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Space Insiders is your bi-weekly deep dive into the intersection of space, cloud technologies, and entrepreneurship. Hosted by Tony Sewell and Rob Ruyak, both seasoned space-tech executives, this podcast features candid conversations with founders, investors, and entrepreneurs shaping the future beyond Earth. Whether you're launching a startup, investing in innovation, or just space-curious, Space Insiders gives you the behind-the-scenes insights you won’t hear anywhere else.
New episodes drop every two weeks. Subscribe now and join the orbit!
Disclaimer: The views and opinions expressed in this podcast are those of the hosts and guests and do not necessarily reflect the official policy or position of any organization or employer.
Welcome to Space Insiders. I'm Tony Sewell, and I'm here with my partner in crime, Rob Ruryak. How are going, Rob?
Rob Ruyak:Great, Tony. How are you doing? Good. Good see you.
Tony Sewell:Good. Yeah, you too. So full transparency for everyone. We're actually recording these after we did the interview. We had a little bit of a technical difficulty, but anyway, it comes with learning how to do a podcast.
Tony Sewell:But great interview this week that we think everyone is gonna really, really dig. We met with Chris Capon, the CEO and founder of Nominal Systems.
Rob Ruyak:Chris is a great guy. I met him a couple years ago. I think Tony, you've met him as well. Yeah. If I remember correctly.
Rob Ruyak:Straight out of Australia, real talent, started his company Nominal Systems. When you look at his background and what he studied in aerospace, it's hard to understand. That's how smart he is. So I'm looking forward to asking him questions around how he got started, why does he have that interest, how it led him to solving particular problems using simulation and digital twin concepts. So it's going be a lot of fun to talk to him.
Tony Sewell:Yeah. Awesome. So before we get to the show, let's talk about some of the news that's caught our eye this week. A couple of things that I was keen to talk about, tariffs. I feel like it's the story of the day in all the news about just how it's impacting our lives.
Tony Sewell:But it's been interesting to see a couple of articles come out in the news in the last couple of weeks about how it's impacting companies in the space industry. This first one was last week a startup in Canada called Galaxia. They were launching their first satellite out of California on a SpaceX rideshare mission, And unexpectedly, they faced a 25% duty on this, which is a big deal for a startup. And I guess it just goes to show, there's going to be a whole sort of replanning process that a lot of these companies are going to have to start thinking about, given most launch now is happening out of The US. Yeah.
Rob Ruyak:Who would have ever thought that the the the word of the day would be tariffs literally every day?
Tony Sewell:What?
Rob Ruyak:And even my children even know what it is now. I think they've mentioned it even. But, yeah, it's we we've talked a lot, I think, in the last couple episodes about the uncertainty of how companies are gonna potentially deal with a whole whole set of unknowns. But now, you know, I thought this was a good article because it it's exemplifying where somebody sees might impact, especially small companies. And they're going to have to start figuring out how to deal with it.
Rob Ruyak:I really
Tony Sewell:worry about just the amount of friction this is going to introduce into the processes. I mean, they talk in this article about how it created this other some other company has found a way to smooth out this process, but it adds another layer of administration logistics for these companies and cost. No doubt it's going to slow down pace of innovation. Also, I think this is going to disproportionately impact smaller companies.
Rob Ruyak:Yeah. And I think the company you're referring to might be ExoLaunch, which for those people that don't know the industry that well, there are companies that actually help satellite manufacturers and operators get what we call manifested or set on a launch schedule with a particular launch provider. And they offer a whole bunch of services like testing and integrating their payload for a satellite into a mission and kind of helping manage that whole process. What they talk about in the article is how that company in particular as, you know, maybe an exception, probably an exception basis at this point, trying to help offset some of those tariff costs. And who knows?
Rob Ruyak:I mean, with every constraint, I think in a market, there could be opportunity and maybe there's that's another service that's offered by some of these kind of intermediaries that help with the process. We'll have to see what happens. But if I'm an investor in these companies, it's a concern because it's definitely going to impact their bottom line for sure.
Tony Sewell:Yeah. The contrast to that story was, I think two weeks ago, there was an article in Space News about Iridium talking about how they've seen the potential impacts to their supply chain, because obviously not only are they operating space systems, they have a significant equipment component to their service. They're manufacturing in a whole bunch of different companies and they've really had to think about how to rejig their supply chains to, I guess, offset the potential costs and look at how they diversify suppliers and stockpile key components just to try and manage the impact. But it just shows that no industry is immune from this upheaval we're going through at the moment.
Rob Ruyak:Yep, absolutely. Rob, I know
Tony Sewell:you wanted to talk about the Satellite Industry Association just put out a new report on the state of the space industry. I'm going to try something different. I'm going to share my screen here so that we can talk about this infographic.
Rob Ruyak:For those of you listening and not viewing, there are links that we'll provide in the podcast episode so you can actually see this infographic. It's free, and it's widely available.
Tony Sewell:So what jumped out to you most from this, Rob?
Rob Ruyak:Yeah. So for those of you that aren't familiar with this, and this is part of why Tony and I want to do this, is just try to educate folks on this market and of the different research groups and analysis that's available. And one of them is from, it's an annual report from the Satellite Industry Association, and they typically do it in partnership, with a company called BriceTech or Brice Space and Technology, which is a which I think is a is a very unique niche firm that is based out of Alexandria, Virginia, that puts out really well done reports on the industry. And the the one that we're referring to here, is really helpful, especially if you're new, because it it gives you a good sense for the segmentation of space, the space economy that a lot of people talk about. And it spans from satellite services, the grounds ground what they call ground equipment or ground segment, satellite manufacturing launch, and then even sustainability.
