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The space economy is growing. Do you have a strategy?

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The space economy’s next era

In the news

•

Lunar commerce. One day, sending people and goods into space could become as normal as launching a satellite into orbit. Space start-ups are developing spacecraft that can transport payloads to the lunar surface and back again. That could lay the groundwork for a future lunar economy that might include mining metals and extracting lunar ice for rocket fuel. Two US space start-ups are aiming for their robotic landers to touch down on the moon later in 2023, and a third company based in Japan already has a spacecraft heading there. [Bloomberg]

•

Space innovations. Public- and private-sector leaders are setting big goals for the new space race. From 3-D-printed, reusable rocket engines to satellites the size of microwaves, technological innovation abounds. One space start-up based in Bengaluru, India, offers imaging satellites that weigh roughly 33 pounds. These produce high-resolution visuals that exceed 150 bands of color from the infrared and visible spectrums. A space start-up in the US uses centrifugal force instead of rocket fuel to fling spacecraft into orbit. [Fast Company]

If the current momentum continues, commercial funding for space ventures could surpass government funding for them in the next 20 years.

On McKinsey.com

•

Investing in space. The cost to access space long proved prohibitive, undermining commercial-business cases. But recently, launch costs have fallen 95%, and satellites are becoming smaller and less expensive. At the same time, private companies, especially new space start-ups, are substantially upping their investment in the space economy, explain McKinsey global managing partner Bob Sternfels and coauthors. Private-sector funding in space-related companies topped $10 billion in 2021, close to a tenfold increase over the prior decade.

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Opportunities in all sectors. Space will provide an opportunity for growth across all sectors, from semiconductors to agriculture, energy, and insurance. For instance, better satellite imaging might allow more insurers to assess risks and damages at remote locations more cost effectively. Improved resolution and greater image-sequencing frequency could help them pinpoint problems more clearly, eliminating the need for in-person visits. Consider three ways that leaders can begin to prioritize space—starting with setting a vision.

Understand opportunities in space

— Edited by Belinda Yu, editor, Atlanta

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by "McKinsey On Point" <publishing@email.mckinsey.com> - 12:13 - 5 Apr 2023

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The space economy is growing. Do you have a strategy?

The space economy’s next era

In the news

If the current momentum continues, commercial funding for space ventures could surpass government funding for them in the next 20 years.

On McKinsey.com