Launch was the hard part. It's solved. What comes next is infrastructure, and almost nobody outside the category is watching it get built. Daniel Kleinmann spotted the shift in 2018 while deploying venture capital for a single family office. Tom Ruggie talks with him about how a category gets identified before the market agrees it exists, and why Daniel thinks the real surprise of the next five years is the moon, not AI.
Launch was the hard part, and it's been solved. What comes next is the infrastructure, and almost nobody outside the category is watching it get built.
Daniel Kleinmann is co-founder and general partner of Balerion Space Ventures, a Dallas-based venture firm backing companies across launch, Earth observation, propulsion, and dual-use defense. Before that he was a founding principal at Explorer 1 Fund, and earlier ran the venture strategy and direct investment program inside a single family office, where he started deploying capital at 24.
Tom Ruggie talks with Daniel about how a category gets identified before the market agrees it exists. They cover the full value chain from launch vehicles to the lunar economy, why Golden Dome moved missile defense into orbit, how the AI race triggered a nuclear renaissance, and the convergence of four macro trends that arrived on the same timeline. Daniel also explains why he thinks the real surprise over the next five years is the moon, not AI.
LINKS & RESOURCES
Want to read more about the impact of SpaceX going IPO for investors? Read Tom Ruggie's article, published on Forbes.com, Shooting for the Stars: What the SpaceX IPO Means for Investors.
ABOUT SIGNIFICANCE OF WEALTH PODCAST
Hosted by Tom Ruggie, ChFC®, CFP®, the Significance of Wealth explores the evolving landscape of wealth management, private investments, and collecting as both a passion and an investment strategy. Subscribe for new episodes on Apple Podcasts, Spotify, Pandora, and YouTube.
Martie Salt: Welcome to the Significance of Wealth Podcast, where we explore the evolving landscape of wealth management, private investments, and collecting as both a passion and an investment strategy. I'm Martie Salt, and today's guest started deploying capital for a single family office at the age of 24.
Martie Salt: He now runs his own fund. Daniel Kleinman is the co-founder and general partner of Balerion Space Ventures, a Dallas-based firm backing the companies building the new space economy, from launch and propulsion to Earth observation and dual use defense technology. Before Balerion, he was a founding principal at Explorer 1 Fund, and earlier built the venture strategy and direct investment program inside a single family office.
Martie Salt: He's worked both sides of the table, the family deciding where its capital goes, and the investor asking for it. Today, Daniel joins Tom to talk about how you back a category before anyone else calls it one. They get into what a newly public SpaceX still has to prove, the moon as the center of a new race with China, the nuclear build-out the AI boom is forcing, and the bigger idea behind all of it, which is moving critical infrastructure off Earth.
Martie Salt: And now, here's your host, Tom Ruggie
Tom Ruggie: Tom Ruggie here with, another edition of The Significance of Wealth. I have with me Daniel Kleinman. Excited to have him. I actually have been, been following his and his company's newsletter for a number of years, which we'll delve into along with, you know, a, a, a topic that a lot of people are talking about today, SpaceX, gonna get, maybe even a little bit deeper than, uh, this, than SpaceX the, the space exploration topic.
Tom Ruggie: With that, Daniel, pleasure to have you here. Thank you for being on the pod with us.
Daniel Kleinmann: Thank you so much. Yeah, I appreciate I appreciate you guys having me.
Tom Ruggie: Yeah. would love to hear a little bit about, you know, the path you worked with a single family office. You know, we run a multifamily office. You've gone a different direction and now very focused in you know, what I think is just one of the most exciting sectors out there. But again, would love to hear more about what got you from point A to point B.
Daniel Kleinmann: Sure. Um, yeah, thanks so much for having me today. I mean, my, my story kind of starts back in, uh... I mean, I, I kind of grew up between New York, Israel, and Canada. Did my undergraduate studies in Canada and from there went over to Israel to work in kind of the tech ecosystem, working for startups, scouting, uh, technologies and, and then gone to business school and kind of post-business school in New York.
Daniel Kleinmann: You know, I was, I was very fortunate to meet a gentleman who asked me to kind of join his family office and help build out his venture strategy. And at the time, I inherited sort of a bespoke venture strategy that kind of spread out in-into different opportunities, and I kind of helped build, uh, from the ground up, like a multi-channel deal sourcing engine, both at the fund and direct level.
Daniel Kleinmann: And, and by doing so, I was spending a lot of time in, in Silicon Valley. This is around like twenty seventeen, twenty eighteen, twenty nineteen. And I was attending, uh, Y Combinator, if you're familiar with Y Combinator. Sort of the, uh, the, the marquee kind of, uh, accelerator/incubator in Silicon Valley where most of the tier one VC firms kind of attend.
