can your core constraints. That's why everyone's worried about, all right, you know, how do I get plugged power in, you know, for these data centers or what have you. because really the only question you have is like, is there a cap on intelligence? Is there a cap on the value that intelligence can create? And if you don't believe that there is a cap, or at least in our viewpoint as we understand it today, like we're at the bottom of an S-curve and we're looking up at a wall of of growing opportunity and growing productivity.

then you basically realize like the only thing that matters is scaling that up and getting more and more productivity and faster and faster. So like if you buy into that, or you can buy into the bubble narrative and we'll just, you know, whatever, that's fine. You know, it really depends on what you believe. so with all of that being said, there's the reason why you're looking at like, okay, the opportunities that grow and the opportunities that are coming, it's infrastructure built. And to answer your question, there's all these different scenarios. And I think if you have or there's all these different technologies that play into it.

It's why communications matter. You need to connect the information. Think of it as like an industrial revolution. You had oil. It was a commodity. It's crude oil. It got transported with railroads. It got refined with the refineries. In the world today, you know, starships are those are those railroads. The refineries are the orbital data centers.

They're they're taking something that's raw and crude like information and turning it into something that's relevant and useful, like intelligence is the same thing. So I think those are the it helped it's a helpful kind of analogy to think about these things. Put yourself in the industrial revolution where actual infrastructure and real things are being built, and everything else is kind of just like rolls downhill from there. And obviously we could spend all day, and I know, I know Bradley could go deep on all the intricacies.

Bradley Hatton-Jones (22:51)

I was just gonna say, like, if we just have a look at what is available and working right now for us, everything we do, every minute of our day, we are using space. The in-orbit economy is working for us right now. It's not something that is gonna happen in 20 to 30 years' time. You've done you've worked in the space environment or at least interacted with the space environment just 20 times this morning, right? The moment you went and

ordered your cup of coffee and tapped your phone, well, that used internet communication to do that. But the banks also needed to make sure that that transfer happened at the millisecond. And so they use GPS technology to get that big grandfather clock to enable all of that from taking place. And so, you know, if you go and scale this backwards and into the current world now and you go and say, well, what does this mean? How does this all layer out?

I would just say just do a little bit of self-reflection. Just have a look at what did I do today, and how did that end up, you know, impacting me in terms of the space economy. and and just to give a a fun little tidbit on this, the UK government it was about three years ago, maybe less, they did a big research on what does the UK government look like? What is what does the United Kingdom look like?

if we had to turn off the space economy for one day. We just completely said no more. And that came out to be almost like an end of the world scenario, right? It is just complete and total collapse of everything that we do today. And so I think it is a bit of an underappreciated, you know, environment where people go and say, Well, why should I invest in space? What has space done for us? And it's like just about everything. Everything that you are interacting with now

has come from the space economy.

Eric Cantor (24:46)

We're drilling into a lot of bullish and you know high high potential innovations we might be seeing down the road. Can we just take a quick sidestep and and just ask, does anyone have a realistic expectation of when these data centers could be operational in space?

Bradley Hatton-Jones (25:03)

I could take a stab at that. So if we work on Elon Musk's time, it would be yesterday. but if we look at what a realistic output would look like, I'd say that an MVP of data centers has already gone up. StarCloud has sent their first MVP up and essentially communicated with that.

the first functional or commercially available data centers in space or array of data centers in space, we're probably looking at twenty thirty, twenty thirty one, as essentially a generation one of these data centers. Whether that be StarCloud or SpaceX or enter new competitor here, I don't think that really matters. I think that is w sort of the convergence point is that twenty thirty, twenty thirty one.

Aaron Burnett (25:52)

Got it. yeah, let me let me this is like the thing that we're best known for is the research from an independent perspective. So we're not like, you know, SpaceX that we have position there. it it's it's we used to think that it was a not gonna be a truly, you know, economically viable thing until w pushing twenty thirty.

