Episode #71: Blue Flame Thinkers: Russell Hannigan

Tech Optimist Podcast — Tech, Entrepreneurship, and Innovation

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In this episode of the Alumni Ventures Tech Optimist Podcast, host Mike Collins speaks with Russell Hannigan about the future of space technology and the need for a “railroad to space” to lower launch costs and boost accessibility. They discuss key innovations like reusable rockets and space-based manufacturing, which could revolutionize space industries and drive entrepreneurship. The conversation also addresses the challenges of reducing launch costs, fostering competition, and maintaining U.S. leadership in space, with Russell sharing his vision for a sustainable, accessible future for space-based innovation.

Episode #71: Blue Flame Thinkers: Russell Hannigan

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In this Blue Flame Thinkers episode of the Alumni Ventures Tech Optimist Podcast, host Mike Collins welcomes Russell Hannigan, a visionary in the commercial space industry, to discuss the transformative possibilities emerging in space technology. Together, they explore the growing need for a “railroad to space” that would drastically lower the cost of launches, making space more accessible for innovation and entrepreneurship. Russell highlights pivotal trends, from reusable rockets to the potential of commercializing space-based manufacturing, emphasizing how these advancements could redefine what is feasible in orbit.

Watch Time ~41 minutes

The show is produced by Alumni Ventures, which has been recognized as a “Top 20 Venture Firm” by CB Insights (’24) and as the “#1 Most Active Venture Firm in the US” by Pitchbook (’22 & ’23).

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Creators and Guests

HOST

Mike Collins
CEO & Co-Founder at Alumni Ventures

Mike has been involved in almost every facet of venturing, from angel investing to venture capital, new business and product launches, and innovation consulting. He is currently CEO of Alumni Ventures Group, the managing company for our fund, and launched AV’s first alumni fund, Green D Ventures, where he oversaw the portfolio as Managing Partner and is now Managing Partner Emeritus. Mike is a serial entrepreneur who has started multiple companies, including Kid Galaxy, Big Idea Group (partially owned by WPP), and RDM. He began his career at VC firm TA Associates. He holds an undergraduate degree in Engineering Science from Dartmouth and an MBA from Harvard Business School.

GUEST

Russell Hannigan
Space Business Executive

Russell Hannigan is a space business executive with over 30 years of experience in satellite communications, Earth observation, reusable launch vehicles, automotive systems, consumer electronics, advanced imaging radar systems, and metamaterials technology.

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One or more investment funds affiliated with AV may have invested, or may in the future invest, in some of the companies featured on the Podcast. This circumstance constitutes a conflict of interest. Any testimonials or endorsements regarding AV on the Podcast are made without compensation but the providers may in some cases have a relationship with AV from which they benefit. All views expressed on the Podcast are the speaker’s own. Any testimonials or endorsements expressed on the Podcast do not represent the experience of all investors or companies with which AV invests or does business.

The Podcast includes forward-looking statements, generally consisting of any statement pertaining to any issue other than historical fact, including without limitation predictions, financial projections, the anticipated results of the execution of any plan or strategy, the expectation or belief of the speaker, or other events or circumstances to exist in the future. Forward looking statements are not representations of actual fact, depend on certain assumptions that may not be realized, and are not guaranteed to occur. Any forward- looking statements included in this communication speak only as of the date of the communication. AV and its affiliates disclaim any obligation to update, amend, or alter such forward-looking statements whether due to subsequent events, new information, or otherwise.

Frequently Asked Questions

FAQ
  •  

    Samantha Herrick:
    This is a podcast brought to you by Alumni Ventures. Welcome to the Tech Optimist. This is a podcast where we tell you the stories of the people creating tomorrow.

    Russell Hannigan:
    In space, the companies are being asked to basically build a railroad every time they go to space.

    Samantha Herrick:
    That is Russell Hannigan, space executive and entrepreneur.

    Russell Hannigan:
    They rip it up and they build another one in place. That’s traditionally what has happened. And so we need to get to a place to try and build that true railroad to space to benefit everybody.

    Mike Collins:
    You have to go to the Wild West and…

    Samantha Herrick:
    You know that voice. That is Mike Collins, co-founder and CEO at Alumni Ventures.

