Next time you spot a satellite in the night sky, pause to consider that some of its control systems might be from Stellenbosch.
The town, better known for fine wine and academia, is rapidly making its mark in space technology through a locally-based company that manufactures satellite components and is on its way to becoming a start-up worth more than $1bn (R18bn).
Spun out of academic research at Stellenbosch University, CubeSpace scooped one of the top honours at the Western Cape Innovation Awards hosted by the Cape Chamber of Commerce & Industry this month.
CEO and co-founder Mike-Alec Kearney, 37, told the Sunday Times this week how his team transformed university research into a globally competitive satellite technology company. He said the firm was on track to achieve unicorn status — referring to a privately held start-up business valued at $1bn — a rare milestone in the South African economy.
“What I can say is that we are growing our revenue at about 50% to 60% year-on-year,” he said, “Meaning we are on track to become a US dollar unicorn in the next five to seven years.”
The team manufactures high-precision satellite control systems and components, with a focus on Attitude Determination and Control Systems (ADCS).
These help satellites orientate themselves in space by adjusting their position relative to the Earth, sun and stars.
The firm has more than 10 years experience in orbit, over 250 customers across 30 countries and has developed more than 350 ADCS systems.
“Nasa is a customer, the UAE Space Agency and a lot of commercial customers. For the UAE Space Agency, we are not just building a control system, they are building a lunar rover which is going to land on the moon. We are building the computer and the electronics that drive the wheels of the rover,” he said.
“The amount of flight heritage we have means our products are highly refined. Because we supply components to a wide range of satellite companies, we gain valuable experience from each of them. We have built complete control systems for over 400 satellites and supplied more than 4,000 satellite components.”
He said extensive in-orbit experience enabled the start-up to refine its products to near-automotive standards, making them suitable for mass production.
“To put it in perspective: if you order a space product from most global suppliers, the lead time is typically eight to twelve months,” he said.
“With us, many products are in stock or available in less than three months which is a game-changer for most of our customers as it means they can get to orbit more quickly. That is possible because we have industrialised our manufacturing. We produce space-grade technology with the efficiency of automotive-scale production. Our products are about half the price of our European competitors and roughly a third of the cost of those from the US.”
The company has grown from humble beginnings to having 70 highly-skilled staff
The company has grown from humble beginnings to having 70 highly-skilled staff.
After completing his master’s in control systems at Stellenbosch University under Prof Herman Steyn, a global expert in control systems, he seized an opportunity to commercialise more than a decade’s worth of research.
The breakthrough came when a UK partnership needed control systems for satellites carrying atmospheric sensors. Using university research, Kearney and his peers filled the gap, achieving their first orbit in 2014. He then began selling the technology at conferences, reinvesting profits to hire former classmates and eventually founding CubeSpace in 2017.
“We never took any investment — no external funding at all. From the outset we made sales using technology developed at the university. We bootstrapped the company’s growth from those early sales and gradually began to penetrate the market,” he said.
“We were established during the boom in the nanosatellite market, think satellites the size of shoeboxes or smaller, which is when we achieved the first flight opportunities for our technology. After that, we rapidly deployed many of our systems into space.
“With satellites, the key nuance is that you cannot fully test them on Earth. A satellite must be in orbit for you to operate it and confirm it works. Every component on a satellite has to be absolutely reliable, and ideally, it should have flown in orbit before.
“That prior flight experience is crucial as it represents the chicken-egg scenario most companies face in the space industry. You need flight heritage to make sale, but you need sales to get flight heritage.”
“One of our proudest moments was during our first fundraising when seven investors wanted to invest simultaneously. Being able to choose among them was remarkable, especially given the challenging South African investment climate. Having a queue of eager investors made me realise we had created something valuable.”
Kearney welcomed the Cape Chamber of Commerce & Industry honour.
Chamber CEO John Lawson said: “Systemic innovation is key to economic growth” and “certain catalytic innovations benefit large numbers of businesses”. CubeSpace was a case in point as its birth was made possible by a systemic innovation implemented by Innovus & Launchlab, the incubation platform for Stellenbosch University, he said.
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