How I Built A $4.2 Billion Space Start-Up | Founder Effect

Summary

Tim Ellis, CEO of Relativity Space, is revolutionizing space travel by developing the world's first robotically 3D printed rocket launch vehicle. With a $500,000 seed investment from Mark Cuban, Ellis and his team aim to reduce manufacturing times and costs, making space travel more accessible. From a love for Legos to a multi-billion dollar startup, Relativity Space is now valued at over $4.2 billion, challenging industry giants like SpaceX with its innovative approach to rocket production.

Takeaways

• 🚀 Tim Ellis is the CEO and co-founder of Relativity Space, which is developing the world's first robotically 3D printed rocket launch vehicle.
• 🌟 Ellis aims to compete with industry giants like SpaceX, founded by Elon Musk, and is considered an up-and-coming figure in the space industry.
• 💰 Tim Ellis secured initial funding for Relativity Space with a $500,000 investment from Mark Cuban after a cold email.
• 🏠 Relativity Space has two launchpads, one at Cape Canaveral and another at Vandenberg Air Force Base, showcasing its operational presence.
• 🎓 At the age of 31, Tim Ellis has already founded a multi-billion-dollar startup, highlighting his early success in the industry.
• 📈 Three key numbers in Relativity Space's story are $100,000 in student loans Tim had when starting the company, 1.4 million square feet of company space, and $1.3 billion in total outside investment.
• 👶 Tim's childhood passion for Legos and his natural aptitude for STEM led him to a career in rocketry, starting with a student group at USC called Rocket Lab.
• 🔧 Tim recognized the potential of 3D printing during his internships at Blue Origin and later initiated the company's 3D printing division.
• 🤖 Ellis envisions a future where 3D printing and artificial intelligence are central to space exploration and the establishment of an industrial base on Mars.
• 💼 Tim's leadership at Relativity Space involves being deeply involved in technical aspects and decision-making, drawing from his extensive knowledge and learning from industry experts.
• 🏢 The company has rapidly scaled from 100 to 700 employees in about two and a half years, reflecting its growth and ambition in the space industry.

Q & A

What is the name of the company founded by Tim Ellis?

Tim Ellis is the CEO and co-founder of Relativity Space.

What is unique about the rocket launch vehicle Relativity Space is building?

Relativity Space is building the world's first robotically 3D printed rocket launch vehicle.

What significant contribution did Tim Ellis make during his time at Blue Origin?

Tim Ellis conducted the first ever metal 3D printing at Blue Origin, which helped to shrink manufacturing times and reduce costs.

How did Tim Ellis secure initial funding for Relativity Space?

Tim Ellis secured initial funding by cold emailing Mark Cuban, who committed to investing $500,000 in the company.

What was the subject line of the email Tim Ellis sent to Mark Cuban?

The subject line of the email was 'Space is sexy 3D printing an entire rocket.'

How much student loan debt did Tim Ellis have when he started Relativity Space?

Tim Ellis had $100,000 in student loan debt when he started Relativity Space.

What is the name of the rocket Relativity Space is developing?

The script does not provide the specific name of the rocket being developed by Relativity Space, but it is referred to as the 'world's largest 3D printed rocket'.

How much total outside investment has Relativity Space received to date?

Relativity Space has received over $1.3 billion in total outside investment to date.

What are the two launchpads that Relativity Space currently has?

Relativity Space currently has two launchpads, one at Cape Canaveral and another at Vandenberg Air Force Base.

What is the current valuation of Relativity Space?

Relativity Space is currently valued at just over $4.2 billion, making it the second most valuable space company.

What is the significance of the number 1.4 million in the context of Relativity Space's facilities?

The number 1.4 million refers to the square footage of the company's facilities, indicating the scale of their operations.

How did Tim Ellis' experience with Legos influence his career path?

Tim Ellis' obsession with Legos in his childhood, which led to a permanently bent thumb from pressing pieces together, symbolizes his deep interest in construction and assembly, which translated into his passion for rocket building and 3D printing.

