Do you want to go to the moon? For space startups, the first step could be in Colorado

In a warehouse in Arvada is a place called Crater Beach. It’s actually just a giant open box filled with about 30 tons of sand and a handful of man-made boulders. And on a recent day, cruising around Crater Beach, there’s a rover. Insofar as the bread bin is a relevant parameter in a 21st century discussion of space entrepreneurship, this test rover is roughly the size of a bread bin.

Near the beach, a 20-year-old is using a modified Xbox controller to operate the rover and help test its autopilot software. Does she do the right thing when he rolls into one of those boulders? How does it fit in the sand?

The experiments at Crater Beach are some of countless late-stage tests the Lunar Outpost company is running before trying to send a rover, one much larger than a breadbox, to the Moon’s South Pole later This year.

There are approximately 500 space industry-focused companies in Colorado, and more and more of them are opting for a different path from the military-focused applications that have dominated states’ input for decades. Instead, these relatively small startups are looking to make a mark in what they see as a commercial space sector poised for explosive growth.

And now might be the right time to do it.

Military roots

Of those 500 or so companies, about half are based in Colorado Springs, and it’s no wonder why.

The world’s Global Positioning System (GPS) is exhausted from the Schriever Space Force Base east of the city. The North American Aerospace Defense Command (NORAD) operates from nearby bases at Peterson and Cheyenne Mountain. The US Air Force Academy was an early leader in aerospace education.

Additionally, Colorado’s inland location made it a logical host for some of the country’s first ICBMs.

Today, the portion of the space sector that specifically serves the Department of Defense is only expected to grow, especially with Colorado Springs hosting the largest share of personnel in the new United States Space Force.

The Catalyst Campus for Technology and Innovation is a startup incubator on the east side of downtown Colorado Springs. Senior Executive Director Dawn Conley said about 80 percent of the companies on campus are space-focused; the fact that almost all of them meet military needs is in itself representative of a change in the industry at large.

Over the past couple of years or several years, the reliance on space dominance, especially the way the military conducts some of its business, has evolved and is very prominent and progressive, Conley said.

The Army has long sought contracts with the country’s largest aerospace companies. Think Lockheed Martin. Think Raytheon. Think Northrop Grumman and Boeing. That certainly hasn’t changed. However, the rapidly accelerating competition with potential adversaries such as China and Russia has resulted in even some of the smaller startups successfully pitching their new ideas and technologies.

Even the Department of Defense has recognized that that’s where the real innovations and solutions come from and that’s where the opportunity lies, said Andy Merritt, chief strategy officer of The ONeil Group, a real estate and venture capital firm that owns Catalyst Campus and invests in emerging cybersecurity and space companies.

News Dan Boyce/CPR
The Catalyst Campus for Technology and Innovation is a startup incubator on the east side of downtown Colorado Springs. Officials say 80 percent of startups are space-focused.

Small and shabby

The rover that Lunar Outpost is planning to send to the Moon on a SpaceX rocket in November isn’t much to look at. This vehicle is closer to the size of a wheelbarrow than a breadbox, and to the untrained eye the clunky silver box doesn’t look too dissimilar to what high school and college students compete with each year at the Colorado Robotics Challenge in Great Sand Dunes National Park. But, of course, in reality, the Lunar Outpost rover is the product of thousands of hours of planning and tens of millions of dollars.

It is designed to handle direct radiation from the solar heating circuit and to tolerate temperature changes from -200 to 200 degrees Celsius (changes that occur within seconds in the vacuum of space). It needs to be able to broadcast its exact location from a world without GPS and make sure the technologies that other private companies have paid Lunar Outpost to connect to the rover also have a chance to do their job.

It must also know when it has encountered a boulder and adapt accordingly.

When Justin Cyrus, 30, co-founded Lunar Outpost in 2017, he and his team wanted to find a niche with high potential for growth and diversification, but small enough to avoid having to compete with the industry’s biggest.

At the end of the day, we didn’t want to compete against Elon Musk, we didn’t want to compete against Jeff Bezos, Cyrus said, referring to the heads of SpaceX and Blue Origin.

Instead, Lunar Outpost takes advantage of the main innovations of these two companies, which in some cases has been to reduce the cost of putting payloads into orbit by about 90%. The Lunar team decided to focus on transportation technologies beyond Earth orbit, eventually landing on industrial robotics for use in extreme environments.

The company also embodied Musks’ ethos of moving fast and breaking things. The company-made rovers certainly look expensive, but they cost a fraction of those developed and sent into space by NASA, which cost billions of dollars each.

That’s what it’s going to cost if you have to have a 99.99999 percent chance of success, Cyrus said. However, if you’re willing to accept an 80% chance of success, you can send dozens of rovers, dozens, and potentially even hundreds of rovers for the same cost as one rover.

This trade-off, he said, would allow much more work and science to be done on the lunar surface, even with some broken rovers. Then, as was the case with SpaceX, the data provided by the failures allows for rapid iteration and improvements on subsequent ones scheduled for launch.

Cyrus has high hopes that the rover sent to the moon in November will achieve all of its goals. But, he said, if his rover is able to successfully eject its lunar lander, his team will consider it a success. They have three more launches scheduled over the next three years to try again.

Colorado as a hub

Cyrus said Colorado’s space community is different from the space and tech sectors in other places, like Silicon Valley or Boston.

These boot environments are very competitive, he said. Here in Colorado it’s a little different. It’s a very collaborative environment and that’s what I love about Colorado. It has been a great ecosystem for our company to grow and thrive in.

Bob Cone, chairman of the Colorado Space Business Roundtable, said states including California, Texas, Alabama and Florida all have thriving space industries, but that no one else has been able to foster innovation like Colorado.

We have the highest concentration of aerospace jobs in the United States, perhaps in the world, here between Fort Collins and Colorado Springs, Cone said.

He said the state-owned industry is well-diversified, with the largest companies having a solid presence down to small startups like Lunar Outpost, which currently has around 70 employees.

A 2023 report from the Metro Denver Economic Development Corporation finds that more than 60% of Colorado’s space companies employ fewer than 10 people.

With costs falling and advances in everything from materials and electronics to artificial intelligence, Cone said that at any point in his 30-plus-year career, the period now looks like a new space renaissance.

I’ve never seen the confluence of really positive effects for an industry in this aerospace case like I have in the last five to 10 years, across the board, he said.

Courtesy of the Lunar Outpost
Two rovers Lunar Outpost is planning to send to the moon. The one on the right should take off this fall.

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