The newest information we have with the specs that are coming out with A one SATS, which is what the basically SpaceX will reveal their next generation of a satellite, whether that's Starlink or whatever. And they and they and the specs are very close to the way they actually end up, you know, being built because they're developed with engineers. They're not totally pie in the sky. Normally there's like an iteration to them, but you know, not totally pie in the sky.

So if you look at those, basically it suggests that they're probably gonna be economical much sooner. meaning it won't necessarily be cheaper to plug in Iraq in space than on Earth, but they will make money probably as soon as the end of twenty twenty seven, maybe even twenty maybe twenty twenty eight. so they'll be launching them and they have the desire to do that. So and the money to do it. So like they he Elon can just be like, I don't care what you think, I'm gonna do it. to some extent with but it needs to make money.

So we think economically it'll be viable 27 late 27, probably in that first that first iteration through a variety of different things, but one of them being like the co-design rack, which they were just announcing at the quarterly earnings. okay, so then then the question is when's the true crossover? Because at some point we we just did this AI compute keystone model. It's like way too in-depth to go into here, but like basically it suggests that there's gonna be some crazy number of tokens, like 3,000 times.

the demand of tokens that we have today and this prob we're probably undershooting it by twenty forty and it's gonna be done basically served by increasingly efficient computers, dramatically increasingly efficient commute computers, but something like five hundred gigawatts of these of these computers doing that. And somewhere between twenty thirty one and twenty thirty five, it becomes so obvious that it's so much cheaper to do it in orbit that you

Like basically people stop planning based earth-based data centers. That's kind of the way we think about it. Somewhere between twenty thirty twenty thirty one and twenty thirty-five, we actually estimate a peak in twenty thirty one of like planned Earth data s earth based data centers. And then most of the training will be done on Earth. Okay, so that like with that land in context, you know, it there's a real drive for that. The reason data centers are important though is not necessarily just because AI compute and hype or whatever.

It's because from a space perspective, it's because what Starlink was and what Earth sor sorry, you know, satellite internet was, is the next general iteration, right? Like you're moving bits around. It's easy to put something up and generate value just by transferring bits from one place on Earth to another. And that's what that's what Starlink is. That's what internet is. so then the the next logical thing would be move a bit up.

create value on that bit and there's more valuable of a bit when it comes down. It's kind of like what Earth observation is. Like it's like pulling data and and sending b data down. But now there's like a direct value that's created on that bit with intelligence. And so it it's just a huge pull that says, okay, I can pull that way. And there's reasons this orbital data centers work and the reason the math we have in there works is because there's you know you get like six times the efficiency in a solar cell.

in Earth or in space than you do on Earth because of the atmosphere. and you get cooling, cooling isn't free, but it's you it's CapEx instead of OpEx. You're not right, you're you're paying for a radiator up front and then you kind of radiate the heat out over time. there's definitely some you know innovation that needs to happen there, but it's not like new stuff. It's just like hard engineering problems. And so then it really becomes just a demand question. Like if you believe the world as we see it, which is you know,

three thousand three three thousand six hundred times the number of tokens being demanded than we have today. And like that would even be in a scenario where there's a we want even more than that. then it it's kind of a no brainer that it goes that way.

Eric Cantor

So we've articulated a lot of bullishness and confidence in what's to come. We've talked at some of these different sectors where value can be created. Let's just throw a little bit of cold water on it for a minute before we dive into the actual top companies operating in the space and just think about risks. What could go wrong? So as an investor, I want to know how big the market is. I want to know what the big risks are. How could I be totally wrong about this? and maybe just, you know, there's a lot of risks here. So maybe each picks one risk or one area that you think is particularly

interesting and relevant to know about and just kind of give us a little bit of a a of a deep dive into that. you want to go first, Aaron?