Outlines

00:00

🚀 Founding Relativity Space and the Vision for 3D Printed Rockets

Tim Ellis, CEO of Relativity Space, introduces the company's ambitious goal to build the world's first robotically 3D printed rocket launch vehicle. Ellis, previously an intern at Blue Origin, leveraged his experience and passion for space to start his own company. With a $500,000 investment from Mark Cuban after a cold email, Relativity Space now has two launchpads and a mission to revolutionize space travel with 3D printing technology. Key points include Tim's background, the initial funding, and the establishment of the company's infrastructure.

05:00

💼 From Intern to Innovator: Tim Ellis' Journey in the Space Industry

This paragraph delves into Tim Ellis' professional journey, starting from his time at Blue Origin where he pioneered the use of metal 3D printing. Despite initial resistance, Ellis' persistence led to the establishment of a 3D printing division at Blue Origin. His vision of utilizing 3D printing to reduce costs and increase efficiency in space travel led him to found Relativity Space. The narrative also touches on his educational background, his experience at USC's Rocket Lab, and the pivotal moment when he secured funding from Mark Cuban, highlighting the challenges and opportunities in the early stages of his entrepreneurial venture.

10:01

🌌 Scaling Relativity Space and the Path to Mars

The final paragraph outlines the growth and current status of Relativity Space. It discusses the company's rapid expansion from 100 to 700 employees and the acquisition of 1.4 million square feet of space, previously leased by Netflix. Ellis reflects on his role as a leader, emphasizing the importance of curiosity and the integration of expertise from veterans of the space industry. The company's value, its pre-sold rocket Terran 1, and the collective experience of its team are highlighted, showcasing Relativity Space's potential to be a significant player in the future of space exploration and its commitment to innovation.

Keywords

💡Relativity Space

Relativity Space is a company focused on developing 3D printed rockets, aiming to revolutionize the space industry by leveraging advanced manufacturing techniques. The company is central to the video's narrative, showcasing its innovative approach to space exploration and its potential to compete with established names like SpaceX. Tim Ellis, the CEO and co-founder, is highlighted as a key figure in this endeavor.

💡3D Printing

3D printing is a manufacturing process where three-dimensional objects are created by depositing material layer by layer, based on a digital model. In the context of the video, 3D printing is portrayed as a game-changing technology for space travel, enabling the construction of rockets more efficiently and cost-effectively. Tim Ellis' vision for Relativity Space hinges on the potential of 3D printing to transform rocket production.

💡Robotically 3D Printed Rocket

A robotically 3D printed rocket refers to a launch vehicle that is manufactured using robotic systems to print its components layer by layer. The video emphasizes this concept as the future of space technology, with Relativity Space leading the charge in developing such rockets, which could significantly reduce the cost and time associated with traditional rocket manufacturing.

💡Launch Vehicle

A launch vehicle is a rocket-propelled vehicle used to transport a payload, such as satellites or spacecraft, from the Earth's surface into outer space. The video discusses Relativity Space's goal of building the world's first robotically 3D printed launch vehicle, which would be a major milestone in the commercial space industry.

💡SpaceX

SpaceX is a leading private aerospace manufacturer and space transportation company founded by Elon Musk. The video mentions SpaceX as a major player in the space industry and as a benchmark for Relativity Space's ambitions. Tim Ellis expresses his desire for his company to join the ranks of SpaceX in the race to Mars.

💡Blue Origin

Blue Origin is a private space company founded by Jeff Bezos, focused on developing technologies to enable human space exploration. The video highlights Tim Ellis' previous employment at Blue Origin, where he gained valuable experience and was inspired to innovate in the field of 3D printing for rocket manufacturing.

💡Student Loans

Student loans are financial instruments taken out by students to cover the cost of education. In the video, it is mentioned that Tim Ellis had $100,000 in student loans when he started Relativity Space, illustrating the personal financial risk he took to pursue his entrepreneurial dream in the space industry.