Rob Ruyak:And the one thing that really stood out to me here was that in 2024, the overall, revenue for the satellite industry was just just south of 300,000,000,000, about 293 to $294,000,000,000, Whereas launch, which seems to get a lot of the press, and what a lot of people talk about because you can see it, you can hear it, you can Yeah. It's exciting. It's only it was only about it it not only, but it was about 9,300,000,000.0, but relative to the overall satellite industry was was just a fraction of that.
Tony Sewell:Yeah, we're to talk a little bit about launch with Chris. Gives a little bit of commentary about Gilmore Space, and they've been one of the really high profile space companies in Australia that's trying to launch a satellite and create some sovereign launch capability in Australia, but attracting a lot of the limited investment dollars in Australia. It's interesting to get his thoughts on that. I think the thing that, again, linking to the discussion with Chris, because Nominal Systems, their business really started because of the space situational awareness and sustainability was really the core thing that they started with. The fact that only $350,000,000 out of that 300,000,000,000 is being invested in space sustainability.
Tony Sewell:It just really kind of, I follow a number of people in social media and writing on these topics. And it is kind of scary given the amount of activity, particularly in LEO. We talked to Chris about the impact on LEO's basically uninsurable because of issues linked to sustainability and control and regulation in space too. So it's kind of startling really.
Rob Ruyak:Yeah. And I think it's also maybe it's kind of like a chicken and egg kind of problem too, you know, because I think with space sustainability, you get a lot more visibility into what's actually out there, And I think being able to know what's out there and being able to quantify potential risk a little bit differently in LEO or other, I think that transparency of information and analysis might lead you know, more, like, new entrants in insurance markets for for the satellite industry or other types of spacecraft that that's coming down the road. So so let's see what happens. You know? Is it gonna be regulation that forces the growth and investment of this potentially?
Rob Ruyak:I think that is going be a big part of it. And then how government is actually going to be a part of funding some of that activity.
Tony Sewell:Chris actually offers some really interesting insights into some potential models for insurance for satellite operations. But I think given that, I think this is a good point to go to our interview with Chris. What do you reckon, Rob?
Rob Ruyak:Let's do it, Tony. So Chris, thanks for joining us. Chris, from the future. I want to add that Chris is actually, we're talking to Chris in Canberra, Australia. So how many hours what's the hour difference?
Chris Capon:Enough. Enough. Fourteen ahead. Fourteen? Yeah.
Chris Capon:Yeah. Who knows with daylight savings?
Rob Ruyak:Yeah. That's well, I'm glad we can make this work because I know it's not easy. I know you've been traveling the world talking about your company, meeting with customers, and now meeting with us. So this must be the highlight of your around the world trip. So thanks for joining us.
Rob Ruyak:The first thing that we'd love to talk to you about today is a little bit about you. You've had a career from aerospace engineering, getting your PhD and your studies and now starting nominal systems. So walk us through a little bit about how that journey's been and how you ended up starting your own company.
Chris Capon:Yeah. It's it's been an interesting one. I mean, why did I get into the space industry to start with? You know, I I get asked these questions a lot, and I I take it all the way back to back when I was a kid. You know, I either wanted to be a dinosaur or an astronaut, and I've I've yet to figure out how to be a dinosaur.
Chris Capon:And so there was a lot that motivated me to getting into the space industry. The way that I got to where I am now was a little bit of luck and a little bit of following opportunities when they were presented to me. So I did my undergrad at the University of Queensland in mechanical and aerospace engineering. I had the opportunity then to participate in a rocket competition where I designed a payload, for a rocket. I won it.
Chris Capon:And that really then motivated me to then think about pursuing a career, as an academic. So I started my PhD actually in hypersonics. And my supervisor at the time, Russell Boyce, got this opportunity to move to Canberra to start a space group. And I was like, well, hypersonics is cool, but space is where I really wanna be. And so I was like, you're not you're not leaving me behind.
Chris Capon:So I pretty much duct taped myself to him. We moved down to Canberra, and the rest is a bit of history. We we built four missions, five spacecraft. I got to experience the the challenges, and the the successes, of doing that. And we my cofounder and I realized through those experiences that there were broader challenges that the industry was facing in building things that actually work when they get to orbit and equipping, the operators, the people who were us, with the tools that they need to operate at scale.
Chris Capon:So we founded Nominal Systems largely with a drive to figure out how we could help make, an industry work, and solve lives for solve solve problems for people on the ground.
Rob Ruyak:That's that's a great story. So so who you said we. So who was the cofounder?
Chris Capon:Yeah. So, Brenton Smith, was my cofounder. So he's the CTO of Nominal Systems, and I'm the CEO these days. But he really drives a lot of the the technical innovation, within the company. And, you know, we're really pushing the envelope and exploring new ways to to design and build and manage many things.
Chris Capon:So, you know, one of the the fun things I think about working in a startup is it's very agile. There's there's lots of things that are happening in the world, and we we keep a close eye on them to see how we could incorporate them what we do.
Tony Sewell:You've been the company's been around a bit over five years now. Is that right, Chris?
