Chronicles of a Would-Be
Space Entrepreneur

By Steve Bartlett

Note: Your humble correspondent has recently left “regular” employment and ventured into the murky waters of private space business, where he hopes to make his fortune, do some really cool things, and move us all a little closer to space.

The Prequel

Back in the late ’80s and early ’90s, I was a young, single aerospace engineer with more money than sense. My co-workers and I were making pretty good salaries and most of us hadn’t yet figured out what to do with our “surplus funds”. As it turned out, there were people out there who were only too willing to help us with our little problem: stock brokers.

One day at work, I got an unsolicited call from a broker who’d gotten my name from someone else. We talked, and I with dollar signs in my eyes did a little research and decided that maybe I could make some decent money at it. I’d gotten the investing bug.

So, my broker would occasionally call me up, make some stock recommendations, and I’d do some online research on the companies and decide whether to buy or not. Well it turned out that that broker was pretty good at his job and I started bringing in a fair amount of extra money every month from his stock picks. I was a happy man.

But all good things come to an end. In this case, my broker with the good picking sense moved on to some other company and I lost track of him. The brokerage house assigned another broker to me, one who wasn’t so experienced and who usually pushed what the brokerage house wanted to move. Unfortunately, most of what he was pushing was junk and I, being a fool for listening to him, ended up losing a fair amount of money on his picks. I was frustrated with his bad selections but I was still convinced that there was money to be made in the market.

About that time, I was just getting actively involved in the space activist movement and I started reading about investment opportunities in space companies. Another space activist with some business savvy, Alex Howerton, was publishing a magazine, Space Available,which described all of these great companies that were going to help move us into space and make us rich.

This was the time when new communications satellite constellations were being proposed, new rockets were being flown, and it looked like reusable launch vehicles were just around the corner. Venture capital dollars flowed freely, and private and institutional investors were jumping on the small- and mid-cap investment bandwagon like never before. It looked like we’d all become wealthy and turn ourselves into junior D.D. Harrimans from the Robert Heinlein novel, The Man Who Sold The Moon.

I invested heavily into a few companies that looked like they had a great deal of promise. Two of these in particular appeared to offer excellent opportunities. One was a satellite builder and operator that had just become an independent company and had a large stockpile of cash available. Its management was promoting a concept for a satellite phone constellation that would provide worldwide communications in just a few years. The other company was a small launch vehicle and satellite builder that was doing gangbusters business and had its hands in a variety of different space-related programs.

And for a while, both companies were doing great. Their stock prices were going up and up and up. They were building and flying space hardware as fast as they could make it. They had large backlogs of orders from commercial and government customers. And it looked like they both had pretty solid business plans. Their stock prices were increasing by three, four, five times what they’d sold for just a few months prior. So I, like a lot of investors, got greedy and held onto my stocks, expecting to get embarrassingly rich off of these companies. If only I’d used my good sense and gotten out when their stock prices reached my personal targets!

But I didn’t. And soon the bad news was arriving in spades: the satellite builder’s phone system didn’t tie into the regular ground-based cellular phone systems and cost a lot more per minute than a regular cell phone. The company just couldn’t get enough customers to buy their phones and pay for the service. They couldn’t recover the billions they’d invested in the satellite system and their stock price plummeted. And when it went down, it went WAAAAYYYY down and I lost my shirt on them.

Well, I thought, there was always the launch vehicle provider. They were still building and flying rockets and satellites, servicing the Shuttle, and providing other services. They still had a lot of business coming in. Maybe all wasn’t lost.

Then came the investigation by the Securities and Exchange Commission and all of the bad publicity that went along with it. It seems that the company had been misreporting its profits and expenses for several quarters and, instead of turning a large profit for the previous year, had actually lost hundreds of millions of dollars. Again, I watched the price of my stocks tank and I lost another shirt.

Fortunately, I was young and could stand to replace a few shirts. I was still employed by a large aerospace company. Still making pretty good money and doing interesting work. And I hadn’t invested what I couldn’t stand to lose.

While all of this was going on, I was socking a little money each week, into the employee stock purchase plan where I worked, for my eventual retirement. The company’s stock wasn’t doing great, but the company matched your investment at fifty cents on the dollar. I was gradually accumulating a lot of stock that wasn’t worth very much. “Ah, well, I’ve got time,” I thought. And it was a space-related company.

I eventually decided that it was time to move onto another company and so I had to cash-out on my employee stock purchases. Well, my timing was perfect for a change, and I was leaving in the middle of “The Big Gobble” of the late ’90s, where two large aerospace companies were buying out most of their competitors. The company I’d worked for was being consumed by one of the two and so their stock, which had been a modest performer up to that point, was going up in value seven- or eight-fold! I was finally making a lot of money in the space business!

Unfortunately, that money was for my retirement and so isn’t readily available to me. I’d have to wait awhile before I could join the “D.D. Harriman Club.” But someday . . .

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