QUARTERLY VOL. 6 NO. 3 WINTER 2015 COSMIC SHIFT THE COMMERCIAL SPACE REVOLUTION IQT Quarterly is a publication of In-Q-Tel, Inc., the strategic investment firm that serves as a bridge between the U.S. Intelligence Community and venture-backed startup firms on the leading edge of technological innovation. IQT Quarterly advances the situational awareness component of the IQT mission, serving as a platform to debut, discuss, and debate issues of innovation in the areas of overlap between commercial potential and U.S. Intelligence Community needs. For comments or questions regarding IQT or this document, please visit www.iqt.org, write to [email protected], or call 703-248-3000. The views expressed are those of the authors in their personal capacities and do not necessarily reflect the opinion of IQT, their employers, or the Government. ©2015 In-Q-Tel, Inc. This document was prepared by In-Q-Tel, Inc., with Government funding (U.S. Government Contract No. 2014-14031000011). The Government has Government Purpose License Rights in this document. Subject to those rights, the reproduction, display, or distribution of the Quarterly without prior written consent from IQT is prohibited. EDITORIAL IQT Quarterly, published by In-Q-Tel, Inc. Editor-in-Chief: Adam Dove Theme Editors: Ryan Lewis, Todd Stavish, and Devin Brande Contributing Editors: Brittany Carambio and Emma Shepard Managing Editor: Lisa L. Bader Design by Lomangino Studio LLC Printed in the United States of America QUARTERLY Identify. Adapt. Deliver.™ TABLE OF CONTENTS On Our Radar: The New Race for Space 02 By Ryan Lewis and Todd Stavish A Look Inside: Cosmic Shift 05 Space is Open for Business 06 By Peter Beck The Second Decade of CubeSats: Utility Cubed 10 By Rob Call and Andrew E. Kalman Seeing the Whole Earth, Every Day: More than a Thought Experiment 14 By Rich Leshner Infographic: Small Satellites are Driving 16 a Commercial Space Revolution With commentary by Aaron Q. Rogers Fast Data: Satellite Imaging Analytics in the Era of CubeSats 20 By Pavel Machalek A New Model for Space Situational Awareness 24 By Paul Graziani Tech Corner 28 A technology overview from IQT portfolio company DSSP In the News 33 A survey of commercial space industry trends IQT QUARTERLY WINTER 2015 Vol. 6 No. 3 01 IQT QUARTERLY ON OUR RADAR THE NEW RACE FOR SPACE By Ryan Lewis and Todd Stavish President John F. Kennedy, speaking several months after John Glenn’s historic flight aboard Friendship 7, famously proclaimed that, “No nation which expects to be the leader of other nations can expect to stay behind in this race for space.” The origins of the modern space industry are rooted in one of the most renowned global competitions: the race for space between the United States and the former Soviet Union. Fifty years later, a new space race is underway that is being driven not by nations, but by venture-backed startups. Throughout the 1960s and 1970s, space research and looking to government agencies to serve as their sole or development was driven by government agencies seeking even primary customers. Instead, commercial industries to expand their national security capabilities and prestige. serve as their main sources of revenue generation. In today's space race, this generation of venture-backed While many of these consumers may be unfamiliar startups is challenging long-held industry conventions with space-based capabilities, the insights provided by leveraging the same techniques that drove innovation from space remote sensory data fit directly into existing in the software market and applying them to space big data, communications, or tracking and monitoring systems. As a result, space capabilities and services challenges. This comprehensive market change and are rapidly becoming accessible for commercial and rising commercial interest has not been lost on investors. government consumers alike. For the first time, venture capital firms are playing an increasingly significant role in funding space startups. The changes currently unfolding in the market are truly As more money enters the industry, more entrepreneurs unprecedented. While the space industry had its share are likely to join this new race. of new commercial entrants in previous decades, never before has the industry experienced aggressive startup It is important to consider why this innovation in the activity across every market segment. From providing market is happening now. Startups are taking advantage reliable and affordable access to space to developing of fundamental changes occurring across a variety of new analytics for remote sensory data, startups are market sectors, including launch vehicles, hardware and looking to disrupt current practices by leveraging software, satellites, and analytics. affordable platforms that allow them to innovate quickly Decreased Cost to Access Space and inexpensively. This approach allows companies to rapidly evolve their products and services at previously The ability to reach outer space safely has always been unimaginable price points. one of the biggest challenges in the space industry. As recent events have shown, rocket launches are still The cost structure of these startups also allows them to risky enterprises. Despite the inherent challenges of pursue new types of business models. Unlike a majority rocket science, recent advances in expanding affordable of their predecessors, most new space startups are not 02 Vol. 6 No. 3 Identify. Adapt. Deliver.™ IQT QUARTERLY For the first time, venture capital firms are playing an increasingly significant role in funding space startups. As more money enters the industry, more entrepreneurs are likely to join this new race. access to space have made it possible for entrepreneurs methods, in which requirements and solutions evolve and startups to put pathfinders and prototypes into orbit through collaboration between self-organizing, cross- at a fraction of the cost. Demand for secondary rides functional teams. This promotes adaptive planning, has developed so rapidly that startups specializing in evolutionary development, early delivery, continuous launch brokerage services have emerged to simplify the improvement, and rapid and flexible response to change. process for new companies. The U.S. government also The end result is that a single satellite design can helped ease access to space by supporting efforts like evolve through ten generations in one or two years — NASA's rideshare program, which provides secondary taking advantage of hardware that did not exist at the rides to university science projects. inception of the design cycle. Although the secondary launch market helped catalyze Standardized Satellite Buses growth among aspiring small satellite startups, it Expanding on the original CubeSat standard developed cannot address the ever-increasing demand for launch at California Polytechnic State University and Stanford services. From launch dates to desired orbits and University, manufacturers have drastically simplified altitudes, startups are demanding increasingly complex the process for researchers and companies alike to services to meet their needs on an already overtaxed procure, test, and fly their own inexpensive satellites for system. A series of startups have emerged to meet this a wide variety of missions and/or research projects. This demand for timely, reliable, and affordable access to flexibility has catalyzed numerous startup companies space. These innovations will be important not only for to develop tailored satellite services leveraging an aspiring companies dedicated to small satellite launch, inexpensive satellite bus. As the standard matures but also the current heavy lift providers who are looking and companies support different elements of the to diversify their product lines. supply chain, it will become easier for individuals and Commodity Hardware and Software companies interested in CubeSats to experiment with their own satellites. The second major change to the space industry is the Common Analytic Engines and Services adoption of commodity hardware coupled with the use of agile development methods. The advantage of using Historically, the analysis of remote sensory data commodity hardware is most widely recognized in from space assets required a series of highly trained “Moore’s Law” — the observation that, over the history professionals to prepare, analyze, and disseminate the of computing hardware, the number of transistors data to the appropriate stakeholders. While there will in a dense integrated circuit doubles approximately always be a need for highly trained professionals, the every two years. This doubling effect creates massive emergence of proprietary and open source analytics computing power over generations. The power of engines have enabled companies to sell affordable generational doubling is not isolated to computing, analytic products, not just raw data. however. For example, space startups are utilizing the The shift from raw data to insights will have a rapid pace of innovation currently experienced in solar substantial impact on the market. Companies, both power cells, battery systems, software-defined radios, incumbents and startups, now have new product lines and smartphone sensors. to sell customers. Furthermore, it has given rise to a The exponential improvement of commodity hardware new group of startups focusing exclusively on remote is further amplified by the use of agile development sensory analytics. Thus, a major barrier to entry for IQT QUARTERLY WINTER 2015 Vol.