Gilmour Space Technologies

[CameronD]

Australian Prime Minister visit:

It's truly an Australian manufacturing success story, and we want more of them. 

That's why our National Reconstruction Fund backs local manufacturing, including in the space industry.

And our Industry Growth Program in last week’s budget helps turn ideas into success stories. 

We’re backing more out of this world innovation, right here in Australia.

No, you're not you snivelling little ... If the SMH article posted by trimeta in another thread (below) is anything to go by, you're just shoveling cash from space launch to anywhere else you've a hole to fill and calling it a 'budget surplus".   

Perhaps related to this article (about Australia cutting its budget for spaceports, including Toowoomba)?

https://www.smh.com.au/national/plan-for-australian-spaceports-axed-as-federal-budget-cuts-run-deep-20230510-p5d7do.html

[plugger.lockett]

Politics aside, I do see the perspective here, at least somewhat. How many launch sites do we need sitting idle? We've already got ELA and Southern Launch, and from my perspective those sites are already under-utilised due to lack of launch demand domestically. Adding other launch locations to an already over served market makes little sense from either a private or government perspective.
Until Australia has a proven domestic commercial launch capability I'm not sure how much value more launch sites would provide.

[CameronD]

Politics aside, I do see the perspective here, at least somewhat. How many launch sites do we need sitting idle? We've already got ELA and Southern Launch, and from my perspective those sites are already under-utilised due to lack of launch demand domestically. Adding other launch locations to an already over served market makes little sense from either a private or government perspective.
Until Australia has a proven domestic commercial launch capability I'm not sure how much value more launch sites would provide.

That's not the point.  Cross-posting from another thread:

Space low priority for new government, suggests ELA chief
18 May 2023

The CEO of spaceport business Equatorial Launch Australia has suggested that space is now a low priority for the new government. Speaking at Space Connect’s Australian Space Summit, Michael Jones added it was “disappointing” that the recent budget cut $77 million of investment announced by the previous administration. “Call it what it is: the lack of federal government support with the change in government makes me nervous, and it makes the job really hard,” said Jones.

https://www.spaceconnectonline.com.au/launch/5893-space-low-priority-for-new-government-suggests-ela-chief

I just happen to agree with him.

[plugger.lockett]

How much money do you thing the federal government should plow into the industry, and what sectors do you think that funding should be targeted towards specifically? It's all well and good to lament budget cuts, but unless there's a demonstrable return (not necessarily financial, but tangible and beneficial) for Australia more generally I do still think it's hard to argue that we should be spending more.
From my perspective the regulatory environment domestically is arguably one of the biggest hurdles to progress. That and the wider risk averse way Australian politics (and in some ways society) operates more generally. These things won't and aren't fixed by governmental spending, they're more cultural and structural.
More specifically, ELA has been around for how long again? To my knowledge they've had the NASA SRP campaign in July 2022, and that was 3 suborbital launches. If they can't attract more customers to ensure that site doesn't sit idle for the vast majority of the year that's on them imho, not the government. To my knowledge there's never been a successful space shot (data verified) from Southern Launch either.

[Steven Pietrobon]

How much money do you thing the federal government should plow into the industry, and what sectors do you think that funding should be targeted towards specifically?

I'm not CameronD, but I have specific views on this. The Australian space program should be aiming for 0.1% of the Federal budget (similar to the level of funding in Japan, Europe and Canada), or about $600M per year. The ASA is only getting $11.4M a year now, which is only 0.0018% of the Federal budget! The main targets should be satellite applications (satellite communications, remote sensing and positioning), launch vehicles, science missions (including the Moon and Mars) and an astronaut program.

[plugger.lockett]

How much money do you thing the federal government should plow into the industry, and what sectors do you think that funding should be targeted towards specifically?