Aaron Burnett

Yeah. I think the I think there's a couple of things. I'm gonna I'm gonna pick two. You asked me for one, but I'm gonna pick two. So one and 'cause one can be kind of quick. I think the environmental risks are the things that no one really understands. And so like it's kind of the scary boogeyman. Kessler syndrome, there's been some studies done on this where it's like, Okay, well, we can never have more than seventy seventy thousand satellites or something, which is and we and the plans are for multi like a million plus, okay. So

Like that that's a big disconnect. not to disparage people that do those, but you know, a lot of those studies were done based on the concept of like, hey, we're not actively, you know, cleaning things up and stuff like that, which is just not realistic. This infrastructure becomes more interesting and more re required to be in space and more economical to be in space, there's there's financially incentivizing reasons to just clean it up. So basically that takes that number from maybe

hundred thousand kind of cap to potentially millions. And there's there's a lot of different questions on how much you can fit in there and all that kind of stuff. I'm talking about just orbit. Space weather is another one with solar storms and things like that. We've recently done an analysis that kind of suggested that again, it's just like everything, it's an engineering problem, not a physics problem. So it's you just gotta kind of be smart about how you shield yourself and and that kind of thing. And then the the the business one I think is under val underappreciated depending

Depending on who you're who you are is is really the launch cadence thing. if you talk to people that have that have raised enough money to build a satellite and actually are gonna put something in orbit, the very first question that they have is like if they're confident they're gonna build the thing is like, how am I gonna get it there? And there's not as much launch cadence as people like SpaceX can obviously handle it all from an upmass perspective. That's not really a concern.

The concern is like if you're trying to just buy a really small slot of that, you don't want a you know a hundred or two hundred million dollar starship to buy the whole thing at once. Like you know, that that's where it's not necessarily easy to get a launch slot and people are already having trouble finding transporter slots and things like that. And it there's you know, there's some rumors that there might be bidding wars going on for Falcon 9s right now. So those kind of things are those are very real.

risks for entrepreneurs, private, small entrepreneurs on the ground who are trying to get up into space, because there's not many places you can trust to go and can actually get you access that are, you know, maybe Western friendly today. So I think that's something that people need to be like understanding. Is there's reasons why Rocket Labs is, you know, their launch business is viable. There's reasons why companies like Stoke, which we have positioned in full disclosure, have an opportunity if they if they can execute.

that opportunity is there and big. It's you know, SpaceX has got they've got so many fish to fry on internal demand that like they do not need to bend over backwards. They will help people, but effectively it's I'm not gonna, I'm you know, it's almost charity to help the rest of the industry at this point. they can make money doing it, they're they'll incentivized to, you know, make some money doing it, but they won't be incentivized to bend over backwards to.

fill out cadence and oversupply the market with launch slots. So I think there's w definitely opportunity.

Bradley Hatton-Jones (33:50)

That's out of the wall.

Eric Cantor (33:52)

Bradley, what the risks that you think are, you know, could be showstoppers and investors should be at least aware of?

Bradley Hatton-Jones (33:58)

Yeah,

so I'll I'll I'll just do a shotgun approach on this one over here is so on the environmental risks and all the rest of it, Aaron's absolutely correct. there it is the boogeyman, people don't know how bad is bad and all the rest of it. And so government agencies around the world have also looked at this and said we need to put some actions into place. And so they already are starting the discussions around this and proven on the regulation for space companies like ourselves to ensure.

that there is better deorbiting capabilities that there is deorbiting built into the systems in place. So that is a current risk. It is a current scare, but it is not a always scare. It's something that we are busy working on at the moment. And I suppose that's also a good narration on the rest of these risks over here is that if we have a look at these four risk topics that you have in front of them, a lot of them are

risks of what's happening right now, but they are not risks of what's happening in five years' time because there are already companies, there are already organizations that are working towards solving all of these things. And we could just take, you know, launch cadence is a double-edged sword because as the space economy ends up growing and becoming a bigger, better, larger monster, that requirement for launch cadence will continuously grow. It's one of the it's not so much

If you build it, they will come. You have people lining up outside of your office waiting to fly. And so as SpaceX ends up getting into Starship, they haven't exactly been shy about this either, as they've said that they want to focus on the moon, they want to focus on Mars. And so what does that mean for low Earth orbits economy? does that mean that SpaceX ends up shifting entirely into higher and higher orbits?

