Oxford Space Systems

As part of our Innovation campaign, we spoke to Oxford Space System's Founder and Chief Executive Officer, Mike Lawton, about the company's vision, the role of engineers in the UK and what innovation means to him. Oxford Space Systems is one of the companies supported by our Stephenson Fund.

What does Oxford Space Systems (OSS) do?

OSS is developing a new generation of deployable structures for the global space industry. By ‘deployables’, we mean those things that unfurl from the side of a satellite once in orbit – things such as solar panels, antennas and boom systems.   

What are the key innovations of the business?

What makes us different is the use of novel materials and our design techniques. We do use conventional materials, but we’re also developing our own proprietary materials for the space environment. One such development is a flexible carbon fibre we call AstroTube™. This new, highly flexible and foldable material means we can use origami techniques in some of our designs to maximise stowage efficiency.

One current area of R&D, is exploring the embedding of flexible printed circuit boards (PCBs) and gas feed lines within the material. This ultimately allows us to offer products that are lighter, less complex and lower cost than those in current commercial demand. 

Our products are successful because they’re lighter, less complex, more stowage-efficient and cost-competitive. As all our development is done in the UK with UK/European materials, our products are free of the regulations that control the export and import of defence-related articles in the United States ― this is really important, even to some US customers.

What are the key external challenges for the company?

External challenges include access to test facilities. Developing hardware for space requires the use of test equipment and facilities beyond those that a start-up or SME can afford. Use of UK facilities such as those at the Harwell Space Cluster prove challenging, as they’re an asset currently tied up with delivering long duration science and instrumentation systems. I’m hoping that with further investment at the Harwell Space Cluster we can expand facilities to support the more “quick in / quick out” needs of agile SMEs.  

The European Space Agency funding regimes also pose a challenge, in that they are more suited to larger and more established businesses. Getting appropriate Home Office clearances to bring in overseas talent has proved very time-consuming and challenging.

Access to growth finance can also prove challenging. There’s no shortage of start-up finance in the UK for good ideas via the business angel and venture capital community; accessing seed funding under £1m is relatively easy. However, there’s a lack of growth capital to enable early-stage companies to accelerate expansion. Typical growth funds need to have a critical mass, of over £100m, to enable them to deploy significant expansion capital into companies, for over £5m for example. US funds to do this exist. The challenge for the UK, is that we need to create the environment for investors here to operate such growth funds. Without this, there stands a risk of companies such as OSS relocating to the USA, to access the scale of growth investment required.

Red tape is another issue, as accessing external matched funding to come in alongside private equity finance is a huge barrier and overhead. The process to access funding from ESA and EU programmes such as Horizon2020, are oppressively paperwork-heavy and it can take many months to receive a decision. The return of investment of the time and cost to distract a team for writing a funding bid is something we often can’t make stack up. Put simply: it takes too long and costs too much to gamble resources on the possibility of securing funding at some distant future point. The one exception that must be highlighted is Innovate UK. For some of its nationally administered programmes, levels of bureaucracy show a good understanding of the pressures on SMEs, and application processes are mercifully leaner and the decisions are more quickly made.    

Watch how OSS is developing low mass and cost competitive deployables for use in space

What are the company’s internal challenges?  

Internally, two things are always in eternal short supply in an early-stage company: cash and people. With very modest resources, product development has to be planned very carefully. The focus is invariably on hitting the next technical milestone, to release stage gate funding from investors and agencies on the road to achieving a releasable, commercial product. The first few years of any tech start-up’s life are the most hazardous: getting a product out of a research & development phase to generating revenue before the cash runs out, is not for the faint of heart! 

How many engineers does OSS employ?

We have 11 engineers out of a total of 16 staff members. As the founder and CEO, I’m an Electronics Engineer by training and education (BEng) and our Chief Technical Officer, Dr Juan Reveles, who holds PhD in Computational Mechanics, is also Chartered Mechanical Engineer and sits on the OSS Board.

Has OSS experienced any shortages in the recruitment of engineers or technicians?

Yes. There is a lack of UK talent that can be attracted to consider joining an early-stage tech company. The majority of OSS staff are currently overseas nationals. 

Do you think we do enough to promote engineering and science in the UK?

I would suggest the evidence says we don’t. I think our approach can be much improved. To encourage students early in their education journey, we need to excite and enthuse them. Due to a lack of resources and ever present Health & Safety concerns, it seems a lot of schools aren’t able to let students do the most exciting thing in engineering: learn by physically doing. It’s only when students build (and break!) their first structures and mechanisms that a genuine connection and a passion for engineering take hold.      

Do you believe the UK provides a good environment for science and engineering companies?

Yes. The UK is a great place to start a tech company and there’s plenty of science and innovation campuses around on which to locate. There seems to a constant stream of conferences and workshops in the UK, where the ability to promote a start-up exists as well as network with peers; plenty of seed investment together with co-funding bodies, such as Innovate UK.  

However, I think the Government could revolutionise the UK space industry, by flipping the funding split between national programmes and ESA.  Currently roughly 80% of the UK budget goes via ESA; it would be interested to see how fast the UK could move if that was flipped to provide low bureaucracy, entrepreneurial focused investment. 

Do you believe Government should invest more in product development, or that this should be left to private capital investment?

If the UK would like to have companies like Space X, Tesla and Apple founded here – and stay – then Government should invest more in product development. It is about finding mechanisms to provide growth capital to enable SMEs to scale. Government co-investment at scale serves two purposes:

1.       It reassures the private equity community that the idea/company has undergone further due diligence as to its viability.

2.       Private investment (external to a company) will invariably mean share dilution. If growth capital comes only from private sources, then share dilution might be so excessive that the founders feel that the ‘light is not worth the candle’.   

What does innovation mean to you?

Innovation means taking a non-obvious and often brave leap forward. Brave in the fact it will entail a company and financial risk – and maybe even a career risk. A true test of innovation is the reaction of peers and incumbent competitors: if they’re dismissive or highly sceptical, you’re probably onto something!

Mike Lawton is Founder and Chief Executive Officer of Oxford Space Systems. He is an Electronics & Electrical Engineer, by training, and describes himself as a ‘serial entrepreneur’.

To find out more visit the OSS website

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