Chris Capon:Yeah. Something like that. So we we founded us at the end of twenty nineteen, and that was driven by we did a course at the Canberra Innovation Network called Research Impact. And that course was all about how can researchers, because we were academics at the time, have more impact on the war world. And it was sort of, I think, the the inspiration moment for Brenton and I to go, well, is a you know, if I'm on my deathbed, am I really gonna look back and go, I got a a h index of, you know, whatever?
Chris Capon:Like, is a citation on a paper really a measure of impact on the world? Mhmm. And so we we we we thought at that time, maybe we could start a company to solve problems that people have. And that course really pushed us to think about not just what what we what we're good what what we're good at, but to to validate what what we thought would be an idea because the idea we had to start with was actually wrong. So the first idea we had, back then was what we did in our our PhDs and our our postdoc and academic life was around space situational awareness and space domain awareness, making sure we know where things are gonna be in space now and into the future.
Chris Capon:And we Brenton's PhD was about formation flying a spacecraft. He demonstrated a way that you could use both drag and lift on a spacecraft in low Earth orbit to establish these constellations of, you know, hundreds or thousands of satellites faster than you can do, you know, just using aerodynamic drag. So we said, okay. Well, we're gonna help people manage their constellations better, you know you know, set them up in their formations earlier with drag. We went out.
Chris Capon:We talked to a hundred people in our network, and it pretty much everyone said, that sounds cool, but we don't care. What what what people told us was you know, I remember there was a quote from a a lead engineer at a a satellite developer company, saying, you know, what keeps me up at night is my spacecraft not working. And we'd had those same feelings. We'd experienced them with the satellites we'd built. And so we were like, well, maybe there's something here.
Chris Capon:Because, you know, when we looked into it, far too many satellites fail and continue to fail today. The the stats back then were around 40% failure rate, and the stats aren't much better today. And so that to me means something is wrong. And so 2019, we started this journey on how can we deliver the tools that actually help people make missions work, and today we provide them.
Tony Sewell:Wow. That must have a bit scary being a few months into a new company and stumbling into COVID too. Like, how did that how did that go?
Chris Capon:Yeah. Look. Starting starting a company and then having COVID happen Yeah. Was a an experience, but I think it's actually helped shape the company we are today because we have a bit of a philosophy that you should be able to both love your job and love where you live. That's correct.
Chris Capon:Right. The modern workforce believes in well, if you wanna get the best talent, you need to be able to support remote and flexible working arrangements. Yeah. There is still something valuable in having a place for people in a company to get together and meet. So we have offices in Sydney and Melbourne, but we also use a virtual conferencing tool where, we quite literally have a virtual office.
Chris Capon:Everyone has a little six bit Pokemon style avatar, and we wander around and spend our time in that office. And I think when it comes to COVID really drove us to adopting and and using tools like that in a new way, because that tool was wasn't originally designed for being a virtual office. It was designed to be a conferencing tool where no one could meet in conferences. But I was trying to solve for three problems that we had during COVID, which was how do you, have a thirty second conversation? Because when you're doing remote work these days, no one wants to hop on a Teams or a Zoom call to ask that thirty second question, and you lose a lot when you do that.
Chris Capon:How do you connect and disconnect from work? You know, when you work with us, you're in the virtual office, even if you're in our physical offices. And when you're not at work, you're not in the office to show that, you know, you're around. And the last one is how do you have fun? You know, we have a a mini go kart track, in our virtual office, and we race on there sometimes on Fridays.
Chris Capon:You know, it's it's it's very different, but, you know, I think COVID has helped set us up as a unique company that lets us, you know, be more flexible, more agile, and work broadly across the world. You know, you mentioned me traveling. That's how we manage it.
Rob Ruyak:That's really interesting. I don't know if many companies have figured that out as well as you have, to be honest. And I think the hardest thing is, I think what I find in the workplace in this new world is really trying to make sure that the human connection is still front and center. I had an off-site not too long ago, and a lot of people that went were surprised that we, number one, even did it. Number two, how good they felt when it was over.
Rob Ruyak:And I don't even know if they paid attention to most of the work related items that we talked about. You know, it was just something that I think people yearn for and some and sometimes don't even realize it until they experienced the reconnection. So I think that's pretty cool that you guys have figured that out.
Chris Capon:What what if you think about it this way. What if you were to save the money that you pay in office rent as a business owner, and put that to more retreats, more strategy off sites, which are less about the tiring, exhausting strategy bit of it and more about the personal connection.
Tony Sewell:Bonding. Yeah. Yeah.
Chris Capon:And then you go back to to working remote, and you you can but you've you've had that opportunity to resolve some of those things you need to do when you you that can't be done remotely. Like, you need you need you need a personal connection at some point.
Rob Ruyak:Right. Totally agree with you. So back to back to nominal real quick. So or not real quick. Let's refocus back to that.
Rob Ruyak:Because I I I actually very I'm I'm you know, being a manager in general, I'm I I I could probably talk to you about the whole topic of remote work and the
Chris Capon:other can have a
Rob Ruyak:whole second thing on that.
Tony Sewell:We do want to have an episode on leadership and building culture as well. Maybe we need to make
Rob Ruyak:it a panel. We can have Chris on it. Again, back to nominal. Tell us a little bit more, Chris, about what is the problem that you guys are trying to solve? So I heard you talk about how you have this passion of helping people make sure what they end up putting in space and flying and operating in space work by helping them with tools here on earth to try to model that and try to test it.
Rob Ruyak:So what is it that Explain a little bit more about that, and especially for people that are really new to this industry? Like, why is that so important?