Daniel Kleinmann: At the time, it was twice a year, you'd have, uh, kind of four or five hundred startups appear in, in demo days and kind of present. And it, it was, you know, both an, an incredible place to source opportunities. Companies like Airbnb have kind of come from it and, and Stripe and the likes. But, uh, it was also a great o- kind of litmus test to see kind of what, what Silicon Valley and the venture capital community was willing to fund.
Daniel Kleinmann: And around twenty eighteen, I started seeing more and more space companies attend these demo days. And I r- I remember the first one I attended, there was none. The second batch I attended, there was, there was one that I remembered, and then it was like three, and then seven, and then I kind of pumped the brakes and said s- you know, "Something's going on here."
Daniel Kleinmann: And through that, I d- I started doing more and more research and I was very fortunate to kind of through my research and networking meet m-my now two co-founders at Balerion, a guy named Phil Scully, uh, and Dan Wolman. And Phil's background is kind of like myself, come from financial services, having worked at places like the Capital Group companies mostly doing equity research at the institutional investor level.
Daniel Kleinmann: And then our, our other partner, Dan Wolman, who's an aerospace engineer by training. Dan worked at places like Boeing in a, in a special group there called Phantom Works, doing like rapid prototyping for the US government on unique projects before they kind of get picked up by the primes and then and then worked under Bezos at Blue Origin, doing propulsion and government-related work.
Daniel Kleinmann: And so the three of us connected back in 2020 and we really had this thesis that, you know, launch had effectively been solved for due to SpaceX achieving reusability and seeing kind of the ramp-up of, uh, launch cadence of Falcon 9. And we were seeing more and more assets get sent to, to space.
Daniel Kleinmann: But the underlying infrastructure and supply chain that, you know, was supposed to basically support these assets going to orbit was just, to us, not sufficiently built out or modern enough to really help scale commercial space. And so we, we came together with this thesis that, you know, let's, let's kind of map out every kind of sub-vertical that represented the value chain of, of space, and let's identify the areas that we believe have the largest near-term revenue opportunities, and then go identify the, the, the companies that we believe would be the ca-category winners.
Daniel Kleinmann: and that was back in 2020. Obviously, over the last five and a half
Tom Ruggie: was, I would, I would consider that, at least from my own personal path kinda way ahead of the curve. I can't imagine that there was... Aside from SpaceX, which even, even in 2020, I mean, SpaceX wasn't anything near what it is today from a, you know, a common knowledge standpoint. I mean, you guys are just way ahead of the curve
Daniel Kleinmann: Yeah, it was crazy to start a space fund in the middle of COVID in 2020. We, we were seen as kind of, uh, cowboys if you will, and kinda out there. But I think too, like my partners and our credit, like we kinda saw the fundamental picture play out where there was real revenue opportunities a lot of it from the US government, a lot of it from satellite communication that was being want and companies were, were really generating revenue.
Daniel Kleinmann: And so we kind of pulled on that thread and, and then obviously over the last five and a half years, what's really pl- panned out and helped the category is these major kind of geopolitical events that have acted as like major macro tailwinds to the category, whether it be you know, the, the war is unfortunately breaking out, but defense budgets increasing dramatically.
Daniel Kleinmann: The Chinese emerging as a, as a m- massive threat and sort of main competitor to the US and now a, a sort of a new space race with the US versus the Chinese, the emergence of Golden Dome and, and, and lastly, the sort of the, the AI race that's ushered in a nu-nuclear renaissance. And so we've really been hyper-focused on where revenue have-- has, you know, gone to up and down the value chain as a result of these macro trends.
Daniel Kleinmann: And that, and that's been kind of the, sort of the core thesis of ours from investment standpoint over the last five years.
Tom Ruggie: Yeah. You know, Elon is such a visionary. And again, talk about being so far ahead of the time, but, you know, as you're well aware, in fact, probably some of what I'm talking about I might've e- extracted from your newsletters. But, I mean, E- Elon's got, Elon's got pretty big plans for, you know, kinda the new frontier of, of what space is going to be made available for from, you know, whether it's, it's you know, doing something on Mars, you know, whether it's o- obviously you know, heavy in the, launching the satellites. I also continue to hear a trend of thought of, of space being where, you know, some of the data centers, the data components for AI is ultimately going to be for various reasons in- including resources and and whatnot. Where are you looking on a go-forward basis?
Tom Ruggie: like, when I looked at even SpaceX six, seven years ago, I was just, to, to me, that was just a- almost otherworldly some of the things that were being talked about, and now so much has come to fruition. and I think for a lot of people, and, and to some extent even myself, you know, probably where we're gonna be in five or 10 years is almost hard to imagine or fathom.