    Mike Collins:
    Space is that for me. It’s kind of unlimited upside and potential. Really, really hard problems.

    Russell Hannigan:
    Yeah.

    Samantha Herrick:
    It is also worth noting some historical costs of space innovation. And that’s me. My name is Samantha Herrick and I’m the guide and editor for this podcast.

    NASA spent approximately $10.6 billion in the 1970s—1970s dollars—to develop the space shuttle program. And by the end of the space shuttle program, each flight cost roughly $766 million.

    All right, so we’re going to do a quick little intro to this episode. This is our second installment of the Blue Flame Thinkers type of episode for the Tech Optimist. And with these, I kind of take a backseat. I let the conversation just be natural, so I won’t be butting in too much today. But I wanted to provide a few words for our guest, Russell Hannigan. He’s got quite a career, and I want to share some aspects of it with you.

    So if you haven’t gathered as of now, Russell Hannigan is a very notable figure in the commercial space industry. He was the founder and CEO of EarthNow, a satellite imaging startup that emerged from stealth mode in 2018. EarthNow aimed to deploy a large constellation of advanced imaging satellites to deliver real-time, continuous video of almost anywhere on Earth.

    The company secured investments from high-profile backers, including Bill Gates and many others. EarthNow planned to use an upgraded version of the satellite platform developed for OneWeb’s communication service. The goal was to provide real-time video with delays as short as one second, a significant improvement over existing Earth observation systems.

    Currently, Russell serves as the Chief Innovation Officer at Xplore, a space exploration company. In this role, he’s involved in developing innovative space technologies and applications. At Xplore, he’s been working on hyperspectral imaging technologies for Earth observation and space domain awareness. He’s developing capabilities to use hyperspectral sensors to observe other satellites and orbital debris.

    From an industry perspective, he’s provided countless insights on the emerging commercial space industry. You’ll hear many of them today in the conversation. He’s noted that hyperspectral imagery is still in its infancy in the commercial space domain, suggesting significant potential for growth and innovation.

    Under Hannigan’s leadership at Xplore, the company has engaged with many government agencies. In 2023, Xplore was one of six companies awarded study contracts by the U.S. National Reconnaissance Office (NRO) for commercial hyperspectral imagery. This collaboration aims to explore the potential of commercial hyperspectral imagery for government applications.

    His career demonstrates a focus on advancing Earth observation technologies and bringing innovative space-based services to both commercial and government customers. His work spans from real-time video imaging to hyperspectral sensing, positioning him as a significant figure in the evolving commercial space industry.

    But for now, we’re going to hop into an ad and then jump right into the interview. Hang tight, sit back, and enjoy. I’ll talk to you in a few seconds.

    Matt Caspari:
    Hey everyone, just taking a quick break so I can tell you about the Deep Tech Fund from Alumni Ventures. AV is one of the only VC firms focused on making venture capital accessible to individual investors like you. In fact, AV is one of the most active and best-performing VCs in the U.S., and we co-invest alongside renowned lead investors.

    With our Deep Tech Fund, you’ll have the opportunity to invest in innovative solutions to major technical and scientific challenges—companies that can have a hugely positive effect on society, redefine industries, create a more sustainable future, and deliver significant financial returns. If you’re interested, visit us at av.vc/funds/deeptech. Now, back to the show.

    Samantha Herrick:
    As a reminder, the Tech Optimist podcast is for informational purposes only. It’s not personalized advice, and it’s not an offer to buy or sell securities. For additional important details, please see the text description accompanying this episode.

    Mike Collins:
    Welcome to this episode of the Tech Optimist podcast. This is our Blue Flame Thinkers program, and I’m really honored to be joined by Russell Hannigan today. We’re going to talk a little bit about space. Obviously, many of us have watched Elon Musk have a big week and a big “oh my God” moment in the last few days. I think the timing is perfect for us to get the state of play of what’s going on in space technology. Russell, welcome to the show.

    Russell Hannigan:
    Thank you very much. It’s an honor to be here. Thank you for the introduction.

    Mike Collins:
    Yeah. Russell, tell us again—here we are in the fall of 2024—it seems like a very exciting time in space. What do you think are the three or four big things going on right now?

