Government programs designed to incubate promising new technologies can’t keep pace with the rapid growth of venture-backed space start-ups, says the CEO of Relativity Space, a small launch company that is building 3D printed rockets.
Tim Ellis, the 29-year old CEO, gave a hypothetical example: When his Los-Angeles-based firm had just 14 employees a year and a half ago, it would have been eligible to compete for a NASA contract to bring partially-developed technology at small businesses to fruition. But by the time the contract would have been awarded, because of the lengthy government contracting process, Relativity Space had grown to 110 employees with a launch pad at Cape Canaveral in Florida.
This discrepancy between the speed of government and speed of Silicon Valley means the government could miss out getting in on the ground floor of innovative technologies if the companies are moving too fast for the federal contracting process.
“The sticking point I usually see is if there’s some kind of government award or policy process that takes six to 18 months to enable, you can apply for those things or be talking about policy changes but six to 18 months later you’re an entirely different company,” said Ellis, who designed his own Lego rockets as a child and worked at Blue Origin before founding Relativity Space in 2015.
The company announced this week it has raised $140 million in late-stage, or Series C, funding to fully finance its Terran 1 rocket, which is expected to fly for the first time in early 2021. Commercial launches are also expected to begin that year at a cost of $10 million per launch, Ellis said.
Ellis, the youngest member of the National Space Council’s User Advisory Group, also spoke about how unlike traditional space launch vehicles the company’s rockets can be updated following each launch in much less time and at lower cost than in a traditional factory, as well as how the firm is working to overcome lingering resistance to the company’s innovative approach.
“You always find pockets of hesitancy for sure,” he says. “That still exists. But our biggest argument there is … the opportunity exists for Relativity to be the first [3D printed rocket,] entirely designed, built, and operated in the U.S. If we are not the first to build it, someone else will be, so that’s been our argument.”
This transcript has been edited for length and clarity.
What does it mean to complete this Series C funding?
We’ve closed $140 million in Series C funding. It’s a milestone for Relativity, because now we’re fully funded to launch Terran 1 to orbit. That’s our rocket launch vehicle for satellites and the first 3D printed rocket ever made anywhere in the world. It’s going to be not just an iconic milestone for serving the growing … small satellite launch market, but also an iconic milestone for the 3D printing industry.
What are your next steps now that you’ve received funding?
Over the past year, momentum has been growing. … We have a 220,000 square foot factory at NASA Stennis. We have a launch site secured at Cape Canaveral at Launch Complex 16. All of the infrastructure is in place to finish development of Terran 1. The next steps are finishing development of the Stargate factory, that’s the world’s largest 3D metal printing factory. We’re using that to print the first flight version of Terran 1 … with the first launch in early 2021 and commercial service also beginning in 2021.
Who are your new investors?
The new funding round is led by Bond together with Tribe Capital. Bond is really a world class venture capitalist. … The entire team at Bond has an incredible track record funding some of the largest companies in the world that are privately owned, so having their buy in to what we’re building is a huge sign of confidence in both the technology and our business case.
Other new investors include Lee Fixel on the Forbes Midas list [of top tech investors], Michael Ovits who founded Creative Artists Agency and was briefly president of Disney. Spencer Rascoff was a co-founder of [real estate website] Zillow.com, and we have [actor and tech investor] Jared Leto. … That shows we have a diversity of capital sources. It’s not just Silicon Valley venture capitalists, but it’s also people who have very significant political and financial connections in many different industries. … It shows there’s more people who are very sophisticated who believe in what we’re doing.
What is the status of the Stargate factory in Los Angeles?
The Stargate factory includes the world’s largest 3D metal printers, which were fully designed, developed and built in-house. We’re announcing the next generation of the Stargate printer … which can print metal components as large as a rocket. The next generation is twice as large as the prior version, which was already the largest in the world. … Right now we have several Stargate printers manufacturing the rocket first stage and second stage components. We have done pressure testing to show that 3D printing a rocket will work.
What about your facility at NASA’s Stennis Space Center in Mississippi?
The Stennis one we’ll build out next … as an expansion factory for more mass production. … We’ll be able to iterate extremely quickly for an entire product. We can use software to reconfigure the factory to produce many different types of the rocket at the same time. It allows us to replicate factories and produce different parts of rockets in different physical locations in the U.S. That resilience in manufacturing will be very important.
Resilience in space is really important to the Pentagon, too.
We’re in conversation with different agencies. Our vice president of business development was at SpaceX for nearly a decade … so we have a lot of relationships. … Not only is resiliency important, I also think reconstitution is important. Our factory and supply chain don’t have a lot of pieces. … We can produce a lot of different products out of one machine, which makes building new factories easier and cheaper
When will first flight be?
It’s going to be out of Launch Complex 16 [at Cape Canaveral Air Force Station] in 2021. We are working on potentially having a customer on the test launch. That would be a U.S. government customer for the test launch, but nothing is signed officially yet.
Has there been resistance to this new technology in the government?
You always find pockets of hesitancy for sure. That still exists. But our biggest argument there is … the opportunity exists for Relativity to be the first [3D printed rocket,] entirely designed, built, and operated in the U.S. If we are not the first to build it, someone else will be, so that’s been our argument.
We need to be the first to build this specifically because the technology gets better and faster over time at an extremely accelerated rate. … Once the factory is operational, we can print from raw material to flight in 60 days. Then 60 days later, because there’s no fixed tooling and it’s largely automated, we can build a slightly improved version, then another slightly improved version. We’re getting to a high-metabolism, hyper-evolvable iteration cycle. Once the technology exists, we will accelerate much faster.
Are there safety concerns with always launching a slightly new rocket?
Certainly there are concerns, but we’re addressing them head on. We developed a rocket design software built for rapid iteration. … Right now we will test every single rocket to standard qualification and testing criteria, but over time we want to use data to do qualification and acceptance testing.
We’re also launching a lot of payloads [up to 1250 kilograms] that are not that valuable. That’s the benefit of distributed constellations. … We care about mission assurance quite a lot, but it is different from launching a $2 billion national asset in one launch.
Where are you looking for a polar launch site?
We’ve narrowed it down to Vandenberg [Air Force Base in California.] That is the leading site that we’re looking at. We’re planning on having something to announce by the end of this year. The reason we’re going to both Cape Canaveral Air Force Base and Vandenberg is because those are the premier launch sites in the U.S. Our customers are used to launching from there. There’s existing facilities, support systems and expertise.
You are the only representative from a venture capital-backed space company on the National Space Council User Advisory Group.
I’m also the youngest person by 20 years. I think it’s about being the voice for the next generation of people who are going to inherit a lot of what we’re building now whether it comes to policy or programs. … As far as being venture backed, I think the biggest thing is around speed and capability. I do see how quickly companies can move when they are less encumbered by traditional organizational structures. The venture capital funding model has been proven … to extremely accelerate growth. I think the sticking point I usually see is if there’s some kind of government award or policy process that takes six to 18 months to enable, you can apply for those things or be talking about policy changes, but six to 18 months later, you’re an entirely different company.
For us, 15 months ago, we had only 14 people at Relativity. Now we’re at 110. In that time, we’ve gotten the launch site agreement, the agreement with NASA Stennis, we’ve signed for public deals. Back when we had 14 people, we easily could have applied for certain programs like tipping point at NASA [intended to help get new technology at small companies over the tipping point] or any of the small launch initiatives the Defense Department is working on. Even if we had won an award, at this point, it’s so far in the future that we’re a very different company.