Tom Ruggie: But you know, would, would love some insights on that from your perspective.
Daniel Kleinmann: Absolutely. Maybe, uh, may-maybe it can help kind of provide a framework. This is what we use internally as we think about investing, and it's kind of been our, our framework that we've used over the last six years to help navigate kind of the opportunity set from an investment standpoint. But I think it touches on kinda how you navigate the future of space.
Daniel Kleinmann: To us, e-everything really starts with transportation, so think about launch vehicles that are putting assets into orbit. If you were to kind of parse that out even further and to kind of sub-segment out, you've got these heavy launch vehicles that look like Starship that are sort of the 18-wheelers.
Daniel Kleinmann: You've got the small sat launch providers, which are kind of the sprinter vans, and then you've got everything in between. Those are putting assets into orbit, and those assets look for, you know... The, the vast majority are communication satellites, so Starlink-like systems providing internet from space to earth globally.
Daniel Kleinmann: That's ninety percent of the assets that are being sent to space. Some of the others include, you know, imaging satellites, both for government and civil purposes. You've got private space stations. You've got in-space manufacturing, so actually sending up capsules into orbit that are manufacturing things and bringing it back down.
Daniel Kleinmann: And then I think some of the, you know, future opportunities look like orbital data centers. Kind of moving on, you've got all the subcomponents that kind of make up a satellite. So think about like the actual chassis of a satellite or the, the bus they call it. The subcomponents like power and communications and such.
Daniel Kleinmann: You've got all the in-space infrastructure that supports these assets, so moving stuff between different orbits, refueling these satellites. You've got the ground-based infrastructure that brings the data and offloads the data to the ground stations. Then kind of moving a little bit further out, you've got the lunar economy, and that looks like landing on the moon.
Daniel Kleinmann: You know, setting up critical kind of power and communications infrastructure on the moon, and then eventually mining the lunar surface for, you know, precious metals or, or h- things like helium-3. And then you've really got like the supply chains that feed into everything. That looks like propulsion systems, propellants, power, so nuclear or solar advanced manufacturing, and then even the raw inputs and so on.
Daniel Kleinmann: That is the value chain as we see it today. I think w-what ends up happening is as additional launch capacity comes online and launch prices come down, you'll see that value chain evolve to, to things like, you know, the Martian economy to mining asteroids, to, you know, to, to, to applications that we can't think of today but will come online as a result of that.
Daniel Kleinmann: We've really, as I kinda mentioned earlier, hyper-focused on specific parts of these from what we believe is like investable and others are not today. But, but that's, that's the framework we use
Tom Ruggie: Yeah, no, who, who owns that space? I mean, you've mentioned, the rush to the space, know, sounds like primarily between us and China. I'm sure we're not obviously the only countries that are, that are looking at that. But, I've heard a lot about mining the moon as an example, and,
Tom Ruggie: In all likelihood, we're going to find elements on the moon that are not on the Earth, and we're gonna find elements that, you know, can be beneficial and solve problems and whatnot. But, but again, who owns that space? How does that work from a standpoint of multiple countries to do the same thing?
Daniel Kleinmann: Yeah, it's like a very deep philosophical le- legal question that I think we could probably spend a week trying to answer. But the, the s- the simple answer to that is who owns the moo- moon? Humankind owns the moon. And then from a, a practical standpoint, it's effectively who can defend it. And so I think if you think about the moon as ef- effectively a land grab right now, you've got the Chinese and the US rushing to the moon to establish an infrastructure.
Daniel Kleinmann: And then what prevents potentially the Chinese from encroaching on your mining territory will probably be deterrence from a military standpoint. In, in the same way the US Navy has for decades kinda created stability on you know, the, the, the ocean fronts for global trade to flow freely, I think the same thing we believe will be true in space.
Daniel Kleinmann: But it is a bit of a Wild Wild West moment right now where if you can get there, it's sorta yours.
Tom Ruggie: And you'd also mentioned earlier defense. Is there anything that is, public knowledge that is being utilized from a space perspective for defense mechanisms?
Daniel Kleinmann: Yeah. That's basically what Golden Dome is. Um You, you can think of it sort of like W- you know, the, the war fighter a- and the theaters of war have kinda gone from, you know, on land to sea, to air, to cyber, and now they're just moving to space. And space provides a strategic high ground and he, he who has the high ground has the advantage in, in warfare.
Daniel Kleinmann: But Golden Dome is basically taking our missile defense capabilities and moving them to space to create deterrence against ICBMs, which are intercontinental ba- ballistic missiles that may be launched from our adversaries at the United States. Israel has Iron Dome, which most people know of, and that is a ground-to-air missile defense system which prevents you know, missiles coming in at a certain range.
