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Guests: Michael Mealling, Steven Jorgenson; Topics: Starbridge Venture Capital for the commercial space industry, commercial space sectors, investment analysis, trends and more.
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We welcomed back to the show Michael Mealling and Steven Jorgenson to discuss their company, Starbridge Venture Capital (VC) and the VC industry relative to the commercial space industry. During our one segment 78 minute discussion, we started by Michael giving us a detailed introduction to Starbridge Venture Capital with Steven adding to the introduction with investment goals and objectives for their funds, details on how the VC industry works for commercial space, issues of concern to the broader commercial space industry, trends, commercial space sectors, why some sectors are more in play for VC than others, why they don't look at the launch industry, the attraction to communications and Earth imaging plus lots more. This was a very important discussion explaining the nuts and bolts of investing in commercial space, the needed returns on investment by the investors, the need to remain private, do an IPO or perhaps engage in a newer sort of hybrid model discussed by our guests. Subjects such as industry collaboration as compared to keeping all information tightly held came up plus timelines for an investment fund objectives to be realized and of course the investor qualifications to participate in a Starbridge fund.
Segment preference was an important part of our discussion so don't miss it. Listen to what was said about the need for customers and the type of product mix needed by a successful company. Note the need for innovation and what that means for investors. Also, pay attention to the types of returns that Starbridge needs for its funds. What other industries besides commercial space can one expect such returns on investments within the same time frame? Post your comments on this subject on our blog. Our guests provided us with many company examples when making their points.
Markets comprised a large part of our discussion focus. As you will hear, often in commercial space there simply is no market. You will hear this mentioned later in the show regarding human spaceflight. In addition, you will hear about shrinking markets in the geo satellite industry causing investor retraction. Markets are pretty much everything but listen to the characteristics needed for a good commercial (not government) market.
We took several listener emails during the program. Carol mentioned that she was an individual investor but not qualified for a fund. She was concerned about a developing US political risk regarding policy, taxation, and regulations. This provoked quite a mini-discussion so be sure to listen to it. Our guests explained the impact of these areas on professionally managed funds as compared to investment alternative for investors. They said the fund is better suited to weather such a storm and the individual was more at risk. They talked about what higher taxes and more costly regulations due to time lines, investments, and even some markets. Don't miss this. Our guests added in the potential impact on reducing or stifling innovation.
Other topics included a discussion of challenges for the industry and for VC investment. For example, BLEO investment options were a challenge as there was an absence of markets and customers. Listen to what they said regarding cislunar economic development issues and the use of lunar resources. Once again, share your thoughts and even your timelines for these businesses by posting on our blog. Equity crowd funding projects were a challenge. Listen to what our guests had to say about them and the companies that want to use them.
Before we ended our discussion, we talked about being able to take in foreign investment plus I asked if the Artemis project was a boon for VC investment opportunities re the broader commercial space industry. Listen for the response. I think you might be surprised by what both Steven and Michael said in response to my Artemis question. Before closing, our guests talked about the challenges faced by the GEO market and even the LEO satellite constellations being developed. I told our guests about our recent PhaseFour interview on TSS regarding their in space propulsion unit, Maxwell, to address small satellite propulsion for these LEO constellations. Both Steven and Michael had lots to say about many of the in space propulsion projects and those working to develop products in this specific market.
Prior to ending our discussion, Michael was asked about the much earlier Colony Fund idea proposed more than a decade ago by Tom Olson. Both Michael and I were around to hear Tom's proposal plus he promoted it on many early Space Show programs. Michael had much to say about putting forth ideas that are way too early for the times. I took the opportunity talk about my doctoral dissertation and the three VC surveys I did on the commercial space industry back in the late 90's when I was still collecting research for my dissertation. Don't miss what I said about my VC findings way back when. Both guests offered short and to the point closing comments you will want to hear.
Please post your comments/questions on TSS blog for this program. You can reach Michael and Steven through me or their Starbridge VC website, https://www.starbridgevc.com.