Thursday, December 5, 2024

The Startup Nation in Space – Israel’s Equation for the Space Ecosystem 

Shelli Brunswick is the chief operating officer of the Space Foundation.

It was January 2003, and Israeli Air Force Col. Ilan Ramon was about to make history as the first Israeli in space. He would take a ride on NASA’s Columbia space shuttle for a nearly 16-day science mission in orbit, and as he spoke to reporters before his departure, he said, “The route to the target is more important than the target. We are going to go for the target, but we enjoy the route as well.”

On Feb. 1, 2003, STS-107 ended in tragedy, and Col. Ramon joined history. His words, however, echo, and in looking at the Israeli space ecosystem today, we can see them endure. In the tale of Israel’s trajectory in space, the targets aren’t the story. It’s how Israel is getting to them that sets the nation apart in its concerted effort to maintain and grow a leading role in the global space community. 

To be sure, Israel’s achievements in space are notable. It was the fourth nation to reach the Moon (and the first to do so with a private spacecraft, SpaceIL’s Beresheet mission). Israel was the eighth country to realize domestic end-to-end satellite capabilities, from planning and building to launch and operation. And in 2022, retired Israeli Air Force Col. Eytan Stibbe (who once flew an F-16 under the command of Ilan Ramon) joined the first all-private crewed mission to the International Space Station (ISS).

These and other Israeli endeavors are remarkable in Earth’s space history, particularly for a country of 8,000 square miles, fewer than 10 million residents, and relatively scarce natural resources. What is the equation of stakeholders, investments and activities that has allowed a nation only 75 years old to take such a leading role in space?

Government as an Enabler 

In the beginning, the Israel Space Agency (ISA) was founded to lead and coordinate activities of the country’s civilian space program. In 1983, space activities were driven largely by defense and national security needs on the one hand and science and R&D ambitions on the other. It was another era, when large national space programs in a few bold nations set the tone for what humanity could do in space. 

“Go back even just 15 years, it was not the New Space era,” said Uri Oron, ISA’s director general. “What has changed is the understanding that space is open for business, and the private sector must go in. What we are trying to do in the last couple years is to build the right ecosystem to make it flourish.”

There are routes that lead to this target. A significant part of it is the government support, provision and funding for enabling space infrastructure. Oron characterized infrastructure as government-founded or -funded scientific and engineering facilities for startups, physical infrastructure for space access, and sponsored accelerators that spread space awareness among entrepreneurs and nurture their participation in Israel’s space ecosystem. 

Part of this effort is supported by ISA’s plan to spend $180 million in the coming years to boost private sector development. The targets are ambitious, including doubling the number of Israeli space companies, raising the space industry workforce to 10,000 people, encouraging more space researchers in the academic realm, and driving Israel’s leadership in the global space community. Among government investments to enable ecosystem growth, in January 2022, ISA (with the Israel Innovation Authority and the Ministry of Innovation, Science and Technology) awarded nearly $6 million to 11 Israeli startups to develop space technologies and fund a percentage of R&D costs. 

There is also the matter of connecting government demand with private sector capabilities. Giving new businesses access to a government customer helps fuel and sustain growing companies as they develop intellectual property and seek opportunities in the space market or adjacent markets. Israel, like many other spacefaring nations, is still working to facilitate this essential component of a growing space economy.

“We need to use our understanding of the capabilities and potential of space to bring value to other government entities,” said Oron. “In most cases, government will probably be the first client of many space companies. It must not be the last client, but it could be the first. Israel is not there yet in terms of government demand driving private sector growth. It’s much more of a process of connection between entities. We already started that. We have a list of more than 25 use cases brought by government entities seeking data from space to solve those issues. We are getting very close.”

Entrepreneurs Who Wrestle with Space

The 2009 bestseller, Start-up Nation: The Story of Israel’s Economic Miracle, explored the reasons for Israel’s strong economic growth, which persists today as the nation enjoys economic expansion exceeding many developed countries. The interesting topic aside, the book’s title has taken hold as a colloquial and endearing moniker for the state itself. In the space ecosystem, there are numerous factors that are clearing the way for growing space businesses in a ways that capitalizes on Israel’s human capital and industrial strengths. 

While Israel does enjoy a nearly complete space value chain (with the exception of human spaceflight), it has particular strengths in the areas of satellite development and operation, communication services, and remote sensing. But Israel’s private space sector is not simply a collection of companies working with satellites to satisfy a domestic demand. It is more nuanced and global.

“To scale and be the New Space nation, we need a global market,” said Noga Yaari, vice president of ecosystem development at the early-stage venture fund Earth & Beyond Ventures. “Most of our industries inherently lean on exportation because our national market has limited scope. If a startup wants to scale, it needs international customers, hence, their target market must unequivocally extend beyond Israel’s borders.”

Earth & Beyond Ventures has raised $125 million to invest in Israeli deep tech startups with conventional applications on Earth and in space. While the technologies the fund seeks to support are not exclusive to space applications, they are areas where Israel already enjoys a strong technology heritage and capabilities, such as semiconductors, robotics and quantum computing. Yaari noted that Israel’s strongest competitive advantages in space are unlikely to be found in a breakaway launch provider or transformative spacecraft. 

“We might not see the next SpaceX emerge from Israel,” she said. “But it’s conceivable that tier 1 and tier 2 providers will originate here. Israeli startups can become companies that other larger space companies invest in or buy. For example, a startup that developed a sensor for the automotive industry, such technology could find applications across various industries. I don’t think Israel will necessarily excel in one specific technology, but instead, Israel’s strength might lie in developing diverse foundational technology components.”