And leaves a vacuum behind in the low Earth orbit. And so we've got companies, launch providers that are all coming up now. They're just they're like mushrooms. They're just growing out of every corner of the earth these days to fill in that launch cadence capability. So yes, it's a risk, but it is not a long term risk. It is something that is going to get sorted out. the other thing that I I have a look on on your your table over there is technology risk, flight heritage.

So this is probably not something that a lot of your investors are familiar with, but for space companies, especially product based space companies, when they want to try and sell something to another space company or to a defense company, one of the first things that gets asked is what is your flight heritage? And so that often means is that you need to be able to have flown and proven the bare minimum that your technology works before you can actually sell the product.

And sometimes that is already a five to ten million dollar commitment just on your space program to do that before you've even received one dollar. And that can become a little bit of a risk because what that does is it creates a giant cavern that you need to cross just to in order to end up making money. And I'm gonna take the opportunity to do another pitch over here, but

You know, this is exactly where Orbit2Orbit is busy trying to solve is we've got this lab to space program that acts as this validation step prior to actually getting into launch. And so we do that by giving all of our clients these payload housing units where they can build their payloads inside of it, inside of a lab, and then they can progressively scale all the way through from TRL three to TRL nine to validate their technology before they actually end up committing into that space economy so that they can

One, just make sure that the thing works and that they've de-risked their own mission. But then the second one is to get that flight heritage in place. So for a lot of your investors out there that invest in other space economies, if you want to, you know, help the people that you're supporting to de-risk themselves, to get that flight heritage out quicker and sooner, you know, really look towards us. We can help you on that front. but just final

One quickly, Eric, and I think this comes from a very unique perspective on customer concentration, the over reliance on the government contracts. So coming from Australia, that and and so this is very much a I would say not a US problem, because US is very, very well funded when it comes to these things. But outside of the US, when you do end up having these space companies that are relying quite heavily on these government contracts, we've seen it in Australia.

budgets change, rule set changes, and then suddenly a lot of these companies no longer can tap into that nest that money. And then that ends up becoming a problem. So to battle a lot of these risks, pretty much across the board, is make sure that the company that is busy operating, they are generating revenue early. They are generating whatever that may be. Just generate something, get some money working in so that you're not trying to rely too hard.

on the capital investments come in for survival. You use the capital investment then for your growth, your acceleration.

Eric Cantor (39:11)

Used an acronym TRL. What does that stand for?

Bradley Hatton-Jones (39:14)

Technology readiness level. So technology readiness level three is from you just essentially come out of your PowerPoint slide, your research and your development. You've got everything still on paper, and now you actually need to start building the physical thing and you need to actually start developing it. And TRL nine is pretty much I've got everything understood. I am currently selling to clients. This is a product that is on the

Eric Cantor (39:44)

So let's jump into the actual company. So we we pulled out a few of the top companies in the space. we are a little bit behind on time, so I think we're gonna do this a little quicker than we'd planned, but but let's make sure we have a chance to talk about some of the more interesting ones. talked about SpaceX plenty. Aaron, do you wanna just like pick out two of the companies, tell the investors what's interesting about them from an investment perspective and and your forecast of of where

where they might go in the next couple of years.

Aaron Burnett

I'm gonna I'm gonna give a principle here that's gonna help, I think, which is it kind of touches a bit on that like flight heritage risk thing. almost always if you are a new investor to space, you are doing one of two things or both things that kind of fall on a barbell problem barbell thing, which is kind of polar, I guess, is you are either dramatically underestimating the risk associated with space. There's the whole reason this like

flight haters thing even exists and why people talk about it is because it's v space is actually hard. All right. Like creating a new model seems hard because other companies have done it and put you know AI model. no. Like 'cause you can compete three months later and have an open source doing the same thing or six months later. The SpaceX has a 10 year advantage on something everyone thought was impossible for, you know, decades. All right. It's actually hard. It's at the edge of physics. It's very hard engineering. So the point is is that

your risk premium should be graded, in my belief, which is slightly controversial, on an exponential power law-driven curve. Meaning, like someone who's got world-class execution gets a world-class risk multiple. gets an ad or you know, whatever you want to call it, valuation multiple because of their risk, you know, that that they've offset. and so it's like SpaceX way the hell up here at the very tippy top of your curve, the next one.

