Making Space: What Government can learn from SMEs & VCs to make the UK a Space & Science Superpower

This week, Skyral and The D Grouppartnered on an incredibly unique event. Joined by leaders from Defence, industry, wider Government and private equity, we hosted a roundtable dedicated to exploring what our Government might learn from VCs. VCs, our thinking went, have the kind of agile spirit the Government could leverage to help achieve sustainable innovation and technology ecosystem here in the UK.

We centred on the UK’s burgeoning Space industry as the central area to explore because its relevance and future-forward nature touches each and every market. It doesn’t matter if you’re from the worlds of finance, telecommunications, Defence, STEM, or infrastructure: growing the UK’s space industry is going to require collaboration across user groups through long-term programmes that capitalise on the right end user capability and treat SMEs like technology partners.

But collaboration is a fluffy goal.

We all know it. We also know there isn’t enough mission alignment, especially across sectors, let alone between industry (SMEs and primes), and Government, for true and worthwhile collaboration to take place.

We hosted our event with this reality in mind, because we are deeply aware from personal experience that we can’t collaborate if we’re not mission aligned.

And that’s why we chose Space as the central topic for our discussion. It’s an industry that would benefit more from increased collaboration and technology partnerships; but supporting the UK’s space industry is going to require collaboration to be more than a buzzword. It’s going to take a significant realignment of what we value when it comes to investment, procurement, fair market competition, and if it’s not too bold to say: ‘winning the space race.’

I’m a technologist. And when it comes to space, I know the UK’s space industry is going to require novel, dual-use technologies in a very different way than the traditional market thinks of dual-use. Novel technology for the space sector must go far beyond use by defence/government and use by enterprises. Dual-use in the ‘Space context’ also refers to the applicability of technology to commercial use cases, as well as the reusability of technology to solve both direct and tangential problems. That’s a lot of uses. Maybe we should call it ‘multi-use’…but I digress.

In any case, that’s the first step to realigning our mission: infusing people into programmes to deliver dual-use capability, rather than buying off the shelf technology from a faceless Silicon Valley.

In other words: encouraging Government and enterprises to adopt novel technologies from SMEs who can be true technology partners. Shameless plug incoming:

At Skyral, we’ve found our customers are willing to place investment into end user capabilities because we are clear about our desire to be the right partner in their journey. Even if the government procurement process isn’t yet designed to match this ambition, it’s promising knowing that our users crave the outcomes we can deliver. And that means that if Government is able to catch up and allow officials to more easily access the best tech on the market, not only is longevity in the programme assumed, it means we’re able to deploy an unmatched level of expertise because our people operate as partners.

That brings me to the other reason we hosted our event with the D Group. Being an SME, we interact with the private equity community regularly. In fact, there probably isn’t a better example of true technology partnership. It’s fairly obvious that VCs operate in total contrast to Government. They’re quick, hungry for rapid success, and agile beyond measure. I’m in no way suggesting our Government start operating like a VC, but having spent years sitting in the middle of these two groups, I strongly believe there are lessons Government can learn from its neighbours in the City.

That’s why we were thrilled to have Sriram Krishnan of Andreessen Horowitz join our panel to help us understand what Government might be able to learn from how VCs operate. Sriram made a number of excellent points, but one struck me the most: Why is it that the most innovative companies always seem to be snapped up by VCs?

It’s because VCs see letting the next best thing slip through the cracks as an impossibility. If it happens, that’s failure. Horizon scanning in the private equity world is so advanced, so agile, that employees are deeply incentivised to never miss the next Palantir, the next Anduril, or Improbable. But how did they get there?

Ironically, Sriram invoked military strategy 101: the OODA (Observe, Orient, Decide, Act) Loop. When horizon scanning, the quicker a VC can move through the OODA loop, assessing rapidly if the company they’re reviewing is at an inflection point where funding would truly maximise growth, the more likely they are to either full-on succeed, or fail fast and move on faster.

Now, Government, on the face of it, is always at an inflection point. New threats, new challenges, the next budget or Integrated Review sitting right around the corner, an election…that’s a lot of risk to manage.

A VC would quickly assess the benefits of those risks, scanning the market of SME talent and capability to find the best and brightest solutions, and then exploit them quickly and effectively.

So, the call to action to government is this:

1. Use your home market as proof to find the solutions to your challenges (which probably lie with SMEs).
2. Design commercial processes that enable their entry.
3. Rely on them to form partnerships with primes (I promise, they will).
4. Exploit the best capabilities available to solve major problems.
5. Champion these dual-use capabilities into complex enterprise industries, like space or CNI.
6. Reap the benefits of a truly fair and open innovation marketplace where novel technologies are accessible and commercially available.

Conversations like the one we hosted with The D Group this week are too far and few between. But I’m confident they are a great step toward creating a system where everyone benefits: where the UK realises its ambition of becoming a technology hub and science superpower, where VCs rush to the UK because of talent and tech we have based here, and where Government becomes a model partner for the best dual-use capabilities SMEs are bringing to the market.

I’m hopeful this is only the beginning.