Philip Johnston is the co-founder and CEO of Starcloud, a startup building space-based data centers. Starcloud has raised about $200 million over this last round, over a billion dollars. Famously, Philip's company launched Starcloud 1, the first Nvidia H100 GPU in orbit. And apparently, Philip, you've trained your first LLM in space. Starcloud launched in November of 2025 on Falcon 9. Welcome, Philip. Pleasure to have you.
Thanks so much for having me. It's a huge honor. Been a long-time fan, so very privileged to be here.
Awesome. It's mutual. It's mutual.
Yeah, I mean, a lot of stories we want to talk about in data centers in space to wrap up today's episode, but let's start with a little bit about Starcloud. Tell us about the company, your vision. Where are you guys? What have you done with that H100? And yeah, let's go there.
Yeah, for sure. So, we started about two and a half years ago in January 2024. We're a team of about 20 engineers based in Redmond, Washington, actually right down the road from the Starlink manufacturing facility. About half our team came from SpaceX and the rest are from the data center companies up here, so AWS and Azure and the others. And then, yeah, so we launched our first spacecraft, Starcloud 1, in November last year. It actually had five GPUs, two from ARM and three from Nvidia. But the most important one, as you mentioned, was the Nvidia H100. And so with that, we were the first to train a model in space. We trained nanoGPT from Andrej Karpathy's version. Very tiny model, just a couple of lines.
[laughter] Totally counts.
And then, we actually were the first to run a version of Gemini in space. So, we ran Gemma, which is DeepMind's cut-down version of Gemini. And then, we've done a few other things. So, now we're doing much more kind of useful workloads. So, we've just been doing high-power inference on SAR data, synthetic aperture radar data, in collaboration with various DoD entities. And also, we actually just played Doom. We ran Doom on Starcloud 1.
As one does. [laughter] Little latency there probably.
And before we get into it, I just want to say you guys have been ahead of this trend more than most. So, thank you for your support. I know Alex has often been vocally very supportive. And Dave gave me a shout-out early on. And Peter, I know you in the interview with Elon, you were also very supportive. So, really appreciate it.
Yeah, well, you know, you're building the Dyson swarm, and this is important for our great-great-grandchildren, for all of us.
And Philip, just speaking for myself, I want there to be multiple Dyson swarms. We can't have a solar system [laughter] scale monopoly.
Agreed. We maybe a Matryoshka swarm so we can have swarms inside swarms inside swarms.
Yeah. [laughter] So, there's Jupiter and Saturn. Plenty of atoms left to disassemble.
So, Philip, give us a sense of where you are right now in terms of Starcloud 1. But where do you go next?
Yeah. So, we've got three launches booked next year. We're launching Starcloud 2, booked for January. It's about 100 times the power generation of Starcloud 1. We'll have by far the largest commercial deployable radiator in space. And so, yeah, that's going to have a whole bunch of H100s also flying, the Blackwell chip from Nvidia, and also some other interesting things like some Bitcoin mining ASICs. And also AWS Outpost, which is their on-premise server blade, so we can run like an instance of EC2 on all of it, which is useful for DoD customers. And then as soon as possible, we'll be launching a much larger spacecraft, what we're calling Starcloud 3. It's a 200 kW, 3-ton spacecraft which will fit on the Starship's Pez dispenser form factor. Actually, if you guys can see this, I can even show you. We've got a version of it welded up on the ceiling, the chassis.
Just so you get a sense. So, this is the length of the chassis of it. So, it's about 6 m long, and with this we'll have huge 100 m deployables hanging off the side of that.
How much power are you generating to power that?
Yeah, and we can fit about 50 of them per Starship. So, we're talking about about 10 MW of new compute capacity per Starship launch. And yeah, we're hoping to be launching very frequently on Starship. I mean, they're building just absolutely enormous capacity, as I'm sure you're all aware. These two Starship gigafactories designed to produce something like three Starships a day. So, hopefully there'll be capacity for us to launch. And also, you know, we're looking at some other launch vehicles as well, but that's the primary one.
So, I have to ask the elephant in the room, which is when you're going in to pitch for investors and they say, 'Hey, but there is, you know, Elon and his mega plans and Google's far behind, and are you picking a niche in this area that you're going to be competitive in?'