Chris Capon:Yeah. So I think it it the reason why it's really important today, there are there are two main reasons, and I'll I'll get to those. But I think it's important to think about what's changed. Why why are the problems that I mentioned around mission failure rates, there at all? Because they didn't used to be there.
Chris Capon:And the reason is because, you know, over the last decade, we fundamentally changed the way we design and build and operate spacecraft. So, you know, it's no longer or less common, or less I'll say a smaller segment of the industry is your your billion dollar geosatellite. Those satellites you know, when you were building a billion dollar satellite, if things weren't ready, the rocket waits for you. Whereas these days, we've got some fundamental shifts. So you've got smaller companies with a broader set of stakeholders ranging from still very experienced.
Chris Capon:So I think of, like, the SSTLs as the sort of companies that bridge the the they are super experienced. They can build things that work, but they they still have to charge for that quality assurance versus your university stakeholders who are, you know, less experienced. Now I was building my first satellite, in a clean room made out of, you know, pretty much a plastic bag, and our ops tool was a Python script where we, to start with, were manually putting together byte sequences. So very large array of stakeholders, different budgets, and on top of that, trying to use this commercial supply chain, which is adds a different type of system integrator complexity, to the mix. And then all of that is compounded by your CubeSat mission, your small sat missions are going on a rideshare, and the rocket is not gonna wait for you.
Chris Capon:And so what all of this does is it means that when you're doing the design and build, you have a firm launch date on the right, and there are inevitable slips in schedule. Things arrive in your lab late. You've got suppliers who delivered something out of spec. What do you do? And so what we continually see and saw was that, particularly software testing, got sort of put to the very right and right up against launch.
Chris Capon:Then sometimes even I've met companies who have not even built any flight software for the spacecraft. They've launched it, and the only thing it can do is accept flight software updates. And so a large reason because the people's missions were failing is because they didn't have good ways to quickly understand how exactly they would build their design and then to test it, test the flight software, and train operators not just to be able to operate the thing that they were building, but be able to operate when things don't go wrong. Because the reality for space operations is that the LEO environment let's let's put aside GEO for now, is, an interesting beast. It is both a very it is a predictable environment in some ways, but it also breaks things quite a lot.
Chris Capon:And so as an operator, you need to be prepared to achieve your mission goals when only half your spacecraft works. You have a couple thrusters fail, whether that's a design problem, an environmental problem, a supplier problem, doesn't matter. You still have to achieve those things. And so the problems that we saw and the gaps we saw in the industry is that the design tools were all about orbit optimization. Because the historic thing you had to do when you're bidding for a billion dollar mission was, you know, you were going to the moon or Mars, and the name of the game was orbit optimization.
Chris Capon:Then once you've got that billion dollar contract, you make a boutique simulation where you can model all the subsystems. You connect the hardware up, you know, and do all the testing that you would do. Companies simply don't have the time to build those custom simulators anymore, yet they still need to do all the testing that is so valuable to do with those system level models. And so the gap that we were really filling was making it as easy as possible for people as early as possible to build realistic simulations of their spacecraft all the way down to, you know, the nuts and bolts and flight software, integrate that into their operation stacks so that they could start testing and training, while using it to validate hardware as it came in and do your system level tests. So that was the first problem that we have been solving.
Chris Capon:And then what we've seen since then is that these companies I like to think of the space industry at the moment as going from a start up to a scale up. You've got a lot of companies now with a capability demonstrator, one to two satellites out there. They're partially working, maybe fully if they're lucky. But they're trying to go to 10 or a hundred spacecraft so they can bring these, you know, commercial capabilities online that can do things like manage air traffic management, explore minerals, save people from fires, all that good stuff. But as an operator, you've got things breaking on each of these spacecraft.
Chris Capon:You have to still complete the mission. And so taking that simulation architecture we provide and integrating it in with real data feeds so our models represent exactly what's going on, and then linking that up with I talked about new technologies. One thing what we're working on at the moment is connecting up a AI agents so that the agent is able to give you, as an operator, an understanding of what's going wrong on the spacecraft and recommend how you could actually, deploy those spacecraft even if they're kind of worn and torn or a little bit old, to still achieve their task in a in a reasonable way. But I think I I I got briefly away from your question there, which was I can't remember.
Tony Sewell:That's right. I I like how you I'm glad you got on to to AI because I was reading I was reading one of the blogs on your website, I really like the term about digital twins providing the safe to fail training environment for complex systems. And use the example of AI adding operations of physical systems with self driving. How do you see AI and machine learning transforming satellite operations over the next decade? And are your customers embracing it?
Tony Sewell:I'm also interested in what I'm asking a lot of questions here. I'm also of interested. What are the types of customers that are leaning into this now too?
Chris Capon:So I think the light bulb moment the world had for the interface that people want for managing large amounts of data was chatty bitty. You know, we've seen since then a whole range of different large language models deployed to help people understand their knowledge bases. Where I think the unique opportunity is in the world, which is still yet to be grasped, is using LLMs to manage your assets. And so you mentioned, the word digital twin there. I have a love hate relationship, with this word as as Rob knows or anyone who's talked to me knows, because I kind of feel like the term has lost meaning.
