Shankar: I am excited to be with a rocket scientist. Space has always fascinated me. I congratulate you, Srinath, for bagging the ET 2020 award and TiE50 award. We also read that Anand Mahindra has chosen to invest in your company in his personal capacity. It is a strong endorsement of what you are doing. You are in space tech. How do you fit in with the rest of the space players? What is your competition? Where do you think you are going?
Srinath: Space is another world. Getting to that world is one part of the business. Doing something from there is the second part. Processing the data collected is the third part. We call it: a) launch vehicles b) satellites and c) the ground segment, which collects the data and processes it. We operate in the first part-that is, the launch vehicles. To some extent, you can compare it with transportation business. Here, it is space transportation.
There are a lot of industries emerging in all these segments. Space X is also into launch vehicles but they are in a different class and in a very big way. There are satellite companies as well. You might have heard of OneWeb, in which Airtel recently acquired a stake. There are also ground station providers who collect data. There are companies that process data and distribute it to end users. That is the whole spectrum, and we are in the first part.
Have you chosen to be there by choice?
Who is your customer and why should they come to you?
Let me use a couple of analogies to explain this. Over the last two decades, satellites have become smaller in size because of the development in electronics, sensors, etc. Rockets are nothing but vehicles that carry satellites to space. Rockets could not catch up with the speed at which electronics shrunk in size. As a result, rockets have become too big for satellites and they are forced to ride-share. It is like taking a bus ride because you don’t have a cab. You have to wait in the bus stop for the bus; it must have seats for you; and it has to go to the destination that you want. In the same way, satellites have to wait for the rockets.
In space, there is a recent development where everyone does not want to go with everyone. They feel that an expensive satellite may be damaged by an inexpensive rocket developed by students or amateurs. They want exclusivity. The net result is that even though a small satellite can be built in six months, to check off all the boxes, you have to wait for two years.
Who are the end-users of small satellites?
There are usually three categories: 1) Conventional—either you go up and take pictures or you bounce off signals between two points; 2) Unconventional—very interesting applications are now coming up. There is a company called ALE in Japan. They try to do to artificial fireworks from space. They take the debris up and scatter it in a particular manner; and 3) We have people who do subsistent testing. Earlier, they would simulate the space environment from here. Now they are testing in space with small satellites. These are the people who struggle to get a rocket. And these are the people to whom we are talking to.
With small satellites increasing in number, we thought, “Why don’t we build vehicles for them?” It is like getting all the facilities of a cab ride, meeting all your requirements. You can hire it when you want. So we want to build a rocket that is completely customisable and which is meant for the customer.
Are you telling me that if I have a 10 kg satellite, you will build a rocket for me?
Exactly. The profitable limit at the lower side is 30 kg, and on the higher side, 300kg.
How is your launch cost comparable with the ride sharing cost?
They are on the same side, perhaps slightly cheaper but the game that we play is with the waiting time.
You are 3D printing the rockets which is amazing.
We didn’t want to make a machine for producing the rocket engine. So we chose the biggest machine available in the market. Our design iterations led us to printing the rocket engine which we named ‘Agnilet.’
Rocket engines have to handle enormous temperatures, very high pressures; and, tolerances are very stringent. Why do you 3D print and what advantages does it give you, relative to a conventionally assembled rocket?
Making a rocket engine quickly was a challenge. These engines take enormous amount of time to manufacture because of the number of parts and the precision engineering required. In IIT Madras, there is the largest combustion R&D centre. They were doing projects for 3D printing of jet engines. It proved the point that 3D printed engines are capable of withstanding high temperature and pressure for over a period of time. That’s where our idea started.
Professor Satya Chakraborty of IIT-Madras, who is a co-founder of our company, suggested us to look at 3D printing for our rocket engines. He pushed our boundaries and we decided to print the entire rocket engine. There is zero human assembly involved. We first started printing different pieces of the engine and tested them. Then we moved to printing the entire engine.
In this process, there must have been failures on the way.
We get only 0.4 mm of precision in 3D printing. Because of this factor, one of our engines was not sufficiently cool. The throat of the engine got burnt. Another problem was that the metallic powder from printing got clogged. At every step, we learnt something and the problems could be fixed.
When you carry another person’s satellite, you have to be very careful not to damage it. How do you manage this?
We have been discussing with our customers since 2017. They have seen us grow. They usually ask us about three or four metrics. Because we work with a team of retired ISRO scientists, we are able to convince our customers.
