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New year, new adventures, new opportunities to thrive and succeed

January 6, 2025 By Leave a Comment
Happy New Year 2025

Dear readers, I would like to wish you all a Happy New Year. May the coming year be full of opportunities, successes and prosperity for you and your family.

It has been over three years since my last post on this blog. Time seems to have flown by and blogging just fell by the wayside. My attention was drawn to many other issues, business and personal.

The coming year is shaping up to be quite transformative for Canada, the Untied States and for AurorA, Amitel and me personally. So I thought I would start with this post and see if I can do a better job going forward to informing you about events in my world.

This year will see a new administration in the United States, that promises to enact a host of de-regulation and market friendly tax and economic policies. Canada will see a new Federal Government soon with the resignation of the Prime Minister today and the people’s demand for an election which forecasts indicate will lead to a Conservative government . There will be numerous reversals of many of the Trudeau policies from the last nine years.

This will affect the broader Canadian and U.S. economies as well as the telecom sector. The FCC has already seen changes and I suspect we will see a new mandate for the CRTC in the coming months. The space industry is seeing great upheaval in both countries with the success of many new commercial entrants into the what was once strictly the domain of governments and their prime contractors. The economic changes and deregulation will also lead to expanded activity in the capital markets and we are anticipating a boom in the Mergers and Acquisition (M&A) as it has been quiet for the last few years due to the higher interest rates central bankers used to fight inflation.

So how does this affect AurorA and Amitel ? Well, AurorA has been my main business, operating in the wholesale International Telecommunications market for over 30 years. I have been in telecom all my adult life, since graduating engineering school at UWaterloo. Many of you noticed that I was posting extensively about the space sector in 2020 and 2021, especially after taking a course on the business and economics of the space sector with the incomparable Sinead O’Sullivan. Finally, opportunities were presented to me in 2020 that were oriented towards finance and business M&A.

What this means is that my business and life currently look like a Venn diagram around the intersecting circles of telecom, finance and space. I still have interest in other sectors too such as tech and mining and resources and royalties but much of that ties back to the big three circles.

Intersection of Telecom, Finance and Space

Telecom has been through many changes in my lifetime. The market opportunities for AurorA are not what they were 30 years ago. The industry in Canada, the US and globally has concentrated power and traffic into the hands a small number of oligopolies. Voice traffic itself has declined globally since 2015 and continues its drop further. The time may come soon for me to consider whether to continue with AurorA. It has been on my mind for a while now. Stay tuned as we progress through 2025.

Amitel has become where most of my time and mental resources has gone lately. The Amitel retail business was sold off a decade ago. Also, no longer does Amitel provide channel sales for telecom products and services on behalf of other companies. Amitel now is where I provide consulting and expert advice to other companies. Perhaps it is best described as corporate advisory services.

Please note this disclaimer; Amitel is not a registered investment, legal or tax advisor or a broker/dealer. All investment/financial opinions expressed by Amitel are from the personal research and experience of Timo Vainionpää

Some of the projects have been in the telecom sector, some have been in the space sector. Now it has broadened out into a host of opportunities in sectors around the globe.

This late stage career pivot has been invigorating. The team of people that I work with all bring different skills and experiences to the table. The clients all bring unique and interesting issues to us that need creative solutions. It could be raising funds, looking to go public, perhaps a public company looking to go private. Some are looking to acquire other companies while others perhaps may be looking to get acquired. Each is a puzzle that I can bring not only my engineering problem solving approach to but also my decades of experience in building and operating businesses and serving on public and private company boards.

Needless to say, I am excited about 2025. I hope that you are as well as you are forecasting, planning and budgeting for the upcoming year. Watch this space for more stories from the intersection of finance, telecom and space. I endeavour to post a little more often, perhaps monthly, but I promise the next post wont be three years from now !

Cheers !

Timo

Filed Under: Uncategorized

Case Study – Hadrian

December 10, 2021 By

The eighth and final session of the Course on “The Business and Economics of Space” was on Tuesday, Nov 30. This session was a case study on a startup company looking to do Precision Component Manufacturing for the Space and Defence Industries , Hadrian.

We were to use the classic Harvard Business School Case Study method to analyze a potential investment in an early stage start-up factory, Hadrian. The scenario was that we were a family office with $1B under management. We were given an early Hadrian deck for fundraising. Simultaneously, a private equity firm is raising $500M to buy, merge and update existing factories in a Leveraged Buyout model.

