Howard • Howe • Martin • Taylor • Dumaine

3p6—> 23p6—> <—24p6 <—44p6

fiberset founder: Marie Walker mission: Makes rocket parts 1 out of composite materials 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 photographs by brad swonetz—redux

L HOWARD • HOWE • MARTIN • TAYLOR • DUMAINE STORY CODE STORY NAME ISSUE DATE NUMBER OF PAGES: 05 MOJ09Y MOJAVE 09/2008 Page 01 of 05 3p6—> 23p6—> <—24p6 <—44p6

hot spots

1 2 Forget NASA. 3 The real future of America’s space 4 5 program may well lie in a thriving desert 6 7 town of entrepreneurs who aim at the stars. 8 9 utside hangar 7, the desert and sky stretch as 10 far as you can see, broken only by the distant Tehachapi Moun- 11 tains and the occasional Joshua tree. Inside the hangar the 12 O view is equally dramatic. A rocket, 30 feet long, lies on its side. 13 Nearby sits a large capsule, looking like something out of the Apollo pro- 14 gram. But this is the Neptune program—run not by NASA but by Roderick 15 and Randa Milliron, a husband-and-wife rocketry company. 16 The Neptune sure looks convincing. But will it fly? 17 Welcome to Mojave, Calif., where “Will it fly?” is a constant question. The 18 desert town is home to eight small rocket companies, twice the number 19 of a decade ago. The town now boasts 4,000 residents, up from 2,700 five 20 years ago, pursuing a galaxy of ambitious business models: space tourism, 21 rocket-powered sports, and space-based experiments for corporations and 22 scientists. Like any good business ecosystem, Mojave also has a growing 23 cluster of companies that support the rocket firms: fabricators of exotic ma- 24 terials, parts suppliers, and even restaurants that cater to the space set. 25 Mojave can draw on a deep well of California aeronautics and engineer- 26 ing talent on the cheap. It is a 90-minute drive from Los Angeles, home 27 to aerospace companies such as Lockheed Martin, and five hours from 28 San Francisco. The pay at rocketry startups such as the Millirons’ can be 29 as little as $16,500 a year. Yet these companies lure fresh hires with the 30 promise of inspiring work and a bargain-basement cost of living. 31 On average a Mojave home goes for about $150,000, less than a third 32 the average cost in L.A. Still, Mojave is clearly in the boonies. The town 33 doesn’t even have a movie theater. “Here it’s possible to test rockets in a 34 very unpopulated area,” says Mike Massee, a board member of the local 35 Chamber of Commerce. “If something blows up, you’re not going to take 36 out an entire neighborhood.” 37 38 39 40 41 42 43 Rocket 44 45 46 47 48 town 49 50 51 52 . . . 53 usa 54 by justin martin Mojave, calif. 55 56 57 september 2008 FSB 93

HOWARD • HOWE • MARTIN • TAYLOR • DUMAINE R STORY CODE STORY NAME ISSUE DATE NUMBER OF PAGES: 05 MOJ09Y MOJAVE 09/2008 Page 02 of 05 3p6—> 16p6—> <—17p6 30p6—> <—31p6 <—44p6