This concept of space adjacency works in two directions. Companies that primarily operate in one market can find opportunity in the space market, but by that same token, space companies can find opportunity in adjacent markets. Take the Israeli startup Planet Watchers, which provides remote sensing crop monitoring and analysis for the crop insurance industry in North America. It is a perfect example of how the Israeli commercial space sector is growing: an Israeli company selling space-derived solutions to an adjacent market in another region. 

Looking across trends in business and talent retention in the global space ecosystem, one wonders whether Israel will encounter a familiar challenge in retaining space talent and commercial space companies. It is a shared reality for many countries that the best talent and businesses will gravitate toward the largest space markets and broadest wealth of professional opportunities (which, for better or worse, often means moving to the United States). Does this threat of talent and business flight exist for Israel? People interviewed for this article did not think so.

“We love our country, and maybe that’s the main thing,” said Yaari. “We are a startup nation, and the broader tech industry is very strong and full of opportunities. In 2023, you can work in Israel for an American company, or you can work for an Israeli company with global customers. You are close to your home, but you have a global network.”

An enduring trend of building businesses and careers at home may also owe to a national culture.

“It is not just that we are the startup nation,” said Dr. Shimrit Maman, senior scientist and director for the Earth and Planetary Image Facility at Ben-Gurion University of the Negev. “It is how we are encouraged to think. We nurture not only innovation but also creative problem solving. Combine that with courage, you get a lot of great results. Some people will say it is our Israeli chutzpah. It is the way we are brought up. Place that together with historical reasons for a very diverse country, and that yields a lot of creativity. Being Israeli is being something different.” 

Lift Up Your Eyes and Look to the Heavens

Skilled, passionate talent is the fuel for any space ecosystem. Brilliant minds are cultivated in the classroom, and with science, technology, engineering and mathematics (STEM) fields, Israel’s education trends stand out. In recent years, the percentage of Israeli college students enrolling in computer science, math, and engineering degrees has increased dramatically, with a corresponding decrease in students pursuing a degree in the humanities.

One area of focus that is particularly challenging for spacefaring nations is promoting academic access, interest and success irrespective of gender. In many countries, educational attainment for girls and women in STEM is a stubborn challenge resulting from a variety of historical and social factors. In Israel, however, women are beating averages per the Organisation for Economic Co-operation and Development (OECD). Israeli women are more likely than men to graduate from upper secondary general programs. Nearly 60% of 25-34 year-old women have tertiary qualification, and while gender parity in STEM is not yet even, Israeli women still work in engineering, manufacturing and information technology fields at a rate that significantly exceeds the OECD average.

“Growing up in Israel, as a woman, you have the sense that you are Wonder Woman,” said Dr. Maman. “If you ask every girl, ‘Are you able to be that?’ She would say, ‘Yes!’ But if you examine the statistics, the numbers are still too low. We have that problem also in the space sector, and to encourage a solution, we are dealing with it on all levels.” 

On an international level, Dr. Maman is a mentor in the UN Office for Outer Space Affairs Space4Women Network, and at home, she is a founding board member of WiSpace, an Israeli organization focused on promoting gender equity in the Israeli space community. WiSpace provides targeted mentoring and networking for Israeli women in the space sector and related fields. Seeing great success, Dr. Maman also created She Space, an educational project from the Ben-Gurion University of the Negev that exposes high school-age girls to STEM subjects and encourages them to explore those fields throughout their education. Today, the program is offered not just for Israeli students but for girls around the world, and it received the Excellence in 3G Diversity Award at the 72nd International Astronautical Congress. 

Interestingly, both WiSpace and She Space were developed with the support of the ISA, showing how the agency’s “government as an enabler” philosophy extends beyond business growth and into education and talent development. Other organizations are driving space and STEM interest for even younger students. 

“For kids in kindergarten, the things they like the most are space, dinosaurs and princesses,” said Lior Ron, vice president for education and development at the Ramon Foundation. “The Ramon Foundation programs cover the full educational range, from kindergarten all the way to high school. By exposing kindergarten kids to space, they need to learn science, conduct experiments, and learn about notions such as Earth, gravity, and microgravity. When they get to school, they are not that afraid of it, and it lowers the barriers to what they can achieve and what they think they can achieve.”  

The Ramon Foundation offers a variety of programs to stimulate space access and opportunity for students and young professionals. One program is the Ramon SpaceLab, which guides middle school students to develop and design an experiment that could be launched and conducted on the ISS. The program finals are judged by a panel of space leaders from Israel and around the world, and each year, the three winning experiments are sent to space. To date, Ramon SpaceLab students have sent 28 experiments to the ISS. As we have seen in some of the experiential labs offered at our own Space Foundation Discovery Center, hands-on learning experiences are the kind of innovative programming that can set a young person on a path to lifelong learning and equip them with the knowledge and confidence to find their place in the global space community. 

“The most amazing thing is that half of our students are girls,” said Ron. “Because we do this in a different pedagogy from what they are used to in class, it brings the girls to these projects. While these girls may doubt their ability to shine in the STEM areas, we witness them take part and lead some of our most successful projects. Our ability to truly help them maximize their potential is a huge pride of ours and a real privilege.”  

The many pieces of Israel’s space ecosystem come together in ways that are at once familiar and unique. The nation has a cohesive vision for its future in space, and while its goals are both ambitious and attainable, as Ilan Ramon said, how the startup nation gets there is the most important part.

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