Spotlight On: Mike Lungariello, CFO, Axiom Space
June 2024 — In an interview with Invest:, Mike Lungariello, CFO of Axiom Space, discussed the company’s impact on the Greater Houston area, its strategic partnerships, and future plans in advancing the commercial space station, innovation in aerospace, and the space economy amid current economic challenges.
As a pivotal player in the Greater Houston area, what is Axiom Space’s impact on the region?
Axiom Space, founded in 2016, is creating the world’s first commercial space station. We’re headquartered in Houston, and we’re in close proximity to the Johnson Space Center, which is crucial for our access to NASA resources. The Greater Houston area is highly supportive of the emerging space economy. Our headquarters, located just a mile and a half from the Johnson Space Center, benefits from this close relationship. Many of our senior leaders, including our CEO, a former NASA employee and the longest-serving ISS program manager, emphasize our strong ties to the center. This proximity and connection are invaluable, considering the technical nature of our work.
How will Axiom Space’s infrastructure develop in the Greater Houston area and what are the anticipated benefits for the region?
Regarding infrastructure, we have four facilities in Houston, ranging from our headquarters to assembly sites for the space station and spacesuits. We plan to continue developing these sites. This expansion brings numerous benefits to Houston, including job creation. Axiom Space employs around 800 people, most in the Houston area, and we anticipate this number to increase as we approach the 2026 launch of our space station’s first module. Therefore, our presence in the Houston area is not only significant now but is expected to grow considerably.
Axiom Space is engaged in three key business areas. Firstly, we’ve gained attention for our human spaceflight missions to the ISS, as the only commercial entity with NASA’s approval to operate private astronaut missions. We’ve successfully conducted three missions, including a recent one with an all-European crew. Our human spaceflight initiative is a significant aspect of our operations. Secondly, we’re developing next-generation spacesuits. NASA has awarded us a task order to create lunar suits for the Artemis III mission, marking a notable achievement. These suits will be worn by astronauts on their next Moon mission, reflecting our contribution to space exploration. The third aspect is our space station project, which involves the development and assembly of the station and its ancillary components. These key business areas are taking place in the Greater Houston area, including at our headquarters. Our Mission Control Center and spacesuit development program are also based here. The space station will be the first spacecraft fully assembled in Houston.
What is the regulatory landscape of the region, and how do the regional specifics influence Axiom Space’s business operations?
A recent highlight was the ribbon cutting for the Axiom Space Assembly Integration and Test building. This event underlines the regulatory support we’ve received from Houston in developing Space City, a project where we are one of the main tenants. The close proximity of Ellington Airport to this area is a significant advantage, allowing us to easily transport large components for our space station build.
The regulatory landscape in Houston has been very conducive to our needs. The support from local authorities for infrastructure development and business operations is crucial for a company like ours. Regulatory support extends to building approvals, material access, and airport access. Houston’s approach stands out, and we haven’t found a more favorable regulatory environment elsewhere. The state of Texas, as a whole, is business friendly, with metro areas like Austin and DFW also growing rapidly in various industries. But for us, Houston’s commitment to supporting the space sector is particularly valuable. The Spaceport, symbolically and practically, is an ideal base for us. Furthermore, Houston’s historical connection with space exploration, such as the Apollo program, adds to its appeal.
What sustainability practices and environmental considerations are being implemented to ensure responsible development in line with envisioned environmental goals?
At Axiom Space, our mission to build the world’s first commercial space station is guided by a commitment to improving life on Earth. Our activities are designed with this goal in mind. The International Space Station has been a platform for technologies, research and development benefiting Earth for decades. Key areas of our focus include sustainability in manufacturing practices, particularly in low or zero-gravity environments. These practices have the potential to revolutionize manufacturing and pharmaceutical applications, as well as data center operations. Our commitment to sustainability is reflected in every aspect of our operations, from the development of next-generation spacesuits using sustainable materials to ensuring life support systems on our space station are environmentally conscious. Our primary customers, including NASA and other global entities, demand high sustainability standards, which we diligently meet in all our projects.
How are you involved in developing the local workforce and what strategies do you use to attract talent to the Greater Houston area?
We place a strong emphasis on outreach and recruiting, particularly with local schools in our vicinity, like the University of Texas and Texas A&M. These universities have excellent STEM programs and a diverse, skilled student population. Our proximity to these institutions allows us to offer robust internship programs and tap into this talent pool; however, our recruitment efforts extend beyond local universities. We aim to attract individuals who are passionate about making a difference and undertaking unique challenges, such as building the world’s first commercial space station. We emphasize that Houston is an ideal location for this endeavor.
When recruiting, whether it’s students or professionals, we highlight the opportunities in Houston. It’s not just about joining Axiom Space; it’s about being part of a larger community that’s actively shaping the space economy. With facilities like the spaceport and the proximity to Johnson Space Center, Houston is a prime location for anyone interested in aerospace. This environment, rich in opportunities and history, is a significant draw for potential recruits, whether they’re from other parts of Texas, the West Coast, the East Coast or elsewhere. Houston offers a fertile ground for those looking to establish themselves in the emerging space economy.
How is the economic landscape impacting the space economy?
The economic landscape has indeed been challenging in recent years, marked by rising interest rates, high inflation and general volatility. This uncertainty particularly affects emerging growth companies like Axiom Space, as we frequently raise capital to advance our business. Raising funds in such a volatile environment is more complex compared to a stable one. Despite these challenges, our last capital raise in 2023 was notably successful, closing at $350 million, part of a larger round that totaled $420 million starting in 2022. This achievement was one of the largest for a space company, second only to SpaceX, according to PitchBook. This success in capital raising, even amid economic uncertainty, demonstrates the confidence investors have in Axiom Space as a promising opportunity.
For us, the focus remains on building a world-class organization and advancing towards our goal of constructing the world’s first commercial space station. Being located in the right place, like Houston, significantly aids this process. It’s not just about our location; investors are keen to understand our access to resources, employee talent and the support we receive from governments and local authorities. In challenging economic times, any factor that can mitigate risks or difficulties is a strong incentive for investors to continue to provide support. All these aspects are interconnected and play a critical role in our strategic considerations and decision-making at the senior leadership level at Axiom Space.
Looking at the next five to 10 years, what are the top priorities for Axiom Space, and what is your overall outlook?
Over the next five to 10 years, Axiom Space will focus on developing all aspects of our business and enhancing our core competencies. Our primary goal is to continue the development of our space station. We’re adopting a modular approach for this, with the first module scheduled for launch in 2026. This module will connect to the ISS, marking a significant milestone. We expect to receive the metal casing for the first module soon, and the assembly will begin at our spaceport facility. Following this, we’ll continue assembling additional modules. We’re also progressing in our spacesuit program for the Artemis III mission, a significant lunar mission marking the first astronauts to return to the Moon since the Apollo era. We’re in the preliminary design review stage and have other milestones lined up.
Additionally, our human spaceflight program is ongoing. Beyond 2024, we anticipate further developments in space operations. Our focus will also include selling services related to in-space manufacturing, pharmaceutical applications and IT solutions. So, the coming years will be filled with key developments and milestones, which we will share with the public as they unfold.
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