Chris Capon:Mhmm. To us, what a digital twin is a high fidelity model of a thing, which is being continuously updated by the data from the thing to represent a real system. And so that means in space, for example, you could have a single satellite or a whole constellation. All the data from those satellites and constellations is feeding in to that model, and that's when it becomes a dig digital twin, a living, breathing asset. And the reason why that's important is because I think in order for us to realize the opportunity of you know, imagine you're an operator of a fleet of systems, whether that be a fleet of cars or a fleet of satellites.
Chris Capon:Sort of talked about earlier that they wear and tear. You know? Tires, degrade. What if that operator of the fleet of cars could come in in the morning and type into the LLM, hey. Which cars are acting a bit weird at the moment?
Chris Capon:Which which should go in for their maintenance cycles? And I've got customer x and customer y trying to do these things today. Which cars should I give them? It's the it's the natural language of being able to talk to your knowledge bases, but also your assets where I think the the real power of these AI agents will come in, to managing large amounts of stuff. And so, you know, coming back to your core question, I think that in order for that to be possible, you need to have the digital twin to be the thing that's connected to that AI agent on the back end.
Chris Capon:Because without it, the agent is making decisions based on an idealized model of the thing you had when you first bought it. You know, your your one year old car doesn't behave the same as your ten year old car, same as your spacecraft. And so they kind of act as, a framework, a guardrail, for the agent to ask better what if questions. And so I think going forward, I see the the use of the of AI agents for fleet management, and intrinsically linked to the digital twin side of things and that bringing the actual value. So the reason why I think the word digital twin has lost a value in how people talk about it is because it's come to just mean a simulation
Tony Sewell:Right.
Chris Capon:Or a CAD model. That was never what it was about.
Tony Sewell:Yeah.
Chris Capon:It was about simulation meets data, and then being able but the missing piece to realize the value was how do you use it? And I think that these AI agents and LLMs are the way that you drive these these digital trends in the future to deliver value.
Tony Sewell:With the customers that you're working with, has this been what have been some of the challenges for them to adopt this type of this type of framework to operating? Has it been an integration and a business challenge for them to adopt this? And has this shaped the types of customers you go after?
Chris Capon:So when we started out, we had already experienced the integration challenge. Mhmm. The integration challenge, particularly in sort of a COTS world, when you're buying a bunch of parts off the shell a shelf to put together your Lego satellite, you become a system integrator, pretty much. Still doing some design stuff, but, really, that's what you are. And so integration and making our simulation architecture as easy as possible to to tie things into was a core focus for us because, yes, the challenge for our customers is, you know, I was in an interesting meeting the other day.
Chris Capon:We've been running a number of space cyber, training events, and so we were talking with this customer about running an activity for them. And the first question I normally get is, you know, this is great, but I have my own c two system, my own sort of command and control operator interfaces. Can I integrate these into your environment? And the answer needs to be yes because you wanna train people in a rep as as representative environment as possible. And so, yes, the the challenge has historically been how do we make it easy for customers to integrate with what we already have, or we help them integrate.
Chris Capon:So, typically, the way we've worked with our customers in the past, you know, as we're a, you know, smaller company starting out, is we work hand in hand with the com company because sometimes we don't have those integration pieces yet. And so through the process of working with them, we build the Lego blocks so that we could integrate with, say, a CCSDS comm standard. And now we have that block so that the next person we come to, we can say, hey. Look. We've already got that piece.
Chris Capon:You can either do it yourself or it's it's faster for us to do. But, no, the integration is always a challenge. Now
Rob Ruyak:Chris, can you say that acronym one more time?
Chris Capon:Oh, CCSDS. Don't ask me what it actually stands for. I would have to quickly Google it for you. It's a a comms standard, frequently in the space industry.
Rob Ruyak:So I I have a quick question on this. It's a little bit different, but obviously related. To me, it it sounds like if if a lot more businesses actually adopted this modeling simulation digital twin type capability, that maybe would build more transparency into all those stages where integration happens to actually operating and maintaining the quality of the satellite or the constellation or whatever the spacecraft is. This is just, I guess, but it seems like to me, maybe that would help with the insurance industry maybe entering this market more often than not now and seeing, hey, there's another way of actually quantifying risk associated with launching and operating a constellation. God knows it costs a lot of money.
Rob Ruyak:Sometimes there's lies at stake if it's for defense, now security purposes. So I don't know. I'm just wondering, it's fascinating to, as we interview and learn more from people like you, I think naturally there's going to be some interesting impacts to the market and the business that might create new entrants, might create more competition, it might make things more accessible and therefore might make more people want to join the workforce and participate. To me, it just seems like what you're doing is going to in effect, provide more transparency to understand the risk associated with this. Is that do you believe is that true?
Rob Ruyak:Or is
Chris Capon:that think that there is a desperate need for the industry and the supply chain to mature, to to be transparent, in some of these things. It's it's way more difficult than that, you know, in a practical sense. But on insurance specifically, you know, we have talked to insurance underwriters, space insurance underwriters, because they are struggling at the moment with the way the market is involved as well. Because, you know, coming back to what I said earlier, when you have a billion dollar satellite, you can afford a custom insurance plan. When you have a satellite that is a couple million dollars in value, then you can't.
Chris Capon:And so you need to have a standard insurance product. But with the failure rates like they are, the insurance companies, you know, can't afford that risk. And on top of that, if you're a constellation developer, you're less inclined to insure a single spacecraft and more the commercial capability. And so it's been interesting talking with the insurance sector who are exploring different ideas. For example, a satellite refill rate.
