Common Cents in Outer Space on January 17, 2020

“I think we are at the dawn of a new era in commercial space exploration.”

Elon Musk


Over the last week, with the NCAA Championship Game, the impeachment saga in Washington, the ongoing turmoil in the Middle East, the stock market which keeps going up, and even Champagne Gate (and shame on me for knowing what this is), it is understandable if you missed it. However, on January 6th, NASA made an interesting announcement, and I will simply paste it from the agency’s website or you can follow the link:

NASA’s Transiting Exoplanet Survey Satellite (TESS) has discovered its first Earth-size planet in its star’s habitable zone, the range of distances where conditions may be just right to allow the presence of liquid water on the surface. Scientists confirmed the find, called TOI 700 d, using NASA’s Spitzer Space Telescope and have modeled the planet’s potential environments to help inform future observations.

 “TESS was designed and launched specifically to find Earth-sized planets orbiting nearby stars,” said Paul Hertz, astrophysics division director at NASA Headquarters in Washington. “Planets around nearby stars are easiest to follow-up with larger telescopes in space and on Earth. Discovering TOI 700 d is a key science finding for TESS. Confirming the planet’s size and habitable zone status with Spitzer is another win for Spitzer as it approaches the end of science operations this January.”

TESS monitors large swaths of the sky, called sectors, for 27 days at a time. This long stare allows the satellite to track changes in stellar brightness caused by an orbiting planet crossing in front of its star from our perspective, an event called a transit.

TOI 700 is a small, cool M dwarf star located just over 100 light-years away in the southern constellation Dorado. It’s roughly 40% of the Sun’s mass and size and about half its surface temperature. The star appears in 11 of the 13 sectors TESS observed during the mission’s first year, and scientists caught multiple transits by its three planets.

The star was originally misclassified in the TESS database as being more similar to our Sun, which meant the planets appeared larger and hotter than they really are. Several researchers, including Alton Spencer, a high school student working with members of the TESS team, identified the error.

“When we corrected the star’s parameters, the sizes of its planets dropped, and we realized the outermost one was about the size of Earth and in the habitable zone,” said Emily Gilbert, a graduate student at the University of Chicago. “Additionally, in 11 months of data we saw no flares from the star, which improves the chances TOI 700 d is habitable and makes it easier to model its atmospheric and surface conditions.”


First things first: this was not the first Earth-size planet ‘in its star’s habitable zone’ scientists have found; it WAS this particular satellite’s first (TESS). Second, the TESS mission has been something of a minor disappointment, as it has ‘only’ identified roughly 1,500 exoplanets since being launched in April 2018. Researchers were hoping this number would be closer to 20,000. Third, only 34 have been confirmed. Fourth, it is still amazing science, regardless. Fifth, a high school student helped find the planet, which is awesome (what were you doing in high school?). Finally, and this is where this newsletter takes a turn, it was launched atop a Falcon 9 rocket. Pretty cool, huh?

Oh yeah, SpaceX designs and manufactures the Falcon 9, and, as you probably know, SpaceX is a private US aerospace engineering, manufacturing, and transportation firm founded by Elon Musk of Tesla fame. A trust in his name owns something like 75% of the company.

Throughout history, humankind has explored and exploited numerous ‘frontiers.’ ‘We’ tend to go where the opportunities are the best for the future growth of our wallets and our species, with the emphasis on wallets. While there are still places on this planet no person has seen with the naked eye or trod upon, it is safe to say the ‘final’ frontiers on Earth are far less numerous than they were a century ago. In another 100 years, they will be less than they are today.

That leaves the vastness of space left for us to conquer, and some of biggest entrepreneurs in the world are getting into the game.

As I have already mentioned, Elon Musk has SpaceX. However, Bill Gates has purportedly made a sizable investment in Redmond, Washington-based Kymeta Corp. According to Wikipedia: “Kymeta mTenna technology uses a holographic approach to electronically acquire, steer and lock a beam to a satellite.[4] It is built using a metamaterials toolset, which uses a thin structure with tuneable metamaterial elements instead of reflecting microwaves like a traditional parabolic antenna or creating thousands of separate signals like a phased array antenna.” Holograms to lock a beam to a satellite? Really.

Then, there is Jeff Bezos’ attempt to challenge SpaceX, Blue Origin. Apparently, Jeff peels off a smooth $1+ billion worth of stock every year to fund the company. Also, we shouldn’t forget the late Paul Allen’s foray into space, Stratolaunch Systems. After some confusion after Allen’s death, it appears as though new owner, Cerebus Capital Management, is intent on reviving the company…as Cerebus is wont to do. Finally, there is everyone’s favorite omnipresent Briton, Richard Branson, and his Virgin Galatic which have promised to make commercial spaceflight a reality.

Make no bones about it; the first people to an area buy up everything and get rich in so doing. In space, there is just so…so…much of it, and folks are lining up to get their share.

Obviously, I find this stuff fascinating. I routinely go to, and have any number of nerdy science news feeds on my phone. However, the news recently has been particularly interesting, as it suggests scientists have made outsized gains in a compressed period of time. While TESS hasn’t found the number of exoplanets experts anticipated, it was STILL able to find a planet orbiting a red dwarf in a solar system 101 light years from Earth which may be capable of having liquid water…a major first step in making it habitable for humans.

What’s more, after several postponements, it appears as though the Webb telescope will finally launch at the end of March 2021. If you aren’t familiar with it, consider what Paul Sutter at had to say about it in an article on December 29, 2019:


“While the James Webb Space Telescope (“JWST” to those in the know) is heralded as the “successor” to NASA’s storied Hubble Space Telescope, it kind of isn’t. The Hubble is primarily an optical telescope, capturing wavelengths of light similar to the range that the human eye does, and extending past that a little bit into the infrared and ultraviolet (UV) portions of the electromagnetic spectrum. In essence, the Hubble is a giant orbiting space eyeball, delivering stunning pictures that you would see, if your optic nerves were similarly equipped.

But the JWST is different. It will be observing entirely in the infrared, barely scratching the deepest possible reds that a human can see. In other words, the JWST will be studying a universe that is largely invisible to human experience.

…And what it will see will be — and I’m not using this word lightly — remarkable. One of its main targets will be the early universe, when our cosmos was just a few hundred million years old. The first stars and galaxies to appear on the cosmic scene blazed brightly in the visible spectrum, but over the course of the past 13 billion years the universe has expanded, stretching that light out of the visible range and down into the infrared — right in the sweet spot of the JWST’s design parameter

Since we have no images at all from the epoch of the first stars and galaxies (known colloquially as the “cosmic dawn”) this will be our first-ever view into this important age in the history of the cosmos.”


While Sutter might use the word remarkable in the column, I call it awesome. Looking back in time to the beginning of the universe? Come on. All of this has a point.

At some point in the not so distant future, investment managers, advisors, and investors themselves are going to get increasingly comfortable with this unofficial sector, outer space. Of course, I imagine the industry will devise a more marketing savvy word for it, just as they did for junk bonds (high yield). ‘Outer Space’ sounds too Star Trekkie and far-fetched for the average American. However, the potential for returns won’t be far-fetched, at all. They will be far-reaching.

Unfortunately, it seems many or most of the pure ‘plays’ are still private at this time. Essentially, Elon and Jeff aren’t sharing the love just yet, and nor do they have to do so. As such, we are going to continue to explore opportunities to get exposure to this upcoming ‘asset class/sector’ in the most investor friendly and ‘purest’ way possible.

Have a great weekend!

John Norris

John Norris

Managing Director

Chief Economist


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