Beyond Rockets: How Space Technology Is Reshaping Industry 

Chris Robinson: Hello everyone and welcome to the webinar, Beyond Rockets, How Space Technology is Reshaping Industry. My name is Chris Robinson. I’m a senior director here at Lux Research and I’ll be moderating today’s session. Presenting today is my colleague Runeel Daliah, who’s a principal analyst here at Lux Research. Throughout the webinar, you can type any questions you have in the questions box on your screen. Time permitting, we’ll answer all the questions that we can. And if your question doesn’t get answered, please don’t hesitate to e-mail it to questions at luxresearchinc.com. We’ll make sure to respond. If you have any technical difficulties like a frozen screen, try refreshing your browser and just check that you have a strong internet connection. Now, before we start into the webinar, maybe a quick word just about who we are. So we at Lux Research work with a lot of organizations, helping them make more confident innovation decisions about what matters next in the world. So as an independent research and advisory firm, we get to work with a lot of the world’s leading companies to identify emerging opportunities, evaluate technologies, and just generally make high-impact innovation decisions. So our analyst team, scientists, engineers, analysts, other industry experts, we combine original research methodologies with practical decision-making frameworks to help you separate what might be signal from what might be noise. So every day we help clients really with three questions. One is, where should we focus innovation efforts? Two is, which technologies deserve investments? And finally, three, which partners are worth accelerating innovation? So today’s webinar is an opportunity to share some of that thinking with you. And with that, we can jump over to discussion. So over to you, Runeel.

Runeel Daliah: Great. Thank you very much, Chris. And hello, everyone. Very happy to be here to present on a very interesting topic, which is the space economy and how it’s impacting industries on Earth. So just a quick overview of the structure of the presentation. I’ll present some data to give you an idea of the size of the opportunity in the space economy. And then I’ll focus on the areas that will directly impact industries on Earth. So the question that we often get asked, the first question we often get asked is really, how big is that space economy? How do you characterize it? How much money is flowing into it and how much can you make out of it? Now in 2025, as you can see in the figure, there was over $120 billion invested in the space economy. We first reached 100 billion in 2022 and that is now steadily growing. Now out of that $120 billion, half of it is dedicated to the defense sector. That is an area that is growing especially fast given rising tensions around the world, but you can also see that half of it, 60 billion, is still going to the civilian sector. In terms of geographical breakdown, the US is the largest contributor with 58% of the global budget and they are followed by China and Europe. Now while these figures provide you with an idea of the size of the space economy, it doesn’t really give us a sense of the commercial momentum of this sector, which is why I believe that a better indicator to look at is the number of launches. Now here on the figure, you can really see the momentum of the sector because in 2021, there were around 150 orbital launches around the world. And yet in 2025, this grew to 324 orbital launches. That’s a doubling in launch count in just four years. However, while this is a clear indicator of growth, you also need to be careful when looking at this data. The reason being that it’s just one company that is responsible for most of that recent growth. And that company, of course, is SpaceX, who really ramped up its launch cadence to send its Starlink satellites in space. So yes, the commercial space economy is growing, but at this stage, the momentum is really being driven by one company, which is SpaceX. So another indication of commercial momentum is also looking at venture capital. Now you can see that there was a peak in VC funding in 2021, which fell, but is now recovering. And an interesting observation here is China, which you can see in pink here on the bars, because China is investing a lot in space tech, a lot more than it used to in previous years. So that’s a country, a location to really monitor when it comes to activity in space tech. So overall, we have established that the space economy is growing, which now brings us to the next big question, how much does it actually cost to get to space? So if we go back in time, let’s say we go back to 1981 exactly. We had the launch of the space shuttle in the US. And back then, it was estimated that it cost around $55,000 to launch just one kilogram of payload into space. That is quite a bit of money. Fast forward, 20 years later, we had the launch of the Ariane 5 in Europe, and that brought the cost down to $5,000 per kilogram, which is still a lot of money, but better than 1981. But then, of course, SpaceX entered the picture with its Falcon rockets, and today the estimated cost of launch is between $2,000 and $3,000 per kilogram of payload. So you already see the reduction in launch costs over the past decades. But what about the future? Well, just two weeks ago, Starship from SpaceX entered orbit