    Russell Hannigan:
    That’s a great question because there’s a lot more than three or four, I suppose. Clearly, yesterday was an incredible moment. I would argue that it was one of the most impressive, if not the most impressive, engineering accomplishments ever. And not just because it’s an accomplishment, but because of what it’s trying to achieve—the first fully reusable space transportation system. That is head and shoulders above everything else.

    Samantha Herrick:
    Here, if you haven’t picked up on it already, Russell is talking about the Starship flight 5, which is featured in episode 69 of this podcast.

    Russell Hannigan:
    In addition to that, of course, there are so many different ventures—everything from direct-to-cell communications, which is a big topic right now, to mining Helium-3 on the moon. Think of anything, really, and some entrepreneur or innovator out there is trying to figure out how to make a business in that particular area.

    Space is incredibly cool, but it’s also got to make money. That’s where I see things. I try to separate the cool factor from the fact that I want a good return from this—I want a great return from this. And that’s where many of the challenges are today. There’s great, fantastic stuff, but the question is: how are they going to make money?

    Mike Collins:
    Yeah. No, and it’s—

    Russell Hannigan:
    And so we’re at a transition point right now in many ways.

    Mike Collins:
    Yeah. One way I’ve thought about it too is that a lot of times there’s a big investment in other technologies. You’ve seen the government go through wave one, and then you see private sector and public sector partnerships building infrastructure—whether this was the internet or the railroads. And then those infrastructure plays really unleash the garage entrepreneurs.

    It seems to me that space is such a huge opportunity, but we’re transitioning now from deep science, government-funded R&D to starting to see applications and infrastructure. There’s a backbone now where entrepreneurs can really be unleashed. How would you build on that?

    Russell Hannigan:
    They definitely can, but they still have one very, very big hurdle, and that is the cost to get to and from space.

    Mike Collins:
    Yes.

    Russell Hannigan:
    It is simply enormous. You mentioned the transcontinental railroads, and it’s really interesting that in today’s dollars, the two companies that built the railroads were paid about $1.5 million per mile to do that.

    Mike Collins:
    Yeah.

    Russell Hannigan:
    You weren’t told what kind of rails to build or how far. But they said, “Here’s $1.5 million for every mile you build.” In this case, over mountains and difficult areas. “Oh, and by the way, we’re going to give you this land grant equivalent to the size of Texas.” That paved the way to allow California to exist and all the commerce that happens today.

    In space, companies are being asked to basically build a railroad every time they go to space. They rip it up and build another one in its place. That’s traditionally what has happened. We need to get to a place where—and that’s why yesterday was so significant, and why everything happening in reusable space is so important—we can build a true railroad to space to benefit everybody. It’s taking time, but it’s finally coming.

    Mike Collins:
    Yeah. No, and again, there was promise yesterday. I think people have seen, “Oh, these things have landed in the ocean before. I’ve seen these landings.” I believe yesterday was, I don’t know, 30 times as big or something. It was one big, big-ass rocket that took off and landed yesterday, right?

    Russell Hannigan:
    It was, but physics is physics, engineering is engineering. If the numbers add up, they add up. SpaceX has successfully landed a Falcon 9 booster more than 350 times. They know how to do it, so it just extrapolates to something bigger and heavier. Yes, incredibly impressive and energetic, but it’s not the first time they’ve done that. That’s the beauty of any reusable transportation system—you’ve done it before, learned from it, and can do it again.

    Space has been—this has been a bit of a hobbyhorse for me for the last 30–40 years—you’re throwing away this massive capital investment every time you go to space. How do you know it’s going to work? You know because you’ve spent a lot of time and effort to make sure it works, but that leads to something very expensive.

    This industry, as fantastic, dynamic, and diverse as it is, is just the tip of the iceberg because it has this massive roadblock: an incredibly expensive first cost. The impacts of that going forward are even more enormous. So that’s how I’m looking at the world—who are the players going down that path? It has to be more like SpaceX. We’re all capitalists; we want competition; we want the best we can get.

    The other side of the space industry—for all the incredible numbers, and depending on which consultant’s number you choose—is that, with the exception of communications, almost all of it has the government as the customer. That’s true for Earth observation, human infrastructure, and everything else. There are things happening on the margins that suggest demand is there, but it’s still government-funded.

