When Terran Orbital (NYSE:LLAP) won a $2.4 billion contract to build 300 satellites for Rivada Space Networks in February 2023 it confirmed the Boca Raton, Florida company’s leading position among the big league of new space companies proliferating satellites into low earth orbit.
"The partnership with Rivada will show why Terran Orbital continues to be a satellite manufacturer of choice of aerospace and defense companies worldwide," the company’s chairman and CEO Marc Bell told Proactive.
Bell took over at the helm of the company he co-founded with his friend and business partner business Anthony Previte, a little over two years ago.
Since then, its growth has been nothing short of stratospheric.
Terran Orbital, at the time, was a “small company doing big things” with the CubeSat technology it acquired upon launch with the 2013 purchase of Tyvak Nano-Satellite Systems.
The approximately 10cm cubed CubeSat, invented in 1999 by Stanford University professor Bob Twiggs and Dr Jordi Puig-Suari, a professor at California Polytechnic and co-founder of Tyvak, had become the standard format for the thousands of satellites.
“Up until 2012, the world built anywhere from two to 20 CubeSats a year; it was very small and very few people were doing it,” Bell says. “Once we took over, you saw it just proliferate.”
While around 88 satellites were built and put into orbit in 2013, this had skyrocketed to 297 by 2017 as Terran Orbital demonstrated the potential of the CubeSat to the United States government, the National Aeronautics and Space Administration (NASA) and other organizations.
SpaceX Rideshare Program
That growth was accelerated partly by SpaceX’s Rideshare program which offers low-cost rideshare missions to provide access to space for smaller satellite operators. To deploy the satellites, they must be attached to an ESPA ring using a dispenser, another of Terran Orbital’s inventions.
Still, Bell had even bigger ideas when he took over at the helm of the company in 2021.
“I didn't want to run a small business,” recounts Bell, an accomplished entrepreneur with a wide-spanning career. “So, we went to Lockheed Martin, and we said ‘Hey, let's go do something great together’. And we are doing something great.”
Lockheed Martin has been one of many validators of the company’s business plan, Bell says. On top of previous funding of $60 million, in October 2022 the world’s largest defence contractor invested a further $100 million as the companies jointly pursue a variety of opportunities to advance emerging technology across military, commercial, and civil customers.
Space Development Agency
Already, Terran orbital has built and delivered 10 buses to Lockheed as a subcontractor for its Space Development Agency (SDA) Tranch 0 Transport Layer contract.
This year, it expects to begin delivery of 42 Transport Layer Tranche 1 satellites and is preparing bids for Transport Layer Tranche 2 and other SDA programs including T2DES and Tracking Layer which represent nearly 300 satellites this and next year.
“They've invested $160 million into the company, and we have a strategic cooperation agreement with them, that goes to 2035,” he says. “They have been an incredible partner in building our business, both financially and technologically; they give us enormous amounts of technical support along the way.”
Other companies, like Rivada Space Networks, are also sitting up and taking notice of Terran Orbital.
Through subsidiary Tyvak Nano-Satellite Systems Inc, Terran Orbital will act as the prime contractor to design and manufacture the approximately 500-kilogram satellites for Rivada, integrate the communication payload, and perform the final satellite assembly, integration, and test.
Noting that the deal is the largest small satellite production contract to date, Bell says: “The world is looking at us differently. People realise we can build big constellations; we can do the same thing that big primes do. We can also do it cheaper, and we can do it better. And that gives us a massive advantage over everybody else.”
Deliver on time to keep winning
Maintaining credibility is a key factor, says Bell, pointing out that the company delivered the initial ten SDA Tranch 0 Transport Layer buses to Lockheed ahead of schedule.
“The Space Development Agency said those who deliver on time will continue to keep winning,” he adds. “We will continue to deliver on time, on budget, delivering state-of-the-art solutions, and we will get faster and better at what we do. We will continue to innovate and continue to lower the entry price point of building satellites in space.”
With more than 50,000 satellites expected to launch into orbit over the next 10 years, Terran Orbital says it is in a good position to meet the soaring demand.
It recently announced it is adding a new 94,000 square feet facility to its manufacturing base, adding to its more than 200,000 square feet of industrial plans in Irvine. When fully ramped, the addition will have the potential to raise Terran Orbital’s satellite capacity to multiples of its prior 250-per-year target.
In-house component manufacturing
“We continue to expand, both our facilities for module and component manufacturing -- we make 85% of our components in-house,” Bell says. "That's incredibly unusual.”
Most manufacturers source components from a wide variety of suppliers and subcontractors, but he says they don't always work. And they don't always work together. Terran Orbital will be bringing 100% of its components in-house.
“It is incredibly impressive what we're building and incredibly impressive the capacity we can deliver; the throughput we'll have and the quality we'll have,” he says. “We delivered 19 satellites last year and there are over 60 on the production line right now. And we are growing rapidly.”
While the business has grown, so too have the satellites. Whereas the initial CubeSats weighed less than 2 kilograms, Terran Orbital is now manufacturing satellites up to 800 kilograms.
“The joke is a little bit on us,” he said. “We invented this thing very small, but the reality is customers want more power. When you're going around the Earth at six kilometres a second, and hit where the sun doesn't shine, you need more batteries to really be functional. That's why the mass of these things grew.”
Further accolades
As a further vote of confidence, both Terran Orbital and Bell have received recognition for the big strides they have made.
Terran Orbital was named to Fast Company’s annual list of the World’s Most Innovative Companies for 2023, joining the ranks of OpenAI, Disney, Tiffany & Co, and more.
The list highlights the businesses at the forefront of their respective industries, paving the way for the innovations of tomorrow. These companies are setting the standard with some of the greatest accomplishments of the modern world.
“We have an incredible heritage. We have incredible people. We've done incredible things,” Bell says. “We have put satellites around the moon, and we have sent them to Mars. We have proliferated satellites into low earth orbit. This industry called new space wouldn't exist if it wasn't for us.
“If it wasn't for the invention of the CubeSat, Starlink wouldn't exist; Amazon's Kuiper wouldn't exist. Everything you see going on today started with us.”
Bell himself was named to South Florida Business Journal’s 2023 Power Leaders 250 list, with the journal noting the “serial entrepreneur and five-time unicorn founder” is also an avid Broadway producer with two Tony Award-winning Broadway shows: Grammy Award-winning Jersey Boys (Tony for Best Musical) and Pulitzer Prize-winning August Osage County (Tony for Best Play).
His most recent Tony Award-nominated Broadway show was Beetlejuice (Best Musical).
Perhaps Starlight Express will be next.
Contact the author at stephen.gunnion@proactiveinvestors.com