Iain Christie: This is the third installment in a series of articles that we have been calling Parallel Universes — Mining and Space. The articles are basically a conversation between me and Salar Javid a fellow mentor at Creative Destructions Labs with a background in the mining industry. If you have not read the first two columns, you will find a lot of the background material for this discussion there.
In those first two articles, Salar and I have been discussing the state of investment in the New Space sector – specifically for early-stage companies. We have talked about a few ideas, but we really have not made any suggestions about what can be done.
So, this column is a chance for us to put our money where our mouths collectively are and make a start on some concrete proposals. I will add the caveat that these are hardly fully fleshed out plans of action. But I think they are ideas worth discussing.
I think I will go first, since I started this particular ball rolling.
What our discussion has made clear to me is that there is a fundamental gap that needs filling in order to draw more investors into the space sector. That gap is basically a gap in investor knowledge – the lack of which leads to investor uncertainty – which does not “accelerate deal flow” – as the saying goes.
I am convinced from this discussion (and others) that there are early-stage investors – let’s call them Angels – who are interested in space. They are interested in space for its own sake. They have the means and the motivation to help humans and their technology travel to and work from space. They would like the opportunity. Unfortunately, since they are serious financial professionals, that opportunity needs to meet some basic standards in terms of clarity and transparency, of risks, and expectations of returns.
The New Space sector is so “New” though that much of this is missing. In most cases the only source of background information that Angel investors have is the ventures themselves. But asking a founder to explain not only his business idea, but the basic premise of a whole industry is a Big Ask.
Founders, by and large, are deeply immersed in “space culture” and have been for a long time. That is how they ended up founding businesses after all. To ask them to back up and provide a credible overview of a whole industry to interested investors with only a passing familiarity with the inner workings of the industry is a lot to ask. It is even more to ask for such founders to be a credible source of information given the biases with which they enter the conversation.
What is needed is a way to provide objective third-party information to investors in a form that is recognizable and digestible to them about what the workings of the space industry and about what to expect in terms of benchmarks and timelines for any new business starting out in this sector.
To be specific, there is a role here that could be played by space industry Non-Governmental Organizations and/or Government as well. In Canada, both the national trade association of space companies, and the Canadian Space Agency have expressed interest in encouraging the flow of more capital into the space sector.
I think that this desire could be channelled into specific one-day events targeted at accessing and education qualified Angel investors and bringing them together with ventures seeking the kind of capital they can provide.
I envision a single day workshop held periodically (at least annually). The workshop would be divided into to two halves. In the first half the organizers would provide a series of presentations on the state of the space industry both nationally and globally. These presentations would need to include information on the investment climate and on what success looks like in space. These presentations would need to be provided by recognized subject matter experts who could translate the reality of the space sector into the language of business and investment.
The second half of the workshop would consist of venture pitches to the same investors that attended the workshop AND, critically, who accepted that, given the reality of the space sector, they felt that they might realistically want to invest.
The main idea would be to give ventures a chance to pitch to well informed investors so that they could have useful and constructive discussions about their technologies and business plans rather than focusing on why space sounds different than other sectors with which investors are more familiar.
What do you think, Salar, would that check some of the boxes you have been talking about in terms of increasing transparency in the investment process?
Salar Javid: Iain, you are on point. The knowledge gap you describe is a challenge, and your idea for a single-day workshop is exactly the type of initiative that could start to bridge it. While the concept of a pitch day isn’t new, pairing it with a targeted education session beforehand makes it transformative. This isn’t just about informing investors — it’s about reshaping how they engage with the space sector. Imagine a workshop featuring not just venture founders but also space agencies, seasoned investors, SMEs (small and medium-sized enterprises) on various space applications, and even an astronaut or two delivering insights.
Your proposal checks all the boxes we’ve discussed, starting with presentations by credible experts who can demystify the complexities of space for investors. By translating technical opportunities into familiar financial benchmarks, these sessions would set clear expectations and build much-needed credibility. Targeting Angel investors specifically ensures that their interest in space turns into informed action. Equipped with a better understanding of risks and returns, they can evaluate opportunities with confidence. This format also builds transparency by reducing reliance on founder-led pitches and introducing objective, data-driven insights. Moreover, these workshops align expectations around space’s long timelines and capital intensity, helping to create a shared understanding of what success looks like. Perhaps most importantly, they establish a collaborative ecosystem where startups and investors can connect, fostering informed conversations that lead to sustainable investment. This isn’t just about filling a gap — it’s about building a foundation for the future of space investment.
The question is, who do we talk to bring this idea to life?
Iain Christie: As always that’s the question in the space business. It has always been a sector that has attracted public sector funding and it’s driven and regulated by public policy. But, in the last few years we seen a lot of private capital also coming to the sector. But the two funding communities really don’t coordinate in any way. I feel like we need to get past the “old space, new space” discussion and get everyone on the same page.
Salar Javid: I agree – let’s just call it “Next Space” – and let it have all the pros of the two paradigms with added future-oriented, inclusion and adaptive characteristics. To expand on this idea and solidify the flow of capital into space to enable this next wave, we must also look at the larger investment ecosystem as well. Public and private funding have historically driven space development, but they often operate in silos. Public funding lays the groundwork with infrastructure and foundational research, while private capital drives innovation and market growth. The challenge is that these efforts rarely intersect in a way that amplifies their strengths. This lack of alignment isn’t just inefficient — it’s a missed opportunity.
