What does it take to build a space company from the ground up? Jordan Noone, co-founder and former chief technology officer (CTO) of Relativity Space, has some idea. At 22, the rocket scientist left his position as In-Space Propulsion Development Engineer at SpaceX to establish a startup that went on to raise over $1.3 billion and launch the first 3D printed rocket from Earth.
In 2020, Noone stepped down from his position as founding CTO to become an Executive Advisor. With a thirst for building something new once more, he created Embedded Ventures with his co-founder, Jenna Bryant. With a focus on early-stage deep technology, the company has invested in space, digital engineering, and advanced manufacturing. Included in this last category was the $5 million funding of Chromatic 3D Materials, which developed a unique process for 3D printing elastomeric materials.
To learn more about Embedded Ventures, we spoke to Noone, who was able to tell us more about the world of space, capital investment, and how to combine the two.
“I was CTO of Relativity Space for the first five years of the company, and, as the company grew and the printers hit production readiness, I was craving going back to square one again. I really enjoyed that zero-to-one moment for the company, of developing the printers and the early years,” Noone began. “That led me down a path where Jenna Bryant had seen my inclination to supporting founders. She [thought that that would be ideal for] a partner and a fund because I could stay at that zero-to-one evaluation stage in perpetuity.”
To Space and Beyond
With Embedded Ventures’ five portfolio companies so far, a unifying element has been space technology, broadly speaking. However, the investments branch out from that central feature in that space companies can’t exist in the current marketplace without other advanced technologies.
“We do go adjacent to the space infrastructure side, as far as going into the advanced manufacturing and digital engineering—essentially software for hardware.” Noone said. “You can’t make the world’s most complex hardware without the world’s most advanced design tools and the world’s most advanced manufacturing tools. So, it is a very synergetic portfolio for our investors and limited partners. Then, it’s helpful for them because there’s less consolidated risk. There are some funds that are solely space assets and that has amazing upside potential but there’s also a lot of consolidated risk.”
Unlike other VC managers, Noone didn’t come from a finance background, meaning that much of his experience stems from building up what has become one of the 3D printing industry’s few unicorns. According to the fund manager, there are surprisingly few VCs that actually have experience in both building hardware and growing their own companies. This is one area that separates Embedded from the typical Silicon Valley crowd.
“You see a lot of software founders that become partners at funds or start funds. You don’t see hardware founders. Something that I found to be fairly surprising was not only the lack of experience base, but often the lack of willingness to learn within the investment sector,” Noone said. “We’re quite different in that way. We have legitimate operator experience and founder experience. That’s attractive to our investors because there are people in decision-making seats that have built similar types of companies. There’s an approachability to someone who’s built a space company before. When you ask someone to be your first investor, do you want to reach out to the person that’s had an MBA and a finance degree and been doing investment and spreadsheet level assumptions about companies for 50 years or do you want to reach out to someone who recently built a unicorn in a similar sector?”
Alongside Relativity Co-founder Tim Ellis, Noone was involved in the fundraising process for the firm, which took in investments from such backers as Baillie Gifford, Blackrock, BOND, Coatue, Fidelity, General Catalyst, ICONIQ Capital, K5 Global, Mark Cuban, Playground Global, Social Capital, Tiger Global, Tribe Capital, Y Combinator. This meant data curation, investor presentations, and pitching to these groups to get to the point that Relativity could build the world’s largest metal 3D printer.
“I had a good amount of exposure to the fundraising side of the table and some of the bi-directional process there. The part that I had to learn on the fund side was in the area of fundraising what is attractive to fund investors and what they are looking for. How do you market a fund and a portfolio to them? It’s a very different process to raise as a fund than it is to raise as a startup,” Noone said.
Fortunately, Noone and Bryant have established networks from their prior endeavors. Bryant, for instance, was a partner at Riot Ventures, which backed Desktop Metal. In turn, a number of Embedded’s earliest backers have come from their pre-Embedded activities.
“We started Relativity when I was 22, so they essentially saw me grow up professionally through the Relativity experience and that put me in a trusted position with them when it came to being a shepherd. Not only of Relativity as an operator, but a shepherd of capital as the fund manager for them. And, as we expanded, we reached bigger institutions and bigger fundraising amounts. There are a lot more stringent checklists and diligence processes that fund investors look at.”
Just as a startup must demonstrate to its investors that it can scale and take on more complex operations, a VC fund has to prove its ability to manage increasing amounts of capital.
