Elon Musk told a group of assembled space entrepreneurs that if they can build a rocket component better than SpaceX can, “we would love to buy that,” noting his private space startup used to build the landing legs for its Falcon 9 rocket, but now buys them from race car manufacturer All American Racers. “We’d love to outsource more.”
Musk made his remarks Tuesday as part of a wide-ranging on-stage interview at the inaugural United States Air Force Space Pitch Day in San Francisco, an event held by the Air Force in cooperation with Starburst Aerospace, a space startup accelerator and consulting firm. Over 75 space startups were invited to pitch more than 100 venture capitalists in attendance, while others pitched Air Force personnel directly.
Investors are increasingly targeting commercial space companies.. Over $5 billion in venture capital has been invested in space startups in 2019 so far, according to venture firm Space Angels. Several Wall Street firms have projected that the overall space market could more than triple in size to over $1 trillion in the next 20 years.
In addition to pitching VCs, 30 of the startups in attendance have the opportunity to pitch the Air Force directly for government contracts, with a focus on areas such as space situational awareness, space communications, data mining and more. The Air Force could award up to $750,000 in contracts on the spot, with the overall funding available in Air Force contracts worth up to $50 million.
SpaceX has been working with the Air Force for a large part of its existence. Its Falcon 9 rocket was certified for USAF launches in 2015, and it’s launched multiple satellites for Air Force missions. In a fireside chat style interview with Lt. Gen. John F. Thompson, Musk primarily answered questions about building a business and leading companies in the space industry.
When it comes to the space industry as a whole, Musk insisted that there’s really only one real problem to work on, and that’s building a “fully and rapidly reusable orbital rocket. This is the Holy Grail.” In Musk’s view, the fact that rockets today are still primarily expendable, even if some parts are reusable, is the industry’s biggest hurdle, and what keeps the costs of going to space too high. He noted that people would find single-use aircraft ridiculous, “but that’s the way rockets work.”
Musk also shared how he decides to enter a new business. “I do zero market research whatsoever,” Musk said. “If you don’t love the product, you should not expect that others will.”
Musk said he also tries to ensure his staff doesn’t lose track of the bigger picture. “Everyone should be chief engineer,” he said. “Everyone should have at least a cursory understanding of the whole rocket or whole car, even if they have deep expertise in one arena.” That point of that, Musk says, is to ensure a person’s work is optimized for the product as a whole rather than a particular aspect of it.
Placing that focus on work above all else may have its costs for him, however. As CEO of electric car startup Tesla, Musk has gained a reputation as a mercurial leader whose C-Suite has faced a string of senior departures. Tesla has also faced lawsuits from ex-employees alleging racist behavior in the workplace and retaliation against whistleblowers, among others. The company has denied allegations presented in the lawsuits.
When asked about work-life balance, Musk seemed almost a little resentful, saying that he was interested in being as productive as possible, only really taking breaks because taking the occasional break means he gets more done. To stay physically sharp, Musk said mostly he just lifts a few weights and spends 15-20 minutes a day on the treadmill. That period of time, he said, is the only time he watches television. The last thing he watched: the movie Space Jam.
He tries mostly focus his reading on science and technical journals, and avoids the news. “The daily news I find to be a lot of noise,” he said. “Generally newspapers seem to try to answer the question, ‘What is the worst thing that happened on the Earth today?’” He did affirm his well-known love for social media, however. “I find Twitter enlightening at times.”
The line about Twitter garnered a laugh from the crowd, though Tesla investors may have squirmed in their seats a little. Earlier this year, Musk’s use of Twitter with respect to Tesla provoked a high-profile legal fight with the SEC, which ended in a settlement that put tight rules on Musk’s use of the social media platform.
As the questions about business advice continued, though, Musk at one point grew more quiet and introspective. Then almost protested his being on stage. “I’m not trying to think of myself as a great expert on leadership, to be frank. We’re doing okay, but we make a lot of mistakes from what I can see.”