We begin today’s episode with a story from Jim Cantrell, who, you might recall, worked on the founding team of SpaceX:

’S JIM CANTRELL:

So I get this phone call in August of 2001 from this strange guy with a funny accent…

He said he was an Internet billionaire and he wanted to do a space program. And his name was Ian Musk. That’s what he told me.

I was on my way home on a Friday afternoon. I didn’t know who the hell this guy was.

I told him, look, I can’t hear you, I have the top down on my car, I’ll call you back when I get home.

So I called back and it was a fax number. It gave me that REE! ring. And I said, right, a billionaire with a fax number. That sounds about right to me.

So I think I went and had a beer and about thirty minutes later I get an angry phone call back from him…

“Hey!” he said. “You didn’t call me back!”

I said, “Yeah I did. I got your fax machine.”

“Oh. OK. I’m sorry. That’s right.”

He starts to tell me this idea he’s got. He says the same thing today that he said eighteen years ago.

He says: “I want to make humanity a multi-planetary species. I made all of this money. I’ll be damned if I waste it drinking Mai-Tais on the beach. Or pissing it away in some other venture. I want to do something meaningful with it.”

Elon’s a very idealistically-driven person.

He had this idea of sending mice to mars to show humanity could leave the Earth.

So, I said, “Why are you calling me?”

“Well,” he said, “I need to buy Russian rockets. Because I can’t afford American rockets. They’re too expensive. They’re like $100 million a piece.”

[CHRIS’ NOTE: Some backstory: Cantrell spent almost 25 years working with the Soviets, and then later the Russians on various space programs. Elon needed him. He was an American aerospace expert who spoke Russian and had experience working with the Russkies in the industry. He was “the guy.” But let’s rewind a bit…]

From the Beginning

This story started a long time ago. Long before Elon and SpaceX.

There were a number of people back in the ‘80s who really got tired of waiting on the U.S. government, and in some cases, some foreign governments, to do something.

As time went on and we finished the Apollo space race, what really came about was a situation where it became a jobs program for many countries.

It was less about doing something worthwhile in space, and more about keeping your job. And as I got into space, I got in on the promise of Apollo.

That’s what really interested me. And to come in and find out the industry was really more looking like the IRS than it was some sort of front-edge technical institution, that was appalling to me.

So I, from the beginning, found myself on the outside of what people consider the military-industrial complex. And I ended up going over and getting involved in a mission to Mars that was both Soviet and French, working in France for a number of years.

And this was all citizen funded.

I used to think of the typical little old lady with her $20 check that would send money to the Planetary Society to send me to France. To go work on this mission. Because they wanted to see this done, they didn’t care what country was doing it.

You know, that spirit has evolved.

And the astonishing thing is, over the next five years we’re going to launch more satellites in orbit than in all of humankind prior to this.

You think those are government satellites?

No. The majority of them are commercial. These are people like you that just said, dammit, we’re going to do this.

The New CubeSat Revolution

[CHRIS’ NOTE: Currently, the number of space launch services catering to private customers is incredibly low, while demand is skyrocketing. Combined, the overall capacity amounts to only 30 to 40 rockets per year. Worse, these companies focus almost exclusively on large satellites, which can cost up to $200 million per satellite.

If someone wants to launch a smaller satellite they would have to wait to hitch a ride as “secondary payload,” which would put them on a waiting list and take three or more years.

Vector wants to change that.

Jim Cantrell and his team are building smaller, more cost-effective, rockets built specifically to carry CubeSats into space, bringing the cost down to as little as $2.5 million per launch.

By 2020, Cantrell predicts CubeSats will make up 75% of all satellites launched into orbit. And Vector’s getting ahead of this trend not a moment too soon: The cost of building a small, 50-pound satellite has plummeted in the past few years. Only about three years ago, it would’ve cost you $2 to $3 million for just the parts for a microsat. Today? Roughly $25,000. And it may get even cheaper sooner than later.]

CANTRELL: Some of this early microsat technology was literally putting a phone in space. There was something called PhoneSat. It was funded by some wackos at NASA who had nothing but disgust for the way NASA was doing things. They funded a project where they put a Google phone into space — and this started the whole business of CubeSats.

Cubesats have actually been around for a long time. There was a professor from Idaho State that invented this. He’s now at Stanford. He wanted to do this for kids to learn with, for students.

So we’ve taken something that weighs as much as a car and costs hundreds of millions of dollars and we put it into something we can do for hundreds of thousands or even tens of thousands of dollars and is the size of a loaf of bread. That’s an amazing thing.

You all have camera phones in your hand. It used to be big video cameras you used to have to carry around. This is the world we’re living in and it’s finally making its way into space. And it’s massively disruptive.

It’s every bit as disruptive as cryptocurrency, which is why I personally see the connection between cryptocurrency and what we’re doing in space with micro satellites.

In a way we’re taking a page from the SpaceX playbook, which is to build an ecosystem. Elon, in my view, is building an ecosystem to go to Mars. We want to build an ecosystem to do commerce in space.

So, what we want to do is transform a very hardware-centric, high capital cost industry to one that’s software centric. The reality is that the innovation in today’s society is in software. My kids, I give them a phone, they can make it do things in five minutes I can’t figure out in a week.

This new generation relates at that level. And we have to produce a capability in space that is commensurate with that talent in our society, that innovation.

I’m not smart enough to know all the ways we can exploit space, but I am smart enough to know how to give you the tools, so that’s what we’re trying to do.

[Ed. note: This information was adapted from Jim’s talks at Nexus 2017, which you can find here and here. Stay tuned for Part Two tomorrow, where Jim will reveal the face of the new Space Race, how Vector plans to “make rockets like sausages,” who the most famous human being in the Universe will be and what role cryptocurrencies will play in this revolution.]

Until tomorrow,

Chris Campbell

Managing editor, Laissez Faire Today

P.S. Have something to say? Say it! Chris@lfb.org.