Joshua Western: I look at this like a before and after moment, in-space manufacturing, it’s this century's printing press, or the jet engine, or the invention of nuclear. It is going to create a fundamental shift in the way that we think about almost all of our technologies.

Gabriele Capamasi: Supply chains, data, and connectivity in many other sectors will depend on space. So every company needs really a form or a sort of space strategy.

Joshua Western: Space is better, for almost every industrial process and that's because all major industrial processes have to fight against one or more of the constraints of being on Earth: our gravity, our atmosphere or the temperature.

Lizzie O'Leary: Right now, miles above our heads – there is a whole industry at work.

Femi Oke: The space economy. It helps us find our way around, stay in touch with friends, and keep us safe. And with more and more companies getting involved, the sector is really starting to take off.

Lizzie O'Leary: But what is it going to take for industries like this to scale? And what lessons can other business leaders learn from those exploring new frontiers?

Femi Oke: I’m Femi Oke, a broadcaster and journalist.

Lizzie O'Leary: And I’m Lizzie O’Leary, a podcaster and journalist. 

Lizzie O'Leary: This is Take on Tomorrow, the podcast from PwC. Where we’re looking at how businesses can build momentum around bold ideas.

Femi Oke: Today... Is space the next business frontier?

Lizzie O'Leary: Shortly, we’re going to hear from a company manufacturing advanced materials in space... But first, to help us understand exactly how the industry works, we’re excited to be joined by Gabriele Capomasi, a “Strategy&” Partner with PwC Italy, where he is a leading practitioner in Aerospace, Defence and Space services. Gabriele, welcome to the show!

Gabriele Capamasi: Thank you everyone. Pleasure to be here and good afternoon to you all

Lizzie O'Leary: I think when a lot of us think about space, we are thinking about exploration, mission to the moon, exploring planets beyond Earth, but there is this whole industry built around space. I wonder if you could set the scene for us a little bit. What is the most exciting for you in the space sector right now?

Gabriele Capamasi: Many things are exciting for me in the space sector. Space used to, to be a lot about exploration, lunar mission and landing, one off space activities, right? Today it is becoming more and more a real industrial sector. Satellites are increasingly being produced in series, rather than being built one by one. Talking about scale, we can actually give a size of how big the business really is, right? So today,  we're talking about a 550 billion turnover, and our most recent Space Trends and Challenges paper is talking about 1 trillion turnover to be exceeded by 2035.

Femi Oke: Gabriele, you say that the expansion of what's possible in space is very exciting, but if people aren't rocket scientists, this might not feel very relevant to their lives or their work. So why should all of us care about what's happening in space regarding industry

Gabriele Capamasi:: Space is already part of everyone's daily life. When we go from point A to point B, we navigate, we use satellites. When we speak over the phone, that is provided by SATCOM satellites, while we look at what's gonna happen to the weather tomorrow, talking about satellites. I mean, even timing behind financial transaction, all depend on available space infrastructure. And what's relevant, I mean, just if we take one programme, for example, the Copernicus programme, which is a European Earth observation programme where satellites are used for monitoring climate, land use, and disasters. These programmes are seeing investment of around 70 to over a hundred billion in terms of actual return. That's gonna be 10 or 20 times what have been invested so far, right? So people don't really look at the benefits from space, but in fact, it is already impacting everyone's life on a daily basis.

Lizzie O'Leary: That makes so much sense and I, I sort of haven't been thinking about it that way. Gabrielle, we're gonna come back to you shortly, but first, Femi, you had this completely fascinating interview with the CEO of an aerospace manufacturing company. I wonder if you could tell us a little bit about that.

Femi Oke: Yes, so I spoke to Space Forge, who make semi-conductors in space. I had so many questions about how this works. So, to learn more, I spoke to Josh Western, he's the co-founder and CEO of Space Forge, and I began by asking a very straightforward question, why manufacture in space?

Joshua Western: So space is better, for almost every industrial process and that's because all major industrial processes have to fight against one or more of the constraints of being on Earth: our gravity, our atmosphere or the temperature. So if you are making steel, you have to get to an incredibly hot temperature, and you need to remove gravity from the equation. If you are producing dried pasta, you need to do that in a vacuum environment. So if you can think of all of the industries that are between making dried pasta and making steel.

