3D Printed Rockets Poised to Disrupt Satellite Launch Market

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The space industry is undergoing a remarkable transformation, with a growing demand for commercial satellite launches, space exploration missions, satellite constellations, and servicing existing satellites and space stations. The global space market is expected to reach $1 trillion by 2030 from around $447 billion in 2022 with the number of active satellites likely to grow 3-fold by 2033, according to McKinsey projections. The falling launch prices and increasing demand for launching satellites from both corporations and governments are anticipated to create supply constraints in the launch market for the remainder of the decade.

Additionally, commercialization of low-earth orbit (LEO) in the past decade has paved the way for the emergence of numerous space startups. With both the private and public sectors increasingly looking for consistent, cost-effective, and reliable launch providers, 3D-printed rockets offer a viable option. The traditional rocket manufacturing process has been labor-intensive for over six decades. In stark contrast, 3D-printed rockets offer a more fuel-efficient, lightweight, and rapid alternative. 

While a lot of companies are leveraging 3D printing to build rockets, California-based Relativity Space is pushing the boundaries of innovation with its novel approaches to 3D printing and artificial intelligence. Using advanced 3D printers and AI, rocket engines and complex parts can be manufactured in as little as 60 days, a significant improvement over the 24 months required by traditional methods. The successful liftoff of Relativity’s Terran-1 demonstrated the structural viability of 3D-printed rockets. 

Relativity Space, which aims to challenge SpaceX on innovation, price, and reliability, has signed a customer backlog of $1.65 billion in launch service agreements and has an additional $3.68 billion in customer pipeline. In June 2022, Relativity had a multi-launch agreement, worth over $1.2 billion, with OneWeb to launch its Gen 2 satellite network. Such large contracts are a testament to a high degree of customer conviction in Relativity. The company distinguishes itself further through its vertically integrated supply chain, streamlining the manufacturing process and reducing costs. Most recently, Relativity Space leased a historic first-stage test stand at NASA’s Stennis Space Center to advance the development of the Terran R launch vehicle.

Sensing the potential future shortage of launch providers, Relativity was quick to retire its Terran 1 rocket, despite its partial success at the first launch, an impressive feat considering how hard the space tech is to crack and shift its focus to medium-to-heavy launch vehicle Terran R. The company is designing the 13-engine Terran R with a first stage that can launch and be reused at least 20 times. For comparison, SpaceX’s Falcon 9 first-stage booster has flown 16 times. Accordingly, Relativity Space stands out as a compelling investment opportunity given its current valuation of $4.2 billion – a figure that remains remarkably reasonable in the context of the capital-intensive space technology industry. Their quick-to-market rockets are perfectly poised to fill in the growing demand for launch providers, making the company an ideal partner to secure more contracts. 

However, the space race is just as competitive when it’s 3D printed, with each startup endeavoring to craft its unique and innovative approach. Industry stalwart SpaceX’s Starship has a significant number of 3D-printed parts. On various occasions, SpaceX CEO Elon Musk has emphasized the importance of using 3D printing in the production of Starship. The company has 3D printed a wide range of engine components, such as the combustion chamber and nozzle extensions, as well as various brackets, fittings, and other elements throughout the spacecraft. The company has also invested heavily in developing new 3D printing technologies and materials, aiming to improve further the speed, quality, and performance of its manufacturing processes. California-based ABL Space Systems, founded in 2017, uses 3D printing to manufacture its E2 Engines for its RS1 launch vehicle. The low-cost small satellite launch vehicles maker was valued at $2.4 billion after a $200 million Series B-II round in October 2021. UK-based Orbex, which raised a $46 million Series C round in October 2022, has built the largest industrial 3D printer in Europe to rapidly print complex rocket engines in-house.

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Nuclear Fusion – Next Frontier in Clean Energy Investment

The pursuit of clean energy sources has been a top priority for decades, driven by the urgent need to mitigate climate change and reduce dependence on finite fossil fuels. While solar and wind power have made significant strides, they still face challenges such as intermittency and energy storage. In the last 10 months, US scientists have achieved important breakthroughs in nuclear fusion, showcasing the immense potential of this technology as a source of clean energy.

Nuclear fusion, in many respects, epitomizes the quintessential venture capital opportunity – it comes with substantial costs and challenges, but the potential rewards are monumental and justify the risk and longer timeline. In a nuanced comparison, nuclear fusion can be compared to generative AI. While artificial intelligence had been in existence for decades, its tangible benefits were relatively elusive until the emergence of transformative models like ChatGPT, which propelled the technology into an unprecedented phase of exponential growth and real-world applications.

The US, with its favorable regulation and groundbreaking innovations, remains well poised for a third energy revolution, according to Goldman Sachs, which sees the energy sector as a $10 trillion market opportunity. If fusion technology were to capture even 1% of the market, this could lead to billions of dollars in market opportunity. Goldman estimates the US power demand to increase 2.5 times by 2050 compared with 2021, which will require $6.6 trillion in renewable power investment. Legislation such as the Inflation Reduction Act will spur about $3 trillion investment in renewable energy. 

The scientific breakthroughs have changed the perceptions of the timeline for the commercialization of fusion technology. Accordingly, VC interest in the technology has surged. In the first two quarters of 2023, VCs invested $549.2 million across 11 deals in nuclear fusion start-ups. For comparison, only $634 million were invested in the overall 2022. The average deal size this year has been nearly $50 million, which also reflects the high capital costs associated with developing and producing the technology. Although the funding for both years has decreased compared to 2021, it’s important to note that fusion startups operate on significantly longer development timelines than conventional startups and try not to raise a new round before a certain milestone. 

Despite being a nascent industry, the industry has numerous startups with varied approaches trying to generate meaningful power from fusion. In the last 6 years, the number of start-ups in the sector has grown three-fold. For instance, Washington-based Helion Energy, claiming deployment of its fusion plant by 2028, secured a commitment from Microsoft to purchase electricity upon the deployment. The company is aiming to demonstrate net electricity from fusion in 2024. Financial backing from Sam Altman as a lead investor in the latest $500 million series E round cements the credibility of the business model. 

Additionally, California-based TAE Technologies, with around 1,400 granted patents and total private funding of over $1.2 billion, is aiming to deploy its fusion plant in the 2030s. Moreover, Commonwealth Fusion Sytems, fueled with a massive $1.8 billion series B round in 2021, is anticipating the completion of its fusion power plant, known as ARC, in the early 2030s. In September 2021, the company even demonstrated an entirely new type of superconducting magnet technology that enables a new commercial pathway for fusion energy at scale. Furthermore, Masschussets-based Type One Energy Group, with the completion of the world’s first high-temperature superconducting stellarator magnet, is projecting the commencement of its fusion plant by 2033. Zap Energy Inc is also building a low-cost, compact, and scalable fusion energy platform with a recent $5 million grant from the US Department of Energy and a $160 million series C round in 2022. Partnerships with renowned institutions such as the University of Washington and Lawrence Livermore National Laboratory, among others, cement the credibility of the company.