for the very first time ever on a test flight, and it was just a test and it will take some years before it fully enters commercial service. But the cost target of SpaceX for Starship is less than $1,000 per kilogram. So that’s already quite a reduction. However, once again, this is all based on SpaceX’s estimates, and that is risky because if you’re building a business case for a project in space, it’s quite risky to rely on projections from a single company. And that is why I wanted to show you this. This is a very recent study that came out just a few months ago in July of this year. That’s a study that was done by Terzi and Nicole from the University of Cambridge. And they projected the cost of reaching low Earth orbit. Now, how they did that is the authors, they assembled the largest data set of historical launches across the world, and they used the data to derive an average of historical and projected launch costs. Now, based on the data, the average launch cost in 2025, which is essentially today, is at around $4,000 per kilogram, which is higher than the price listed by SpaceX, but still within the range. But what’s more interesting is that according to the projection, as you can see here, that cost is set to drop to $300 per kilogram by 2040. And that is a massive reduction in cost. Now, of course, that is still very much a projection. It depends on a lot of assumptions regarding technology development, but it is today the most reliable projection that we have when it comes to estimating what the future launch cost is. And as you can imagine, reaching such a low cost by 2040 opens up quite a range of opportunities. And this is what I want to focus on today. Because to understand the opportunities in space, we really need to understand the space value chain. Now, the value chain for space is very similar to other industries in that you have an upstream and a downstream. The upstream is what most of us have in mind when it comes to space, which is really about launching rockets and putting satellites in space and all the services related to that. The downstream is what you do once you’re in space. How does that benefit us on Earth? And this is really where you have all the functions of satellites, which is today primarily navigation and communication. Today, both of these, navigation and communication, they’re fully commercial, and they’ve been for many years now, so I won’t be spending time talking about this. What I want to talk about is observation and orbital production. These are the two areas that directly impact major industries on Earth. So let’s start with observation. Now, as the name implies, observation is really about using satellite imaging to measure, to track, to verify things on Earth, and it takes many forms. You can use satellites to, for example, detect and measure greenhouse gases, and you can use that data to penalize industries for it. You can also use satellites for verification purposes in the carbon credit and the carbon offset industry, for example, to measure deforestation progress. Now, the industries impacted are any industry that is emitting CO2 emissions or that is using carbon offsets to reduce the emissions, which is really every industry on Earth, whether you’re in government, whether you’re in oil and gas, chemical, heavy industry, and so on. But satellite imaging is not just about catching industries and penalizing them, but you can also use it to improve your operations. This is what’s happening in the agricultural sector, where there you can use satellites to measure crop health, to measure the yield of your crops, to even forecast the yield of your crops. And all of that will help you boost the productivity and essentially improve your operations. You can also use satellites for predictive maintenance. So this is another big area of application for satellite imaging because there you would use the satellite images to measure, for example, structural faults and defects and fix those before they cause major incidents. You can also use satellite imaging for weather monitoring and climate risk analytics, and that helps you make better decisions about your supply chain. This has already been done at scale today. You can see a selection of headlines of these impacts. Oil and gas measures, for example, are under great scrutiny today when it comes to their emissions. But companies can also use that data to improve their operations, as you can see here, when it comes to improving the yield forecast or when it comes to getting better seismic data for oil and gas extraction. My point here is that satellite observation is already impacting industries on Earth. If you’re a company active in any industry, whether it’s oil and gas, whether it’s industrials, whether it’s chemicals, you should really be ready for greater scrutiny. But you should also look at leveraging the potential of satellite observation to really help improve your operations and manage your risk. The category that I want to focus the most on today, however, is orbital production. Now orbital production, as the name says, is really about making things in space. So just like you’re making a product here on Earth, whether it’s a chemical, whether it’s a semiconductor material, for example, this category is really about bringing that capability to space, about bringing terrestrial industries to space. Now this is a very, I would say, unexplored area of the space