Daniel Kleinmann: That would not really be effective for the United States just because of how vast the land is. You couldn't line up our coastlines with Iron Dome batteries. What you'd need to do is basically move those to space, and the premise of... and the architecture proposed of Golden Dome is a couple thousand satellites operating in low Earth orbit or in space, majority of them being threat detection, so imaging satellites that are looking for a heat signature from a known ICBM launch site from places like North Korea or China or Russia.
Daniel Kleinmann: And then once those missiles are detected as being launched at the United States, those missiles have to travel basically such long distances that they enter space and then they come back down. And when they enter space, you would have space-based interceptors, which effectively would act like Golden Iron Dome batteries on Earth to intercept those ICBMs in orbit.
Daniel Kleinmann: And, and that is a lot more effective, and if you can get the cost down a lot cheaper to defend the United States and ideally create deterrence where it doesn't really make sense to launch nuclear warheads and ICBMs at the United States. So that is, Space is just a, a different domain for our national security infrastructure, mostly at the missile defense level.
Tom Ruggie: Pretty fascinating. You know,
Daniel Kleinmann: There's a great movie on this, by the way, Tom. There's a movie called, there's a movie called House of Dynamite if if you've ever seen it on Netflix. And it ba- basically if, if you watch it, it, I think it, it helps exemplify the need for a golden dome-like system
Tom Ruggie: Yeah. Well, I'll, I'll definitely, definitely check that out. You know, there's lot of talk and I read and listen to a lot about you know, what we've been calling the, the AI race. And I think it's still highly believed that we're ahead of China in the AI race, although not by very much.
Tom Ruggie: I think we're fortunate to be in the situation that we are that we can even be ahead because, as you know, there's a lot of headwinds for some of what's going on. But, you know, again, my philosophy is if we don't win the AI race, then China does, and, what's the impact of that for us long term? From a defense standpoint, like you were talking about, where would you suggest we are in, if we wanna call that a race as well?
Daniel Kleinmann: Yeah. On the AI front, I think China's, you know, I think incredibly competitive to us, if not slightly ahead or slightly behind. The way we view the AI race is really a function of power and the need for power to be put online to help facilitate compute capability and then eventually AI.
Tom Ruggie: That's where I would feel we're be- we're behind there personally from, again, my understanding
Daniel Kleinmann: We, we we are, I guess, technically currently because of if you look at the, the amount of nuclear power that China's putting online on an annual basis versus us, we're, we're dramatically behind. But I think this administration has done a, a really good job at putting, changing kind of policy and bureaucracy to enable a new nuclear renaissance.
Daniel Kleinmann: There was an executive order signed last May by this administration that effectively selected a handful of nuclear startups and tasked them to build a reactor that would be approved by the Department of Energy in an expedited manner and then, uh, have that reactor basically be turned online and produce heat eventually to produce electricity and power, uh, by July 4th this year.
Daniel Kleinmann: And three, so excuse me, four companies, uh, achieved that goal. And so I think what-- A- and now in the market, we're seeing billions of dollars being raised by these companies to go and, uh, really start scaling, uh, and manufacturing these, uh, small modular nuclear reactors on the fusion side to produce power for data centers and our needs on the national security front.
Daniel Kleinmann: So I, I would say we, we were behind on the nuclear side. I think that the optimist view moving forward is that the incentive structures have been changed and are now in place to help kind of capitalism do its thing and catch up.
Tom Ruggie: It's good to hear. I'm a start back from the beginning just a little bit I wanna talk a little bit more about you and your path, And then I do wanna get into a, a specific SpaceX conversation, understanding there's certain things you're not really at liberty to talk about. And then finally get into more of a forward-thinking, thesis and, what you all are looking at. The first part is, a large part of your career started in a single family office space. What led you to make adjustments in your career from what you were doing there, which was probably a pretty cool gig, you know, got you into Silicon Valley, had you looking at and doing cool stuff.
Tom Ruggie: But what was the transition that led to where you are today, and what was the thought process behind that?
Daniel Kleinmann: Yeah. I had a incredible opportunity and I'm very fortunate to the family that I worked with provided me at a young age of t- 24 to be able to start basically deploying capital for a family and these unique opportunities at the venture side was, was rare. I think for me it was an opportunity that was too big to, to miss out on.
Daniel Kleinmann: The... I think I, I kind of viewed it as an- analogous to the beginning of the internet where computers were
Tom Ruggie: well, by the way. I use that example all the time
Daniel Kleinmann: Exactly. Yeah. I mean, for, for me it was like computers used to be the size of the rooms we're sitting in, and the cost to compute was incredibly high. And then we saw like the miniaturization of hardware advancements in sort of compute and underlying infrastructure, the emergence of the internet and sort of the advancements in the internet infrastructure and then the sort of the rise of the applications that came on top of that.
