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23 November 2021

One Giant Leap for Humankind?

On a warm afternoon in a small Texas town 500 miles west of Dallas, the residents of Van Horn were going about their daily business. For one man, this was a momentous day. Jeff Bezos, founder of Amazon, was the second businessman that month to take flight into space. Only a fortnight earlier, the British entrepreneur Richard Branson made his own historic strides into the final frontier.
 
Both flights carried a lucky few upon them, ranging from flight crew to siblings and auction winners, making the journey an exclusive experience for those involved. After a year in which the world was largely unable to travel abroad for their holiday, it seems two of our planet’s billionaires were not content with a staycation, and instead jetted off into the stars. Such space tourism may be limited to those with deep pockets, but the ability for privately funded individuals to take this leap has profound ramifications for us mere mortals left on earth.
 
Space travel is nothing new. Now a multi-generational aspiration, the desire to leave earth stems back to mid-20th century Cold War tensions, where the world’s largest superpowers battled it out to become not just rulers of the planet, but beyond as well (See: Spacenomics). Since then, satellites have provided the backbone of global communications and, with the advent of a rapidly growing automated world, space technology seems to hold the key to unlock the economic growth of the next century.
 
But with economic growth comes an environmental cost. Burning rocket fuel and filling our outer atmosphere with metal boxes seems to be at odds with the strides we are making to reduce pollutants here on earth. Mr Bezos’s Blue Origin space company promises to “build a road to space so our children can build the future”. Very exciting, but what does that mean?
 
I’ll leave the detail to my colleagues in the linked pages, but simply put, to address the world’s biggest challenges, we must first use the vantage of space to gain a view of our actions and their consequences (See: Fruitless Fame or Fuelling Change?). In a world so depleted of resource, how will we keep finding places to farm, mine, or fish? Not least, technological milestones developed for space have offered new innovations for humankind.
 
With the industry in its relative infancy, we find ourselves in a narrow investment universe. With mostly private and early-stage companies, space tourism remains in the science fiction section of the stock markets for now. Instead, it is the ancillary technologies that will continue to take the lion’s share of this untapped market (See: Seraphim Space Investment Trust). Data analytics, communications and navigation companies are poised to benefit from a more connected and automated world. Drones will need an air traffic controller, autonomous cars will need a driver, and rockets will need to become cheaper to sustain the expected demand in satellite launches.
 
There are some revolutionary technologies out there, but the appetite of governments to fund agencies such as NASA and the ESA is waning under political pressure. Funding must come from investors to push these boundaries. We might not be joining the billionaires in the stars just yet, but we can take part.
 
This article was taken from the September 2021 Market Insight. To subscribe to our investment publications, please visit www.redmayne.co.uk/publications.
 
One Giant Leap for Humankind?
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