I'm not CameronD, but I have specific views on this. The Australian space program should be aiming for 0.1% of the Federal budget (similar to the level of funding in Japan, Europe and Canada), or about $600M per year. The ASA is only getting $11.4M a year now, which is only 0.0018% of the Federal budget! The main targets should be satellite applications (satellite communications, remote sensing and positioning), launch vehicles, science missions (including the Moon and Mars) and an astronaut program.

Thanks for sharing Steve! I agree with some of your targets (eg sat comms, remote sensing, and science) and am less bullish on orbital launch (profit depending) and an astronaut program (this seems a real outlier). But I still maintain that government should not be driving funding of these activities; it should be supplementing new space projects that already have VC funding and at least something of a business plan built around profitability.

I've got a Federal Gov bureaucrat mate and have spoken to him a bit about this subject. The internal/fed gov bureaucrat opinion on the previous government's space funding was in effect "money the liberals were funneling to space was largely into money pits with no real substance or chance of success but very beneficial for Morrison from a political announcement perspective". And throwing more money on top of a system like that doesn't really seem like a wise allocation of funds from a governmental perspective, or a value add to the long term viability for the new space industry domestically more generally.

[CameronD]

How much money do you thing the federal government should plow into the industry, and what sectors do you think that funding should be targeted towards specifically?

I'm not CameronD, but I have specific views on this. The Australian space program should be aiming for 0.1% of the Federal budget (similar to the level of funding in Japan, Europe and Canada), or about $600M per year. The ASA is only getting $11.4M a year now, which is only 0.0018% of the Federal budget! The main targets should be satellite applications (satellite communications, remote sensing and positioning), launch vehicles, science missions (including the Moon and Mars) and an astronaut program.

Thanks for sharing Steve! I agree with some of your targets (eg sat comms, remote sensing, and science) and am less bullish on orbital launch (profit depending) and an astronaut program (this seems a real outlier). But I still maintain that government should not be driving funding of these activities; it should be supplementing new space projects that already have VC funding and at least something of a business plan built around profitability.

So you're okay with the federal government funding Gilmour, ELA and Southern Launch then?!? 

That's great.. but it's not what they're asking for.  Government support comes in many flavours both state and federal.  From where I sit, the "support" these companies would most appreciate is (a) some help to unwrap the mountains of red tape put in place by other government departments and (b) a single point of contact for approvals.
 

[plugger.lockett]

should not be driving funding of these activities
maybe you should have expanded you bolding?

From where I sit, the "support" these companies would most appreciate is (a) some help to unwrap the mountains of red tape put in place by other government departments and (b) a single point of contact for approvals.

could have fooled me...

No, you're not you snivelling little ... If the SMH article posted by trimeta in another thread (below) is anything to go by, you're just shoveling cash from space launch to anywhere else you've a hole to fill and calling it a 'budget surplus".   

but on the plus side, I'm happy we agree on this

From my perspective the regulatory environment domestically is arguably one of the biggest hurdles to progress. That and the wider risk averse way Australian politics (and in some ways society) operates more generally. These things won't and aren't fixed by governmental spending, they're more cultural and structural.

[CameronD]

should not be driving funding of these activities
maybe you should have expanded you bolding?

Why?  Each of the companies I listed are "new space projects that already have VC funding and at least something of a business plan built around profitability" - to use your words.  If those words aren't what you really meant, maybe you should choose better ones.

[Steven Pietrobon]

Still no earlier than fourth quarter of 2023. Some screen grabs from the video below. Two sizes of liquid engines were shown. The vehicle is not yet fully assembled. They will be providing a livestream. The Prime Minister visited Gilmour and signed the launch vehicle. Looks like they are making good progress on the launch site. Currently have 200 employees with job openings for 40+ more employees at https://www.gspace.com/career