Daniel Kleinmann: And as I kind of look today at the biggest companies in the world from a market standpoint, market cap standpoint, I think they, they all can be traced back to sort of this key inflection point over maybe a 15 to 20-year period where we saw the cost of compute come down and these companies kind of emerged as either the infrastructure layer category winners or the application layer category winners.
Daniel Kleinmann: And I think as a venture investor, you kind of, you're always looking for those unique moments in time where you can identify kind of a changing landscape that may produce the biggest companies in the world 20 years from now. And, and to me, that's what was happening in space in 2018, 2019, 2020, today, that made me say, "Hey, this is a kind of a once in a lifetime opportunity to invest in truly a transformational asset class that has the potential to produce what will become the biggest companies in the world."
Daniel Kleinmann: And the analogy there is instead of the cost of compute coming down, it's the cost of launch and the launch prices coming down, enabling the infrastructure build-out in space and, uh, eventually the application layer in space. And so, I think it, it took a little bit of time to come to that realization, but once I did, I kind of had full conviction.
Daniel Kleinmann: I was incredibly fortunate to have and to have partners in Phil and Dan to kind of share that vision and push each other to, to building the firm we have today. But a lot of growth to still to be had, though.
Tom Ruggie: Yeah, yeah. But, I mean, y- you're a young guy. You've got an amazing story already, so, you know, congratulations on where you are. again, obviously I'm sure you're gonna continue to, pardon the pun, but keep going up and up and up, so let's talk about SpaceX for a few minutes.
Tom Ruggie: I would imagine we have a lot of listeners that are investors in SpaceX. We've had the privilege to have early access as a private company to SpaceX, as I am quite sure you did well for your investors. You know, now they're public, just had their first earnings release and, it's gone from 135 225, down to, to 110.
Tom Ruggie: And, the first tranche is getting released for the 20% of the insiders, so there's a lot going on there. I still can't help but marvel at, you know, just in my span of, average knowledge what's going on with SpaceX, you know, where they were four or five years ago when we first started at, looking at them, and again, what Elon's vision has been and he's been able to execute on.
Tom Ruggie: And of course, he's just so forward-thinking. I know you're somewhat limited on what you can talk about, but what can you share about SpaceX from, you know, the historical vetting and investments that you made to kind of where they are today, and perhaps where, you know, where they're going?
Daniel Kleinmann: Sure. I think best to kind of go back to the, the framework that I, I described earlier in the, in the value chain where and to understand kind of where SpaceX competes within the category. SpaceX today really has the majority of the market share in launch and in you know, communication satellites in, in orbit.
Daniel Kleinmann: They, they don't do much in observation, if really anything. They don't do much on sort of the infrastructure in orbit or, or on the ground. They, they don't... You know, they, they, they have not really gone after the, the moon and, and sort of, the infrastructure layer. Now they've got lunar landers that they're going after, and then they're making a big push now sort of forward-looking into orbital data center satellites.
Daniel Kleinmann: On the launch side they've got the Falcon 9, which is, you know, the best performing rocket ever built, doing anywhere from 150 to 200 launches a year, which is in-incredible, um, which is partially reusable, meaning they can bring back the, the booster but not the upper stage. And then they have the development of Starship which is a massive launch vehicle.
Daniel Kleinmann: I mean, this thing's 42 stories high. It's like basically a skyscraper that gets launched into orbit and that can re-land partially. Today they've got about I think the, the latest numbers are close to 13,000 or 12,000 active Starlink satellites in orbit charging kind of on average about 120 bucks a month for, for internet.
Daniel Kleinmann: The f- uh, any given Falcon 9 can launch about anywhere from 20 to 25 Starlink satellites on a given l- on a single launch. I think the... What's compelling about the future of SpaceX and, and I think the lever here is, is really Starship, is that if Starship can come online, they can launch anywhere from maybe 250 to 300 satellites at a given time.
Daniel Kleinmann: So 10X-ing the, the, the number of satellites they can p-put in orbit. You know, if they've got plans to put up another 30,000 satellites of Starlink and to have basically complete global coverage, uh, with about a constellation of 40 to 50,000 satellites in space. If, if they can do that and they can take kind of their global subscriber base from 12 or 13 million to 100 million, I think you see a path to a business that can generate 100 to 150 billion in revenue annually.
Daniel Kleinmann: And I think the, the question really is how long will it take them to get the rest of the satellites up, and how long will it take them to get that subscriber and, and user base up? Uh, up until that Super Bowl ad, they had never spent money on advertisements, so I think the IPO and, um, the capital that, kind of they raised from that a lot of it is going into the development of Starship and getting it online and, and sort of fully re-retired from a technical standpoint, um, and then building up their user base.