“It has involved building a track record for us on the investment side. Some of our earliest deals are showing very good returns, very good multiples now, but it took time to get there. Those companies don’t grow overnight. In the meantime, it involves supporting those companies, helping them grow, and helping them convey that to the investment market in a way that tells the cohesive story. And learning from that gives an investor confidence that we can manage more capital in the future.”
The Central Role of 3D Printing in New Space
Through his work with Relativity, Noone has an understanding that software and hardware are increasingly symbiotic, with the latter now catching up to the former with new digital fabrication techniques. Nothing demonstrates this more than the overall goal of Relativity Space.
“Space X just started flying the Falcon 9 10 years ago. Today, there’s a whole slew of commercial companies, both in launch and in other areas built on top of launches. What is now going on is consolidation, or really a duke-out between the smaller launch companies, while SpaceX is thriving. There’s a question of, ‘where does everyone else land within the market?’”
Since its inception, AM has been critical to the mission of Noone’s former company, Relativity Space. In order to keep up with the pace of innovation necessary to compete with the likes of SpaceX, it’s necessary to be able to iterate as quickly as possible. And if a space company is going to go directly from design to production, there is no better way than 3D printing.
“Relativity, with its 3D printing approach, has been positioned since the beginning to essentially catch up to SpaceX. That’s the thesis of the printing tech: if you can have a more modern, digital set of infrastructure, you can iterate at the speed of software instead of the speed of hardware. That’s what allows Relativity to have that catch-up mechanism. SpaceX is in such a predominant position in the market today, that for companies that don’t have the ability to reach fully reusable launch economics, it is unlikely for them to be competitive on market share with SpaceX. And there’s not a good outlook there. Relativity is essentially the only other company that’s in a strong position to compete there by leveraging 3D printing.”
Perhaps more important to Relativity’s mission than AM itself is flexibility. The company has expanded from using 3D printing alone to produce its launch vehicles to combined sheet metal with secondary features added onto the base metal structure. This both lowers the cost of the rocket, while maintaining the benefits of 3D printing.
Now, Embedded continues to see the value in digital manufacturing, leading it to invest in Chromatic 3D Materials. Elastomers are comparatively rare in AM due to the lack of hardware capable of printing them. While there are a few silicone 3D printing options, the industry is more or less left with a few varieties of thermoplastic polyurethane, typically melted out of an extrusion head or fused in a powder bed process. These high temperatures, in turn, cause these materials to lose some of their desired properties. However, because Chromatic’s RX-AM relies on chemical reactions within the print head to deposit elastomers, the technology is able to achieve industrial-strength elastomeric parts.
“There hasn’t been the fulfillment of that promise to break through to replace industrial manufacturing with 3D printing. It’s useful for prototypes and one-off spare parts, but not industrial applications. And that’s where Chromatic has a huge edge because in traditional plastic printing, you’re melting and fusing,” Noone said. “It involves a level of heat that breaks down high-quality polymers. Chromatic is actually controlling the reaction and forming the polymers in the printhead, which lets them achieve industrial-grade properties that can even be varied in a very controlled manner.”
Space and Regulations
Other companies Embedded has invested in include Inversion Space, which is designing low-cost re-entry capsules, as well as Skyryse, dedicated to standardized flight automation technology, and Slingshot Aerospace, focused on monitoring, simulating, and optimizing space systems. There’s also KittyCAD, a developer of hardware design APIs to make the creation of hardware as simple as designing games and websites.
Given the critical areas in which some of these startups work, specifically space and defense, it’s worth noting the need to be able to navigate government bodies that regulate these sectors. Fortunately, Noone has experience there, too. And it’s not just limited to 3D printing enormous rockets.
“My government affairs work started back in college. I was running USC’s Rocket Propulsion. Lab, where I led what would become the first student group to fly a rocket to space. The biggest constraint for us was the regulatory side—getting the FAA and the Bureau of Land Management to agree on jurisdiction for what was regulated by whom at takeoff and landing. I was 19 when we got that first license and there is still a lot of interfacing with the same people at the FAA that we work with for our portfolio today and that Relativity works with on launch licenses. It’s a surprisingly small world.”
According to Noone, this background in government affairs and business development is crucial to the success of many Embedded companies. This extends beyond pure regulations to actually opening up new business opportunities for the startups in the VC’s portfolio.
This will continue to be important to the firm as it invests in additional businesses. Embedded is already looking into new areas, such as the future of GPS, space sensing, and satellite tracking. We’re not privy to what exactly will come next for the VC, but we expect future advanced manufacturing techniques to play a role.
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