economy, which is why I want to focus on it today and really highlight the key activities and opportunities from it. So what can you make in space? It’s quite a few things, actually, as you can see. This market map here shows you the main categories that comprise orbital production. You can make pharmaceutical products. You can mine asteroids for metals. You can manufacture materials in space. You can even generate energy in space via space-based solar. Or you can even deploy orbital data centers in space. Now, all the companies that you see here are directly developing all of these applications. And over the next half of the presentation, I will go through each of these, starting with in-space manufacturing. Now, in-space manufacturing, as the name implies, is really about the production of material in orbit to overcome any manufacturing limitations that are caused by gravity here on Earth. And today, the two main products being worked on in space are optical fibers and semiconductor crystals. Now, there are quite a few companies working on these, but the one that I want to highlight is Flawless Photonics, which is really the leader today when it comes to in-space manufacturing. Now, the product that Flawless Photonics is working on is known as ZBLAN fiber. ZBLAN fiber is fluoride glass optical fiber that can transmit light with up to 20 times lower signal loss than conventional silica fiber that we use today. Now we can make ZBLAN fiber on Earth. The problem is that gravity on Earth affects the manufacturing process and it introduces imperfection in the structure of the fiber. And if you look at the picture here, you can see on the right a ZBLAN fiber that was made on Earth, whereas on the left is the fiber when it is made in microgravity. And here you can see very clearly that you don’t have any of these imperfections in the structure of the fiber. So Flawless Photonics has already gone to space. They manufactured over 10 kilometers of this fiber cable on the International Space Station, and they’re very strongly supported by NASA and the European Space Agency. So Flawless Photonics has shown that it can make the ZBLAN fiber in space. Now the company has to show that it can scale the process beyond a few trial runs. Now, another company active in the space is Space Forge. However, Space Forge is making something completely different. Space Forge, they really focus on developing returnable satellites with the intention of producing semiconductor materials in space. Now, unlike Flawless Photonics, Space Forge has not yet produced anything in space. The company has launched its first satellite last year, where they have tested the operation of a plasma furnace that would be needed to make these materials. The test was successful and now the company is planning a second launch. It hasn’t yet disclosed when the second launch will happen, but it is actively raising money for it. Now, Space Forge’s returnable platform really overcomes a key bottleneck in the space economy, which is really about bringing material back to Earth because it’s one thing to produce it in space, but you also have to be able to bring it back to Earth. So right now, the company is at a very early stage. However, the next launch, Space Forge’s ForgeStar-2, sorry, is really going to be a key milestone to monitor for this company. The second category that I want to look at is the life science category. So similar to the previous category, this is about producing material in space. In this case, it’s about producing drug crystals or cell-based tissues. And here, once again, it’s about leveraging the microgravity of space to make structures that you would not be able to make on Earth because gravity would introduce defects in those structures. And the leader in this area today is a company known as Varda Space Industries. Now, Varda’s focus is on deploying space capsules, which you can see here in the picture, to manufacture drug crystals and bring them back to Earth. Now, the company has a range of drugs in its development pipeline, and they’re currently now at the trial stage. But back in 2024, the company successfully manufactured Form III ritonavir, which is an antiretroviral medication. And they successfully managed to do so, and they brought the crystals back to Earth. Now, the goal of this test for Varda was not to manufacture a new structure, but rather to show that it is possible to manufacture drug crystals in space in the first place. Now, the company has raised more than $300 million, making it a very well-funded company. And what’s interesting is that very recently they signed an agreement with United Therapeutics to really investigate the reformulation of new medication, the reformulation of pulmonary disease drugs in microgravity. And the goal is that the structures of these drugs in microgravity would be different than what you can make here on Earth. So that is a very interesting company to monitor. And the other reason for that is because pharmaceutical materials are low-volume, high-value products. It costs a lot of money to go to space and you don’t want to go to space and manufacture a material that has a low value because you need to be able to offset the cost of your space launch. So when it comes to orbital manufacturing, focusing on high-value material is really crucial. Now another area that I want to look at is about mining, in this case asteroid and lunar resource