Is a 3D printed engine superior to the conventional engine?
It is superior in terms of manufacturing because in 72 hours, without any human intervention, we can manufacture the engine. Performance wise, both target the same parameters. So basically, it is the ease of manufacturing.
What sort of investors have you found in this journey, to fund your project? What is in it for them?
We have gone typically with institutional funds. Some angels too have come in. We found it hard in the beginning. The Space-X story has inspired many investors.
Why do you continue inside IIT where the setup is very good for early stage? Now you are in project mission mode. Very soon, you will be commercialising it.
We are now in the quasi-commercial stage; when we transit to commercial stage, we will move out. As per industry standards, we must make three test launches. It is now comfortable working in the academia. After the third launch, definitely we’ll go out.
For ten years, you were a Wall Street insider. Then you made two major shifts. From Finance, you have moved to a totally unrelated domain. What caused you to work in two different dimensions?
I have always been an aerospace physics enthusiast. My dad is an engineer and my mom is into physics. I wanted to do a degree in aerospace engineering. People advised me to go for a core and branch off later. So I did electrical engineering and took up a job in motor design in India. I went to New York in 2008 and pursued finance because everyone who was around me in my college was doing a course in finance.
I had no idea in finance and was intrigued by it. But my timing was a little wrong, with the financial meltdown happening in 2008. But it taught me rare values and about risk management. Every day, there was one less company to apply for a job.
I got into hedging and risk management. Within a year or so in Wall Street, I realised that my heart was in engineering. After a couple of years, I quit that job and joined Masters in Aerospace Engineering in University of Illinois Urbana—Champaign. It was 2015 and I was closely following Space X.
I have always been a rocket enthusiast. Luckily, we found there was big gap in this segment and a huge need for rockets to carry satellites.
You were in US and Space X was happening. Why didn’t you join Space X?
In fact, I was interested but I had visa limitations due to my finance background. I even applied but couldn’t clear the interviews. I found out that there was tremendous respect in the US for Indian space work. All credit for this must go to ISRO. So I wanted to move to India.
Your co-founder Moin has also travelled a similar path like yours.
Yes. I knew him from very early days. We used to play cricket together in Gopalapuram, Chennai. He was in Australia and came back to Chennai because his dad was not well. After he stabilised, he was looking for a career in aerospace engineering. That’s how we came together and the combination clicked. Because we knew each other, it was easier.
How did you sell this to your family?
(Laughs) I used to crib a lot earlier about not liking what I was doing. So my family just wanted me to be sure if I was doing the right thing and I must thank them for that.
Did you have a sense of insecurity because you moved from a salaried job to one with an uncertain future?
Definitely, it was bothering me. My friends encouraged me. I wanted to try out for 7 or 8 years; if nothing clicked, I could fall back on my finance background and go back to a job. It was like jumping off a cliff. If you had no parachute, you would figure out your tools.
How did you get connected with IIT?
In 2017, I was cold calling a lot of professors in IIT. I wanted to have academia as my partner because I didn’t have that much money to do it myself. There’s an organisation called ‘Aerospace Industry Development Association’ in Tamil Nadu. My wife casually suggested that I could speak to Mr N Shekar, President of this association, seeing his tweets. He connected me to Mr Madhusudan, Director of Lucid Software. Through his contacts, I got connected to Prof Satya Chakraborthy in IIT. He was the only professor who said that my idea was not bad (laughs).
Tell us about your early days in the startup where you had zero infrastructure and zero funding.
In the first six months, we were not even sure about what we were doing. Then, Professor Satya introduced us to Mr R V Perumal who is considered the father of India’s GSLV program. We had his guidance. Having a retired ISRO scientist on our board cut short our time by 10 years.
How do you divide your roles between you and your co-founder Moin?
There is a formal delineation of our roles and, of course, there’s some overlap. He takes care of the core operations. I work on fund raising and technology part.
You decided to follow the Space-X model and go into the rocket segment, not the satellite part of it. Was it a conscious decision or out of passion?
It was my passion. I have always been a rocket enthusiast. Luckily, we found there was big gap in this segment and a huge need for rockets to carry satellites.
We’ll have a margin of $15,000 per kg. We need a minimum of 30 kg per launch. To break-even, I have to put around 250 kg payload into space. The demand is 40 Tons per year. Our company caters to a very small requirement. India has a potential to meet 4 to 5 tons through small rockets like ours.
What’s your continuous differentiator? Tomorrow, anybody can 3D print rockets.
