Mynaric Co-Founder and Management Board member Markus Knapek. Credit: ESA

UPDATE Nov. 19: Mynaric AG announced it is opening a new facility in Shanghai without specifying whether it’s a Chinese satellite constellation that is the customer for Mynaric’s October MoU to provide laser communications terminals for a 300-satellite constellation.

The company said the Asian market in general is showing “high demand” for Mynaric products.

“China is already one of the fastest-growing space nations and is experiencing a boom in its aircraft industry, with several Asian companies and organizations announcing plans to pursue satellite networks in low Earth orbit,” Mynaric said in a statement announcing the China facility.

Industry officials had been stumped by Mynaric’s October announcement, whose details appeared to rule out all the major announced North American and European broadband constellations as Mynaric’s prospective customer.

PARIS — Startup laser communications terminal manufacturer Mynaric’s cryptic Oct. 24 announcement that it had signed an MoU for a LEO satellite constellation that needs “upwards of 1,000” units was vague enough to leave doubt as to whether it was a key event.

It’s an MoU, not a contract. The customer is not named, nor is the application.

But Mynaric shares are traded on the Frankfurt Stock Exchange following a late-2017 IPO that raised 27 million euros ($32 million). That gives management an incentive not to exaggerate. It has created a U.S. subsidiary and begun serial production of its product portfolio:

In an interview, Mynaric Co-Founder and Management Board member Markus Knapek went as far as his NDAs would allow in making the case that this MoU is very likely the start of something big.

You can’t identify the customer; OK. But is this real? None of the big broadband constellations has cleared their financial hurdles.

From my perspective, the customer we have has solid financial backing. That’s the good part. We know the customer quite well. We have worked with them for two years, gone through the feasibility studies and worked on the interfaces. We are pretty far, in the sense of establishing this program. It’s not all finished, but it’s in a good place.

The customer has developed quite well from the financial side. There are companies out there with nice ideas but they don’t have the financial backing yet, they are still waiting for it. On that score, I am happy to see how this customer has developed. It’s fine.

On the contractual side, we have been planning this early-bird mission with them, as all the constellations do, to test all the equipment. On part is the laser communications but there are other parts such as RF and routers and so on. They need an early bird to test that.

We have agreements with the customer on how we will do this.

To get the full contract would you need to invest in the customer’s equity?

We are a component supplier. That’s the role we have.

This is for inter-satellite links?

It’s a constellation with inter-satellite links. We do the broadband for it between the satellites — it’s a few hundred satellites. it’s similar to what OneWeb does or what LeoSat does.

The MoU has to transfer to a contract very soon, correct?

Exactly. The plan is to finalize the contract in the next couple of months. I don’t see a problem there. We have already negotiated the terms with the customer. It’s just a matter of preparing the contract. The customer also knows the terms for the full constellation. That’s the important part for us, of course. We’re not talking only about the early bird mission.

So the contract would be just for early-bird or for the full system?

The contract would be for the early-bird mission, the first phase, but it could include the numbers for the full constellation. It goes in steps. You wouldn’t expect a full contract at this point. That’s the reason why you do an early-bird mission — to test everything and make sure it all works together. The investors of course also see that everything works fine and then they go to the next step.

They also need to prove “bringing into use” with a satellite in the final operational orbit to preserve their frequency filings?

Yes and the customer is very well aware of that. There are several steps from the customers and they have communicated that to us in terms of keeping the frequencies at the ITU.

Why doesn’t the customer want to make itself known?

Your supply chain is considered key knowledge — who is supplying them and so forth. We also don’t want to publish our suppliers.

Separating hype from reality with the big constellations isn’t easy, and none appear to be on solid financial ground yet.

We have those interests too. Of course I would like to say I am working with this or that constellation. But we have to live with what the customers ask of us.

On the financing side, from everything I know about this customer — and we have asked very detailed questions — I am happy the customer has investors behind them that can finance the full constellation. They have significant backing.

Our customer has been very careful with this over the last year. They have been very open with us and saying they don’t have the financial backing yet and we cant contract with you for that reason. We know the investors, we have met them personally, we know their interests and capabilities.

So you’ve done your own due diligence?

It was important for us. We have put a lot of work into this program already. We would not have done that if we didn’t have good insight into what they’re doing there and their degree of openness.

You had planned to put components of your laser system on a satellite this year. Has that happened?

That has happened, yes. It’s a cubesat program. It’s in space and is under testing now. We delivered key components for laser communications on the satellite. There is also a program behind that. We have delivered parts for the space side and parts for the ground side, so we are key in this.

Munich-based Mynaric began series production — small numbers, but real production — of its laser communications units. Early applications are for satellite Earth stations, with space-to-mobile-platforms and inter-satellite links for satellite constellations the other pillars of the activity. Credit: Mynaric

We hope that by the end of the year this is fully tested in space. It’s in LEO orbit.

When will you be able to report that your stuff works fine in orbit on this cubesat?

The customer is waiting to demonstrate the system and they will want to announce this first.

Is this the same customer as the constellation work?

No, it’s a different customer.

You can’t name it?

No. We have a couple of customers, such as the constellation customer with which we just signed the MoU. These customers are at different levels of maturity. They see we are going to mass production of terminals but they do not yet have the financing.

We have another customer, also a constellation, which has some components in the air, which is also an interesting concept. They talked to investors with potential. I am not sure how far they are.

This is for the big constellations but we have a full portfolio of laser communications including the ground stations for LEO-to-ground links. They have gone into serial production. We produced this with a full supply chain so we can provide 10 ground stations next year — one big ground station for space-to-ground and a smaller one for air-to-ground. It has been very nice to see this move to serial production. That was always our vision, to have a commercial, industrial approach.

Will you produce 100 units in 2019?

It wont be quite 100. There have been some small delays, but the important thing for me is that it is in serial production. And we can get to larger numbers.

Do you still see more than one of mega-constellation for broadband connectivity being fully deployed?

Definitely. There is this one constellation that has signed the MoU, and in my view they have what it takes to deploy. They have a neat consortium around that, with people with enough space experience over many years in the case of some of the suppliers and the prime.

For the other constellations I am pretty positive. But the one we are talking about here? They are moving forward.

Your lasercom terminals are about 15 kg each?

That’s about right. With three, maybe four per satellite.

For me it was always important to have several pillars for our business. The constellations are not the only pillar. It’s important of course, with big numbers. But we’re also working on the air side for aircraft, and UAVs equipped with laser communications terminals. That’s a smaller market in that maybe a customer doesn’t buy 5,000 terminals, but only 10. But there are hundreds of these companies in the world. Plus the ground stations.