So we looked at those vehicles, and we decided that was not something that we wanted. We have been around the space business some time, so we knew what to do next. That was, hire some high-priced consultants. We hired some of the top people and top ex-people from the chemical systems division of United Technologies, Martin Marietta and TRW, which is one of the leading integrators of space vehicles, and we looked carefully at the situation.

We went out and talked to the companies that made the vehicles and made their major components and said, "Look, we would like to get into the space transportation business. What would it take to build a new space transportation system,"

They said, "Oh, about half a billion dollars."

I said, "Excuse me,"

They said, "Half a billion. That is with a "b" and we would like most of it up front, please."

We said, "No, no, no you don't understand. We would like a pickup truck, not a race car."

And they literally said to me, "No son, you don't understand. We have one way of building things, and we are not about to change it for American Rocket Company. And, yes, we do understand that you want something that is really industrial rather than aerospace, and so you might be able to cut some corners here and there and get by for maybe $350 million."

Well, this was a year before Challenger, and everybody who we had talked to at that point who we told we were going into the space transportation business reacted with, "You must be crazy. You are going to compete with NASA. This is a government monopoly. It is not only a government monopoly; it is heavily subsidized by the government." Because every time you saw one of those communications satellites with PAM-D1 underneath come spinning out of the payload bay on the shuttle, Western Union, or AT & T, or USAT, or Intelsat has paid about somewhere between $19 and $30 million each to get that up there, and you and me and the rest of the American taxpayers have paid about $150 million to let them do it.

It is kind of tough to compete with that sort of setup. We knew that there wasn't $350 million available in the capital market. I am basically a capitalist. We actually went and looked and tried to analyze how much was available in the capital market. It turns out that we thought there was between $25-50 million available for what could be termed, in general, space commercialization. There weren't very many people at that time out trying to get that money, and we thought we could get a little bit of it. But we knew that in order to do that, we were going to have to do something within those parameters.

Now, at the same time, Jim and my partner, the third original partner in American Rocket, Bevin McKinney, had sat down at his computer and, working with a number of other people, had looked at what it would take to build from ground zero - that is, from a clean piece of paper - and industrial rocket.

And Industrial Rocket

To us, an industrial rocket meant something that met a number of criteria. First of all, we weren't interested in maximum number of warheads. The first criterion we had was safety. The second criterion we had was reliability. The third criterion was low cost. Then, after that, came performance. And when you sit down and put together those sorts of criteria and look, if you will, at what it will take to build a van or Toyota pickup truck as opposed to an Indy 500 racecar, a lot of things come out differently. One of the things that came out differently was, we felt we could do it for $130 million. What it was, was to build an, fly a launch vehicle that would demonstrate our concept.

We felt that we had to raise the money to build it and fly it off, because nobody was going to ride with us until we had proven that we could fly. Especially when NASA was running around offering people rides for essentially nothing. I mean, at least the big guys were being charged $20-30 million, but if you had a little experiment of the kind we were interested in flying, NASA would let you fly for nothing. So we felt that is what we had to do.

Now let me tell you a little more about what "it" was. "It" is a launch vehicle, which classically has three parts. IT has a propulsion. It has what is normally called GNC - guidance, navigation, control and flight termination system. It has structure to hold those two things together and hold the payload on. That is a launch vehicle.

Next Installment: Electronics

Read Part 8: After The Fall, Resurrection
Read Part 7: The Proof Of The Pudding: SET-1
Read Part 6: The Rocket
Read Part 5: Questions & Answers
Read Part 4: Propulsion
Read Part 3: Electronics
Read Part 2: In The Beginning
Read Part 1: Introduction