How SpaceX builds Products for the Universe
SpaceX takes an incremental, evolutionary approach to defining and delivering capabilities over time through their iterative cycles.
With the Falcon 9 rocket, SpaceX has brought down the cost per launch for a Falcon 9 (the launch vehicle) to around $60 million. This is already much cheaper than alternatives like the Space Shuttle which cost around $1.5 billion per launch in the 1990s ($30,000 per pound to low Earth orbit). Reusability has allowed SpaceX to further drive down the marginal cost of a Falcon 9 launch to around $28 million as of 2020.
There’s a lesson in product development, which has not been studied enough.
What would Product-Market Fit (PMF) mean in the world of space exploration? An intriguing question indeed, lets find answers to it today. Share today’s post with your network of a friend, to help them with a great read:
Product-market fit in general means that the products and services effectively meet the demands and needs of their target markets. But how does it translate for SpaceX?.. the American aerospace company founded in 2002 by Elon Musk that helped usher in the era of commercial spaceflight.
We dive into how companies like SpaceX achieve product market (which is counter-intuitive to how modern tech software companies do it) and what does a typical product development process at SpaceX looks like.
Today’s newsletter aims to be an eye-opener in the world of “fail fast” approach driven by iterative experiments, which is not always applicable to companies where upfront cost to even get a pilot or MVP running is too high to fail fast.
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So, what is the product and what is the target market for SpaceX?
So, let’s start with the basics. SpaceX is pursuing product-market fit for two main products/services:
Launch Services (Falcon 9, Falcon Heavy, Starship)
The core product SpaceX initially found success with is its reusable rocket technology, providing cost-effective and reliable launch services for various payloads like satellites, spacecraft, and supplies to orbit or other space destinations. The target market here is:
Commercial satellite operators
Government space agencies (NASA, USAF, etc.)
Other companies requiring launch capabilities for their space missions
By drastically reducing launch costs through reusability and vertical integration, SpaceX disrupted the traditional launch market dominated by companies like ULA and Arianespace.
Starlink Satellite Internet Constellation
SpaceX's other major product is its Starlink satellite constellation aimed at providing global broadband internet connectivity, especially in underserved areas. The target markets are:
Residential customers in rural/semi-rural areas lacking reliable internet access
Businesses requiring mobile internet connectivity (maritime, aviation, etc.)
Potentially partnering with existing telecom/internet providers
By leveraging its low-cost reusable launch capabilities, SpaceX can deploy the Starlink constellation at a fraction of what was previously possible, enabling it to provide competitive internet services in this emerging market.
So in essence, SpaceX is pursuing product-market fit in two domains - affordable launch services by disrupting the traditional market, and satellite broadband internet access by creating a new market enabled by its low-cost launch technology. Its reusable rockets are the key innovation allowing SpaceX to achieve better product-market fit in both areas.
What would success criteria look like for SpaceX if they achieve Product-Market Fit (PMF)?
Here are the potential success criteria that could indicate SpaceX has achieved product-market fit (PMF) for its two main products/services:
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Launch Services (Falcon 9, Falcon Heavy, Starship)
Success Criteria:
Consistently high demand and a full manifest for upcoming launches from commercial satellite operators and government agencies
Ability to offer significantly lower launch costs compared to competitors due to reusable rocket technology
High launch cadence and frequency enabled by rapid rocket reusability and refurbishment
Positive customer feedback and satisfaction from satellite operators on reliability, schedule adherence, and cost-effectiveness
Starlink Satellite Internet Constellation
Success Criteria:
Rapidly growing subscriber base for Starlink internet service across residential, business, and mobility markets
Ability to provide competitive internet speeds and latency that meet or exceed customer expectations
Global coverage achieved through rapid deployment of the satellite constellation
Positive net promoter scores and customer referral rates indicating users are actively promoting Starlink
Revenue from Starlink services becoming a major income stream for SpaceX
In essence, SpaceX can claim product-market fit when its innovative reusable launch capabilities enable it to consistently meet the needs of the commercial launch market at disruptive costs and cadences.
For Starlink, product-market fit would be realized when the global satellite internet service gains widespread adoption by providing a superior broadband experience compared to traditional options.
The key metrics indicating fit would be high customer demand, satisfaction, and revenue growth, while delivering on the core value propositions of low cost and high performance that SpaceX's vertically integrated model enables
SpaceX does rare ‘make or break’ tests to move towards PMF, whereas software companies take “break often” experimentative approach
SpaceX products are highly complex aerospace systems that require immense upfront investment and rigorous testing before ever reaching the market.
Unlike software where you can quickly build a minimum viable product (MVP) and get it in front of users for feedback, SpaceX has to make multi-million-dollar bets on new vehicle designs years before they can realistically test them in their target environment - space.
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For SpaceX, achieving product-market fit starts with extensive market research to identify unmet needs or opportunities in aerospace. Their engineers then model potential solutions through simulations, trade studies, and systems engineering - making educated guesses on what designs will resonate based on the research.