spots hot boomtown Mojave has doubled in size 1 nother dr aw is mo- Rocket since becoming 2 jave’s 12,500-foot run- Riders a spaceport. 3 way, longer than any- A video of Mojave’s 4 thing at Los Angeles Interna- See startups spacebound 5 tional. During World War II, at cnnmoney.com/ 6 Mojave’s airport was used to smallbusiness. 7 train Marine pilots. After the war 8 it became a private airfield favored by 9 owners of vintage biplanes and decom- 10 missioned fighter jets. In 2004, Mojave’s 11 airfield became the first inland facility to 12 receive FAA approval for space traffic. 13 That same year saw the first small com- 14 pany reach space: Scaled Composites, 15 then owned by Mojave entrepreneur and 16 airplane designer Burt Rutan. His revo- 17 lutionary SpaceShipOne became the first 18 private craft to ascend 62 miles to the 19 edge of suborbital space, twice over two 20 weeks. That netted him the $10 million 21 Ansari X Prize, but even larger purses 22 awaited. Last August, Northrop Grum- 23 man purchased Scaled Composites for an 24 undisclosed sum. And Richard Branson 25 commissioned Rutan to design and build 26 the first batch of rockets for a space tour- 27 ism business, Virgin Galactic. 28 This summer Rutan began testing 29 SpaceShipTwo, which is twice the size of locating a spaceport like Mojave along time. After a month of training, passen- 30 the original, in the nearby desert. Bran- the Gulf Coast. Hollywood studios have gers would spend a week in orbit before 31 son has taken $30 million in deposits paid to record some of the engine tests the capsule parachutes into the ocean. 32 from customers hoping to take a 2c-hour that the Millirons have conducted out Such a ride does not come cheap: The 33 space flight.V irgin Galactic is hoping to in the desert. Spaceship sound effects Millirons plan to charge $2.5 million a 34 launch in 2010, and has many would-be in movies such as War of the Worlds and ticket, although the first ten Neptune 35 rivals. “All the rocket pioneers in town Serenity are from their rocket engines. passengers will get promotional fares of 36 want to be like Burt,” says Bill Deaver, “Rod and Randa are from another $250,000. (A Virgin Galactic ticket is set 37 editor and publisher of the Mojave Desert planet,” says test pilot Dick Rutan, to cost $200,000.) “We’re not interested 38 News. “The stakes are big, the money is brother of Burt. “But nobody knows in a short flight where you kiss the edge of 39 big, the glory is huge.” what’s going to work. Lots of industries space,” says Randa. “We want our passen- 40 Most Mojave rocket startups, however, we now take for granted grew out of in- gers to circle the earth, experience orbital 41 are still operating on a shoestring. Rod- novators trying things. We need a whole sunrises and sunsets, and get a privileged 42 erick and Randa Milliron, both 57, have bunch of ideas—the weirder, the better.” perspective from 250 miles up.” 43 44 “We want our passengers ver in building 25, you’ll 45 to experience a privileged find a very different dream in 46 Oprogress. Instead of high-end 47 perspective from 250 miles up.” space tourists, Dave Masten wants to 48 capture the market for low-end space 49 been operating out of Hangar 7 since The Neptune, partly powered by a pro- science. Masten is a Silicon Valley refu- 50 1996. On a microscopic revenue stream prietary fuel that the Millirons identify gee who cashed in his options and moved 51 ($150,000 in 2007) they’ve managed to only as Hydrocarbon X, certainly fits that here in 2006, after Cisco bought a small 52 keep their business going, and in flush bill. The Millirons are currently seeking company he worked for. For a second act 53 time have hired up to 25 employees. funding for a series of test flights of their Masten is hoping to offer an alternative 54 To fund their dream, the Millirons 90-foot multistage rocket next year. In to an expensive NASA rocket program. 55 seize any side project they can find. They the long run they plan to offer full space NASA regularly launches rockets to 56 consulted with the state of Texas about vacations for as many as six people at a conduct zero-gravity experiments in the 57 94 FSB SEPTEMBER 2008

L HOWARD • HOWE • MARTIN • TAYLOR • DUMAINE STORY CODE STORY NAME ISSUE DATE NUMBER OF PAGES: 05 MOJ09Y MOJAVE 09/2008 Page 03 of 05 3p6—> 16p6—> <—17p6 30p6—> <—31p6 <—44p6

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 interorbital systems 25 co-founders: Randa and masten space systems 26 Roderick Milliron founder: Dave Masten 27 mission: Offer weeklong space mission: Create space-based 28 vacations for six people at a time research at low prices 29 30 31 earth’s upper atmosphere. You can place of precious space time, and returning the Not all Mojave companies are coasting 32 your payload aboard one of these rockets. payloads safely to earth. He has staked on fumes. XCOR is the most prosperous 33 But competition is fierce, and the cost can his hopes on the XA rocket, a squat, of the local rocket startups, and the one 34 be more than $1 million. Masten asked pyramid-like design. A prototype of the with the best prospect of being the next 35 250 recent users of NASA’s rockets, If rocket sits in his hangar with a gaggle Scaled Composites. Headed by former 36 I could bring down the cost to around of exposed wires, tubes, and valves. So Intel executive Jeff Greason, 41, XCOR 37 $25,000, would you conduct more exper- far Masten has conducted tests where makes rocket engines for clients that in- 38 iments? The response was overwhelm- the XA has risen only a few inches off clude NASA. XCOR, now nine years old, 39 ingly positive, and Masten feels he’s found the ground. even managed to turn a small profit in 40 a niche worth billions. For one thing, all 41 computer chip makers need ever more miller aims to create a giant wi-fi 42 precise crystals. In zero gravity crystals 43 can grow with almost no defects. hot spot in space, So that space 44 Masten, 40, has also identified the tourists can send e-mails home. 45 nation’s 58 million school children as a 46 potential market. He plans to offer some- Revenues for Masten are even more 2006, though it lost money in 2007 on 47 thing called a SodaSat, a Coke-can-sized scarce than for the Millirons. Masten and revenues of $3.6 million. 48 payload that for a $99 fee can be trans- his four employees have burned through Greason’s most glamorous commission 49 ported alongside larger corporate and $1.25 million, which includes his Cisco so far is developing the Rocket Racer, a 50 academic payloads. “A kid could send a proceeds, funding from an angel inves- light aircraft powered by rocket engines, 51 seed into space to learn how it’s affected tor, and money invested by friends. Mas- for the Rocket Racing League. Think of 52 by microgravity,” he says. “Wouldn’t that ten has pretty much maxed out his credit it as NASCAR in the sky: As many as ten 53 be an amazing science project?” cards as well. Still, he defiantly predicts rocket planes race around a five-mile cir- 54 To capture these markets Masten better test results for the XA. “Ever since cuit, 17,000 feet in the air. There would be 55 needs to build a craft capable of leaving I was a little kid I wanted to build rock- spectators, of course, but the RRL will be 56 the atmosphere, providing a few minutes ets,” he says. “I still intend to.” a truly made-for-TV sport. The planes will 57 96 FSB september 2008

