I was looking for a word to describe an unimagined market and the best fit I could find is terra incognita, or “unknown land.” Roman cartographers used the term to label mystery territories on maps for explorers.
This all came up because Deloitte just published its attempt at a value for the moon economy—and all the cascading unknowns that could flow from going there like finding rocket fuel, extracting minerals, and forming data center manufacturing hubs. The value of a lunar economy is $566 billion in an accelerated-growth scenario by 2050, and $343 billion under a more conservative scenario. But there’s a separate $541 billion that Deloitte pinned to the space-based potential stemming from scientific advances, new energy sources, and innovative commercial applications. That’s the terra incognita—what could come.
I spoke with the coauthors of the report, “Building the Lunar Economy,” Brett Loubert, who leads Deloitte’s space practice, and Raquel Buscaino, head of its novel and exponential technologies team. I asked Buscaino about risk, and she told me the “uncertainty and ambiguity” around the unimagined market isn’t necessarily a warning, it’s a sign of “extraordinary possibility.”
“Uncertainty isn’t a flaw in the story,” said Buscaino. “Some of these distant opportunities could have extremely large upsides.”
No one knows yet which ones will pan out or what will ultimately matter the most in a market we haven’t imagined yet, she said, but it’s a critical piece of what’s playing out right now in space. “The uncertainty is part of the reason so many investors, countries, agencies, and folks within your community might be interested in this,” Buscaino said.
Deloitte’s model drew on more than 25 interviews and 400 model inputs to map two value pools. The first is core lunar infrastructure, which is what you need in space. Transportation, energy, communications, life support, and construction come in at $282 billion through 2050. Not a shock that transportation soaks up $206 billion of that figure.
The second pool is what all that infrastructure can enable. There’s the obvious national security posture, which Deloitte calls “the ultimate high ground.” Deloitte itself is moving onward in this sector with its Silent Shield cyber intrusion detection system, so the advisory firm already has a stake in the success of space. There is also helium-3 extraction, rocket propellant, orbital compute, and in-space manufacturing. Deloitte valued this pool at up to $284 billion.
Capital of all sorts is already on the move. Seraphim’s space tracker reported $7.5 billion in space-tech investment in Q2 of this year, with trailing 12-month investment at an all-time high of $23 billion. A separate analysis of publicly disclosed equity rounds by space companies over the past year found 47 deals with a median round size of $40 million and an average of $116.2 million. SpaceX alumni have left the mothership and forged 141 startups and companies of their own, worth $10.6 billion, according to Forbes.
By the way, none of this can be disentangled from SpaceX, piloted by Elon Musk and now a public company carrying a market cap of $1.8 trillion. Only Musk could make space as mainstream as it is right now in as short of a time period as we’ve seen.
And potentially an even more interesting dynamic, Loubert said, is the funding model for space, where governments are increasingly acting as anchor investors and customers. They buy rides to the moon and engage with companies on commercializing their capabilities. The government has said, ‘We’re going to basically fund the initial development and the initial missions that are going to go there to help de-risk and provide not just government funding, but also confidence to your investors that there is a near-term government and consistent demand,’” said Loubert.
Essentially, said Buscaino, governments are helping to create demand for the foundational infrastructure. The hope is that as the infrastructure matures and costs come down, commercial activity increasingly scales alongside it. So, if the unknown sounds appealing and not at all like a warning, I invite you to the terra incognita of what’s to come.
See you next time,
Amanda Gerut
amanda.gerut@fortune.com
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This story was originally featured on Fortune.com
