To attract innovation, the DoD is shifting its procurement process. Instead of issuing rigid, 300-page requirement documents that favor incumbents, it now defines a problem and asks companies to propose their own novel solutions.

The next wave of space companies is moving away from the vertically integrated "SpaceX model" where everything is built in-house. Instead, a new ecosystem is emerging where companies specialize in specific parts of the stack, such as satellite buses or ground stations. This unbundling creates efficiency and lowers barriers to entry for new players.

The new wave of space startups is moving away from the SpaceX "build everything yourself" model. Instead, companies like Apex Space are unbundling the stack, specializing in one component like satellite buses. This allows for faster development cycles and creates a more robust, collaborative industry.

A key trend, exemplified by Starfish Space, is the rise of businesses serving other space assets rather than just ground-based consumers. Starfish provides services *to* satellites, indicating the development of a self-sustaining, in-orbit economic ecosystem with its own B2B market.

Startups are successfully deploying infrastructure like in-orbit GPUs. However, the space economy remains self-referential, serving other space companies. It needs a major commercial application with Earth-based customers, like asteroid mining, to achieve sustainable growth.

A major shift in government procurement for space defense now favors startups. The need for rapid innovation in a newly contested space environment has moved the government from merely tolerating startups to actively seeking them out over traditional prime contractors.

To combat the growing problem of space junk, any new satellite launched into orbit must have a pre-approved plan for its disposal. This "deorbit plan" functions like an entry visa with a set departure date, ensuring the satellite will re-enter the atmosphere and burn up after its useful life instead of becoming permanent debris.

Starfish Space will own and operate its fleet of "Otter" space tugs, selling services like de-orbiting rather than the hardware itself. This model allows them to continuously improve their software across the entire fleet, capture more value, and align their business with customer outcomes.

The US government no longer just funds defense-specific space tech. It now mandates that startups demonstrate a clear dual-use commercialization plan, ensuring the technology fosters a broader economic ecosystem and isn't solely reliant on defense budgets.