Daniel Kleinmann: And I, and I think, you know, f- the qu- the question is really h-how quickly can they get to 100 million users? That, that, that's kinda how I think about it.
Tom Ruggie: Yeah. Yeah. Well, amazing company. You've talked a little bit also about, what is beyond and, some of the other sectors. What are your thoughts on, on some of the other sectors within let's call it the space exploration space?
Daniel Kleinmann: Sure. so I, I think, infrastructure in space is, an incredibly exciting area for us. There's, uh, a company specifically, called Impulse Space that I think kind of exemplifies this opportunity. Impulse was started by a guy named Tom Mueller. Tom was, the first employee at SpaceX. He was the, CTO of propulsion there for 18 and a half years.
Daniel Kleinmann: He designed and developed the propulsion systems that power SpaceX today. He left with, uh, the goal to basically pick up where SpaceX drops off, both from a figurative and, and literal sense, which is SpaceX puts stuff into low Earth orbit. Once they're in low Earth orbit, how do you get them to their desired orbits in LEO, MEO, or GEO, which might take upwards of, excuse me, ten months to get there?
Daniel Kleinmann: And so they are basically doing the, you know, orbital transfer layer, the in-space transportation, in-space propulsion capabilities. And to us, that is the next layer that is required in space to make commercial space economy kind of flourish. You know, we've, we've got to the New World with the ships. Now we need to build, you know, the, the railways.
Daniel Kleinmann: We need to build the highway systems. We need to allow us to sort of build out an infrastructure to get to and from the Moon or to and from sun-synchronous orbits to put orbital data centers and build out those constellations. So I think the infrastructure layer in orbit is incredibly exciting to us from an investment standpoint.
Daniel Kleinmann: Impulse Space has had now th- multiple successful missions. It's you know, o-on pace to be one of the, one of the largest companies in the category. Beyond that, I think the Moon is incredibly exciting. The, the Moon is kind of the heart of the new space race against the Chinese, where they've got nuclear-powered rovers prospecting deposits to bring back and, and try and eventually mine the Moon.
Daniel Kleinmann: And, and the US is... knows they're behind and is spending, you know, billions of dollars in the form of government contracts to enable the private sector to give them the capability to be competitive with the Chinese. The Moon is, is, is very important from a strategic high ground perspective as a staging point to get to Mars, as a staging point to build out orbital data center constellations, and then eventually to also mine the Moon for rare metals and minerals.
Daniel Kleinmann: That's a very exciting area. And then I think lastly is is power. You know, o- in space, you can really on-- there's no grid to plug to plug in anything. So you're either doing solar or nuclear. And now with The AI race and the, the massive demand for power it's become an incredibly attractive area to invest in from a dual use standpoint, both for applications in space, and then obviously for applications on Earth.
Daniel Kleinmann: And so I think small modular fission and fusion opportunities are, are incredibly exciting. So that- that's some of the areas that we're focusing on right now
Tom Ruggie: Yeah. No, that, that makes perfect sense. So, you started in 2020, so here we are six years later.
Daniel Kleinmann: Great
Tom Ruggie: are you surprised where things are at this point? Is, is it developed faster than you thought it would, or around the pace that you thought it would? and the follow-up question to that is, what has been the, the biggest surprise that has, come up over the last six years?
Daniel Kleinmann: Yeah. you know, we, we try to operate kinda like with blinders on, chip on our shoulder, make us believe that, you know, everything's gonna fail, we gotta keep going, and, and that's kinda allowed us to kinda grow, grow the business and, and invest in these in- incredible companies. But yeah, taking a step back and looking at it...
Tom Ruggie: complacency
Daniel Kleinmann: Yeah. Yeah, exactly. We're, you know, gotta keep swimming with sharks, you know? I think, you know, the, the original thesis was that lo- dropping launch costs was going to enable, and I think will enable a flourishing, commercial space economy. And, and sort of the grand vision of this comes from kind of the ethos built, that Blue Origin is built on, which comes from, uh, a b- a book written by Gerard O'Neill called The High Frontier, which is the idea that as kinda launch costs and prices come down and launch capacity comes online, it will start to make more and more sense to move heavy industry off Earth and keep Earth l- zoned as kinda light and residential.
Daniel Kleinmann: Um, and so you can think about, like, landfills. Why, why would we have landfills on Earth if we could just, you know, launch all the, all the crap into space and send it out to the surface of the sun to burn off? Or move data centers off Earth, move manufacturing off Earth, move energy production off Earth, anything that has a negative externality on the sort of atmosphere and, and, and the globe.
