Chad Anderson, the CEO of the specialist space-focused venture-capital fund Space Angels, is an investor in SpaceX and says entrants to the market need specific characteristics to succeed.

Anderson told Business Insider that how SpaceX's owner, Elon Musk, bounced back from failure was the best example of the type of qualities he looked for in a founder.

"You need the right background, to understand what you're doing, to be passionate, hungry, resourceful," he said.

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Like the universe itself, the market for funding space-tech companies is seemingly limitless.

Chad Anderson, a venture capitalist who is the CEO of the specialized space fund Space Angels, says that learning how SpaceX's owner, Elon Musk, bounced back from failure is the best example of the type of qualities he looks for in a founder.

Space Angels has invested in 22 space-tech companies since 2010, the most of any individual fund, according to PitchBook. That includes some of the startups that could be set to crush the market in the coming years.

Having barely existed before 2009, private funding for space has taken off. It's a $350 billion market that could be worth more than $1 trillion by 2040, according to Morgan Stanley. Hundreds of companies are looking for financing each month as a result, making finding the best founders a key priority for specialized VCs.

That's where founders like Musk come in.

In 2008, SpaceX had its third launch attempt of its Falcon 1 rocket. The rocket failed after it reached orbit and in doing so used up all of the $100 million that Musk had personally invested in the company.

After three launch attempts, it seemed as if that might well be the end of the line for SpaceX. "But then Elon walked out of the mission-control trailer, straight past the press, and addressed the 350-plus SpaceX employees in attendance," Anderson told Business Insider. "He reminded them that what they were doing was extremely hard and that by getting to orbit, they had done something that a half dozen or so countries had failed to do."

Musk had brought in VC funding as a contingency to provide for two more launches and urged his staff "to pick themselves up and dust themselves off" ahead of Falcon 1's next launch, which was a success just seven weeks later. "For my part, I will never give up, and I mean never," Musk said, according to Space.com.

Anderson said this experience encapsulated the drive needed by founders in the increasingly competitive and technically challenging field of space tech. While Musk is not without faults, the Falcon 1 launch is cited as the beginning of a new boom in private funding for space companies. Anderson invested in SpaceX in 2017.

Read more: A VC on Elon Musk's SpaceX board says founders who can't answer this question may miss out on millions in funding

Finding the best founders

"We're looking for founders that have similar approaches to this market as SpaceX — you need vision and real chops," Anderson told Business Insider in an interview. "You need the right background, to understand what you're doing, to be passionate, hungry, resourceful."

SpaceX's founder, Elon Musk. Refugio Ruiz/SpaceX

Anderson used to manage JPMorgan's $50 billion real-estate portfolio before switching into his work as a VC.

He also cites three other characteristics and qualities that are apparent in both Musk and founders at Space Angels' portfolio companies, in his opinion.

1. Honesty and transparency, particularly when things go wrong.

2. Careful planning and communication. The best founders provide assurance and security to employees even while they are attempting something very risky.

3. Lead by example and help employees believe that if they expect as much of themselves as the founder does, together they can accomplish incredible things.

As with every exciting new market to enter there are those seeking to build businesses that may not stand the test of time or scrutiny.

Unsurprisingly, it's not rocket science to expect that space-tech founders have a strong grasp of physics in their repertoire, Anderson said.