Race To Space

Ten, nine, eight . . . Who will win the $10 million contest of a lifetime?
Magazine Contributor
5 min read

This story appears in the November 1998 issue of Business Start-Ups magazine. Subscribe »

Space. The final frontier for . . . entrepreneurs? As the millennium approaches, it seems fitting that space travel is expected to be touted as one of the biggest entrepreneurial opportunities to hit planet Earth in the coming century.

Historically, the business of space travel has been limited to academic and government organizations, with NASA flights costing roughly $500 million and only a handful of astronauts making the trips. Now, nearly 30 years after man first landed on the moon, a move to privatize the industry is underway in hopes of spurring competition, driving down costs, and making space travel a reality for average--but wealthy--consumers.

Driving this change is the X PRIZE Foundation, a nonprofit organization that's sponsoring a contest that will award $10 million to the first privately financed team to successfully send passengers into space. The winner must build a vehicle to transport three civilians into space (62 miles into suborbit, to be exact), return them to earth, and complete a second trip within a two-week period.

The contest is counting on the ingenuity and spirit of small companies to make space travel a reality. "We're using the competition to spark entrepreneurs to look at different ways of creating vehicles [for cost-effective space travel]," says X PRIZE's Steven Werner.

This kind of contest has a precedent: It was a contest with a $25,000 prize that spurred Charles Lindbergh to make his historic flight.

So far, 15 teams, comprised of aerospace engineers, adventure travel companies and, yes, rocket scientists, are rising to the challenge. Some companies are already selling tickets, starting at around $98,000, for the ride of a lifetime. The X PRIZE Foundation expects a winner in 2000.

"I've always felt it's only a matter of time until regular people can go into space," says Werner Zehnder, president and co-founder of Zegrahm Space Voyages, a Seattle-based adventure travel company that's entered the race to space. "The technology is already there, and by getting the private sector involved, I think we'll finally see it happen."

To those seeking to build the space travel companies of the future, this is no ordinary entrepreneurial opportunity. "I'm aware that what we're doing is groundbreaking," says contestant Michael Kelly, chairman of the board and chief technology officer of Kelly Space & Technology Inc. in San Bernardino, California. "It's a thrill."

Far Out

Space companies of the future.

While space flights are one of the most exciting space ventures, following are other opportunities industry experts predict will pop up in the not-so-distant future:

  • Looking to reduce delivery time, leading package companies hope to use fast cargo-delivery vehicles to send shipments via space.
  • A demand for low-cost satellite launching and servicing is expected to proliferate due to anticipated growth in the communications industry.
  • Hospitality companies, including Hilton Hotels Corp., are seeking ways to build resorts in space.
  • Companies in need of geographic data or photographs of the earth will hire satellite-based remote imaging services to provide this kind of information.

Fast Track

Names and ages: Michael Kelly, 44; Karen West, 45; and Michael Gallo, 40

Company name and description: Kelly Space & Technology Inc. is a satellite-launching company.

Based: San Bernardino, California

Founded: 1993

Start-up costs: $10,000

1997 sales: $1 million

Number of employees: 20

Going their own way: After working in TRW's ballistic missiles division for several years, Kelly and Gallo struck out on their own in an area their former employer chose not to pursue: commercial satellite launching.

Novel idea: The company is developing a partly reusable satellite-launching vehicle that it claims is less expensive to operate and easier to launch than others on the market. (A smaller version of the vehicle will be used for the X PRIZE Competition.)

"We're the air charter service to use to deliver what anyone wants [into space] in a cheap, reliable manner," says Kelly.

Future's so bright: "All the dreams that the Apollo program instilled in people about the future of man in space have been delayed for various reasons, but they're about to materialize," Kelly predicts. "So if you want to be a part of this, get ready."

Fast Track

Names and ages: Mike Messick, 35; Scott Fitzsimmons, 38; Werner Zehnder, 49; Susan Zehnder, 51; Sonya Messick, 34; Peter Harrison, 52; Shirley Metz, 49; and Jack Grove, 47

Company name and description: Zegrahm Space Voyages is a division of Zegrahm Expeditions Inc., an adventure travel company that organizes exotic trips to Antarctica, Africa--and space as of December 1, 2001.

Based: Seattle

Founded: 1990

Start-up costs: $200,000

1997 sales: $12.5 million

1998 projections: $14.2 million

Number of employees: 30

Adding their own twist: "We have an advantage because we're already in the travel business," says president Werner Zehnder of the X PRIZE Competition. Passengers are in for an impressive seven-day experience, complete with lectures from famous astronauts and a post-flight celebration back on Earth.

Standing room only: With adventure travel the fastest-growing segment of the travel industry, the future market will likely be crowded. "No doubt there will be competition [in space travel]," admits Zehnder, "so it's just a matter of doing what we do best to stay ahead of our competitors."

Contact Sources

Kelly Space & Technology Inc., (909) 382-2010, http://www.kellyspace.com

X PRIZE Foundation, 5050 Oakland Ave., St. Louis, MO 63110, http://www.xprize.org

Zegrahm Space Voyages, (206) 285-3743, http://www.spacevoyages.com


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