    We need to move away from that. Having the government as a customer is great—there’s absolutely nothing wrong with that. But if we really want the space industry we envision, we need commercial applications and customers. We need it to grow, to be vibrant and self-supporting. When 90-plus percent of your revenue comes from the government, I don’t believe that’s sustainable long-term. You’re not going to get the kind of return that’s possible elsewhere if that continues.

    Mike Collins:
    I agree.

    Russell Hannigan:
    You can create a good business and do great things for everybody—there’s nothing wrong with that. But if you want the kind of multiples we see on Earth, then you need that dynamic, commercial customer base.

    Mike Collins:
    Communications is an obvious area where we’ve seen Starlink and some incredible businesses being created. What do you think are the pockets of commercial opportunity? Clearly there’s infrastructure. How do we crack the biggest problem—getting there safely, repeatedly, and affordably? That’s one. Communications would be two. What other areas are on the list of potential?

    Russell Hannigan:
    There are a few. One I wrote about recently is materials processing—basically making stuff in space, whether pharmaceuticals or fiber optic cables. There are things you can do when gravity is taken out of the equation. Like pressure or temperature, gravity is just another parameter.

    There’s been incredible research done—that’s pretty much all they do on the space station: microgravity research. Wouldn’t it be great if we could actually make stuff in space that you can’t make on the ground?

    But the challenge is, again, as I described, it’s just so expensive. For example, the cheapest way to get 200 kilograms into space is a Falcon 9 rideshare. It’s by far the least expensive option, and it’s $1.2 million. The spacecraft on top of that will cost at least another $1.2 million. So right there, you’re looking at $2.5 million.

    Of that 200 kilograms flown, a tiny fraction is the actual thing I’m making in space because I need solar panels, a heat shield, electronics—all that stuff. So at the end of the day, I’m adding about half a million dollars per kilogram to the product I’m making. There’s almost nothing that’s worth making in space at that cost.

    Mike Collins:
    Nothing. Yeah, worth it.

    Russell Hannigan:
    Exactly. There are things that are that expensive, but almost nothing needs to be made in space that’s worth that much. There are always exceptions, but fundamentally you have this problem. Yes, it can be done, and there’s tremendous research and work being done, but if I want to make something I can sell to a customer, I cannot do it at half a million per kilogram—and that’s optimistic. It’s usually much higher.

    Samantha Herrick:
    With this topic, I want to provide more context on how expensive is expensive. Russell and Mike are talking about how these ventures for some entrepreneurs and innovators can be upwards of millions and billions of dollars.

    Traditional launches used to cost hundreds of millions of dollars. SpaceX’s Falcon 9 rocket now offers launches for around $62 million—still insane. Larger rockets like SpaceX’s Falcon Heavy can cost upwards of $90 million per launch. NASA’s Space Launch System (SLS) is still extremely expensive, estimated at over $2 billion per launch.

    Narrator:
    And as far as launch vehicles—reusable launch vehicles—using a reusable rocket can be up to 65% cheaper than traditional single-use rockets. Companies like SpaceX, Blue Origin, and Rocket Lab are clearly leading the way in reusable rocket technology. Reusability spreads development and manufacturing costs across missions, similar to commercial airplanes.

    Now, satellite technology is a whole other venture. The advent of CubeSats and small satellites has made space missions more accessible to startups and universities. Miniaturization of satellites has significantly reduced costs.

    In terms of investment trends, in 2023, space tech drew $12.5 billion in investment. The global space economy expanded to $546 billion in 2023 and is projected to reach $1 trillion by 2040. Those numbers just don’t feel real—it’s hard to contextualize.

    It’s also worth noting some historical costs of space innovation. NASA spent approximately $10.6 billion in the 1970s—1970s dollars—to develop the Space Shuttle program. By the end of that program, each flight cost roughly $766 million when accounting for overhead costs.

    While innovation in space travel remains expensive, several factors are making it more accessible: decreasing operational costs due to technological advancements (thanks to SpaceX for much of that), expanding market potential and projected growth, and the strategic importance of space technology in defense.