Using the tools and techniques and knowledge we had learned in the course we broke out into teams to discuss the following;

  • The difference between a startup vs a rollup ?
  • What market do each of them serve – the same of different ?
  • Which would we invest in ? Start-up, LBO, or neither

I wont share the deck or discuss the specifics of Hadrian here. For that I suggest taking the Course !

Things we thought about included

  • How fragmented is the market ?
  • How do you scale the solution ?
  • Who are the end customers ?
  • What is the relative power between suppliers and buyers ?
  • What are the barriers to entry ?
  • What returns do we expect for VC vs Private Equity ?

Some of the things we discussed in our groups were the ;

  • Market Opportunity ; the Dynamics, the TAM size and growth, and the attractiveness
  • Startup Advantages ; The potential for disruption, with breakthrough technology , Return on invested capital
  • Private Equity Advantages ; Revenue Stream Profile, Risk Profile, Return on Invested Capital
  • Team & Capabilities ; Did they have Domain Expertise ? Was there Founder – Market Fit ?

There was very lively discussion both in the breakout groups and also when we all got back together. There was a wide range of opinions on whether to invest or not and for how much.

The last hour we had a Q&A session with Chris Power, Founder & CEO of Hadrian

It was a very interesting and informative session where we got to use a lot of what we had learned to date.

Filed Under: Business of Space, Satellite

Case Study – Varda

December 6, 2021 By

The seventh session of the Course on “The Business and Economics of Space” was on Monday, Nov 29. This session was a case study on a startup company looking to do In-Orbit Manufacturing , Varda Space.

We were to use the classic Harvard Business School Case Study method to analyze a potential seed investment in Varda. The scenario was that we were a $200M seed-stage VC fund. We were given an early Varda deck for fundraising. Then using the tools and techniques and knowledge we had learned in the course we broke out into teams to discuss the following;

  • Do we invest ?
  • How much ?
  • At What Valuation ?

I wont share the deck or discuss the specifics of Varda here. For that I suggest taking the Course !

Some of the things we discussed in our groups were the ;

  • Market Opportunity ; the Dynamics, the TAM size and growth, and the Attractiveness
  • Technology Advantages : what was the potential for Disruption ? What was their breakthrough tech ?
  • Product Readiness ; How was the Fit to Customers, to the Market ?
  • Product Advantages ; Vision and Roadmap, Category Leadership
  • Growth Readiness ; Was there a Sustainable Competitive Advantage ?
  • Team & Capabilities ; Did they have Domain Expertise ? Was there Founder – Market Fit ?

There was very lively discussion both in the breakout groups and also when we all got back together. There was a wide range of opinions on whether to invest or not and for how much.

The last hour we had a Q&A session with Delian Asparouhov, a Principal at Founders Fund and Cofounder of Varda Space Industries.

It was a very interesting and informative session where we got to use a lot of what we had learned to date.

Filed Under: Business of Space, Satellite

D-Orbit – Space Logistics

November 29, 2021 By

This weekend I listened to the Space Business Podcast hosted by Raphael Roettgen, where his guest was Luca Rossettini, founder and CEO of D-Orbit, one of the most prominent European NewSpace companies. It was very interesting and informative and you can find it here.

I thought I would use some of the tools and techniques that I have been studying in the course on “The Business and Economics of Space” with Sinead O’Sullivan. Tonight we are doing a case study on Varda Space, tomorrow on Hadrian so today I thought I would practice with a look at D-Orbit. Their website is available here.

Founded in 2011, D-Orbit is the first company addressing the logistics needs of the space market.
The Company is based in Como, Italy, it has subsidiaries in Lisbon, Portugal, Washington DC, and Harwell, UK.

One of the first things that caught my eye as a key differentiator is that D-Orbit was one of the first European companies to be registered as a Benefit Corporation, and the first certified space B-Corp worldwide ! D-Orbit places equal emphasis on three pillars: profit, social benefit, and global impact. Their products and services are designed to solve global challenges with a high social impact. D-Orbit’s business approach goes beyond the mere economic benefit: all of their activities aim at producing a wider benefit that can impact positively on humanity.

Their Vision is to create the first space logistics infrastructure company to enable the next trillion-dollar space economy. The Mission is to provide end-to-end solutions to improve new and traditional space businesses by streamlining in-space and on-ground operations with unique, innovative and proprietary technologies. So what does that mean ?