Daniel Kleinmann: And I think that vision is still, far away, from becoming a true-
Tom Ruggie: to interrupt you, but that's a great vision though. I mean, that's, that's about as succinctly as I've ever heard that. That's awesome.
Daniel Kleinmann: Yeah, and, and I, I think, like, that is the inspiration that, that space, You know, I-I'm obviously, you know, in it day-to-day, and there's a lot of just, like, practical nuance things that you have to do. But to have that as sort of a guiding vision is, is inspiring. And I, and I think, you know, there's, you know, the environmental community can, can probably learn a lot from the opportunity of space of, like, you wanna make space or, or the Earth truly sustainable, we're gonna have to leverage space.
Daniel Kleinmann: and so I think that is the vision. I think we're probably still another 20 to 40 years away from seeing that in reality. we're starting to see the early days of that. But to answer your question more directly, kind of what has been the surprise, and what has... And w- and we always knew it was gonna take a while, but the surprise how quickly things have gone as a result of kind of the national security side of space.
Daniel Kleinmann: And I think that the... We, we, we've st- talked about it internally, but we, we kind of call it the convergence, um, where you've had four or five different macro you know, disruptive technological and economic or geopolitical trends happening at once. So wars breaking out and defense budgets increasing and seeing the vulnerability of our national security supply chain, which, uh, resulted in a mass investment into sort of hardware and ramping up our defense technologies.
Daniel Kleinmann: Then you have the, the new space race against the Chinese forcing us to build out infrastructure and bring on capabilities that sort of compete with the Chinese. Then you've got national security leveraging space because of the increase of launch capacity and building out things like Golden Dome.
Daniel Kleinmann: And, and then you have the new AI race, which has created a new nuclear renaissance. And kind of these four or five macro events were all kind of operating in silos at, on, on different timelines, and what's been absolutely incredible over the last few years is seeing the convergence of all those taking place on the same timeline.
Daniel Kleinmann: And that has created such an incredible opportunity from an entrepreneur standpoint and from an investor standpoint. And I think as this plays out over the next five to 10 years, we'll start to kind of see the, the long-term vision of space and a true space economy become more reality in the near term.
Tom Ruggie: It's funny you, you said that about the economic impact because as you were talking, I was saying to myself, you know, this, this discussion is kind of what capitalism is all about. and the amazing thing is that I'm thinking about this, I'm thinking about, know, the, the race with China, and the reality is that race, that competitiveness is making all of us ultimately better.
Tom Ruggie: And it's making us push harder, push faster, and that's, you know, to me, that's what capitalism is about, is, is having that competition and, you know, ultimately the greater for all good, you know, hopefully comes out of that.
Daniel Kleinmann: The, the, you know, we get asked kind of what's the biggest threat to the space economy? The biggest threat to the space economy is if the Chinese were to stop being competitive to us.
Tom Ruggie: Yeah. Yeah.
Daniel Kleinmann: That, that is, that is... I mean, the, the ship has sailed in terms of
Tom Ruggie: Like I mentioned a minute ago, I mean, complacency. You get, you get complacent.
Daniel Kleinmann: Exactly. And so w-we have launch. We'll get launch capacity online. The tech has been solved. We have nuclear, we've got power, we've got AI, but we need we need competitiveness to, to keep us going. And and you can kind of trace the, you know, the space race against the USSR and, and the development of technology stagnating to the end of the Cold War
Tom Ruggie: Yeah. Yeah. I can see that. So now as you, and you touched on this already a little bit, but, what's going to be the big surprise, let's call it five to 10 years down the road? Like, what would most common people have absolutely no idea be in existence in five or 10 years that is not in existence today?
Daniel Kleinmann: I think there's a lot of talk I think like the, the nuclear renaissance is kind of n- now becoming a, a, a, a more clear reality to people because of AI, and I think that's less of a surprise to people. I think orbital data centers is maybe less of a surprise to people in, in the need for that. I think the big surprise will be the moon.
Daniel Kleinmann: I think, I think not enough people understand how important and how much it is being invested in the lunar economy. And, and I, I wouldn't be surprised in five years from now to see humans on the moon permanently. Now, yeah, it's not gonna be the Four Seasons but it'll be, it'll be, you know, infrastructure build-out, mining kinda sectors that we think about as kinda dirty and infrastructure here on Earth.
Daniel Kleinmann: That, that's what it will be.
Tom Ruggie: Very cool. Well, Daniel, what would you like to, to share with our, our viewers about yourself and, and your, your company? You know, whether it's information about your newsletter or your, your fund. I mean, just o- open to you if and everything you'd like to share
Daniel Kleinmann: I appreciate that. I mean, we're yeah, B- Balerion has been, uh... We're, we're an investment firm, so our, our core focus is to find the, the next great companies to invest into. So if you're an entrepreneur or if you know an entrepreneur that's, uh, operating in this space, you know, we'd love to connect with them.