a. From left to right we have the first stage hybrid motor housing, first stage HTP tank, stage 1/2 interstage, second stage, stage 2/3 interstage and fairing halves.  Behind this vehicle, we can see a second vehicle under construction, namely the parts of the first stage HTP tank.
b. At right is the horizontal integration building. The pad has a vertical tower constructed, but a flame deflector is not visible. It could be integrated with the launcher/transporter. Another tower is next to the integration building.
1. The white tube at left houses the four hybrid motors. At right is the HTP tank.
2. These look like kerolox engines, one small and one large. They both look too large for the kick stage. These might have been developed when Gilmour announced they were dropping hybrid motors in favour of kerolox engines but then changed their mind back to hybrid motors for the first and second stage.
3. Two of the four hybrid motors for the first stage. Plates are covering the exhaust outlets.
4. PM signing the inside a fairing half.
5. Inside the first stage hybrid motor casing.
6. The top of the hybrid motors. We could be looking at the valve and or catalyst assembly here.
7. First stage HTP tank with interstage at right.
8. Top of first stage HTP tank.
9. Looking at the top of the second stage HTP tank through the stage 2/3 interstage. The second stage hybrid motor looks like it goes through the middle of the tank.
10. The Australian Flag on the second stage with the stage 2/3 interstage at front. The interstage has an "Australian Made and Owned" label.
11. From left to right. First stage HTP tank, stage 1/2 interstage, second stage and stage 2/3 interstage.
12. Bottom of second stage. You can see the hole where the hybrid motor goes through.
13. Top of the first stage HTP tank left with stage 1/2 interstage at right.
14. At far right we can see the fairings.
15. At better view of the inside of the fairings at right.
16. Top of second stage. Through the hole we can see the hole at the bottom of the tank with the top of the first stage HTP tank in the middle.
17. This is the inside of the fairing, just before or after the PM has signed it.

[plugger.lockett]

So we're now basically halfway through Q3 2023 and there's still no launch scheduled. At least, their site says nothing about it.
2024 to orbit then?!?! 

[Steven Pietrobon]

Their website now says

"Gilmour Space's innovative Eris orbital launch vehicles will deliver up to 305 kg to LEO with a first commercial launch expected in 2023/2024."

[ringsider]

Their website now says

"Gilmour Space's innovative Eris orbital launch vehicles will deliver up to 305 kg to LEO with a first commercial launch expected in 2023/2024."

The only surprise is that anyone is surprised.

Gilmour's June 2022 accounts show they burned half their mid-2021 AU$61m / US$46m raise* by mid-2022, so they had burned around AU$30m that year, with approx. AU$30m of the investment income left at that point.



Today it's one year later, and they have probably burned at least that much again, if not more, so how much money does the company have in the bank in mid-2023? The capital they raised in mid-2021 will be gone if the spending was at that same rate, and the same document states they had 165 employees in June 2021, so that gives some idea of the burn rate - about AU$17m annually on salaries alone.

They do get Australian R&D tax credits at a rate of about 40% of expenses, and possibly some grants, so maybe they have about $25m-$30m left in the tank, mostly refunds from those tax credits and whatever grants are left.

But without fresh capital to spend on R&D those R&D tax credits will dry up, leaving them with no money once that remaining cash has gone. Plus, building these things always takes longer than startups think, and as they step into the final stages the need for more money, more people etc climbs dramatically.

So two conclusions:

1) that they will be raising AU$50m-100m around now, which is a tough sell when even your home space agency has pulled out of supporting the sector, and doing so in a tricky/sceptical funding environment.

2) they are probably conserving / stretching the remaining cash they have, and thus delaying anything expensive until they can afford to do it, hence new dates - which will probably be unrealistic until they have more fresh capital to deploy reliably.

*https://spacenews.com/gilmour-space-raises-46-million-for-small-launch-vehicle/

[plugger.lockett]

1) that they will be raising AU$50m-100m around now, which is a tough sell when even your home space agency has pulled out of supporting the sector, and doing so in a tricky/skeptical funding environment.

