SPACE VILLAGES

Where Innovation meets Low

Earth Orbit

Rotterdam School of Management

Innovation Management (BT2106/BK2106)
Professor: Jasmien Khattab

This case was written by Adrienn Toth (RSM Case Development Centre), with the support of Karla Meschat, Jasmien Khattab, and Sandra
Langeveld (Erasmus University Rotterdam). The writing of this case was made possible by the generous cooperation of Space Villages. The
case is intended for class discussion rather than to illustrate effective or ineffective handling of management situations. Sole responsibility
of the case resides with the authors.

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Introduction
Tomas Hamann, the proposal manager of Space Villages, had another late-night working
session. He was preparing a new proposal to acquire funding for the implementation of novel
software that would operate the robotic arms of an assembly module of the company’s
commercial space station. It was one of the many projects the Space Villages team was working
on, as they had an ambitious vision in mind: to launch a commercial space station within the
next few years, the first of its kind, that would not only take space research to the next level,
but also commercial activities of the industry as a whole.
Up until now, commercialization of space exploration activities had not been the norm, as the
research institutions that were currently active in space research and operated space stations
were mostly founded by various national governments. Even though they had made significant
breakthroughs and further developed the space industry, these institutions were not managed
with the mindset of a profit-oriented company. This was about to change, because Space
Villages’ ambition was to be the first to launch and operate a flexible, modular, and cost-
effective space station. From a technological perspective, most of their planned activities had
already been proven to be possible, so now Tomas and his team were facing the next challenge:
designing the business case, identifying the market needs and services to address them, and
creating a detailed business plan to make it all profitable. Who could be the customers of such
a commercial space station? What are their needs and expectations? How can Space Villages
meet those needs while being profitable?

The Commercial Space Industry

Human interest in space and how to understand, access and interact with it has been around
for a while and has only become more prevalent with the realization that leaving the Earth and
finding other habitable environments will be essential to the human race’s long-term survival.
As is the case with all scientific areas reaching a point of breakthrough technical innovation,
the space industry is at a stage where the focus is slowly starting to shift from exploring what
is possible, to implementing these activities in a more cost- and time-effective way. To
capitalize on these opportunities, new private companies are currently emerging that operate
in a competitive market and relying on generated profit, instead of the government-owned
space agencies that were previously driving innovation. Similarly, to SpaceX—a prime
example of a for-profit company making waves in the rocket engineering industry—new
players are emerging who would like to provide all kinds of services related to space in the
fields of space research, space transport and space tourism.
This puts aspiring players of the space industry in a tough situation: instead of trying to find
their place in an already established business environment with potential customers,
suppliers, and competitors, they have to find their way in this industry together as competitors.
The difficulty lies in predicting future demand for different products and services, as well as
predicting the directions for technological development that will arise as a result of the
democratization of these activities. The one thing that these incumbents in the space industry
have in common is that the business requirements are driving technological development, and
not the other way around. Different from the research driven focus of the existing space
organizations, these new industry professionals are working on innovations they see the most
business opportunity in—not necessarily those that require the most advanced technology.
The range of activities of these new companies is quite broad, such as building bigger and
higher quality telescopes that allow for the advancement of space research, and developing
rockets to creating a good infrastructure for human space travel that could later lead to space

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tourism. These activities are also connected to each other, meaning that these new market
players will most likely create a well-established system where they form partnerships,
complement each other, and compete—just like in other industries.
When it comes to building a commercialized space station that can be used for various
purposes by other companies, there are already some that are being developed. As of 2023,
four different projects are being carried out in the US whose aim is to build such a station, and
one additional project in Europe—spearheaded by Space Villages. It is expected that at least
three of these companies can be successful in the near future considering the expected
demand. These companies must of course comply with a list of safety standards. For example,
they must demonstrate that they can avoid accidents and prevent the space station from
reentering the atmosphere. And—in case they are planning to send people up to space as well—
they should prove to be safe for humans.

Figure 1: An envisioned habitational module in space with artificial gravity

Source: Space Villages

Introduction to Space Villages

“We are committed to building the space infrastructure of the future to enable the
development of Low Earth Orbit as a stepping stone for colonizing space”
Space Villages was founded 5 years ago in the Netherlands and now operates as a group that
has members in different European countries as well as in the United States (Space Robotic
Workers in Spain, Orbital Outpost Italy in Italy and Orbital Outpost X in the US). The different
units work together across their regional boundaries with a unified goal in mind: Their vision
entails enabling space business applications to meet the main goals of both moving
manufacturing services to space and addressing the human interest in space colonization.
Although the different units are located in different countries, they have a common aim of
bringing the business of space to the market—with a particular focus on the European market
before going global. Their commitment is to contribute to the space economy of the future,
with the goal of sparking new markets in technology, assembly, entertainment, and daily living
through their creative business ideas. To do so, Space Villages aims to provide space-related
technical services to commercial customers, space and government agencies by developing
innovative and reliable technological solutions to fulfill their customers’ needs.