Prototyping happens at smaller scales like engine firings and component testing. But building full-scale rocket/spacecraft test articles is extremely costly. So SpaceX relies heavily on leadership's expertise and vision to chart an initial course, making multi-year bets on vehicle designs they think will succeed.
The real "trial" happens when they eventually conduct an orbital test flight of a new vehicle like Starship. If successful, they've achieved product-market fit. If not, it's back to the drawing board after burning through vast resources.
Unlike software's rapid build-test-feedback loops, SpaceX takes a long-term, strategic approach involving deep research, modeling, incremental testing, and conviction to pull it all together.
Experimentation at SpaceX differs from agile software practices. Their products are so complex that changes risk catastrophic failures. So rather than rapid prototyping, SpaceX uses simulation modeling and rigorous, methodical component testing during design/development phases.
They run millions of simulations to evaluate concepts before building hardware. Once promising, they build test articles of subsystems like engines to validate performance. This incremental testing retires risk before integrating into a full vehicle.
SpaceX matures designs through test campaigns and review gates over multi-year cycles. Actual integrated vehicle flight tests are infrequent due to cost/risk.
So while software can experiment frequently, SpaceX takes a deliberate, long-term approach through modeling and rigorous component testing before ever flying an experimental vehicle.
How SpaceX pioneered agile in big machine building
SpaceX appears to follow an agile product development approach rather than a traditional waterfall model.
Iterative Design Process: SpaceX takes an iterative, test-and-learn approach to developing their rockets and spacecraft. They rapidly prototype, test components and systems, analyze data, and iterate on the designs. This aligns with the core agile principles of continuous improvement and adaptability.
Parallel Development: SpaceX has multiple teams working in parallel on different subsystems and components of their vehicles like Starship. Each team operates like a small startup, able to make rapid progress without waiting on other teams. This enables frequent integration and testing.
Frequent Product Iterations: SpaceX builds an entirely new Starship vehicle every month, incorporating the latest design changes and improvements from testing data. This reflects the agile practice of frequent product increments and releases.
Embracing Change: SpaceX views failures during testing, like the Starship high-altitude prototypes explosions, not as setbacks but opportunities to gain valuable data and evolve the design. This exemplifies the agile mindset of embracing change over following a rigid plan.
Simulations and Virtual Testing: SpaceX leverages simulations, virtual testing, and modeling extensively to rapidly evaluate designs before physical prototyping, a key agile practice.
This contrasts with SpaceX's ability to quickly adapt designs based on testing insights. Additionally, waterfall relies on extensive upfront planning and requirements gathering, while SpaceX takes an incremental, evolutionary approach to defining and delivering capabilities over time through their iterative cycles.
SpaceX's agile methods are in direct contrast with Boeing's more traditional waterfall development of Starliner, which faced challenges integrating components developed in series.
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Example 1: Starship Iterative Design Process
SpaceX has taken an agile, build-test-learn cycle for developing Starship, their next-generation fully reusable launch vehicle designed for missions to the Moon and Mars.
Rather than following a traditional linear waterfall development process, SpaceX has rapidly prototyped and tested Starship vehicles through an iterative campaign of sub-orbital and orbital test flights. Some key examples of this iterative process:
SpaceX built and tested several Starship prototypes (SN5, SN6, SN8, SN9, SN10, SN11) for high-altitude flight testing in 2020-2021.
While most of these initial test vehicles failed and exploded during landing attempts, SpaceX gained invaluable data on aerodynamics, propulsion, and control systems to refine the design.
After each test, SpaceX analyzed the failure data and rapidly incorporated learnings into the next Starship prototype, which was built in about 1 month.
This compressed build-test-fix cycle allowed SpaceX to make exponential design improvements on Starship in a short period of time.
The iterative process culminated in the successful high-altitude flight and landing of Starship prototype SN15 in May 2021.
Example 2: Orbital Test Flight Experiments
SpaceX then progressed to orbital test flights of the full Starship stack in 2022-2023, continuing their agile experimentation:
The first orbital test flight in April 2023 successfully cleared max aerodynamic pressure but then exploded minutes into flight due to stage separation issues.
While a setback, SpaceX treated this explosion as a "rapid unplanned disassembly" event to gain more data points on Starship's capabilities.
SpaceX is already working on the next Starship orbital test vehicle, incorporating fixes and improvements identified from the previous test flight.
By embracing an agile mindset of rapid iteration through hands-on experimentation and learning from failures, SpaceX has been able to make rapid progress developing the immensely complex Starship system in a relatively short timeframe compared to traditional aerospace programs
additionally success criteria for launch service could be :
1) Safety ?
2) minimum uptime : in case of any on flight issue time taken to fix it?
Thanks for this, very interesting article!
One question: You can achieve PMF via rapid build of a prototype or MVP, test it with users and learn on it. Isn’t SpaceX doing the same just in virtual environments and maybe with less external testers? With all the simulations, isn‘t it very close to the software based build-measure-learn cycle?