Daniel Kleinmann: We, we have our, our newsletter, News From The Cosmos, that's, uh, running, uh, weekly, sending kinda key updates about what's happening in the category. And then we've got a, a podcast, The Eye of the Dragon, where we kinda showcase the opportunities that, that these entrepreneurs are building and give them sort of a, a, a forum there.
Daniel Kleinmann: And then, um, we're, we're hosting events kinda all over the country, all... and all over the world all the time, uh, giving people an opportunity to, to kinda see this in, in, in s- see it in the flesh and meet founders and, and other investors. So, all, all that can be found kind of on our website and through our, our team and, you know, I'm sure we'll be able to add links or somewhere to connect them with folks.
Daniel Kleinmann: But yeah.
Tom Ruggie: add the, we'll add the links. All right. Well, cool. Any any closing thoughts? Anything else? Anything that I, I didn't ask, we missed that you think is, is good information to get out there?
Daniel Kleinmann: Some people like to ask about aliens, and I have no good answer for them. So, so, I'll keep it
Tom Ruggie: more of the Jetsons myself. I was like, I, I was like that, you know, are, are we gonna be like the Jetsons at some point? Which you might not even be old enough to know what that is, but
Daniel Kleinmann: Oh yeah, I, I do. I think no, I think we covered a lot. It's, You know, when you're in it and you see so much innovation around you, you're in the kind of the weeds. It, it, it's not as fantastic and, and and doesn't feel as, as kind of... You don't feel the change happening in real time. But I think I think five, 10 years from now we'll see sort of like, this was the golden era of the infrastructure build-out space
Tom Ruggie: Well, I, I actually think a lot of people are gonna find discussion fascinating because, I think to the average person there's a lot of unknown about what's going on and, why is this money being spent? Why is this infrastructure being looked at? I still think back, there's somebody in my office whose father was involved with NASA, you know, sending people to the moon the very first time.
Tom Ruggie: And, you know, again, that was such a monumental time 50, almost 60 years ago. And just to, to think where we are today and even using AI as I mean, as a generality, probably 60% of the population may have even heard of AI just a couple of years ago. to,
Daniel Kleinmann: Yeah
Tom Ruggie: where that is today and know, to... Again, what's being done a- along the space frontier, kind of headlined by, SpaceX and Elon. You know, because deservedly so, they have a spotlight in that area. But there's, you know, to your point, there's so much more going on and ultimately going to have such a big impact on all of our lives. I just find it very fascinating. I think a lot of other people will as well. So I appreciate you sharing your time and experience and knowledge and look forward to seeing more.
Daniel Kleinmann: Yeah. No, I appreciate it. I'll, I'll leave everyone with this, that I think for those that have a hard time kind of understanding kind of the space and, and, and hearing these concepts, I you know, an alternative way of, of viewing the opportunity set is we are just moving critical infrastructure for national security, for communications, for data, and for power off Earth.
Daniel Kleinmann: And you know, there's something called the Karman Line, which is kind of the separation of Earth and, and space. To us, there is no line that separates the two. It's just all, all, all one and the same. But yeah, I'll, I'll leave you guys with that. But no, I really appreciate you having me and thanks so much for the opportunity
Tom Ruggie: My pleasure. I look forward to hearing moreand keeping in contact,I actually didn't, didn't realize you sent your newsletter out weekly. Candidly, it, it seems like I get it more often than that, but, you know, maybe just time flies so fast. I do read through it every single, time I get it, so really, really have enjoyed it, and, it's valuable information.
Daniel Kleinmann: Thanks so much
Tom Ruggie: all right, man. Thanks again. Good meeting you.
Martie Salt: That brings us to the end of today's episode. Thank you for tuning in. Be sure to subscribe to Significance of Wealth on Apple Podcasts, Spotify, and anywhere else you get your podcasts so you never miss an episode. You can also follow Tom Ruggie and Destiny Family Office on LinkedIn and destinyfamilyoffice.com for more insights on wealth management, private market opportunities, and collectibles.
Martie Salt: Until next time
Martie Salt: The expressed views, thoughts, and opinions belong solely to the host and/or guests and are not investment recommendations or opinions issued by Destiny Family Office or its affiliates. Investment advisory services are offered through Destiny Family Office LLC, an SEC-registered investment advisor. The funds discussed are typically for qualified purchasers, defined as $5 million of investment net worth, exclusive of primary residence.
Martie Salt: Destiny Family Office podcasts are the sole property of Destiny Family Office, and information provided is for informational and educational purposes only. Learn more at destinyfamilyoffice.com/disclosures.