💡Investment

Investment in the context of the video refers to the financial backing provided to startups like Relativity Space to support their growth and development. The video details the company's total outside investment of $1.3 billion, emphasizing the significant support and confidence from investors in the company's vision and potential.

💡Y Combinator

Y Combinator is a startup accelerator that provides seed funding and resources to early-stage companies. The video mentions that Tim Ellis and Jordan Noone were accepted into Y Combinator, which played a crucial role in establishing Relativity Space and proving the feasibility of their 3D printing technology for rockets.

💡Mars

Mars is the planet that serves as a focal point for future space exploration and colonization efforts. The video discusses the ambitions of companies like SpaceX and Relativity Space to reach Mars, with Tim Ellis expressing his belief in the necessity of 3D printing technology for establishing a sustainable presence on the planet.

💡Artificial Intelligence

Artificial intelligence (AI) refers to the simulation of human intelligence in machines that can perform tasks that usually require human-like cognition. The video touches on the combination of AI and 3D printing as the future of space exploration, suggesting that intelligent 3D printers could be used to build and service rockets both on Earth and potentially on Mars.

Highlights

Tim Ellis, CEO and co-founder of Relativity Space, is building the world's first robotically 3D printed rocket launch vehicle.

Relativity Space aims to compete with SpaceX in the race to Mars by constructing the world's largest 3D printed rocket.

Tim Ellis received initial funding of $500,000 from Mark Cuban after cold emailing him, showcasing the potential of 3D printing in space technology.

Relativity Space currently operates two launchpads, emphasizing the company's practical establishment in the space industry.

At 31, Tim Ellis is leading a company with significant outside investment, highlighting the potential of young entrepreneurs in the space sector.

Tim had $100,000 in student loans when starting Relativity Space, illustrating the challenges faced by aspiring entrepreneurs.

The company now holds 1.4 million square feet of space, indicating substantial growth and investment in infrastructure.

Relativity Space has received a total outside investment of $1.3 billion, reflecting the market's belief in their innovative approach.

Tim's childhood passion for Legos and problem-solving skills laid the foundation for his future in rocket engineering.

Tim's experience at Blue Origin, including his work on the first-ever metal 3D printing project, was pivotal in shaping his vision for Relativity Space.

The potential of 3D printing to revolutionize space travel by reducing manufacturing times and costs was a key insight from Tim's time at Blue Origin.

Tim's vision for 3D printing includes its application in building rockets on Earth and servicing them on Mars, emphasizing the technology's long-term potential.

Relativity Space's Terran 1 rocket is the most pre-sold rocket in history, demonstrating strong market confidence in their technology.

The company has rapidly scaled from 100 to 700 employees in under three years, showing impressive growth and industry demand.

Relativity Space is valued at over $4.2 billion, making it the second most valuable space company, highlighting its market impact.

Tim Ellis remains deeply involved in the technical aspects of the company, showcasing the importance of hands-on leadership in innovation.

Transcripts

Hi, I'm Tim Ellis, CEO and co-founder Relativity Space.

And we are building the world's first robotically 3D printed rocket launch vehicle.

You can probably recognize the biggest names in space by just using their last names.

Bezos, Musk, Branson.

But you might want to keep an eye on an up-and-comer: Ellis.

In order to join Elon Musk's SpaceX in the race to Mars, Tim Ellis' Relativity Space is building the

world's largest 3D printed rocket.

And if that sounds crazy, just wait.

Thanks for taking out some time.

I really appreciate it.

Yeah.

Of course. Excited to chat with you and share more about our story.

You've got a wild story.

Tim spent five years working at Blue Origin before leaving to start the first 3D printed rocket company

with a $500,000 check from Mark Cuban.

A few minutes after cold emailing Mark Cuban, we had a half a million dollar commitment.

But this isn't some hypothetical, futuristic idea.