extraction. This is about the mining of resources, typically metals, critical minerals and helium 3 on the moon or on asteroids and bringing it back to Earth. And one company active in this space is AstroForge. This is a startup that builds small autonomous spacecraft to mine asteroids for metal, platinum-group metals more specifically. And it is not yet doing so. It is not yet doing it at scale. In 2023, the company launched its first test where the goal was to test refinery equipment in space and that test was successful. In 2025, it launched a second spacecraft where now the plan was to map and characterize an asteroid. Unfortunately, the company lost contact with the spacecraft a few hours after launch and they never recovered it. So right now the company is focused on the next steps, which is really about building a larger spacecraft. Now the intention is to actually land on an asteroid. So right now the company is currently still at a trial stage, but when it comes to their focus, you can see the focus is on platinum-group metals. Now that is a concern when it comes to the business model, because yes, platinum-group metals are currently a geopolitical concern here on Earth with trade barriers and so on. However, supply security may be a concern, but is it a big enough concern to justify asteroid extraction? We don’t believe so, because at the end of the day, once you bring these critical minerals back to Earth, you will still sell them at market price here on Earth, so it’s very hard to justify the costs of launching to space, extracting material in space and bringing it back down to Earth if you’re just going to sell it at commodity prices. Another company that would overcome this challenge is a company known as Interlune. Interlune focuses on a different product, which is helium-3. Helium-3 is an isotope of helium that could be used as a fuel in nuclear fusion. However, there’s very little of it here on Earth. But there is a lot of it on the Moon due to the Moon’s exposure to solar wind over billions of years. And this is really what Interlune is going for. The company has not yet gone to space, but is still at the testing stage on Earth. It partnered with Vermeer Corporation, an equipment manufacturer, to develop an excavator for lunar soil extraction. You can see a picture of the excavator here, although the picture was not taken on the moon, but rather in Iowa in the US, which is a much less exotic location. However, you can see from the text here that Interlune plans to go to space this year. Its plan is first to map the surface of the moon for mineral deposits and then eventually send mining equipment to the moon in order to begin extraction. However, this won’t happen until the mid to late 2030s. What’s interesting to note, however, is that Interlune has already signed binding purchase agreements with the US DOE, the US Department of Energy, for any helium-3 that it extracts. And these offtake agreements really help in de-risking future operations as they provide certainty to any future investor of Interlune that there will be a customer for the product, for the helium-3 product that Interlune would be extracting from the moon if it successfully does so. Now moving away from physical products, another category that I want to look at here today is space-based solar. Now in space-based solar, you’re not producing a physical product, but you’re rather generating energy. And as the name implies, this is essentially about deploying vast solar panels in space in order to catch solar energy and beam it back to Earth. Now this is currently at the conceptual stage. And one of the companies developing this approach is a company known as Cowboy Space Corporation. They used to be known as Aether Flux, but they recently rebranded. And their approach is slightly different from others in the space. Why? Because rather than deploying a single large system in space to collect solar energy and beam it back to Earth, their approach is to deploy a constellation of small satellites in low Earth orbit that would collect solar power. So this concept is very similar to Starlink, but rather than internet, they’re focusing on energy from satellites. The company has not yet gone to space. So far, they’ve been focused on raising money. And one of its key backers actually is Bill Gates’ Breakthrough Energy Ventures. And the company is planning its first orbital test in 2027. Now, the last category that I want to look at is orbital data centers. Now with AI, there are a lot of data centers being built on Earth and with that there’s a lot of concerns around the impact of these data centers on energy and water consumption. So there is now a lot of interest in building these data centers in space because over there you obviously don’t have any constraints when it comes to land restrictions or water consumption and so on. Today, no one has built a data center in space yet, but one of the companies trying to do so is StarCloud. The company was the first one to fly an NVIDIA unit in 2025 and demonstrate AI inference in space. The test was successful and it now plans to go back to space at the end of this year with an even larger NVIDIA unit to run further tests. And for that, it has already raised over $400 million. Now, of course, having a data center in space is one thing, but you also need to be able to justify the cost because at the end of the day, a data center would consume a