Femi Oke: Quite a few!

Joshua Western: Indeed yeah, so each of them could take benefit from the space environment. Now obviously in ninety-nine out of a hundred cases, there would be no point in moving them to space because it wouldn't be economically viable, and it probably wouldn't make much sense from an environmental or sustainability standpoint either.

Femi Oke: When you go to parties, when you're out and about and people say, "Hello, Josh, what do you do?" And you tell them about Space Forge, what do you tell them?

Joshua Western: So I should probably add at the start that my wife has banned me from asking people that question, because, it inevitably ends up that I've got the more interesting job, uh, and then we spend a lot of time talking about me, so I try not to do that as much.

Femi Oke: You're a good husband.

Joshua Western: Right, I try! We are a materials company first and a space company second. So we manufacture next generation compound semiconductors - basically the inorganic crystals that underpin all advanced computer chips - in space. The result is that we can produce semiconductors which consume fifty percent less energy compared to today’s.

Femi Oke: Can you help us understand exactly how the manufacturing works by describing it in a way that we will never, ever will see it up close, but we've got a really good visual picture?

Joshua Western: So the be, the best analogy I have of this probably isn't the most exciting, but it's basically like a microwave. It vibrates the water molecules at a certain frequency, and the vibration of the water molecules is what heats the food up. The way in which a semiconductor reactor, or almost like an oven, works is a - very similar principle. So what we basically do is we put in the raw ingredients, of a semiconductor. They're known as precursors. They're often in gas form, and you effectively heat that up to over a thousand Celsius, which forces the precursor materials to basically condense into a crystal form. That seed crystal is basically the sourdough starter of the semiconductor ecosystem. So we produce a sourdough starter in space, we bring it back home, and, and very crudely, we add more ingredients, and we bake loaves of semiconductors. We take some slices of them. Some of those slices go on to become the next generation of starter, some of them go on to become, you know, kind of deployed into, the most highly demanding customers and, and environments that those customers have, to try and operate these systems. So, you know, like, our first generation is pretty much going to be exclusively aerospace and defense. The generation after that is able to move into telecommunications and data. The generation after that is able to move into automotive and on and on and on and on, until you finally exhaust these seed crystals. The result is that for each seed crystal that we make in space, that basically enables more than a million chips to be made on the ground. And that means that we don't have to go to space that often in order to be able to scale this product. That also means we're able to get the price point down pretty bloody quickly, even though we've been to space.

Femi Oke: If you could be super candid, how much is still experimentation or how much is “we know this works? We're gonna keep going until it becomes cheaper, but we're gonna be ahead of everyone else.”

Joshua Western: Sure. So we're definitely out of the science and research phase, but we're very much into the applied development phase. So, the reason I have such great confidence in this is because the first time a compound semiconductor was made in space was 1973. So there is a huge wealth of, of knowledge and historical data in knowing that this is possible.

Femi Oke: So the momentum for space manufacturing to be more commonplace, more everyday, where is that coming from?

Joshua Western: I mean, it's coming from the customer. It is entirely irrelevant to our customers that our semiconductors were made in space. Like, if you got all of the benefits of the space environment at the bottom of the ocean, we would be called Sea Forge, but what matters to the customer is having that improved energy use, that improved performance, that improved, size, weight, and power considerations overall and the improvement in the system architecture. The momentum that exists behind in-space manufacturing right now is because customers see the potential of what we're doing in enabling those performance improvements to happen. If these can be enabled, then we are twenty years ahead of where we thought we could have been in the next five years.

Femi Oke: So if we take that line of thinking about space manufacturing and the products that come, or that are made in, space that are in people's everyday lives, what impact will they feel?

Joshua Western: I look at this like a before and after moment, and I think that in-space manufacturing is kind of, it's this century's printing press, or the jet engine or the invention of nuclear. It is going to create a fundamental shift in the way that we think about almost all of our technologies. Now one of the early challenges that Space Forge had, when we were working through with potential customers on, on our product development and the way that we were doing this is, I basically said, "You know, what would you do if you could shrink the size of this system by fifty percent?" Or "What would you do if you could take sixty percent of the energy bill out of running this massive piece of infrastructure?" And the answer I often got back is, " We don't know, because we didn't know it was possible." We're now able to have those conversations around what is it that's now made possible, I guess that's really how I know that this before and after moment will happen, and after that shift, nothing will ever look the same again.