Number two is going to be dramatically lower, even if they've gotten like the second best execution risk in the world, and then so on and so forth. and so that's where that's why most of your growth opportunity really lives in the private market, where that early stage risk reward is like kind of dramatic, and that's why we invest more in the private market. And then risk adjusted return opportunity is probably ridiculous at like a SpaceX level. It's good, it's like ridiculous in a good way. Like you

Because their execution is just world class. And then mainly where I see most people making mistakes is that like where they're grading someone in between the private market and the space sex kind of risk market. So when you talk about that, you have companies like you know, I think we talked about like Portal. We led their series A, so I'm heavily biased on that. but that's a company that's doing a lot of like the mobility in space. You talk about one of the core things in your movement when you're trying to, you know, do infrastructure in space.

You need to be able to move things around a lot. And there's a lot of reasons to move them. There's not just one. but it's a paradigm that has changed dramatically over the last, you know, little bit. And so that's like one example of a company where, you know, a risk reward may be better because it's not into the multiple billions of dollars or, you know, tens of billions of dollars like some of the public space companies are. and so there's still a lot of room for like a 10, 100x, 1000 X kind of opportunity, but you're taking a lot more risk.

and I forget which one we agreed on that was talked about before as well, but I think Varda is another one as an example because it's very different than the rest of them, where there we talked about like how you know Starlink or Internet's moving bits around, Star Mind or the Orbital Data Center is adding value and sending bits back. the next thing is the atoms side of it, like sending stuff up, real physical stuff, and bringing it back with more value is a big potential unlock. And I think one of the

Maybe not the very next thing, but one of the next things that are coming up as far as a space economy ecosystem and Varda is doing that with the pharma side, sending up raw materials, doing some, you know, secret sauce sort of things, growing some crystals because the microgravity's there and bringing them back, and there's more value that's been unlocked because of that microgravity. and I'll I'll hand the rest over to Bradley because I know we're kind of close on time. Yeah, and somebody

asked Bradley if what you were saying about pharma research, maybe Varda is the company, yeah.

Feel free to answer that.

Bradley Hatton-Jones (43:50)

So okay. I'll just quickly touch on so what we're busy focusing on is a validation layer before space, but then also that operating layer after launch. So we'll we'll talk a little bit about the operating layer after launch. And so we're busy building a reusable vehicle that can move payloads, it supports hosted experiments. we can service the infrastructure, all of these companies that are listed in over here, they could all essentially be Orbit2Orbit clients.

Orbit2Orbit you think of us as a picks and shovels kind of company. We are completely agnostic to who wants to work with us. We can provide that enabling factor to make that happen. And so I think that's really where that economic difference is when it comes to orbital orbit and the rest of us is we're focusing a lot on that utilization side of things. So instead of building and launching one new spacecraft for every single one of these customers, we're working towards a reusable fleet.

that is servicing multiple customers and multiple destinations, using space stations as essentially that that port, that's that docking area that we can stop, refuel, recharge, and then head out. So that is really what that differentiator is for us. but, you know, to give the water space an example in that and how Orbit2Orbit would essentially work with them is Orbit2Orbit is partnering with a couple of pharmaceutical companies now.

US based companies that are listed on NASDAQ and they are creating drugs in space. So in space manufacturing of these new types of drugs. And so Orbit2Orbit is going to help them with that inside of our payload housing units. But then we've got two ways that we can get those drugs back to the back to the clients on the ground. We can either end up docking into a space station where there is a return to Earth

Capability coming back down from that space station. and so that can be on any one of those different space stations. We can move the product around. Or what we would do is we would partner with a company like Varda Space, where once the drugs are being manufactured in space and they need to return back down to Earth in a moment's notice, we can actually end up putting that cargo into a heat shield very similar to what Varda Space has already got. Our vehicles, because they

fly and dock to space stations can actually come down to an altitude where we can release that that heat shield, that payload bay that ends up going back down to Earth at the right orbital window and then allow that to then land back wherever the client needs to, and our vehicle ends up heading back up to the space station ready for the ne next mission. So, you know, we are that company that can help enable a lot of these different peop people in space. But you know, just to

give a shout out Impulse space just did their new raise and so that's given them a four point two six billion dollar valuation and that just shows us that that in space investment opportunity is growing and things are looking really good and so we celebrate when all of our companies around us end up getting these kinds of big injections coming in place because it's just it's so good for the rest of that in orbit economy.