lot of energy. And with space-based data centers, you have a lot of issues when it comes to getting rid of your heat, of your thermal heat, because on Earth, you can use convection to do so. In space, you cannot because it’s a vacuum. Now, right now, there are a lot of challenges in justifying the cost of orbital data centers when it comes to its energy consumption. I showed you a lot of different technologies or products that you can make in space. None of these are commercial yet. It will take many years, and in some cases, many decades before these applications become commercial, if they ever do make it to that stage. But as these companies are developing these technologies, there’s a few things that I would like you to keep in mind as you monitor these activities. The first, of course, is cost. And I’ve alluded to that already. Every application in orbital manufacturing is gated by the cost of reaching orbit, but the impact of that cost will be different by product. For example, let’s say it costs you $1,000 per kilogram to reach orbit, but the product that you’re making can only sell for $500 per kilogram back on Earth, then it’s simply not worth making it in space. This is why it’s very important to prioritize products that are low-volume but have a very high value. For example, pharmaceutical crystals or ZBLAN fiber. On the other hand, something like a semiconductor material, for example, has a lower value and it will be very challenging to make a financially viable business case for orbital production. Which gets me to my second point. There needs to be a reason for making things in space. Now, there are two reasons why you want to go to space. The first one is about the performance advantage. Flawless Photonics, for example, as we’ve seen earlier, is a very good example because the company has shown that the ZBLAN fiber that it manufactures in space has a much better structure than what you can get on Earth. So there is a genuine performance advantage to making it in orbit. On the other hand, Varda has shown that you can make Form III ritonavir in space, but you can also do it on Earth. So why do it in space? Now, I’m being unfair on Varda here, to be honest, because the company did say that the goal of the first test was not to create a new structure, but rather to showcase that manufacturing in space can be just as good as it is on Earth, and they have shown that. And now the plan is to make unique pharma crystals in space, which is the right approach when it comes to orbital manufacturing. But the second reason why you want to go to space is because of scarcity. Now, for example, Interlune has the right focus. There is almost no helium-3 here on Earth, so there is a reason to go to the moon for it. On the other hand, the business case for AstroForge is very flimsy. The company plans to mine platinum-group metals on asteroids, but these metals are the same as what you get on Earth. So once you bring these metals back to Earth, you’re just going to be selling it at market prices, because no one will be paying extra just for asteroid metals that you can already get on Earth. So it’s very important when you assess these companies that you engage only and partner only with companies that are developing something truly unique to orbital manufacturing. And the last factor that I want to look at is really about adjacent technologies. Now all orbital manufacturing companies, all of them are focused only on their technology, but they won’t succeed unless they have access to enabling technologies. For physical products like fiber or pharma crystals, you also need companies to build commercial space stations that can host your manufacturing facility and develop a value chain for re-entry capsules for bringing the materials that you manufacture in space back to Earth. For space-based solar, you need commercial scale wireless power transmission to beam the energy back to Earth that is still not yet available commercially. For data centers, you need to develop radiative heat rejection because as I mentioned before, you cannot rely on convection cooling like we do here on Earth because space is a vacuum and you don’t have the capability over there. So many of these adjacent technologies are being developed independently of orbital manufacturing and they do not necessarily match the timeline of the orbital manufacturers. So this is something that you need to keep in mind when it comes to orbital manufacturing. It’s one thing to be able to produce something in space, but there’s also a lot of enabling technologies that also need to get to the commercial scale before this whole space becomes commercially viable. So this is the end of the presentation. My goal with this presentation was really to give you an overview of the different capabilities when it comes to orbital manufacturing. And I would like to leave you with some key takeaways. First, the space economy is already impacting your industry primarily through satellite observation. Second, orbital manufacturing can be highly disruptive, but despite what you see in the headlines, it is still many decades away from most applications. And lastly, rather than investing in orbital manufacturers themselves, you can also consider investing in companies developing enabling technologies like wireless transmission, for example, to gain a foothold in this industry. So thank you very much and happy to take some questions.