It’s hard to copy because you have to start from scratch. Customisation is another key differentiator for us. We can build a rocket exclusively for you. We optimise our design.
Your rocket names like Agnilet, Agnikul and Agnibaan are so Atmanirbhar! Tell us how did you come to interact with PM Modi?
When he came to IIT Madras for its convocation, it was just a 30 second interaction. We had a stall and he came there. I explained to him in English about our work. He was muted in his reaction and said, “Good.”
Recently, we signed an agreement with ISRO. They organised a meeting with the Prime Minister. I got a chance to make a 5 minute presentation to the PM. He saw that and tweeted about me and our work. That was a very satisfying conversation. The validation that we got from the PM motivated me and my team in no small measure.
Tell us about the days leading to the testing of Agnilet.
During the test launch, we all screamed at our success. Unfortunately, we got our video recording wrong. So we could not show our Professor the video of the launch. Now, of course, we have videos.
How did you pitch for your funding?
We pitched saying that we are building rockets economically just like cabs being used by common people. We have done two rounds of funding and are working on the third. The second one had much to do with customer interaction. Now we are talking about commercialisation. We have some money in the bank. We will get to a point where we don’t need to raise money to survive. We’ll start getting revenues by then.
How are you planning for commercialisation?
We have been reaching out to customers since 2017. Now we have gained traction and people have signed up with us. It’s a small industry and we have overall 600 customers. After you have done a few milestones, people know you.
Unavailability of rockets to launch satellites has been a big constraint. We are tapping into that need. We also partner with the makers of satellites. We offer end-to-end solutions and tell them that we can launch their satellites in just two weeks’ time.
Do you need a formal launch pad or can you launch from anywhere?
We do need a formal launch pad. But we have a mobile solution. We can go to any of the launch pads—the ones in Sriharikota or the one that’s coming up in Kulasekarapattinam. We need seven 40 feet containers to carry all the system and accessories including the rocket, gantry, fuelling system and the controls. We can launch from overseas too. The launch pad should be on a coast line.
What is the ticket cost of launching?
Roughly, it is $40,000 per kg. Our costs are: the Bill of Materials and Operations, Insurance and, the launch pad rentals. We’ll have a margin of $15,000 per kg. We need a minimum of 30 kg per launch. To break-even, I have to put around 250 kg payload into space. The demand is 40 Tons per year. Our company caters to a very small requirement. India has a potential to meet 4 to 5 tons through small rockets like ours.
Once we got the first round of funding, things became easier. The supplier market in Chennai is great because of the automobile industry. There are so many suppliers in Chennai who even supply to the army.
Will ISRO become your competitor?
We are building technology with them and they won’t see us as a competitor.
How has the environment supported you?
I didn’t find any disadvantage operating from Tamil Nadu. IIT Madras is a great place to be in, technology wise. We had problems initially with funding. In Chennai, it’s difficult to get investors. I had to make weekly trips to Bengaluru. It was painful.
Once we got the first round of funding, things became easier. The supplier market in Chennai is great because of the automobile industry. There are so many suppliers in Chennai who even supply to the army. DRDO and ISRO have already built up an ecosystem in and around Chennai. 80 kilometres from here is Sriharikota.
What are your suggestions to make Chennai a more attractive destination for startups?
I’ll share from my experience. Karnataka has ‘Elevate’ awards where they give awards to top100 startups each year. This is a great motivator for startups as the recognition comes from the government. In Tamil Nadu, there is lot of focus on MSMEs and contract orders and little less focus on R&D. It will be good if R&D is also encouraged.
Any wish list from the government?
Only thing is that if the government starts taxing after we generate revenues, it will be good. We have got a free cheque from Atmanirbhar, thanks to our new space policy and PM’s initiatives. I cannot ask for more.
When you scale up, how will your working style change?
We believe in democratic decision-making and autocratic implementation. We follow the rigour in documentation and quality. But we will have to change in terms of the day-to-day operations, when we scale up. We already have 60 people in our team today. Moin and I have trained a lot of people who can manage the routine operations without us being in the loop. We do have a long way to go and we need to showcase our work more.
What do you do to cool off?
I listen to film interviews. I also write. I attended classes in film making when I was in New York.
Your advice for young entrepreneurs?
Many youngsters want to be entrepreneurs because they want to be their boss. That’s the last reason you should be an entrepreneur. If you are becoming an entrepreneur because you want to solve a problem, then everything will flow naturally.