    In conclusion, innovating in space travel still requires substantial investment, but costs are decreasing and potential returns are increasing. Technological advancements, private sector involvement, and growing market opportunities are making space innovation more accessible than ever.

    I really liked Russell’s point about this being an obstacle for innovators and entrepreneurs. Just imagine, in a few years or even months, as this technology and innovation become more accessible, how many more people—how many more geniuses—will have access and be able to innovate themselves. It’s something really cool to think about. Let’s get back into the show.

    Russell Hannigan:
    And I think, again, once that cost to launch comes down by a factor of 10, 25, maybe even 50, that’s when you’ll see things flourish. I’m very excited about what can happen in space.

    Mike Collins:
    I think the other side of that equation is we have to make it cheaper to get stuff up there, and we also need more leverage once we’re there. Meaning, we’ll have to rely on technologies that can automate—robots making robots, so to speak. Robots and AI improving by orders of magnitude could help on the other side of this equation.

    If there’s an asteroid asset, we can create a package that can co-op and do what’s necessary to build a factory there… These are tough, thorny problems that will take time. But I tell 20-somethings interested in building a career over the next 50–70 years in investing: You have to go to the Wild West. Space is that for me—it’s unlimited upside and potential, with really hard problems. Hard things are hard, but they create enormous value when you solve them. Space is almost the ultimate example of that for humans.

    Russell Hannigan:
    It really is. It’s very, very hard. So was the jet engine 100 years ago, and internal combustion 200 years before that. I wish there were the equivalent of the Wild West and Conestoga wagons—I wish there were a way to get to space with those kinds of dollars.

    What we’re seeing now is frontier people having to take a Learjet, effectively, to do something. I’m actually a strong believer in human spaceflight. I think we’re the best robots out there, so to speak. We have intuition, creativity, and the ability to do things. Only 700 people have ever been above the Kármán line.

    If you want to measure where we are in space, or in any business, it’s how many humans are in the loop. That will change. I’m interested in companies pursuing that change. Vast, for example, showed their Vast 2 space station today—that’s definitely a step toward incredible facilities for many people. I don’t want 700 people in space; I want 70,000… 7 million. What they’ll be able to do compared to today will be night and day. Extraordinary.

    Mike Collins:
    I think one thing from the last week we have to step back and acknowledge is this: you can like, hate, despise, or adore Elon Musk, but he had a hell of a week. He thinks big. Humanity needs people willing to think big, take on audacious, hairy problems, and fail often.

    It’s always worth reflecting on dreaming big, thinking big, and tackling hard problems that could take a decade or more to solve. We should tip our cap to those trying to solve these enormous challenges.

    Russell Hannigan:
    It’s extraordinary—to carry people with you in that shared vision. The vision has always been there for SpaceX: they want to be multi-planetary. But to be multi-planetary, you can’t just start there on day one. You have to take steps to get there.

    Mike Collins:
    Got to do the steps. Yep.

    Russell Hannigan:
    Exactly. The first step is toward reusability in space transportation, along with applications like Starlink that generate revenue and make you a going concern. A big vision means nothing if you can’t pay the bills. You have to do both simultaneously and keep both in focus.

    Other companies will hopefully challenge SpaceX. They’re a long way behind, but in my backyard, Blue Origin’s upcoming rocket will hopefully fly in the next few months. It’s enormous—side by side with Saturn V, it’s not much smaller. It’s smaller than Starship, but still massive. The first stage is reusable—another step on that path.

    Mike Collins:
    And it points to the fact that we need competition. We need people trying different approaches, technologies, and platforms. In so many other sectors, it’s competition that really moves everybody forward.

    Russell Hannigan:
    It really does. I see it almost every day—another space venture launched or financed—and that’s super exciting. We all want that to happen, and we’re seeing it now.

    Mike Collins:
    So tell me, what are you working on? Where’s your heart and passion these days, Russell?

    Russell Hannigan:
    My heart and passion have always been about what we do in space and making it self-supporting. I took a bit of a sabbatical—I haven’t worked for almost four years. I’m advising some companies; one in particular excites me because it addresses some of these challenges.

    I started as a physicist, became an engineer, worked on geostationary satellites, reusable launch systems, and small launch vehicles. I had my own Earth observation company and helped create and incubate several startups that have gone on to be super successful.