Femi Oke: Let's focus back though, on manufacturing in space and scaling up. What do you need right now? Who do you collaborate with to succeed?

Joshua Western: There are lots of things that we don't do. We don't build rockets. On the semiconductor ecosystem, we only produce the base materials. We do two things, and in the future, we will do them at scale, and we will do them well. And that is producing the semiconductor material and getting it back to Earth. And that's a really powerful position for us to have because it means on two sides, we have customers everywhere. So on the compound semiconductor landscape, we don't really have much in the way of competitors, because we're able to be friendly to everybody that needs these materials, which is pretty much everybody in the value chain above us. And on the space side of things, we're obviously seeing an emerging demand in being able to do other in-space manufacturing applications, and being able to do in-space assembly and, other kind of close proximity operations which need a base platform to work that from.

Femi Oke: There will be companies who are looking at your work thinking, "Well, there's no connection to what happens in space manufacturing to what I do." Is there a connection between the kind of work that Space Forge is doing and companies and operations and businesses on Earth?

Joshua Western: Yeah I, I can't think of where that connection would end. Semiconductors are in every industry. They're in the combine harvesters required for agriculture. They're in your mobile phone. They're in your washing machine. They're in your car. They're in your aircraft. They're in your banking systems. I'm really excited by making technologies which are currently like, there are barriers to adoption, really plausible and better to adopt than not having done so. So I'm thinking around the shift to electric vehicles, building semiconductor devices that make it that those cars can have much longer range. And I think we will see the same also emerge in things like renewable energy systems and grid storage. We're going to see it in quantum computing. And I think we're also going to see it in Artificial Intelligence and data centers and making those much more cost-effective to be able to operate for the scale of consumption of Artificial Intelligence that we currently have. But at a macro level, the Space Forge is about being able to effectively redress the fundamental imbalance between us as human civilization and the finite natural resources of this planet. The opportunity we have with in-space manufacturing is that we are at the start of being able to redress that balance, and then as other things emerge in the space sector around us, such as the ability to mine asteroids as they pass by, then we don't need to take the raw materials from Earth with us in the first place, because we can take them from the abundant chunks of rock that go past us, ensuring that the technology doesn't have that same impact that it currently does today. And so I appreciate that's a rather grand statement, but having that grand statement is, you know, the reason we exist.

Femi Oke: 10 years from now, what does success look like for space manufacturing, the way you've described it for Space Forge?

Joshua Western: Ten years' time, I very much hope I am on the right trajectory to the day that somebody finds making semiconductors in space boring, because if they've switched their kettle on, and they didn't realize that the energy that came from the grid to power it involved a space-made chip, or they've streamed a video of a cat on YouTube, and the 6G signal was made by a space-made chip, and they're not interested in it, then I've succeeded.

Femi Oke: Josh Western, CEO and co-founder of Space Forge, thank you so much. It's been so interesting talking to you.

Joshua Western: Thanks for having me. Really appreciate it.

Femi Oke: Gabriele. Why does space matter more than it did five or maybe even 10 years ago? Even for those business leaders who may not think of themselves as being directly involved in space industry.

Gabriele Capamasi: Well, what we are observing and what we have been observing is really a shift in the centre of gravity, right? We have been hearing a lot about space being used for sustainability matters, but looking at the geopolitical tensions that we're seeing nowadays, I mean, there's a lot of the shift moving towards security and resilience. If we look at, for example, Earth observation, we need to look at this in terms of also its dual use applications. And roughly today, defence and security applications within Earth observation are for 30% already present there. We even make the shift more visible as more and more countries that are investing significant amount of money in space. The 35 billion programme commitment from Germany, Italy is quadrupling its space defence budget by 2027. So really, supply chains, data, and connectivity in many other sectors will depend on space. So every company needs really a form or a sort of space strategy.

Lizzie O'Leary: And when you think about the industry and the, the places that have the most kind of energy and momentum behind them, where do you see the most momentum in the industry right now?

