Firefly investor Noosphere Ventures eyes satellite manufacturing sector

Space

WASHINGTON — Noosphere Ventures, two years after providing a lifeline investment in small-launcher company Firefly, is gearing up to make another space investment, this time in the small-satellite manufacturing sector.

Officials from Noosphere said they are willing to pull another company back from the brink, if necessary, as they build a portfolio of space companies that enables SpaceX-like vertical integration.

“We believe long term that consolidation and [merger and acquisition activity] will happen in the sector,” Max Polyakov, managing partner at Noosphere Ventures, said in an interview. “Industry will shift toward vertical integration where you control the full range from the launch, to satellite, data analytics, communications and the ground stations. We should all remember the end dollar we collect from the ground — the customer who pays for the imagery, the analytics, or communications.”

Noosphere, as an investor and a holding company, has invested in 19 companies, though not all of them are in the space industry, said Mark Watt, a Noosphere partner.

Watt said Noosphere has averaged between $150 million and $200 million in merger and acquisition-type investments annually over the past five years. In a best-case scenario, an investment in a small-satellite manufacturer or component supplier could happen by this spring, he said.

Polyakov cited Planet, which builds and operates a fleet of Earth-observing cubesats, and Maxar Technologies, which is building satellites to be operated by its DigitalGlobe division, as examples of growing vertical integration.

Those examples hold for small satellites, but not for larger spacecraft. Maxar has begun divesting from its manufacturing business for large, multi-ton telecom spacecraft due to a lack of business.

Polyakov said Noosphere is specifically interested in a manufacturing capability for satellites between 50 and 500 kilograms. Such a company could also help build technologies of interest such as orbital transfer vehicles for deploying satellites, space tugs and debris removal systems, Polyakov said.

Component suppliers for small satellites are also of interest given what Noosphere views as a thinning distinction between them and full manufacturers, he said.

“We will write the appropriate check for the appropriate company,” Watt said. “It could be a small, unknown company; it could be a larger established player that for whatever reason is not executing as well.”

Noosphere executives declined to say how many space companies in which the firm has invested. Polyakov is the chief executive of Earth observation company EOS, and a board member at Firefly Aerospace. Polyakov declined to specify how much Noosphere invested in Firefly, saying only that the company is “fully funded through the initial launches of Alpha,” its upcoming launch vehicle.

Polyakov said Noosphere wants any manufacturer investment to support Firefly Aerospace’s lunar ambitions with NASA. Firefly Aerospace was one of nine companies selected for the space agency’s Commercial Lunar Payload Services program, enabling the company to compete for task orders worth up to $2.6 billion over 10 years to bring payloads to the moon’s surface.

CLPS and Noosphere’s broader space goals are already transforming Firefly Aerospace into more than a smallsat launch provider, Polyakov said.

“It is not technically a rocket company anymore,” he said. “It is basically already an integrated space exploration kind of company. It is also correlated to the SpaceX strategy to some point.”

By adding a satellite manufacturing capability, Polyakov said Noosphere companies could execute “mission accomplished” scenarios where they can fulfill entire space missions instead of a single part like launch. Any investment would still have to make sense as a standalone, however, Watt said.  

“Their business case needs to independently stand up,” Watt said. “We see the upside being we are also able to help drive synergies, whether they be very direct in terms of revenue or customers. We drive those across the portfolio, but the businesses are operated independently.”

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