    Any way I can help push the ball forward a little, I hope my experience is useful. I look at things critically—not in a negative sense, but asking: How will I make money from this? Who are the competitors? How do I differentiate? How do I beat the competition? Does the business plan support it?

    There are a lot of great businesses out there. Some blow my mind because they’ve secured investment despite their challenges, yet they have. I’m not the smartest person out there.

    Mike Collins:
    And most of them won’t turn out. But occasionally, and this is from my own life experience, sometimes I’m shocked too. There are companies that I think are wacky—“How did that get funded?” or “That team doesn’t have the right backgrounds”—and seven years later, they surprise you.

    Russell Hannigan:
    Yeah. Don’t underestimate the ability of entrepreneurs to innovate.

    Mike Collins:
    Yeah, right. Including their original businesses or ideas.

    Russell Hannigan:
    The beauty of what we do on Earth—it’s a weird way of saying it—is that we try stuff, and we can change directions quickly. If it doesn’t look like it will work, we can modify and adjust.

    With space, you’re kind of on this five-year, $100 million path.

    Mike Collins:
    Yeah.

    Russell Hannigan:
    You can’t just change directions. You’re stuck with what you’ve got. I want space to move the other way. I want it so that if I’m an engineer building a new mirror, sensor, or antenna, I can take it to space next Thursday.

    I know that’s a big leap and we’re nowhere near that today, but that future is coming. One way or another, it’s coming. Yesterday was an example that this time really is coming. It’s not just something out of science fiction. We will reach a point where we’re flying people to and from space every day. That is coming.

    Mike Collins:
    And that’s when we really see geometric growth—when we can get this into the garage, where two people with a good idea can actually build something new, innovative, and special. We’re not there yet, but the path is promising.

    What are a few things that our educated but curious audience should watch for over the next year?

    Russell Hannigan:
    I’d keep my eyes on a few launch companies. Stoke is one I advised right when they were starting—not anymore, but in the early days. They’re building a smaller version of Starship, designed to take a few hundred kilograms. They’ve figured out a fully reusable two-stage rocket—first stage comes back, then the second stage comes back later. A proper space transportation system. I’d watch that.

    Radian is another interesting company. They’re building a winged, fully reusable vehicle that takes off on a sled, goes to orbit, drops its payload, and comes back. Airliner-style operations. Those two companies excite me. Others are doing similar work.

    On the spacecraft side, several companies are building standardized platforms—or buses, as we call them—where you can mount sensors or communications payloads. One example is K2 Space. They’ve said, “When Starship becomes operational, we don’t need these highly integrated spacecraft anymore. We don’t need to worry as much about mass or volume. We can build large, inexpensive platforms capable of incredible things.”

    Something to keep in mind: there’s a lot of work on CubeSats, which are great, but revenue-generating ability is generally proportional to size. A small 3U CubeSat can do some things, but it’s not going to generate tens or hundreds of millions in revenue. You need bigger spacecraft, more power, and larger apertures to access customers at scale.

    So I’d look for larger spacecraft. It sounds strange to say “bigger” in space, but bigger can be less expensive, especially in a Starship environment where miniaturization isn’t necessary.

    The analogy I like to use—though it’s not perfect—is: imagine you had to build an SUV for a family of four plus a cat and dog, but you were limited to 100 kilograms. You could do it, but you’d need advanced composites and materials.

    Mike Collins:
    All kinds of compromises.

    Russell Hannigan:
    Exactly. You could do it, but you wouldn’t—it would be outrageously expensive. That’s where the space industry is today: building complex, miniaturized systems because launch is so expensive. Once those shackles of mass, volume, and cost come off, we’ll see tremendous new platforms emerge.

    For example, direct-to-device communications—direct to cell phones—requires a large aperture, a big antenna, because the signal from a phone is so weak. Bigger platforms let you do that. If you want your phone to work indoors, you need an even larger antenna to bounce signals. Again, big apertures.

    CubeSats showed us the way, but the future will be large, CubeSat-priced spacecraft with immense capabilities.

    And with big spacecraft comes servicing opportunities. Companies like Starfish want to service spacecraft, but servicing a CubeSat or even a small satellite makes no economic sense. Servicing becomes viable when you have a multi-ton spacecraft—2 to 10 tons. Bigger spacecraft make servicing practical.

