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Illustration: Annelise Capossela/Axios

The space industry is outgrowing the billionaires who made it famous.

Why it matters: Billionaires Elon Musk, Jeff Bezos and Richard Branson helped put the space industry on the map, but today, a significant amount of growth seen in the industry is propelled by smaller companies.

  • The narrative that the space industry is a place for the ultra-rich to throw some money around for fun is now being supplanted by the idea that space is a place for a variety of investors and companies to strike it rich.
  • "The industry has really evolved quite a bit," Eric Stallmer of Voyager Space Holdings told me. "I don't think it's a billionaire's game anymore."

Driving the news: SpaceX's recent crewed flight was hailed as an American moment, not a personal win for its founder, a sign that these companies are becoming more important than their billionaire backers.

  • Virgin Galactic's public offering, for example, is expected to be a harbinger of more space companies going public soon.

Where it stands: Seeing the industry as a playground for Musk, Bezos, Branson and others helped spark public and investor interest in the sector. But today, billions of dollars are being invested into a variety of companies from many sources.

  • In 2019, nearly 1,000 unique investors put about $5.7 billion into space industry startups, according to a report from Bryce Space and Technology.
  • While Blue Origin, SpaceX and Virgin Galactic account for more than $2 billion of that investment, 135 total startups received funding last year, amounting to a 34% increase over 2018.
  • According to an October report from Space Capital, 53 companies received investment in the third quarter of 2020.
  • The space industry could be worth up to $1 trillion by 2040, according to a Morgan Stanley estimate, and that kind of growth depends on smaller companies continuing to get investment.

Between the lines: Industry experts see the fact that venture investors are now investing in the space industry in large numbers as meaningful growth for a sector that's still working to prove itself.

  • "What they [the billionaires] have done is created such a buzz that commercial space is a viable, profitable, growing, evolving ... industry, and you're seeing just a lot of mainstream investors coming in," Stallmer said.

Yes, but: Bezos, Musk and Branson are still a stabilizing force for investors who might be looking to get into the space industry, but are wary of the high up-front costs many of these companies have to take on just to get off the ground.

  • "It brought visibility to space deals and it brought a degree of legitimacy to space deals, because even though Elon Musk, and Jeff Bezos are visionary investors, I don't think anybody thinks they're stupid investors," Carissa Christensen of Bryce Space and Technology told me.

The upstart companies working on a shoestring are also likely to face challenges that may not plague the companies founded by billionaires.

  • For example, some experts are concerned that small rocket companies are facing a bubble, with hundreds of possible companies aiming to send small satellites to orbit but not enough demand to support all those rockets.
  • Smaller companies may have a harder time breaking through that bubble, while others with extremely wealthy and patient backers might be able to come out on top.

Go deeper

Felix Salmon, author of Capital
Jan 26, 2021 - Economy & Business

Larry Fink to CEOs: Climate risk is investment risk

Illustration: Eniola Odetunde/Axios

The biggest investor in the world has an unambiguous message for the CEOs of the companies he invests in: climate risk is investment risk.

Why it matters: Pressure from BlackRock CEO Larry Fink, who controls $9 trillion, will encourage companies to report not only what their greenhouse gas emissions are today, but also what they're doing to ensure that their future emissions are in line with Paris Agreement targets that end at zero in 2050.

FAA clears more planes after 5G fears

Photo: David McNew/Getty Images

The Federal Aviation Administration said Thursday it had approved nearly 80% of the U.S. commercial fleet to perform low-visibility landings at airports with new 5G services after fears of signal interference limited 5G rollout.

Why it matters: The FAA approvals will help provide more certainty after the agency raised fears that 5G signals could reduce the accuracy of certain equipment, known as radio altimeters, that helps planes land and take off in inclement weather.

Dan Primack, author of Pro Rata
3 hours ago - Economy & Business

Peloton stock tanks on report of production halt

Illustration: Aïda Amer/Axios

Peloton stock fell by as much as 25% on Thursday, following a CNBC report that the connected fitness company will temporarily halt production on its bikes and treadmills.

Why it matters: Peloton is viewed by many as a proxy for consumer behavior in the pandemic era, as its popularity surged when gyms closed and people wanted to exercise at home.