Satellite Startup Aiming for the Big End of the Market

It's an interesting thought experiment to look a few years into the future and decide what aspects of the space industry will be worth aiming for. Can a startup design and implement the needs of the market ahead of the rest of the industry?

Meet the California-based startup satellite company K2, a company with a novel and interesting view of the future.  Instead of expecting fleets of small satellites because of the current trends in that direction, Karan Kunjur the co-founder and chief executive of K2 looks at the emergence of Starship and the other very large capacity launch vehicles being talked about and has the opposite idea.

"We think we're about to go from an era of mass constraints to an era of mass abundance."

Look at the argument that we're going to be able to put much more mass into orbit this way: the cost per kg for the cheapest way to space now, a ride sharing mission on a Falcon 9, has been quoted (2022) as $1M (million) per 200-kilogram (440 lb) ‘slot’ which works out to $5,000/kg (more mass goes at the same price per kg).  Other vehicles currently on the market cost more.  Rocket Lab’s more accessible Electron rocket that only lifts smaller payloads than the Falcon 9 costs at least $7.5M for ~200 kg to sun-synchronous orbit (SSO) – or $37,500/kg.  The cost to orbit for Starship and SuperHeavy has been calculated to be $35 per kg.  That's 0.7% of the Falcon 9 cost of $5,000/kg.

"When we looked at the market, we saw a massive amount of small satellites," Kunjur said. "The small-satellite boom figured out how to go cheaper and faster, but it hasn't figured out how to do that without sacrificing capability." 

We're now back at one of the universal truths of engineering: Engineering is the Art of Compromise.  There are no ideal solutions that are best in every situation so everything is tradeoffs.  When you go to "smaller, cheaper, faster," the tradeoffs are going to take something from you.  

The industry has turned to satellite buses for bigger satellites - a satellite bus is the main structural component of a satellite, which payloads "plug into."  The standard sat bus is made by Lockheed Martin and called the AM2100 spacecraft.  It's a proven vehicle with a payload capacity of more than 1 ton and 20 kW of peak power, used for the military's Global Positioning Satellites and other government applications.  Satellites built on the AM2100 have operating in geostationary orbit for 15 years or longer. 

Although the price of this satellite bus is proprietary, various estimates place the cost at between $100 million and $150 million. One reason for the expense is that Lockheed Martin buys most of the satellite's elements, such as its reaction wheels, from suppliers.

"Lockheed is amazing at doing those missions with really complex requirements," Kunjur said. "But they just have not changed the way they build these larger, more complex spacecraft in the last 15 or 20 years."

K2 figured that there were probably newer ways to do this, since Lock-Mart hasn't changed them in so long.  Last week, SpaceX launched a test version of K2's satellite bus last week on a Falcon 9 Transporter ride share mission. Like the cost of the AM2100 bus itself, the cost of the reaction wheels it depends on is proprietary, but K2 guesstimates the cost at 1/2 to $1M each.  Their in-house developed reaction wheels cost $35,000. 

The company is now building its first "Mega Class" satellite bus, intended to have similar capabilities to Lockheed's LM2100: 20 kW of power, 1,000 kg of payload capacity, and propulsion to move between orbits. But it's also stackable: Ten will fit within a Falcon 9 payload fairing and about 50 within Starship's fairing. The biggest difference is cost. K2 aims to sell its satellite bus for $15 million.

The US Government is quite interested in this.

About a month ago, K2 announced that it had signed a contract with the US Space Force to launch its first Mega Class satellite in early 2026. The $60 million contract for the "Gravitas" mission will demonstrate the ability of K2's satellite bus to host several experiments and successfully maneuver from low-Earth orbit to middle-Earth orbit (several thousand km above the surface of Earth).

Naturally, this is early in the process, but they come across as doing well for where they are in the development process.

A look inside the K2 Space factory.   Image credit: K2