L HOWARD • HOWE • MARTIN • TAYLOR • DUMAINE STORY CODE STORY NAME ISSUE DATE NUMBER OF PAGES: 05 MOJ09Y MOJAVE 09/2008 Page 04 of 05 3p6—> 16p6—> <—17p6 30p6—> <—31p6 <—44p6

hot spots

engineering whiz, and the couple left to 1 found Fiberset in 1983. 2 The company built a client list that in- 3 cluded aerospace companies and boat- 4 makers. All that was threatened in 2003, 5 when the pair went through a messy 6 divorce, and Marie wound up with the 7 company. “I wasn’t sure I could run it,” 8 she says. In fact, she not only held on to 9 the client base but expanded it to rocket 10 companies, for which Fiberset makes 11 nose cones and another parts. 12 Walker’s success prompted her to give 13 back to Mojave, where she organizes a 14 model-rocket competition at a local 15 school. Entrants are required to come up 16 with a marketing plan for a space busi- 17 ness that would launch 25 years from 18 now. “I want these kids to be exposed to 19 the opportunities they’ll have right here 20 in their own community,” she says. 21 You see a lot of long-term thinking 22 xcor at all levels of the Mojave ecosystem. 23 founder: Take Jim Miller, 39, who left a low-level 24 Jeff Greason telecom job in L.A. in 2001. His Mojave 25 mission: Build the company, High Desert Wireless, provides 26 X-Racer for the Rocket Internet service to the hangar head- 27 Racing League quarters of rocket pioneers. Revenues 28 have doubled each year and now stand 29 at roughly $500,000, and the company 30 be mounted with cameras, and the track and it’s almost painful to behold.” is profitable, Miller says. But that’s not 31 will be superimposed the way first-down To keep his workers focused on vehicle where his dream ends: Miller aims to cre- 32 lines are laid out in NFL broadcasts. safety, Greason has laid down an unusual ate a “giant Wi-Fi hot spot in space,” so 33 The RRL is the brainchild of Granger management rule: Each of XCOR’s 25 space tourists can send e-mails home. 34 Whitelaw, an auto-racing investor who employees, down to the receptionist, will Many of these plans are hatched at the 35 provided the financial backing for two eventually fly in one of the company’s cre- Voyager Restaurant, the greasy spoon of 36 winning Indy 500 teams, and Peter Dia- ations. When asked if she’s looking for- choice for rocketeers. Unlike many of its 37 mandis, creator of the X Prize. Its first ward to her flight, the receptionist nods customers, the Voyager boasts healthy rev- 38 exhibition race will take place at an air and flashes a nervous smile. enues—$500,000 in 2007—and double- 39 show in August, and XCOR is one of two digit profit growth, according to owner 40 companies providing the Racers. The fter xcor, the most suc Marie Saady. 41 prototype, about the length of an SUV, cessful spacebound small busi- The Voyager is packed at break- 42 is hidden behind a scrim in a corner of A ness belongs to Marie Walker, fast time, and a palpable buzz travels 43 XCOR’s hangar. 47. Her 40-employee company, Fiberset, through the room when eminences like 44 Greason continues to sweat the Rac- makes lightweight rocket parts out from Dick Rutan arrive. Mojave’s more con- 45 er’s details. The Racer can be filled up in composite materials and had revenues of fident entrepreneurs order the Perfect 46 less than ten minutes, says Greason, but $2.4 million in 2007. It is privately held Landing (eggs, bacon, and sausage pat- 47 because pit stops will be as vital in the and profitable, according to Walker. A ties), while others seem better suited to 48 RRL as they are in NASCAR, he’s work- platinum blond with pink nails and a the Crash Landing (the above, mixed 49 ing hard to pare that down. Then there folksy style, Walker is hardly what you up on a tortilla). Either way, it seems a 50 are the plane’s rocket flames. Whitelaw would expect a rocket entrepreneur to fair bet that space business will still be 51 requested something visually dramatic, be. Raised in a cash-strapped family in here when the town’s grammar school 52 so Greason used a mixture of liquid a nearby town, she took a job at Fred rocketeers are all grown up. * 53 oxygen and kerosene. The result “is Jiran Glider Repair, which made parts To give feedback, please write to us at 54 enormously bright,” he says. “I’ve seen for mail-order kit planes. She married [email protected] or go to 55 it from about 15 feet away in daylight, a co-worker, Jim Walker, a self-taught cnnmoney.com/smallbusiness. 56 57 september 2008 FSB 97

HOWARD • HOWE • MARTIN • TAYLOR • DUMAINE R STORY CODE STORY NAME ISSUE DATE NUMBER OF PAGES: 05 MOJ09Y MOJAVE 09/2008 Page 05 of 05