Chris Capon:So you would pay a certain premium. Say you've got a hundred spacecraft, and the premium covers the cost of putting up, say, one to two failures a year. And then if you have three failures, you lose. If you have less, then they win. But even with those sort of numbers, the the problem for them becomes, one, there's a transparency aspect in the way that operators behave.
Chris Capon:Did they operate with best practices to make sure that the spacecraft remained operational. And because the insurance company's ultimate business model is to charge more than they pay out. And so they need to be able to go, okay. Well, you did the right thing, and this was outside your control. At the moment, they just have to pay out.
Chris Capon:And so, you know, we talk to them about ideas where, if we can demonstrate with enough data that people who use our software and follow best practices using it will have missions less likely to fail, then they can offer lower premiums to the
Rob Ruyak:industry. Yep.
Tony Sewell:That's correct.
Chris Capon:These are standard things, but the the challenge is I don't think the industry is quite ready for that approach, and we need more data in able to in order to be able to say confidently to the insurers, yes. This this this will improve the the likelihood that the spacecraft won't fail, and therefore, you won't have to pay out your insurance policy. Just put me in a mixed feeling because I don't know if I wanna really help the insurers, with their with their business model of charging us lots of money and then not paying out when we need them, but also a separate conversation.
Tony Sewell:Yeah. It is I mean, it it's interesting, though, too, because, I mean, well, obviously, there's a there's a obviously, the insurers are there for financial benefit and to help businesses manage risk. But then when you start thinking about the the whole sustainability topic in space, And I was listening to an interview about a month ago with a CEO of a start up doing space operations management in Europe, she was talking about this from a sustainability perspective and commenting how a lot of the insurers that they are dealing with are really struggling to see how LEO is even going to be insurable, just given the practices that are going on in space now in that orbit.
Chris Capon:That's the answer. That's it's it's fundamentally, it's it's not insurable right now. Yeah. And it it's it's you know, I think it's a reflection of the state the industry is in and a lack of some status quo and norms and agreed norms of behavior and operation. And but there's a there's a broader question about how regulators should be, contributing to that, that problem because space infrastructure is increasingly being built into our everyday lives.
Chris Capon:You know? It's it it's it's one of those industries that works so well or most of the time that you never notice it's there. But if it's not there, you will notice.
Tony Sewell:Right. Yeah.
Chris Capon:You know, everyone uses their GPS to go and find some coffee in the morning these days.
Tony Sewell:Right. Yeah. No no one rings you and tells you you're doing a good job, but as soon as it as soon as it breaks down, like
Chris Capon:So, I mean, I think we're about to see a dramatic shift in the telco industry. Like, services like Starlink, I'm increasingly seeing adopted in the management even of Australian infrastructure. Friend of mine, she works for a water company in Canberra who has recently switched their IT network over to, a LEO data provider. So Wow. You know, it's the there's some interesting questions there around, critical infrastructure as well as, export dollars, because I think that we're gonna see the formation of global telco companies.
Chris Capon:And I I have a whole presentation I give on the future of space, and I think that the future of a country's national prosperity is gonna be predicated on its ability to generate revenue from this new type of land, which is LEO infrastructure, and there'll be the haves and have nots. Don't get me on that that soapbox.
Tony Sewell:It's mean, I'm glad yeah.
Chris Capon:It's it's a really interesting, industry to be in, but I think that coming back to the point I wanted to make, at the moment, when you launch a spacecraft, you have to do your shake and bake. You have to see if it's gonna break during launch from environmental loading. What about regulations to actually validate that your spacecraft is gonna work when it gets to orbit, that you've done the testing, and that you're not just launching debris? Because at the moment, my concern is that too many companies, the onus is not on the regulator at the moment to make sure that your business works, that your mission is gonna be successful. You're the onus is to make sure that there isn't a rocket explosion.
Chris Capon:That needs to change. I think I I think there need to be some requirements or changes in half the way we do regulation to to improve the state of the space industry and bring more quality control. You know, it's kind of I I I like to draw analogies with the early airline industry. Air traffic management and the air industry is heavily regulated. The reason is because there were some planes that crashed and killed people, and government stepped in and said, okay.
Chris Capon:This is unacceptable. People aren't dying at the moment because spacecraft don't work when they get there, But they could.
Tony Sewell:Yeah.
Chris Capon:And we need to be ahead of that curve.
Tony Sewell:Just one last question I wanted to ask, because I'm glad you brought up about national capability. As an Aussie talking to a who lives in The US, and I've been here fifteen years in the space industry, and changed a lot in the fifteen years that I've been over here in Australia, the space industry. How do you assess the state of the space industry in Australia at the moment? I know there's been a lot of consternation in the last couple of years with some policy changes at the federal level. But how do you see things progressing?
Tony Sewell:What are the things that you're really looking for to help build that capability?
Chris Capon:Yeah. Look. I think the the simple answer is that the talent is here, that the ambition is here, but the challenge we have is translating r and d into operational systems that generate revenue and solve problems for people. I think that we need, as a nation, more focus on solving problems for Australians to help them understand how it improves their lives so that they can then understand why the investment is valuable. Saying that, though, I don't think, you know, it's all doom and gloom.
Chris Capon:Think momentum is building. I think that there are companies like Skycraft, which is looking to solve real and valuable air traffic management needs. Fleet, mineral, resource exploration are doing some real things. Those those things are less tied to the the the average Australian experience, so it's harder to draw a direct link for the the voter. Because if I take my cynical look, the the goal here is to the reason why I'm focused on improving lives of Australians is so that they understand why when cost of living is tight and there's a housing crisis, why investing in space infrastructure not only makes sense but is essential because as a country, we are very large geographically with a small population density.