Chris Robinson: Yeah, thank you, Runeel. So we’ll now be taking questions you might have in the presentation. As a reminder, there’s a question box you can enter those in. And if we do not get to your question, someone from Lux will be in touch after the webinar. So I have a couple versions of this question here, but maybe you could first comment on timing. So basically, when do you think large companies should be entering the space industry?

Runeel Daliah: I think before– so when you talk about entering the space industry, I think it’s good to define what does it mean to enter the industry. You’re not going to have a commercial-scale orbital manufacturing platform anytime soon. And when I say commercial scale, I’m talking about really a commercially viable business where you’re sending things to space—sending feedstock to space, for example—manufacturing them, and bringing the products back down to Earth. What you can do, however, is start forming partnerships, R&D partnerships or development partnerships with these companies. Now, it really depends on the product. For example, in pharmaceutical, I believe that the time is now to start forming this research and development partnership with the startups because the R&D work, the research work is already happening on the International Space Station. So partnering now would really allow you to gain an early advantage versus competitors in this area. However, if you look at other areas like space-based solar, for example, orbital data centers, my advice would be to not enter now because, obviously, these applications are very far away. You’re talking decades away. But it’s very unlikely right now that there is a commercially viable business case when it comes to the production of energy, beaming the energy back to Earth, or when it comes to orbital data centers, because the costs are simply way too high. And I don’t see a credible pathway for this cost to become lower anytime soon. So for orbital data centers and space-based solar, for example, you can wait. You can monitor the progress of these companies and wait before you enter the space. But when it comes to high-value products like pharma crystals or ZBLAN fiber, for example, the time is now because that R&D work is already happening in space.

Chris Robinson: Got it. And then you just actually touched upon this one and I mentioned earlier in the presentation, but are there any products you envision that will be produced in space, maybe outside of the ones you showed examples of thus far?

Runeel Daliah: I would say one product I haven’t talked about or rather one industry that I haven’t really talked about is the food industry. You can make food in space. There’s already a lot of research work in this area happening on the International Space Station. There are a few startups already doing R&D work in this area. The reason why I haven’t highlighted that industry and these companies here today is simply because the goal of these companies is to manufacture food for consumption in space. So for example, for astronauts. Right now, none of these companies are considering producing food in space and bringing that food back to Earth. Can that be done in the future? Yes, it could be possible to do it in the future. There’s a lot of R&D work going on in food science, around really coming up with new structures for food products. And I can see some companies in the future looking at what is happening in the pharma space, for example, and trying to transfer this advantage to the food industry by trying to transfer the capability to the food industry where you use the microgravity of space in order to come up with new structures for your proteins, for example, or for your food-based product. So that’s a new area where I can see companies getting involved when it comes to orbital manufacturing.

Chris Robinson: Excellent. Well, thank you, Runeel. That concludes the webinar for today. So the slide presentation and the recording will be sent out to all attendees via e-mail later today. So keep a lookout for that. After leaving, you’ll be prompted to complete a survey on today’s presentation. We do appreciate any feedback. It helps us improve and inform future webinars as well. So finally, take a moment to check out our upcoming webinars on our website. And with that, thank you very much for joining us and have an excellent day.

Runeel Daliah: Thank you very much.