D-Orbit is a service provider for the traditional and new space sectors, with capabilities in satellite manufacturing, launch, deployment, satellite operations, end-of-life strategies and solutions, space propulsion, and critical software. The initial offering was focused on the last phase of satellite missions, i.e. orbital debris mitigation. Today their products and services cover the entire lifecycle of a space mission, including mission analysis and design, engineering, manufacturing, integration, testing, launch, orbital transportation, and end-of-life decommissioning. The future roadmap is even more exciting expanding capabilities to the cis lunar and inter-planetary markets. D-Orbit is well positioned to benefit from a rapidly growing space economy that is expected to grow from 2020’s $425B estimated size (Space Foundation) to over $1.4Trillion in 2030 (Bank of America, Morgan Stanley)

D-Orbit already has an impressive record of flight heritage. They have successfully launched 63 payloads to date for paying customers. The current flagship platform is the iON (in-Orbit Now) , a platform capable of transporting a customer’s satellites into the right orbit and right place in space. They can raise satellites to 1,200 km, change planes, even change inclinations. This solves a number of issues for their customers, not only reducing the cost of launching their satellites but also getting them into the proper orbit and generating revenue faster.

In the rapidly evolving NewSpace market where LEO (Low Earth Orbit) market is king we are moving from an environment where there are 3,300 satellites operating today to one where there have been announcements for another 65,000 more sats to be launched in the next decade. LEO sats are built for shorter lifespans (ie 2 to 3 years) than traditional legacy GEO sats that were designed for 15 years lifespans. Time to revenue is hugely important to them, they don’t want to spend 25% of the sat life just getting into the proper orbit so D-Orbit is ideally positioned to grow.

If that was not impressive enough, the iON is designed to do even more. Once its satellite loads have been launched, the ION can be used as a testbed to validate hosted payloads. If a NewSpace company wants to validate and test their technology or sensor in space they can hitch a ride on the iON to test it there. Wait, there’s more ! The ION can also be used as an orbital data centre, and in the future be scaled with advanced robotics for in-orbit servicing to satellite operators; refilling, phasing, maintenance and eventually active debris removal ! Multiple missions and revenue streams from the same platform !

There have been three successful iON missions to date , Origin (launched Sept 2020), Pulse (Jan 2021) and WildRide (June 2021). The first was on an Arianspace Vega with the latter two launches on SpaceX Falcon9 Rideshares. There is another launch scheduled for December of this year per press releases on their twitter account. I also saw an announcement that they will be testing ION with India’s Skyroot Vikram launch vehicle so it looks like iON is designed to be compatible with many different launch vehicles.

On the latest mission I also read about their Nebula project as well. (read more here) Nebula is a game changer; an on-demand, in-orbit cloud computing, and data storage service. Designed to provide distributed high-performance data analytics computing and storage capabilities in space, Nebula is a hardware-software environment that enables end-users to uplink and run software and artificial intelligence and machine learning (AI/ML) apps in a way similar to conventional, terrestrial cloud environments. The test campaign successfully executed 23 separate applications developed by a variety of partners for disaster monitoring, video and image data transfer optimization, space domain awareness, advanced image processing for precision agriculture, defense early warning, and integrated satellite communication.

D-Orbit also provides space Components and Subsystems as well as their proprietary cloud based mission control software suite, Aurora . They are well positioned to provide a host of services to their satellite customer base. Satisfied customers, lead to repeat business as their constellations and networks grow.

The podcast highlighted the future roadmap of D-Orbit, a step-by-step expansion alongside their customers into the growing NewSpace Ecosystem. The longer term markets would include transporting to the cis-lunar market, inter-planetary (very complementary to the large rockets being planned for such missions), asteroids ; anywhere where there is a need for transport of people and goods in space.

My Deep Dive into D-Orbit left me very impressed with their technology, their heritage, the roadmap and the team. The commitment to sustainability and being a B-Corp also definitely sets them apart. This is a company with a very bright and long future ahead of them. They have proprietary solutions for a growing market, have been able to technically and commercially validate their approach and have an exciting roadmap for growing alongside their customers. Plus, unlike some of the companies I have read about recently they actually have revenues from paying customers !

This is definitely a company I will be keeping a close eye on and will watch with interest.