Relativity Space currently has two launchpads, one at Cape Canaveral and another at Vandenberg Air Force Base.

And at 31, this dude is just getting started.

The three numbers to look out for in this story are $100,000, the amount Tim had in student loans when he

started Relativity Space.

1.4 million, the amount of square foot the company currently holds.

And $1.3 billion, Relativity Space's total outside investment.

Here's how a kid's love of Legos turned into a multi-billion dollar startup.

For CNBC Make It. I'm Nate Skid.

This is Founder Effect.

Tim grew up in Plano, Texas, where he says all the houses look the same.

He was hyper obsessed with Legos.

I actually played Legos so much that my thumb on my right finger is permanently bent backwards,

literally from pressing the pieces together so much.

In high school, he did the least amount of work needed to get top grades.

For him, it wasn't an issue.

Tim says he got a near perfect score on the ACT, even though he forgot his calculator.

I literally had to remember how to do long division and trigonometry by hand on the fly during the

test.

So STEM always came easy to Tim, but his passion was in writing.

In 2008, he landed at USC when a friend named Jordan Noone invited him to join a student-led group called Rocket Lab.

After witnessing a rocket launch in person, he was hooked.

It looks like looking at a star.

Like, video never captures what rockets are like in person.

And the vibrations are so crazy that it makes the air soupy and thick.

Tim and his teammates launched dozens of rockets, eventually leading him to an internship at a scrappy startup in the

middle of the Mojave Desert called Masten Space Systems, which was the first company to turn a rocket engine

off and then relight it while in flight.

The engine turned off.

We all held our breath and then 2 seconds later, the engine turned back on.

It kind of like caught itself in midair and then came back and landed and everyone was freaking out.

Everyone being all six people.

Jordan headed to SpaceX while Tim did three back-to-back-to-back internships at Jeff Bezos' Blue Origin.

He made a name for himself by taking on incredibly ambitious projects.

Tim was easily the youngest and least educated intern at the company.

How much does an intern at Blue Origin make?

I think it's, like, free housing and maybe a few thousand dollars a month.

It was, like, fairly well paid.

It wasn't. It wasn't crazy.

But yeah, it wasn't a lot of money.

What was the interview process like for an internship at Blue Origin?

They would ask a lot of riddles and kind of...

It was, it was almost like a...

Almost felt like a Y-Combinator interview honestly where just every...

I think there were multiple people on the phone and it would be a technical question and then a space history question.

Like, how many people walked on the moon?

And then, what's the lift over drag of an arrow re-entry capsule?

And how many golf balls can you put in a swimming pool?

Like, it was just a bunch of topics rapid fire.

It didn't take long for Tim to recognize the potential of 3D printing on an industrial scale.

I did the first ever metal 3D printing at Blue Origin throughout these internships because it was physically the

only possible way to shrink the manufacturing times and get costs low enough to fit within

an intern project budget.

He thought it was a no brainer, that it was both faster, cheaper and performed just as well as traditional

parts. And so that was after my third internship.

But then when I came back and worked there full time and started six months later, after graduating with my

master's, no one had done anything with it.

His primary role was designing the rocket end line, thrust chamber and reaction control system for the new Shepard

capsule.

But he couldn't stop thinking about the unlocked potential of 3D printing.

I mean, I remember as basically nine months of being told,

"No, I'm wasting my time."

You know, I was told no by my manager and my manager's manager that they were never going to do

3D printing, but I still kept at it.

And I was refining my numbers about how much cheaper and faster it was going to be.

And then ultimately, I remember getting a very brief meeting with Jeff and he

essentially, like in the room was like,

"Tim, I'm one of the richest people in the world.

Of course we can do this." And I was like, "Yeah, that's what I've been saying."

And so then we, I bought the first metal 3D printer at Blue Origin and then started taking off the 3D

printing division.

Did you learn anything specifically from working closely with Jeff that made a big impact on

you?

Yeah.