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Space Villages’ vision has taken shape in the mission of building a modular, expandable
privately owned space station in Low Earth Orbit (LEO). This LEO Space Outpost is an initial
infrastructure with the capability to cater to various needs of customers in the space industry,
while remaining responsive to changing market dynamics due to its expandable design. Space
Villages will contribute to the upcoming space economy by allowing space agencies and
commercial enterprises to embrace more ambitious space plans and missions.

The First Space Village

Compared to the design of the US-based space stations, Space Villages envisions for their
station to be expandable and reassembled flexibly and much more cost-efficiently. They
achieve this by having both a modular and linear design, meaning they can attach and detach
elements easily to/from the station (modular) and also expand the size of the station
significantly if needed (linear). Each module in the station will be responsible for one specific
activity and they can add the new modules based on demand. This can reduce the current risk
of not seeing clearly who their future customers could be. The cornerstone of their strategy is
flexibility, which offers them guidance when thinking about new strategic directions. Given
that they are highly future-oriented, they are already preparing for when the space industry
will be booming, and new players will enter the market every day. Space Villages wants to cater
to the variety of needs their future customers might have by using space platforms as building
blocks that each can provide a different service. Although these space platforms are not
significantly different from existing space platforms, adding such growth possibilities to their
platforms allows for unprecedented flexibility to combining different kinds of services in one
location.
Space Villages has identified more than 20 potential services that they could provide.
Examples include a fueling station for space vehicles, platforms that can hold up to 60-meter-
wide telescopes (bigger than the currently biggest James Webb Space Telescope), and
habitational modules where astronauts (and at some point, space tourists) can stay for a period
of time. Their future customers could be large institutional players like NASA or the European
Space Agency, as well as newly formed commercial companies currently under development.
The range of activities of these new companies is quite wide and as of now, not completely
predictable. For example, Space Villages is preparing to offer the necessary infrastructure on
their space station for future space fuel companies, space travel agencies and space mining
companies alike. The companies offering these services could appear as startups who managed
to secure funding for a novel idea, or as part of well-established giants who see an opportunity
in expanding their portfolio with space services.
Currently, space stations are built primarily with the goal of serving as research centers, where
astronauts are an essential asset. Because such space stations should be safe for humans, they
must adhere to additional regulations, which are challenging and costly to meet. Therefore,
one of the most significant innovations that Space Villages envisions is an array of in-orbit
robotic services, enabling the assembly of the different modules in space. This would eliminate
the needs for humans in the first stages of the creation of the space station, which is a radical
change that significantly lowers the costs and the complexity of creating a minimal viable
product (MVP).

Building the First Space Village

The 45-person Space Villages team is now working with an ambitious goal in mind: to start
operating their space station by launching an MVP in 2028. This MVP would include the basic
architecture of the station with robotic arms that are able to assemble the different modules.

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With the operationalization of the MVP, Space Villages could already start operations, and
then easily attach additional modules on the go based on market need.
After the realization of the MVP, Space Villages plans to expand the space station in 3 key
stages: first as a robotic platform, then as a crewed platform, and lastly as an induced gravity
residential platform that can host up to 100 humans in Low Earth Orbit by 2035.
Since it is currently a guessing game which of their planned services will actually be needed,
the team is now focused on being as flexible as possible by preparing the designs of modules
for all kinds of purposes. Then, once the market landscape becomes clearer, they can more
easily switch and redirect their focus to the most profitable activity. At the same time, they are
already working on implementing the elements of the space station that will surely be needed,
like the robotic system that has to carry out assembly tasks. Modules which could be added in
the robotic platform stage include in-orbit refueling and a shipyard for large systems assembly,
while modules in the induced gravity residential platform would rather include living
residences and leisure activities. Ultimately, Space Villages aims to create the very first space
village, a continuously expanding abode for humans to live, work, and enjoy their free time.

Figure 2: Design of the Robotic Platform

Source: Space Villages

Next Steps
The future was still very uncertain, but Tomas and his team had to manage the situation as
well as they could by remaining flexible and prepared for different scenarios. Matching the
already existing and currently developed technologies with the expected business needs and
adapting to changes quickly has definitely been a challenge but it is key to future success in
this industry. Various questions were circulating in Tomas’ head. How can Space Villages best
prepare for the future groundbreaking technological advancements and their impact? How
can they create a service portfolio that is not only in demand in the short term, but can also
develop together with the industry? Is there a way to somewhat reduce the risks originating
from the current unpredictable state of the space industry? How could they use the gained
insights into the European market to create global success? These were some of the challenges

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Tomas had to face. As he was deliberating these questions, he knew one thing for certain:
Space Villages would have to keep innovating constantly to carve out their space in the market
and remain successful over time.

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