    Samantha Herrick:
    All right. We’re going to take a quick break. We’ll be right back.

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    Russell Hannigan:
    And then that allows you to change things, adapt, and move forward more dynamically with the market. That’s a long-winded way of saying bigger is better.

    Mike Collins:
    No, no, that’s…

    Russell Hannigan:
    It’s counterintuitive to the world we’ve lived in, but it reflects the reality we face every day on the ground.

    Mike Collins:
    Yeah. Last question, Russell: we’re not the only country eyeing the potential of space. How are we doing? What’s the competition like globally? What’s the quick update on the geopolitical landscape of space?

    Russell Hannigan:
    That’s a great question. Globally, governments spend about $175 billion on space annually. The U.S. accounts for about half of that. Between NASA, Space Force, and various three-letter agencies, the U.S. government spends around $75 billion—or more—on space each year.

    So you can see there’s a lot of feeding from a very large trough. The U.S. is roughly half the global space economy.

    Russell Hannigan:
    So that doesn’t mean we can be complacent. There are other countries with companies that specialize in certain areas. You can usually buy spacecraft parts at a lower cost outside the U.S. than you can here, for reasons I won’t go into.

    There are specialties where it doesn’t make sense to do it in the U.S. because there are other businesses you can benefit from abroad. But honestly, you can’t be complacent. There’s always going to be competition. The U.S. represents about half of the global space economy—at least half. It depends on what you include in that, of course.

    Mike Collins:
    And it seems we still have—

    Russell Hannigan:
    We’re doing great.

    Mike Collins:
    We’re doing great. And importantly, we’re doing great because this is such an important frontier. I think we do best when we unleash entrepreneurial and academic capital to solve problems. It seems we’re in the game and continuing with a lot of these new startups.

    I’m waiting for the day when you go to Y Combinator and 50% of the pitches are five-person teams with space ideas. We’re not there yet, but when that day comes—look out—that’s an exciting future.

    Russell Hannigan:
    It’d be interesting to know what percentage of businesses require GPS.

    Mike Collins:
    Right.

    Russell Hannigan:
    Ring laser gyros 25 years ago cost tens of thousands of dollars. Now, I have the equivalent in my phone for about five bucks.

    We rely on space every day for everything—from hurricane and weather forecasting to finding the nearest Starbucks. It’s incredible how successful it’s been given how expensive it is. I keep marveling at that. I’m a bit of a broken record because I can imagine a future where we have Conestoga wagons to space—a railroad to space.

    Mike Collins:
    Your truck.

    Russell Hannigan:
    My truck, whatever it is.

    Mike Collins:
    Your truck to space.

    Russell Hannigan:
    There’s so much I want to do, try, and see what sticks or doesn’t stick. We’re far from that today, but we’re headed in that direction.

    For people looking to enter the space business, my guidance is: what are the technologies, services, and companies on the roadmap toward capitalizing on that future?

    Are those companies on a fully expendable system, like a small launch vehicle? Personally, I’d avoid those unless they have special customer relationships guaranteeing revenue. I’d focus on how the technology, service, capability, or customer benefits in a reusable future—the future we glimpsed yesterday when the booster was caught.

    Because I want to go to space. I want to do things in space. Maybe you do too. Millions of others do. Let’s get it done. Let’s create amazing businesses.

    Mike Collins:
    Well, Russell, thank you for your time today. It was a great brief. Our community appreciates it. Let’s catch up again in 6 to 12 months to see the progress. This journey excites our community—we’re investing in it, we’re passionate about it. I appreciate your update. Thank you.

    Russell Hannigan:
    Thank you. It’s a pleasure to talk about it. I’ve been in this business 40 years—it’s my profession, my hobby. I just want it to be successful. Thank you again for your questions and time.

    Mike Collins:
    We’ll talk again.

    Russell Hannigan:
    All right.

    Mike Collins:
    Excellent, Russell. Thank you. I appreciate it.

    Russell Hannigan:
    Bye.

    Mike Collins:
    All right. Bye-bye.

    Russell Hannigan:
    Bye.

    Samantha Herrick:
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