How Government Catalyzes Space

NASA shows how government can catalyze entrepreneurship and technical innovation. The agency’s ideal roles lie in three areas.

Technical and financial risk:

NASA has achieved the biggest firsts, including landing on the Moon and sending probes beyond our Solar System. Private industry, on the other hand, excels at doing well-understood jobs efficiently and quickly, particularly when it comes to repeated tasks like sending satellites into low Earth orbit. One example, the business model of SpaceX, uses ten identical rocket engines in each Falcon 9, requiring just a small team to assemble, reducing cost. Musk wants to send payloads into space for one-tenth the expense of NASA vehicles.

Pure science:

NASA is best at the missions that explore the edges of technology and share the results publicly. These missions do not promise an immediate financial payoff. They enable pure science and create a knowledge ore for private companies to mine.


As America’s biggest customer, the federal government can pump funds into competitive startups, providing an instant guaranteed market. (Remember the Postal contracts in Chapter Three.) Contracts saved Elon Musk's SpaceX and ensured its continued survival.