Filed Under: Business of Space, Cloud, Satellite

Space Law & Geopolitics

November 26, 2021 By
Will Caterpiller and John Deere become Space companies ?

The sixth session of the Course on “The Business and Economics of Space” was on Thursday, Nov 18. This session was on Space Law, Geopolitics and Sustainability. From a commercial viewpoint the session would help answer questions about appropriate legal frameworks if you wanted to find, own, use or sell space resources. It was also very timely due to a recent geopolitical event with the Russians blowing up one of their defunct satellites with no warning to the rest of the world.

The key takeaways were in the following areas
– There are a variety on National and International Legal Frameworks on Use of Space Resources
– What the Regulatory Roadmap would look like for Commercial Space Miners
– A primer on Geopolitics from our cohort member, Joseph Abakunda
– The need to enforce responsible behaviour of space for the benefit of all

To guide us on the legal aspects of exploiting space resources we had a guest professor Christopher Johnson. In his in depth presentation he discussed

· the 1967 Outer Space Treaty - Rights, Obligations and Prohibitions
· the 1979 Moon Agreement
· National Approaches ; USA, Luxembourg, UAE, Japan
· International Approaches; UN Working Group on Space Resources 
· NASA and USA led Artemis Accords
· Regulatory Roadmap for Asteroid Miners

I won’t get into the details of the legal frameworks that he outlined. Interested readers can find resources online on each of those treaties and legal frameworks. As a Canadian , who grew up in Northern Ontario hard rock mining country, I was very interested in what the regulatory roadmap look like for space miners , whether asteroids, lunar or other planets. There will be a role for Canadian mining and geophysical expertise in such ventures (plus I am old enough to remember when the Apollo astronauts came to my hometown of Sudbury, ON to train for their eventual lunar missions because of our black rock !)

United Nations Committee on the Peaceful Uses of Outer Space

The Artemis Accords drafted by NASA and the U.S. Department of State, the Accords establish a framework for cooperation in the civil exploration and peaceful use of the Moon, Mars, and other astronomical objects like asteriods.They are explicitly grounded in the United Nations Outer Space Treaty of 1967, which signatories are obliged to uphold, and cite most major U.N.-brokered conventions constituting space law.

Even under the Artemis Accords there remain many open questions to space resource exploitation;

· What governmental agency should you seek permission from ?
· What is the application process like ? What do you need to disclose ?
· How long does it take, how much does it cost ?
· How is an interest in a space resource perfected
   a) Just claim it and its yours ? Or do you have to protect it first
   b) What is to prevent a "gold rush "of claims ? Klondike days in space !
   c) Whats the review process for applications of claims ? Interagency ? International ?
   d) Will a regulator enforce claims against "claim jumpers" ?
· What are the limits or boundaries of a permit to mine space resources ?
   Time bound ? i.e. you can mine location x for y years
   Extent bound ?  i.e. you can recover x tons or resource y (but nothing else)
   Activity bound ? i.e. you can mine, but must sell to x, or utilize only for y purpose

That led me to think that there are a lot of similarities to the law and practices that have evolved in other frontiers such as the Ocean, Antarctica, the Internet and radio. There are two great books that come to mind for those interested; “The Pirate Organization : Lessons from the Fringes of Capitalism” by Rodolphe Durand and Jean-Philippe Vergne and “The Outlaw Ocean : Journeys Across the Last Untamed Frontier” by Ian Urbina. You can find more about them here and here

We then got a primer in Space Geopolitics, from Joseph Abakunda of the Rwanda Space Agency. Joseph told us of the activities of China, on the African continent, with their Belt and Road Initiative . China would finance enormous loans to developing nations for building infrastructure . The loans became a Debt trap when the nations could not afford to repay and were forced to cede China with goods, land, strategic resources or ports. Often there were corruption scandals, and human rights violations. This is underreported here in North America.

We then had two distinguished guests; Dan Ceperley, the Founder and CEO of LeoLabs and Christopher Johnson of the Secure World Foundation. We had a lively hour long Q&A session mainly centred around the recent Russian DA-ASAT test .

LeoLabs image with ISS in Orange and Space Debris created as thos white circles

Russia’s surprise direct-ascent anti-satellite (DA-ASAT) missile test on Nov 15, blowing apart a defunct Russian satellite raised important legal and policy questions about the prohibition on the use of force in outer space. The highly destructive weapons test – which forced astronauts aboard the International Space Station to seek shelter and created a long-lasting field of space debris – underscores the need to urgently develop and enforce international standards for responsible behaviour in space.