Chris Capon:So infrastructure provided from services provided from space are ideal for us because they cover large geographical areas, compared to the cost, of actually delivering that service. So I think if we can figure out a way to bridge that valley between demonstration to real capability, then Australia has an opportunity to lead in what I think of as sort of smart space infrastructure, particularly around the themes of of automation. Because in my view, the space industry in general is raise racing towards a automation bottleneck. There are a lot of companies putting amazing things in orbit, but let's take the global telcos. You know, how many constellations of three to 5,000 satellites can we support, and how are they gonna work together in a single environment?
Chris Capon:It's not gonna be manual. It'll be autonomous. And so I the question I ask is how are we gonna build more trust in that autonomous future of space? Because I just don't see it
Rob Ruyak:today. Well, since I have two Aussies here in front of me, and we're talking about Australia. I was reading that today, there's gonna be the first orbital launch of a vehicle.
Tony Sewell:It got scrubbed.
Chris Capon:It got scrubbed.
Rob Ruyak:But I but but I think I think our tomorrow is Friday, which is where Chris is No,
Tony Sewell:it's not. One of my friends, David, one of our mutual friends, Dave, he drove fourteen hours from Brisbane to Bowen A Day ago with his boys to to be there for it, and he's driving back today.
Rob Ruyak:It's But when is it rescheduled? Because I thought it it said Friday.
Tony Sewell:No. No? No.
Rob Ruyak:Okay. Well, this is not my point. Sorry. So my point was Sorry. Question here here's the most important question because you guys were talking about Australia and space and launching things into space from Australia.
Rob Ruyak:Apparently, what they were gonna launch on this rocket was a jar of Vegemite. So what I want to understand now that I have you both on call is what is up with Vegemite guys? I mean, why not launch a stuffed koala? Is it really that good?
Chris Capon:Very long way to get to vegemite. I don't know if you want to jump on that landmine, Tony. Look, all I can say is I'm a happy little vegemite, as bright as bright can be. For all the Australians out there, they can
Tony Sewell:Don't diss it. You watch these videos of Americans trying Vegemite, I don't know who is telling them to scoop it out of a scoop it of spoon in mouth. That's not yeah. It's all about me.
Rob Ruyak:We're these Americans are so dumb. I'm sorry.
Tony Sewell:What's wrong with credible thoughts?
Chris Capon:It's all about me.
Tony Sewell:My middle child, she will have breakfast. She has never lived in Australia. And when you give her a choice for breakfast, she has Vegemite or Primite. We have a Vegemite and Primite in the house. I'm a Primite guy.
Tony Sewell:I like Vegemite, but Primite is my preferred. She has it every day. I don't know how that's gotten on. But at least one of them has adopted it.
Rob Ruyak:I had to ask, guys. I'm sorry. I'm sorry. I think it's great. I think it was so funny, though.
Tony Sewell:Yeah. It was sorry to say that I I I was really disappointing, though. I know this is a big a big a big milestone for for Gilmore, and, hopefully, they can they can turn it around.
Rob Ruyak:Yeah. I hope I hope I mean, I I really do hope it is rescheduled. But just to finish that off, I mean, I've heard of Gilmore, obviously, it's a super interesting company. You got, I think 200 people, raised a bunch of money. And I think any company that gets this far where they can actually launch a spacecraft is Why
Chris Capon:is it an interesting company?
Rob Ruyak:I just think, I think any company where people are launching spacecraft, and solving those engineering problems and getting as far as being able to actually test it is pretty incredible, especially as a startup. Chris, you can tell me if I'm wrong. I mean, I haven't started a company, but I think the stresses of having investors trying to pull together engineering teams, hiring the right talent, and then everything you mentioned around the supply chain to me seems like a lot of things have to go right just to even get to the launch pad. So I think any company gets that far to me is is definitely, is fascinating.
Chris Capon:So take a counter opinion here, because I've talked about why I think what we need as a country in Australia is to demonstrate value. I think that developing a sovereign launch capability is valuable, but is it if if the money that had gone to Gilmore had gone putting up space capability that was helping us fight fires and manage infrastructure through floods and farm better. Would we have more money in the space industry now to actually then support these things? I think the problem I see is that how many space ports are being built in Australia? There's, like, six.
Chris Capon:It's just concrete slabs.
Rob Ruyak:Right.
Chris Capon:And it's it's safe, and it's easy to cut a ribbon for. But if I wanted to be, you know, pretty brutal. But I think the problem with the space industry in Australia is that we've been focused on the things that make us look like we're a spacefaring country and not actually delivering the capability that improves like, that delivers the value that we talk about. Now so I it it
Rob Ruyak:I'm not saying any different, though? Do you think that's any different than Why
Chris Capon:any other collapse? It's, like, literally a couple hours flight away.
Rob Ruyak:Yep.
Chris Capon:Like, it's a there I think there's space in the world for, like, maybe six launch providers. SpaceX and and Rocket Labs are two of them. They've they've got the they've got the opportunity. There will always be software and launch capability companies spread across the world. There's I've lost count of how many there are.
Chris Capon:I view them as as dual use capabilities that can be spun into software and missile programs. That's fine. I get the defense application. That's a separate discussion we can have. But if Australia was being pragmatic about its investment, then why not work with our ANZAC partner to launch with Rocket Labs and launch more stuff?