Eric Cantor (47:07)

So I'm an investor here. I want to make my first space investment. Give me a one one liner on which company here should I invest in and and why. And and take into account, you know, the prices.

Bradley Hatton-Jones (47:19)

I would say I would say invest into Orbit2Orbit and I'll tell you why is because we currently have an investment open and we are rubbing shoulders with just about every single one of these other companies out of there. And you see they're all at 500 million valuation, $2 billion valuation. We are nowhere near that. We are probably one of the the the best deals that you're gonna get out over there. We're still in our early stage. We are going to be

listing on the Canadian stock exchange, we're targeting towards September and then we're gonna be doing an up list to Nasdaq in quarter one, maybe end of quarter one of next year. That's really the target. And so, you know, if there was a time to buy space stock, and I know that I'm the CEO, I'm very biased of you, but I'd say that is my recommendation.

Eric Cantor (48:11)

So you'll be public next month. Makes it a lot easier for folks than the private deals. and Aaron, which pick are you wanna give us here?

Aaron Burnett

I think it comes into two it just depends on your risk, right? if you are not excited about losing your entire shirt with any single one of your investments, you don't you shouldn't put all your money into one investment generally speaking, but if you're not excited about like the the opportunity for a thousand X but could go to zero, then you you probably should stay out of the stay out of the private markets, quite frankly.

if you're interested in, you know, kind of the long term growth and upside, I think there's a lot of room left with SpaceX. Like I've been pretty vocal about that publicly. You could probably find all of that quite out out there publicly is one of our biggest positions and we're not selling it. And there's a reason for that. because I think there's at least 10x on this one. I I think it's crazy to say 10x and you're like, wait, it's it's two trillion or whatever it is today. And it could be twenty, that's like big, right?

Everyone thought that about the first trillion dollar company, you know, a decade ago. It's like, well, how's that a big deal? And so I think I think there's a lot bigger than people think, especially with the AI side of it stuff that's that's coming on. and then the on the private side, you just gotta you gotta make intelligent bets with the idea that it's like there's a good chance it's going to zero as there is this anything else. And so you probably need to place kind of bets with that kind of mindset in in mind. but yeah.

So let's let's kind of rein this all pull this all together, rein it in as we approach the the end of this chat. And it's been super interesting. I've learned a ton. let's look forward to the future. So I mean one thing that occurred to me, and then a couple of investor questions touched on this too. So I'll just ask it and then we can get into kind of predictions. is there a world where the national security concerns kind of override the commercial imperative? In other words, if

the government as they're sort of hinting with AI says, well, this is not something a bunch of companies should be playing around. We're we're gonna like take this over a little more. So more like what NASA was fifty years ago where it kind of owned all the space activities. Could something like that be a blocker to any of this progress?

Bradley Hatton-Jones (50:20)

Well, I don't I don't see a reality where you're gonna get government organizations to go and essentially shut all this down and they're gonna own everything just like, you know, how we used to operate nineteen sixties NASA. I think the cat got out of the bad bag on that one a long time ago and I don't think that's coming into place. And I also think this question arises not because of

You know, anything new or great has taken place. I just going all the way back to Aaron's first comment is this is all old, this is all developed for people in the industry. You're only getting these kind of questions coming up now because you've started paying attention a lot more since SpaceX has made this available. So, you know, if if a

situation like that was ever to occur, it would have already happened. It would have already taken place in the 1970s, 1980s. And nothing like that has happened. But what we can do and what we can say is that as we expand out into these new industries, into these new markets, we constantly have government doing their job by saying, hey, we need to do be better at regulating this. We need to understand what is going on. I need to give you a good example

space mining is something that is a hot topic. And so NATO is actually put their heads together to go and say we can't stop it from taking place. But let's come up with a set of rule books, a set of understandings of what does that mean for that economy of mining in space. So that is something that is happening right now. So yeah, hand over to Aaron if he's got any other thoughts around that.