While I agree it's a tough sell, I don't agree government funding domestically really matters much. They were raising VC funds successfully long before the home space agency existed, and years before the prior government made their big cash splash for new space that didn't have much detail in reality. From my perspective the tough sell lies in the millions they've burned through with little more than static engine test fires to show for it.
It's a VC entity, it has to stand or sink on it's own merits. They've raised many tens of millions of dollars and don't have a single successful launch under their belt. They keep building/testing rockets but to my knowledge don't have a suitable launch site ready. Sink or swim, I  think that's on their shoulders, not the current federal government.

[CameronD]

Adam Gilmour describes himself and his team as “super-busy” assembling an orbital launch vehicle and launch site when asked.

Gilmour Space Technologies has been focussed on rockets since 2015. Gilmour hopes its Eris rocket can reach low earth orbit in a maiden launch by the end of the calendar year.

“I’m going to try very hard to do that, even if we have to work on weekends,” Gilmour tells @AuManufacturing.

“But if we have to, we’ll take a financial hit and just work on the weekends to try to get the rocket away.”

Only 11 nations have put orbital vehicles in space, and only five regularly do so nowadays, says the CEO and co-founder, when asked about the complexity of what they’re attempting.

He adds that the craft contains 55,000 different parts. This includes nuts and bolts, Gilmour concedes, “but it’s still a lot.”

On June 23, GST marked a rare milestone for an Australian manufacturer, making its 200th hire and moving out of the SME and into the “large” company designation.

https://www.aumanufacturing.com.au/spotlight-on-scaleups-why-more-manufacturers-need-to-grow-up

[c4fusion]

While I agree it's a tough sell, I don't agree government funding domestically really matters much.

While this can be a true statement, I think that it definitely matters considering who the current investors are.  Additionally, with the current economic climate, new investors would be hesitant to invest in companies with even the slightest of perceived blemishes.  It's far more problematic for a government agency to pull out than to have internal issues since outside investors will question why the government is pulling out, is there something they know that we don't know?  Sure this can be easily cleared out if you are able to talk in front of an investor but that is if you are able to schedule time with them.  From an outsider perspective all that is visible is that the government pulled away from this company, maybe they know something I don't know.  I should just invest in something else.

From my perspective the tough sell lies in the millions they've burned through with little more than static engine test fires to show for it.

That's actually not as big of an issue since 99.9% of investors have no idea how far away a rocket is from launch until they do seriously deep digging, so this fact maybe easily explained away/obscured by the founders.

As for the current VCs, I can see most of them pulling back, especially since interest rates are so high right now (you might as well throw your money into CDs):

1. Main Sequence Ventures - Lead investors in Series B and topped up on Series C, the big issue is that they are partially backed by the government and thus may have less money due to the pull back by the government.

2. 500 Global - They just only funded series B, interesting that they didn't come back to top up in Series C.  This is interesting since they are not a super hot unicorn that has more investors than required.  Generally investors love to come back to top off their shares so they can protect their pay out.  Generally the last investor gets the first payout in either an IPO or bankruptcy (obviously there are additional terms).

3. Blackbird Ventures - Only 'proper' Australian venture capital firm as 500 Global is US based, lead only in Series B.

4. Fine Structure Venture - US based Venture capital group that lead in the Series C funding.

5. HESTA - A super fund for people working in health and community services. I never worked with supers but from my understanding, they are generally more conservative since they a pension fund system similar to 401K in the States.

6. Hostplus - A superannuation fund for the hospitality, tourism, recreation, and sport industries. See HESTA for thoughts.

7. NGS Super - A super fund for non-government education and community organizations. See HESTA for thoughts.

8. Australian Government Department of Defense - Obviously they are pulling out.

I just wanted this post to be a super high level view of why I think Gilmore is going to have trouble moving forward while providing a tiny bit of insight into series funding.