Gabriele Capamasi: So a lot of the momentum is on building and developing the infrastructure. So we’re really talking about access to space. And if we look at this from even investment standpoint, we see that investment on access to space players have increased uh from 1.6 billion in 2020 to almost 8 billion in 2025. In space manufacturing, advanced material, reuse of resources in space, these are gonna all bring significant value on the infrastructure and on the industrial volume of the sector.

Femi Oke: So are there ideas that at the moment you can see can be scaled into something incredibly impactful that you’re seeing right now?

Gabriele Capamasi: Well, when we talk about scale, uh, we also talk about some of the bottleneck, so we look at supply chain, resilience of the supply chain, availability and responsiveness of the supply chain, but also the capital that is needed, to scale up, right? So if you look at some of our most recent analysis, almost like 40% of aerospace firm, they're saying that they're not able to meet the rising demand they're gonna be seeing in the market. And the lead time of some of the critical components are gonna exceed almost two years to materialise. Also, if you look at funding, a lot of the investment are concentrated on the initial phases of, of startups of the new players. So series A and series B, really proven technologies they need much more significant and deeper later stage capital to be industrialised. So there's an increasing gap that needs to be filled, both from an industrial and supply chain standpoint as well, from a, a capital and financial standpoint too.

Femi Oke: Gabriele, what partnerships and collaborations are you seeing beginning to form, to work in, experiment, to strategise about what is possible to manufacture in space? Who's working with who?

Gabriele Capamasi: Well, we are, we're seeing actually quite a few different set of industries trying to enter, trying to experiment and trying to expand their portfolio and the set of collaboration in the sector, right? So some of the examples of these are automotive player, that are typically involved in the automotive and / or even industrial sector, that are producing and manufacturing at scale, satellites. If you look at, uh, low Earth orbit, and if you look at, uh, zero gravity application, you have, for example, manufacturers such as Barilla, Rana, or even Prada, if we just look at the Italian example that are trying to conduct, experiment on low-Earth orbit. So there's these players, there is cosmetic players, there's pharmaceutical players, last but not least, uh, you also have, the material that need to be procured in the market, such as, uh, in situ material that, for example, are and can be retrieved from the moon or from other planets, and how this material can be used, reused, recycled for new products, new applications, and new technologies.

Lizzie O'Leary: So, if you are listening to this, and especially if you are in a business that you don't think of as touching the space sector, are there two or three top lessons that someone could take from that sector for all businesses? Kind of no matter what the industry is.

Gabriele Capamasi: I think so. I mean, I can think about, two or three in reality, right? So number one, I would say you need to really map how much you're exposed to the sector, right? Understand global positioning system, satellite data and communication, the data already supporting your daily operation, right? You need to manage those dependency as a real business risk, right? What happens if they're not redundant, if they fail, if they're brought down? You need to think about the potential for dual use applications, right? Ask yourself whether technology's expertise and application can be used or developed for other market between civil and defence application, and / or also for adjacent sectors. And engage before the market is perfect, right? What does that mean when you need to start small to pilot, to partner, to do proof of concept, and you wanna fail fast to try new application in space because there's quite a lot of new development and new technologies up there, and you wanna actually better understand what your requirements are and what space technologies and assets, what and how they can satisfy your needs.

Lizzie O'Leary: Thank you so much for talking with us today.

Gabriele Capamasi: Thank you so much for inviting me. It's been a pleasure.

Femi Oke: Lizzie, it feels like the only barrier to what is possible in terms of the space industry is money.

Lizzie O'Leary: That was so fascinating to me to think about like, oh, there is money for these big startup ideas, but then a kind of later stage infusion of cash and how you take all of these things and scale them is the next big important piece.

Femi Oke: And having the patience to be able to experiment, to fail quickly, start again. That's not necessarily in an investor's mindset, so it's going to take a very special kind of investor to say, let's work in the space industry.

Femi Oke: That’s it for this episode – if we inspired you to think about business in a new way, please follow Take on Tomorrow wherever you listen to podcasts. For more, you can visit pwc.com/takeontomorrow

Lizzie O'Leary: In our next episode - AI is already changing the way we work, so what do jobs look like at all levels?

Lizzie O'Leary: And are organisations ready to rethink how they develop talent?

Femi Oke: Take on Tomorrow is brought to you by PwC. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity.