Earlier this month, Oxford Space Systems founder and chief executive Mike Lawton returned from a whirlwind tour of the United States that might have made even a seasoned astronaut giddy.
As a result, the company that develops components for micro satellites is now in advanced discussions with a potential new investor and a new customer, both from the US.
Mr Lawton said: “I want to develop a US base for OSS.”
At the start of August, the company secured £1.2m from a second round of fundraising, exceeding the initial goal of £1m. The CEO said he had since set a revised upper limit of £1.5m to allow an additional £300,000 from new US investors.
The possible US customer is a space company that wants to develop hardware for a satellite constellation that would be trialled on the International Space Station, which rents out space for tests.
Mr Lawton was one of nine entrepreneurs participating in a week-long trade mission to the US organised by Government agency Innovate UK. The trip took in the annual small satellite conference in Utah, as well as San Francisco and Los Angeles. Mr Lawton gave presentations in both Utah and LA, where he pitched to Space Angels Network investors, and also visited Virgin Galactic and Lockheed Martin. He said: “The idea was to have a pretty punishing tour around the US to meet potential investors, collaborators and customers.”
The trade mission was part of the Government’s Space Innovation and Growth Strategy, which aims to increase the UK’s share of the global space economy from six per cent to 10 per cent by 2030. The space economy is forecast to be worth between £150bn and £200bn.
Mr Lawton, 47, established Oxford Space Systems in January 2014 to be part of the race for space revenues, basing the company at the Harwell Space Cluster in Oxfordshire, which he describes as “the government’s site of choice for the space industry”. The company attracted £500,000 in its first round of fundraising.
The long-time Oxfordshire resident, who lives in Didcot, said Harwell allowed the company to “stay fairly small and lean” by renting laboratory and testing facilities. After only a year-and-a-half of operations, the firm employs 11 full-time staff and generated €1m (£0.7m) in revenues in the year to April 2015, he said.
A graduate in electronics and software from Plymouth University, Mr Lawton had previously started and sold two other businesses – a biofuel technology company called Regenatec, for which he won Entrepreneur of the Year in the Oxfordshire Business Awards in 2007, and another involving intelligent monitoring technology in the beverage industry – before embarking on his own space mission.
Oxford Space Systems designs and makes deployable structures for micro satellites, typically structures that unfold after the satellite has been shot into orbit. The company specifically works with highly flexible composite materials such as carbon fibre.
He said the idea for micro satellites, also known as cube satellites, originated at Stanford University in the US about 15 years ago, but that the market for commercial applications was still nascent.
He added that whereas traditional satellites can be as big as a bus, take a decade to build, cost between £30m and £1bn, and last for 15 to 20 years at a high orbit, micro satellites are as small as a loaf of bread, take only a few weeks to build, cost about £30,000, and last for six months to a year at a low orbit. “The capability of electronics has improved massively,” he said. “The market is still undecided for what the purpose of a cube satellite will be.”
Potential applications include communications companies delivering the internet from space, or military organisations launching undetectable high-resolution cameras to keep an eye on war zones.
In late 2016, Oxford Space Systems is scheduled to launch its first two micro satellite missions, by deploying two Astrotube boom systems to measure the Earth’s magnetic field.
Mr Lawton said the potential opportunities created by this new “space race” of micro satellites reminded him of the time when personal computers displaced the cumbersome mainframe computers.
On the other hand, the rush of emerging space entrants – such as Sir Richard Branson’s Virgin Galactic developing commercial travel in space – also reminded him of historical financial bubbles.
“We’ve got to be careful we don’t turn this into another dotcom bubble. It is a very frothy and buoyant area,” he said. “How much is hype and how much are genuine business models?”