Aaron Burnett (52:06)

there's always a risk of nationalization. It's literally already been stated twice by both the populist right and the socialist left to nationalize SpaceX. It's been said. So it's out there. I'm not breathing, you know, life into that thing. It exists. I think that the risk of it's pretty low. I mean it's basically that's the same risk as like, you know, you know, the US going entirely socialist. It's not like a yeah, there's a wave of this stuff or entirely nationalist.

or populist, I guess. there's a wave of this stuff. It's definitely an opportunity for this. But I would say, you know, these are like like kind of extreme tail risks. but definitely a thing as you should be thinking about. China's definitely moving it in the right direction. I think the thing that's made the US great for so long is allowing kind of like the decentralized, more of a decentralized capitalist sort of up upswall of of innovation. So I think the US sticks with that over over the long haul.

Generally speaking, anytime there's an administration change, there's an opportunity for, you know, problems. I think if you're it's one of the reasons like you you you're investing in something like a you know, a SpaceX or what have you, you know, they've kind of you already saw what happened when they were kind of subjected to kind of really dumb regulatory stuff and they can like sustain through it. Whereas like a small company and we invest in them.

Like the risk is higher that some small change or some person that doesn't like them moving whatever and like kill the whole company is just a higher risk. So it kind of just compounds, I think, with where you're investing and who has the staying power. Interesting. All right. So wrapping up, let's just leave our investors with one prediction. I think maybe checking in on where it's going to be in three years and where it's going to be in 10 years, and just something you expect to happen in this industry that maybe is a little bit

not yet priced in or accounted for. Something we can come back to you in 10 years and say, hey, did you did you get it right or not?

Eric Cantor

and just do like a minute on these because we have about two minutes left before we need to break. Aaron, why don't you go first?

Aaron Burnett

inside of three years, SpaceX will probably be, I mean I'm seeing the the fruit of the labor right now. They'll definitely have a lot more money coming from their AI. They'll be a leading lab, which is kind of not space, but

It matters for them owning the infrastructure of what they're building in space. in a 10-year time horizon, let's see, 10. Yeah, it's almost certainly the we may not be a majority of orbital data centers serving inference at that point. Elon would disagree with me on that. But we may not be majority, but it will be in the cards and obvious that it's in that direction whether by 10 years. Awesome. There's my bread. Bradley, last word on this.

Bradley Hatton-Jones (54:41)

So I'll just quickly touch on SpaceX over there is in three years,

Eric Cantor (54:46)

Yeah.

Bradley Hatton-Jones (54:47)

they're currently operating at about one thirty nine, somewhere over there. so I think full prediction in five years they're pretty comfortable operating around about the hundred and forty, hundred and fifty mark. and

speaker-2 (55:02)

Sorry, we talked about.

Eric Cantor (55:03)

Price

or is this some other metric that you're talking about

Bradley Hatton-Jones (55:05)

Stock

price. Stock price, sorry. Yeah. And I think, you know, after that, I I agree with Aaron. as it's not even just the AI side, but as Starship starts hitting into that commercial market and they're, you know, operating routinely, they're doing point to point transfers with Starship, you're just gonna see that share price do crazy silly things. but then, you know, the go saying Orbit2Orbit it's looking pretty good. Three years time.

We're probably going to be over the billion dollar mark. That is what we're targeting for. and so, you know, keep an eye on us as well.

Eric Cantor (55:40)

Awesome. Great last word. So thanks to both of you for all the thoughtful, candid commentary. Thank you for the audience that stuck with us throughout this hour. And we'll continue to follow the space. We'll continue to educate you on pre IPO trends and have a great rest of your summer.

Bradley Hatton-Jones (55:58)

Thanks, Eric.

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