By DAVE MICHAELS
Special Contributor to Silicon Hills News
The Technology Entrepreneurship Society (TES) and 1 Semester Startup (1SS) Thursday hosted its Fall Finale, inviting Tom Pickens, President and CEO of Astrotech Corp., to speak on the space industry and his company.
TES President Aaron Sanchez said that TES’s mission is to plant the seed of entrepreneurship and provide crucial resources through their vast network to catalyze projects and startups. By exposing members, mainly technology students, to successful entrepreneurs and hands on activities such as hackathons, the hope is that students will see it’s possible to take an idea to market and consider entrepreneurship as a viable alternative to the more established route of a corporate job.
More than 100 students attended the event, which featured UT Professor of Innovation Bob Metcalfe interviewing Pickens on stage at the UT Student Activity Center’s auditorium.
Astrotech’s core business is testing and preparing satellites for launch, serving as an intermediary between satellite owners and launch service providers at Cape Canaveral (FL) and Vandenberg (CA). Their service is critical, because once a satellite’s in space, there’s no way to get it back for repairs. Astrotech’s jobs span working with the satellite team to run through all functions the satellite will need to perform, mounting the satellite to a platform that fits the nosecone of the rocket, and finally delivering to the launch pad. Their ability to work quickly on mission critical and complex tasks makes them the go-to provider, as confirmed by their holding 98 percent of the market. According to Pickens, “We only had them for 13 to 14 weeks. So all the teams come in that had been working on that satellite for five to eight years. Some of those things are really complex.”
This business brings in approximately $25 million in revenue ($10 million in profit). And though they have cornered the market, the lack of growth is pushing toward diversification.
Astrotech has been operating since 1984 under the name SpaceHab, but when a shuttle carrying an Astrotech client’s payload crashed, there was subsequent legal action against NASA that caused some tension in the partnership. Ultimately they were unable to pursue legal action, and this, coupled with other debt threatened to sink the company. Pickens joined the company in 2007 and to keep the company afloat took strong action, convincing existing board members to leave, as well as negotiating debt to equity agreements to keep the creditors at bay and layoffs. The company currently employs 72 and has facilities in Florida, California, and Houston (R&D), with its headquarters in Austin (midpoint between FL and CA). Pickens decided on the name change to Astrotech to mend fences with NASA.
Astrotech had a role with the International Space Station (ISS) the biggest component of their NASA relationship for a long time. However, As U.S. involvement in ISS has been discontinued, the nature of the relationship has evolved. Astrotech stills counts NASA as a customer, servicing their satellites for launch and delivered their mass spectrometer for use (see First Detect below). They are also partnering on the ISS research side to continue the work for Astrogenetix, its subsidiary.
The growth of Astrotech is being built from past work and research. Astrotech worked with NASA on the microgravity lab in the ISS, developing the module to serve as the lab. This work has built a strong platform to harvest new ideas for development, the most prominent example being their wholly subsidiary, Astrogenetix.
Astrogenetix came from Astrotech’s work on the International Space Station where they developed a module for running a variety of experiments (over 1,500) in microgravity. The body of work that was done is a trove of possible application. A key finding that they are moving on is the discovery that some bacteria cultures grow much more in microgravity than on earth. The application is allowing for greatly improved efficiency of discovering disease biomarkers that map a path to a cure for different diseases. Currently, they are working on Salmonella and Methicilin-Resistant Staphylococcus Aureus (“MRSA”). Drug companies that are doing similar work can spend upwards of $20 million so with a much lower cost method, Astrogenetix would have a huge market for a variety of different diseases needing a path to cure.
As Astrotech’s work with ISS wrapped up, the company realized it needed to diversify and they drew on their expertise to start developing a highly differentiated mass spectrometer. First Detect is another wholly owned subsidiary that developed a low power, miniature mass spectrometer which can detect a variety of substances through isolating individual molecules and identifying their unique signatures.
It improves the accuracy for current solutions which in the most extreme cases could save lives, not to mention lower cost of use and portability.
“I’m seeing a pretty big market size,” Pickens said. “If you go into food processing, if you go into TSA, you go into semiconductors, oil and gas, the list goes on and on, all kinds of manufacturing. I’m seeing a multi-billion dollar market.”