I mean, I feel like I'm still, still learning from him.

Like, it's great to set a North Star that fundamentally you don't think people are ever going to want

rockets slower with more parts, with more manual labor and less

automation? Like, there's no world, whether it's one year, ten years or 100 years, where anyone's

ever going to say, "You know what?

I actually want more fixed tooling and less flexibility.

And I want it to take longer and cost more and have more parts and more complexity."

So it almost sounds kind of obvious, but it's not so obvious when you're really thinking

about innovation.

Tim saw the impact 3D printing could have on an industry saddled with millions of square feet, dedicated to

antiquated tooling and a cumbersome supply chain.

If he could drastically reduce the price of building rockets, the cost of space travel would decrease as well.

There's just these giant factories full of fixed tooling, building products one at a time by

hand with hundreds of thousands to millions of individual piece parts with almost no automation.

And that paradigm is just as true 60 years ago as it is today.

Tim thought if we as a species are ever going to get to Mars, we need to develop an intelligent 3D printer capable

of everything from building rockets on Earth to servicing them on Mars.

As I realized, you know, for that future to exist, someone was going to have to found a company

somewhere that built an industrial base on Mars.

I felt 3D printing was really inevitable.

Like, you need a small, lightweight factory that you can launch on a rocket to another planet that can

build a wide range of products with very little human involvement.

And so I thought all of those North Star parameters described an intelligent 3D printer.

And then I just thought, "Well, if we get started today, maybe we could be the person to start this

company."

Tim left Blue Origin in December 2015.

He knew some combination of 3D printing and artificial intelligence was the future of space exploration, and at

just 25 years old, he was willing to go all in.

So he got together with his old friend Jordan, who had recently left SpaceX, and the pair began plotting their next

mission.

And then we very quickly met up at a Starbucks, and I kind of wrote on the back of a Starbucks

napkin this idea of 3D printing being inevitable for existing on Mars.

And that 3D printing really was an automation technology and it was about part count reduction,

fix tooling reduction, speeding up the rate of progress and learning.

Because the faster you can 3D print, then of course, the more you can build a product, test it, improve it,

and keep iterating. And so I just kind of drew out this diagram linking everything together at the high level.

But there was only one problem.

They were flat broke. In fact, Tim had about $100,000 in student loan debt.

How much did you guys have saved up to, like, invest in this company?

From an investment standpoint.

Like I mentioned, I was 25, Jordan was 23.

I had over $100,000 of student debt.

That was my one money mistake was doing a master's and I did not have a scholarship for the

masters. And I didn't do a TA'ship because I was so hooked on Rocket Lab.

I'm from Texas.

I had heard from one friend at USC that Mark Cuban actually responds to

cold emails. And so I just, as the very first email I ever wrote with my Relativity Space email

address, wrote Mark Cuban a cold email.

I actually guessed his email.

So I put 20 different permutations of [email protected].

MCuban, you know, [email protected].

And then I had the message subject line of: Space is sexy 3D printing an entire rocket.

And then I laid out I'm from Plano.

I worked at Blue Origin.

Jordan north at SpaceX.

Here's what our experience is.

And then 5 minutes later he said, "Well, what do you want from me?"

We're raising half a million dollars for our seed round.

You know, I was making numbers up.

Like, I didn't really know at the time what we were doing because we were so new to it, you know?

I said, "Well, hey, do you want to put in $100,000?

We're raising half a million dollars."

And then he replied back probably 30 seconds later and said,

"You know, I'll actually do the entire thing.

I'll give you the full half a million dollars."

And so just like that, you know, kind of a few...

A few minutes after cold emailing Mark Cuban, we had a half a million dollar commitment.

And I haven't told Mark this since, but he was trying to wire us money to a bank account that didn't

exist because we didn't even have a company yet.

How long from writing your business plan on the back of a receipt to you guess Mark Cuban's

email?

Probably like a week, maybe a few days.