Chris Capon:Do more things. So that'll that'll probably get me in trouble with some people.
Tony Sewell:No. I love I love a little bit of spice to to finish up the up the episode. Well, we're going to definitely have to cut this into the promo because this will get people to
Rob Ruyak:watch it. Yeah. Totally. Well, can I say one more thing? And again, not all this is going to be in the final episode because it's a good conversation.
Rob Ruyak:But one of the things that Tony and I talked about when we were talking about some of the news in the industry over the last couple of weeks, there was this whole article about the impact of tariffs on companies that are building a spacecraft, let's say in Canada, they have to ship it to The US to be launched on a spacecraft or excuse me, a SpaceX vehicle. That could be a significant barrier to most startups, right? I mean, if it's, let's say it's 25% duty, you know, to actually get your satellite launched, and all it's doing is passing a border, right? I mean, that's all it's doing. So I don't know, it'll be interesting maybe is the word to see what happens over the months and years around how collaborative and how not collaborative certain countries are where they have launch capability and what that does as a consequence.
Rob Ruyak:Maybe there will be more launch providers that are sovereign in country, for example. It could be an economic reason, right?
Chris Capon:Takes us back to the reason why regulation of space is hard because if the launch provider, the nation state you're launching from is the the one that's imposing the regulation or additional costs, you got regulation shopping. And so, you know, you're right. I think that if there is an additional cost associated with launching from The US as an example, then that will be factored into the the the calculus of where am I gonna launch from, which could open up more launch. Like, maybe it would be a benefit for Australia, you know, coming back to to Right. Why you would launch from here.
Chris Capon:Although I I would say that Australia is a long way from anywhere. Yeah. It's gonna cost you
Tony Sewell:a lot more than 25% to get everything down there.
Chris Capon:One of the problems we had when we were building our own satellites was I hadn't even thought about this. How do you ship a satellite? Like, I I kid you not, and maybe this is a good little story to end on. We bought it a business class seat on
Rob Ruyak:a plane.
Chris Capon:I I I kid you not, and it just sat there, and you get a little little special customs duty thing, from the government saying this is a satellite when you're putting it through security. Because I can tell you what, putting it through the X-ray machine
Tony Sewell:is not Jeez. Yeah.
Chris Capon:Something you wanna do.
Tony Sewell:Yeah.
Chris Capon:But it's the the logistics of of launch and and the distance Australia is from things is a real it is an argument, for Sovereign Launch. I'm not completely against Sovereign Launch, by the way, but my my point is that we have to be pragmatic in our approaches. And so there is a definite shipping cost. There is a risk associated with it, and there are some unique values that Australia has for launching, that advocate for why you should do it here. And I do think that the there is a lot of uncertainty geopolitically at the moment and and in what policies are gonna be.
Chris Capon:Thankfully, we do software, though. So
Rob Ruyak:Right.
Chris Capon:We don't have to worry about shipping hardware, and we have also established a a US entity. So, our our work gets done in The US. So, it's it's something that I'm I'm thinking about less of, but it is definitely something that I think about for the customers that I work with and and and how we incorporate that, for example, into the training that we've been doing.
Rob Ruyak:That's great. Yeah. It's it's all very super interesting. Okay, so Chris, this has been amazing. Thank you so much for spending time with us.
Rob Ruyak:With the time difference and everything, we want to end with one kind of interesting, maybe fun question to ask you that might tell the audience a little bit more about who you are as a person. Maybe, maybe not. So if you could rename any planet in the solar system, which one would it be? And what would the new name for it be?
Chris Capon:I I name I think I I rename Uranus. And, look, the reason is obvious. It's been the butt of far too many jokes, including that one. And it's a distraction from what is genuinely a really fascinating ice giant with a unique sideways rotation. And, frankly, it deserves some better PR.
Chris Capon:What would I name it to? I have pretty much no idea. I know. Well, while I'm at it, I can name it after myself. We'll go to the Cape on planet.
Chris Capon:I can it I just resonate with that ice giant. It's Man,
Tony Sewell:that's such a good answer. And I think this that I think that that little clip has actually made it to the top of the Twitter feed now.
Rob Ruyak:Percent. Not even a question.
Tony Sewell:I love Chris, this been such a great discussion. And honestly, we probably could have spent another hour, at least another hour talking about this, covered some really cool topics. So I really appreciate your time. If people want to learn more about you and Nominal Systems, where can people find you?
Chris Capon:Look, the the easiest way you can reach out to me on LinkedIn. My handle is my name, Christopher Capon. Otherwise, you can, jump over to our website at nominalcyst.com or drop me a message at chrisnominalsys dot com. I'm just happy to talk about space and looking forward to figuring out how we can make an industry work.
Tony Sewell:That's brilliant. And we'll we'll also link for our our listeners in the show notes so that you can find Chris and Nominal Systems. All right. Well, thanks everyone for joining us for another episode. If you like what you're hearing, because Rob and I are having so much fun doing this, But if you like what you're hearing, we'd love to hear from you.
Tony Sewell:We have an email address too. It's infospaceinsiders. Show. And you can also reach out to us on LinkedIn. But please follow us.
Tony Sewell:We'd love to get it. We had first review. It was pretty good this week, Rob. So we'd love to get some reviews too. So thanks for joining us, and we'll look forward to seeing you next time.