Two hours went by quickly but we were able to at least get a taste of some of the very complicated issues in the Space law and Geopolitical realms.

Filed Under: Business of Space, Regulatory, Satellite

Deep Dive Space Tourism & Exploration

November 24, 2021 By

The fifth session of the Course on “The Business and Economics of Space” was on Tuesday, Nov 16. This session was a Deep Dive into Space Tourism and Exploration. You can find my earlier post on the Deep Dive into Launch and Satellites here.

Space was in the mainstream news this summer with plenty of excitement over Jeff Bezos and Richard Branson becoming “astronauts” as each took short flights to sub-orbital space on their own company’s rockets. This was followed by the Inspiration 4 mission by SpaceX launching a crew of four civilians for a 3 day orbital flight that also served as a fundraiser for St. Jude Children’s Research Hospital. These events kicked off a new era of space travel in which billionaire-backed companies offer high-flying excursions to anyone who can afford it.

Space Tourism, however, has been around a lot longer than that. Dennis Tito was able to visit the ISS as a private citizen in 2001. The trip was conducted by the Russian Space Agency (Roscosmos) and arranged by Space Adventures. This was well before Blue Origin, Virgin Galactic and SpaceX were founded.

How does one commercialize Space Tourism ? We have to look beyond the technology to see what the problem is these companies are trying to solve ; ie what is the customer use case ? The core problem is to figure out what is the job to be done. One of the most famous quotes in marketing comes from HBS Professor Theodore Levitt: “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”

We can get some idea by looking at the charts below to see the functional jobs that need to be done for a Virgin Galactic flight to space, followed by a chart showing the personal journey each customer gets when they sign up for a flight on VG. Perhaps Space Tourism has more in common with Disney rather than a rocket company ?

It is apparent that what Virgin Galactic is selling is a luxury good item, a premium experience that offers High Net Worth signalling. There are segments of the population that it would appeal to, those into conspicuous consumption and those looking for a unique adventure like going to Antarctica or climbing Mount Everest.

In the previous session we debated the price elasticity of rocket launches, and if demand for them rose as the price declined. Space tourism does not follow a typical demand curve, demand does not go up when the price declines, as it would lose the “snob value”. It is more like a type of good called a “Veblen Good”. Wealthy people by luxury goods for many reasons and will spend a lot of money on what they want. A Space Tourism company needs to be able to fulfill these needs at the highest efficiency to maximize returns.

What then happens if there is democratization and expansion of the space tourism industry , if it moves beyond a bespoke , luxury experience through efficiencies of scale to one that more and more people could afford ? Will the demand curve shift to one more like a business class airline ticket ? Perhaps these flights evolve from tourist hops to rapid continental travel to disrupt that industry.

The other topic we looked at this session was the economics of space exploration. What was the utility of the Space to Earth economy, the Space to Space economy or Earth to Space ? There are examples of each of those that were examined, for example the often touted mining of asteroids . There are potential asteroids that may have resources that might be valued in the trillions of dollars. Finding one and actually being able to extract those resources and bring them back to Earth is a whole different story. What would happen to the market for such scarce precious metals if they were brought back in bulk ? Supply demand curves would indicate that prices would decline.

Perhaps there would be better use cases for mining asteroids, or the Moon or Mars for resources in the Space-Space economy. It is expensive to launch everything required for establishing space stations, Lunar (or Martian) outposts from Earth. Ideally resources for fabrication, for fuel as well as oxygen and water for life could be obtained from these sources.

That assumes that there is an intrinsic utility in establishing such outposts in space. There are those who advocate moving heavy industry to space to avoid polluting the Earth further. Others tout establishing humanity on Mars so be a multi-planetary species to avoid the eventual extinction events of being only on Earth. Space exploration ties into the natural urge of humans to explore new frontiers, and Space is the ultimate frontier.

These were all topics worthy of discussion, especially with the guests we had in the second hour of the Session; retired NASA astronaut Nicole Strott and Blue Origin’s Head of Corporate Strategy Kylie Lucas and Corporate Development, Zach Havanec.

Filed Under: Adventure, Business of Space, Satellite
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