I was technically, yeah, I was at my uncle's funeral when I was writing the cold e-mails to Mark Cuban.

So it was like, yeah, it was a very kind of crazy time.

Why didn't you ask Bezos for that first seed funding?

Why did you go to Cuban?

Maybe I was just nervous at the time that if I asked him for the funding that...

I didn't know. I was working there.

I just left. And, you know, I left on good terms and it all seemed fine.

But I don't know.

It's a good question. I really hadn't even thought about that.

At the same time, Tim and Jordan were accepted into Y Combinator, which meant they had three months to prove they

could build the world's largest 3D printer and use it to build a rocket.

They made it. Just barely.

And so I remember Jordan...

While I was rehearsing the pitch for demo day, Jordan, my co-founder, was in the lobby

fighting to file the provisional patent and finish the patent paperwork on the day of demo

day as we had just gotten these parts in.

And then, yeah, we filed it, did the pitch.

I think we were the last presentation of the day.

So we pitched off the record and anchored it because we had some ridiculous number of customer contracts.

Relativity Space sells room on the rockets it launches into orbit to companies like NASA, Telesat and

the DOD.

The same as what SpaceX does and other private launch companies.

And so we have a launch site at Cape Canaveral.

We also have one at Vandenberg Air Force Base.

Ellis says Terran 1 is the most pre-sold rocket in history.

So I think it's definitely showing a lot of the customer confidence in what we're doing.

How much have you totally raised?

How much square footage do you have?

How many employees do you have now?

So we've raised a little over $1.3 billion to date.

We've got 700 employees now, so we're at 100 kind of right when COVID started.

So we've gone from 100 to 700 over approximately the last two and a half years.

So pretty fast scaling.

As far as square footage, so we now have, I guess like 1.4 million square feet.

In that ballpark. Netflix is actually the lease before us.

And so you can actually see this building.

I just learned this. You can see this building in Space Force, the TV show, which is kind of

hilarious that... Yeah, now we're going to build the world's biggest 3D printed rocket in this

new facility.

Relativity Space is currently valued at just over $4.2 billion, making it the

second most valuable space company.

How do you run a company of 700 people though?

I'm now realizing a lot of the things that I got made fun of for growing up, whether it was

researching every topic under the sun and following all these threads and being hyper curious and picking

up and pattern matching information.

All of those skills have let me scale and run Relativity.

We've been also very fortunate to bring on a lot of people that led the first generation of private space

companies. So we have the guy that led the entire Dragon capsule program from the first person on the program to

leading the entire thing over his 13 year career at Space X.

We have the person that led all of production launch.

3000 person team for the whole company.

One of the CTOs and co-founders is an advisor helping us design our next generation rocket

engines. We've got, like, quite a lot of very experienced people.

I think across our whole 700 person team, we've done well over 30,000 rocket launches in our

prior history.

The depth of knowledge that you have to have to not only be a figurehead, but to actually be the highest

level or one of the higher level intellects on the team.

That's got to be crazy.

Like, that has to be insane.

Do people not understand that about Elon or someone like yourself or like or am I conflating two things?

I'm sorry if it's a clunky question.

It's actually a really wonderful question.

And I do think super interesting.

So I can definitively say, I you know, I've met Elon.

I've not worked with him, of course, directly, but from everything I can gather, the guy is an engineering genius.

There's no question about that.

Like, he himself is very special and how hard he pushes, where he

chooses to be ambitious, you know, driving teams to see this vision and

really kind of come around to it being possible.

And I think it's probably the same with Relativity.

Like, yeah, for sure.

I'm definitely plugged in to technical meetings, decision making.

Like, I could walk you through every single way our rocket engine works.

Why it was made that way.

What the decision process was, the 3D printers, the material science, the control algorithms.

Yeah, I'm definitely... It's actually in many ways, Relativity's a playground for me to continue to learn from.

And the more great people we bring on to the team, then you just learn even more because now you have some

of the world's best people to learn from.