Please see this Crunchbase link for more info: link

[Steven Pietrobon]

8. Australian Government Department of Defense - Obviously they are pulling out.

That is not obvious to me at all. They have a $15M contract with Defence that as far as I know, has not been cancelled.

https://www.innovationaus.com/15-million-defence-deal-for-gilmour-satellites/

Gilmour was also awarded $52M under the Modern Manufacturing Initiative (MMI) which as far as I can tell, was also not cancelled.

https://business.gov.au/grants-and-programs/modern-manufacturing-initiative-manufacturing-collaboration/grant-recipients

Applicant details: Gilmour Space Technologies Pty. Ltd.
Grant amount: $51,934,940
Project cost: $157,378,613
Project title: Australian Space Manufacturing Network (ASMN)
State: Queensland

[c4fusion]

8. Australian Government Department of Defense - Obviously they are pulling out.

That is not obvious to me at all. They have a $15M contract with Defence that as far as I know, has not been cancelled.

https://www.innovationaus.com/15-million-defence-deal-for-gilmour-satellites/

Gilmour was also awarded $52M under the Modern Manufacturing Initiative (MMI) which as far as I can tell, was also not cancelled.

https://business.gov.au/grants-and-programs/modern-manufacturing-initiative-manufacturing-collaboration/grant-recipients

Applicant details: Gilmour Space Technologies Pty. Ltd.
Grant amount: $51,934,940
Project cost: $157,378,613
Project title: Australian Space Manufacturing Network (ASMN)
State: Queensland

I meant that they are not investing more in the future. Sorry for the confusion

[ringsider]

Gilmour was also awarded $52M under the Modern Manufacturing Initiative (MMI) which as far as I can tell, was also not cancelled.

https://business.gov.au/grants-and-programs/modern-manufacturing-initiative-manufacturing-collaboration/grant-recipients

Applicant details: Gilmour Space Technologies Pty. Ltd.
Grant amount: $51,934,940
Project cost: $157,378,613
Project title: Australian Space Manufacturing Network (ASMN)
State: Queensland

Looking into this more closely to get beneath the headline figures, this grant scheme provided up to 1/3rd of the total project cost. So while the grant total is AU$52m, that means they need the balancing AU$105m from the total cost from other sources:

https://www.industry.gov.au/news/modern-manufacturing-initiative-collaboration-stream-open

Also, while Gilmour is the lead, the ASMN is a consortium of "more than 30 companies, universities and supply chain partners":

https://www.australianmanufacturing.com.au/govt-signs-off-53m-mmi-funding-with-gilmour-to-bolster-space-manufacturing-in-australia/

Lastly, that PR says it is to fund 3 big projects.

So it's not clear how much of that AU$52m (US$33m) will go to Gilmour directly (or how they balance the books for the rest of the AU$105m / US$68m project cost) but with 30+ project partners will it be the lion's share, or a relatively much smaller amount  around AU$10-15m (US$6.5m-9.75m)?

[plugger.lockett]

While I agree it's a tough sell, I don't agree government funding domestically really matters much.

While this can be a true statement, I think that it definitely matters considering who the current investors are.  Additionally, with the current economic climate, new investors would be hesitant to invest in companies with even the slightest of perceived blemishes.  It's far more problematic for a government agency to pull out than to have internal issues since outside investors will question why the government is pulling out, is there something they know that we don't know?  Sure this can be easily cleared out if you are able to talk in front of an investor but that is if you are able to schedule time with them.  From an outsider perspective all that is visible is that the government pulled away from this company, maybe they know something I don't know.  I should just invest in something else.

The point I was trying to make was that Gilmour was able to source VC funds successfully prior to the last government's 'cash splash for space' announcement and to my knowledge that announcement didn't have large sums earmarked for Gilmour use.

From my perspective the tough sell lies in the millions they've burned through with little more than static engine test fires to show for it.

That's actually not as big of an issue since 99.9% of investors have no idea how far away a rocket is from launch until they do seriously deep digging, so this fact maybe easily explained away/obscured by the founders.

IDK, sooner or later the fact that they keep talking about orbit and then shift the goalposts back to the next year is going to get noticed. And while I also don't have much in the way of confidence in the actual skills in VC investors understanding the difficulties to reaching orbit I do believe they're not super keen on a 'new' venture that's been running for years and has yet to leave the pad.