The NewSpace industry is soaring thanks to the proliferation of private companies developing versatile innovations in the space and aeronautics fields. As recently as the early 2000s, the only way to launch supplies into space was through major governmental organizations like NASA, the ESA, and CNSA. Now, the United States is leading the way and providing launch services thanks to private space companies, while the private sector is building public-private relationships with government agencies and working with businesses and investors to launch non-government payloads.
Meanwhile, space agencies are at a crucial pivot point as international groups embark on ambitious endeavors to collect samples in space. Partnerships in the nascent NewSpace sector will be vital to take humans to the moon, Mars, and beyond—and much collaboration will be needed to succeed at these efforts that were once thought impossible. Partnerships are essential to further developing space exploration innovations while reducing costs and risks.
As the NewSpace industry matures, the industry should seek to evolve more public-private partnerships to further innovate business models and develop better practices for successful collaborations that advance our presence in space.
INTEGRATED PARTNERSHIP SOLUTIONS
Large-scale companies within NewSpace, like BlueOrigin and SpaceX, have enough resources to vertically integrate their business models and enter the market independently. They also have the capabilities to expand their products and services with in-house agencies. However, smaller or VC-backed NewSpace companies need to depend on external players as a core aspect of their sales, marketing, and customer service intelligence.
Many of today’s established space companies can partner with companies outside of the sector’s supply chain. Rocket Lab, for instance, formed a partnership with KSAT to provide a complete solution for customers who need transportation to space and communication solutions for their payloads. Rocket Lab’s Photon hosts the customer’s payload, while KSAT offers the communication services so customers can focus on their mission, rather than having to integrate and manage vendor products and services fully.
In order to produce the best investment, companies should consider integrating systems that provide options for their clients. For instance, in this model, customers can use any ground provider and take advantage of Photon and the communications service.
GO-TO-MARKET AND DEVELOPMENT PARTNERSHIPS
Many innovative new companies in the space sector that started with in-house business strategies are migrating to a new business model that harnesses partnerships to produce more innovations. Government agencies like NASA should continue to expand their capabilities for Earth monitoring, navigation, communications, space exploration, and other space-based applications. Public-private partnerships can provide significant benefits to government agencies by utilizing commercial efficiency and technologies while supporting each other through the risks associated with developing new projects in the industry and exchanging capital according to performance.
Earth observation is a unique subsector of the space industry that can implement a classic go-to-market partnership model. Complex data and images need to be transferred into usable insights or decisions that businesses and their consumers can easily use and understand. Next, the decisions or solutions need to be marketed to different sectors and vertical target markets. Planet, the earth-observation and remote sensing provider, created a partner program to address any obstacles faced in this model and connect consumers to experts who can find specific solutions across various industries, from energy to agriculture. This go-to-market partnership model allows Planet to grow faster and reach more customers across a wider net of segments with value-added products.
Likewise, market development partnerships can be extremely valuable in a growing space sector or when shifting business practices are required to scale. Companies that are developing systems in space must focus on the entire value chain. While offering the technology can be one goal for a partnership, a primary goal for a company may be to ensure efficiency for operators and allow service providers to build a third-party service into their business model.
CREATING SUCCESSFUL PARTNERSHIPS
While partnerships can be complicated, the proper process and agreements can usually help them succeed. Partnerships have many dimensions and need to be crafted well to protect intellectual property, manage overhead, and prevent loss of control. RBC Signals is a space company that has made partnerships a core part of its strategy. They are critical to improving the company’s standards and reducing tension in the market. Plus, building partnerships can help signal the emergence of the new market. Eventually, smaller businesses will be able to innovate and scale faster with the help of premier contractors.
In a diverse industry, the opportunities and goals for each company will continue to vary by market segment. The accelerators of business that influence partner strategies differ by sector, ranging from data applications to infrastructure. Each model is unique to its own circumstances. But every space company needs to think holistically about its partnerships. They should acknowledge which activities to keep in-house and which products and services are best procured from suppliers. Additionally, they should consider how they can improve market access and competitive offerings for their partners.
Success depends on acquiring a deep understanding of the space ecosystem and value chain. Companies should also think about each crucial function of their business, from research and development to marketing and sales to production and delivery. This will help them learn where partnerships can add value and lead to more thoughtful and practical partner strategies, especially as companies change and grow.
Few companies can succeed by themselves. Even SpaceX has partnerships with NASA. Partnerships are the key that NewSpace companies need to build awareness, improve reach, and deliver valuable solutions. If we’re to develop a realized in-space economy, it’s critical that NewSpace companies include partnerships into their business models. Investment in partnerships can help support and give life to an ever-expanding industry, and those who build upon those relationships will soar above the rest.
Chairman & CEO, Voyager Space Holdings. Full bio available at www.dylantaylor.org.