Commercial Space Netscape Moment?
I know that I've mentioned on several occasions the hope that at sometime in the next few years, we might see some commercial space company have a "Netscape Moment". The idea being that having a major alt.space company succeed in a very public way (such as SpaceX getting their Falcon vehicles flying reliably enough for them to successfully go public) would likely result in a major positive change in the funding environment for other alt.space firms.
However, Tom Olson had a good post over at Space Cynics today bringing up some issues with the "Netscape Moment" analogy. While I still think that having a successful example of an alt.space company making a good return on investment would help a lot, Tom makes some good points about why that analogy may not actually be the best model for alt.space hopes. I would much rather see an alt.space world where the funding is still tight enough that only the good ventures with good technical and business approaches can get much money, than one in which the money flows so freely that a lot of it ends up being blown on fly-by-night businesses that don't really do anything for solving the challenge of cheap, reliable, access to space.
Just a thought.
However, Tom Olson had a good post over at Space Cynics today bringing up some issues with the "Netscape Moment" analogy. While I still think that having a successful example of an alt.space company making a good return on investment would help a lot, Tom makes some good points about why that analogy may not actually be the best model for alt.space hopes. I would much rather see an alt.space world where the funding is still tight enough that only the good ventures with good technical and business approaches can get much money, than one in which the money flows so freely that a lot of it ends up being blown on fly-by-night businesses that don't really do anything for solving the challenge of cheap, reliable, access to space.
Just a thought.
Labels: Commercial Space, Space Development
posted by Jon Goff at 11:40 PM
2 Comments:
the problem with the tight funding environment is, that it does not guarantee that only good plans attract funding. There is a glaring example of a certain well known "alt space" company once in COTS competition for example.
Tight funding does not guarantee good "natural selection" of businesses. Technical concept, even solid business plans obviously arent the only factors to attract funding. In a theorethical "Economy 101" world yes, but back in real world, connections, people relations .. matter.
Another fairly fundamental rule of new businesses is that a large percentage of them fail. The percentage is not affected by the number of the entires on the field very significantly. Hence, tight funding across the sector means very, very, very few successes in absolute numbers.
Take again the example of the net bubble. Basically, technology-wise across the world, it was pretty much throwing spaghetti on the wall to see what sticks.
Some of it stuck, regardless of the business metrics of these ventures. And we wouldnt be having Web2.0 and Google phenomenon now if this spaghetti throwing in large amounts had not happened.
Anonymous,
Good points about the role of luck, connections, people relations, etc. When the pie of funding going into the industry is tight to start with, the effect of bad apples getting funded is more pronounced. If there were a dozen orbital transport companies out there with at least enough money to start bending metal and flying hardware, the effects of one or two of those companies being flakes, or taking bad technical approaches would be a lot smaller than when they're one of only a couple of companies that are actually on people's radar screens.
~Jon
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