One approach to address this is adapting the concept of Capital Pool Companies (CPCs) specifically for space ventures.
CPCs have proven highly effective in mining, allowing early-stage companies to access public capital through small, manageable public offerings. In the space sector, CPCs could offer a transparent and structured way for early ventures to raise funds while also providing liquidity options for investors.
CPCs, in my view, are far better suited for space companies compared to SPACs. Their structured approach, smaller scale, and built-in guardrails foster disciplined access to public capital. This framework helps early-stage companies prioritize sustainable growth, avoiding the pitfalls of overvaluation and the rushed timelines often tied to SPACs (Special Purpose Acquisition Company).
With a proven track record in fostering stability and performance, CPCs are particularly well-suited for emerging and specialized industries like space. This model could help bridge the funding gap, particularly for Series A and B rounds, and make space ventures more accessible to public investors.
A hybrid funding model, one specifically crafted for the space sector, could provide a much-needed bridge between public and private investment. Combining the disciplined approach of CPCs with targeted government incentives — like tax breaks, grants, or loan guarantees — could address the funding challenges that often stall high-risk R&D projects or scaling efforts in this industry. By pooling resources, this model doesn’t just spread risk; it creates a coordinated push that aligns public interest with private innovation, setting the stage for meaningful advancements in space exploration and technology.
The CPC-only model excels in scaling ventures, providing liquidity and attracting private capital for companies ready for public offerings. The hybrid model goes a step further by incorporating government backing to target high-risk, high-reward opportunities in early-stage R&D and later-stage scaling. Both models have their merits and could be critical components in building a robust financing ecosystem for space.
To tie all of this together, though I want to tread carefully here, we also need to consider the role of regulations and reporting — financially supported in its scope but backed technically. The space sector could benefit from an independent standard — akin to National Instrument (NI) 43-101 in mining — but one tailored specifically for space.
NI 43-101 transformed mining by bringing transparency and trust, ultimately attracting institutional investors who previously hesitated due to the sector’s perceived opaqueness. However, while it succeeded in building confidence, it was not without its issues. For example, NI 43-101 often overemphasized early-stage exploration data, leaving critical operational and economic variables, such as process mineralogy and ore-body compatibility with processing methods, underexplored. This led to feasibility studies that appeared sound on paper but lacked the depth to ensure operational success.
In the realm of space, similar challenges must be addressed. A specialized framework tailored for this sector should tackle its distinct hurdles — such as lengthy development periods, high-risk projects, and technological uncertainties—while still fostering innovation and avoiding excessive burdens on startups. Unlike mining, where geological and metallurgical standards prevail, a space-oriented framework must establish criteria for evaluating technical feasibility, technology scalability, market viability, and even regulatory and geopolitical risks.
Additionally, it should recognize that, similar to mining, space initiatives often experience inadequate data collection in crucial areas, which can result in overly optimistic projections that fall short of reality materialize. I personally have a few detailed ideas based on the above categories that I mentioned that I want to explore.
Look, overall, a thoughtfully designed framework could standardize due diligence across the technical, market, and financial aspects of space ventures, aligning investor expectations with industry realities. It would foster transparency, reduce the perception of risk, and create a level playing field for companies to compete for funding. Importantly, such a standard must retain flexibility to accommodate the fast-evolving nature of space technologies and ensure it doesn’t replicate mining’s tendency to reward box-checking over genuine innovation.
Iain, how do you think such a framework could be adapted to the space industry’s unique needs? Could this be the catalyst we need to attract a broader and more sustainable base of investors, or are there other considerations we must weigh in creating a space-specific regulatory framework?
Iain Christie: Well, saying “regulatory framework” in a room full of space people is unlikely to make you popular. It is a sector that is already highly regulated. But that being said, this is the kind of initiative that would be designed to help assist the sector – rather than to constrain it – which is what regulation usually does.
If there is a place to start, I think it is with what I call “Execution Risk” – I wrote a column about it a while back. It means that in this business it is not enough to know how to produce your particular technology, you also have to know how to get it flown and to fly it successfully. Often this requires experience and expertise that is hard to come by.
This is a fact which is not well appreciated by outsiders to the sector – both investors and new founders. I think the risk that this lack of experience poses is also often underestimated. On the other hand, lots of government officials – having spent careers as customers in the space business – are well acquainted with these kinds of risks.
So maybe that’s a place to start this conversation. A place where public sector funders and private capital providers could have a useful discussion. What we need is some kind of framework to assess a venture’s preparedness to fly their technology successfully. And a way of assessing their own plans for increasing that readiness. This is an assessment that governments have been making when selecting bidders and managing programs for a long time. I think advice on this subject is something that private sector investors should welcome.
The challenge, as always will be finding a forum in which these ideas can be exchanged – honestly. And finding a group or organisation that is willing to spend the human and political capital to get something done. I wish I had some answers to those questions. I don’t. But I think it is time we started looking for some.
Salar Javid: So, if that is the case, let us do something: How about we do our best to create that conversation, gather feedback on these ideas and write about it in our next installment? Let’s make it happen, I am committed, are you?
Iain Christie: I am. But it is going to take a community of more than two. I think it’s time we start making this a topic of conversation whenever space founders, executives, investors and government officials get together. Fair warning to everyone I know who falls into one of those categories. When you talk to me – be prepared to have that discussion. Frequently. Repeatedly. Until we get something done.