Yeah, it's a great question. So, the main niche we're going after is be more like an energy and infrastructure play than like our own cloud. And so, for example, we've got an agreement with Crusoe where we essentially say to them, 'Hey, we have a box, and that box has power, cooling, and connectivity. And we'll work with you on whatever chip architecture you like, and you can sell to whichever customers you like for whatever price you like, and you just pay us a fee in the same way that you would pay a rental fee to somebody like Equinix, you pay that kind of rental fee to us, and you finance the chips.' So, that's kind of the approach we're thinking. I think in the early days at least, it looks like SpaceX is primarily going to be serving their own, you know, Cursor, Grok, and xAI workloads. And, you know, in the more medium term we'll be providing a cloud service to folks like Anthropic. I think it's probably a bit further out that they're looking at being just a pure infrastructure provider. Though, I think actually Elon did mention something about that relatively recently, but that's the idea. I mean, so in general it's a good point because of course we're going to have a higher cost base than SpaceX because they own the launch. So long as we have a lower cost base than all of the other hyperscalers, I think we're in a reasonable position. You know, if we have a lower cost base than OpenAI, for example, they're going to need to figure out a space solution and either they pay xAI to run workloads on xAI or on SpaceX's satellites. In OpenAI's case, I think that sounds unlikely. Or they [laughter] start building their own satellites.
Yeah. Or they start building their own satellites, and it's possible, but I mean they're going to be way, way far behind. Or the last option is they'll look around, you know, in sort of two, three years as Starship cadence ramps up, and they're going to be like, 'Okay, we're going to get left behind if we don't get on top of this.' And they'll be like, 'Okay, who's the most advanced in the market, you know, maybe besides SpaceX?' And at that point I think we'll have a very significant lead over anybody perhaps besides SpaceX.
Interesting. Dave, Alex, you want to jump in?
One was two years ago, you know, we didn't have data centers in space on our bingo cards at all. What had you... [laughter]
Hold on. So, Selena, hold on. Hold on. Some of us did. Some of us did.
And I don't think the mainstream did. I know Alex, you've been talking about Dyson swarms since you were probably like five years old. [laughter] But what had you jump to that and say we're going to do that?
Yeah, yeah. We actually started off by doing... Well, we were initially just looking at space-based solar. So, in mid-2023, I actually just randomly on a weekend took a trip down to Starbase, Texas, like even before the first launch. Not as many people were looking at it back then. And I was just blown away by the scale of what they were building. You know, in my head I was like, 'Okay, all of the concepts from sci-fi that I remember reading about, you know, Asimov was talking about space-based solar in the '40s even, are going to come true. It's just a matter of a timeline now.' And so...
Philip, if I could — space-based solar power satellites for beaming energy down to the ground?
Yes, exactly. Yeah, so huge, huge solar panels in space and then either using infrared or microwave to beam power down. The main problem, and we spent, you know, several months on the math essentially on the break-even. We wanted to know, 'Okay, what is the break-even launch cost at which space-based solar makes sense?' And we came to a round number of about $50 a kilo where that would make sense. And initially we thought, 'Okay, that's kind of good enough. Starship will get there at some point.' But then we started working on that. But then we were like, 'Okay, well, the problem with space-based solar is you lose 90 or 95% of the energy in transmission from space to ground.' And we were looking around and saying, 'Okay, once we get the power down, what are we going to be using it for?' And even two years ago, most new energy projects being built, particularly in the US, were being built primarily to power data centers. So, the thinking was, 'Okay, well, either directly or indirectly that power is going to be going into data centers. And so if we instead can find a cheap way to get the data centers to space, let's rerun all those calculations to know what would the break-even launch cost need to be that that business would break even, you know, would make sense versus terrestrial.' So, we reran those numbers. We came to a launch cost break-even of around $500 a kilo if we had a cheap way to get the data center to space. And then that became the basis of a white paper that we put out in summer 2024. And then that essentially became the basis of the company.
Wow, that's great. It's a great story. I mean, and it's an interesting entrepreneurial story for all the entrepreneurs listening, right? It's like you're going down one road and then all of a sudden you see a massive opportunity, especially when you can go deep enough to look at it, because the idea of space solar power satellites has been around since the '70s. Gerard K. O'Neill at the Space Studies Institute, you know, his solution was to build them on the moon and then fly them to Earth orbit where the launch costs obviously are de minimis compared to...
That will happen. I'm sure that will happen. Yeah.
Yeah. Second question is what are the couple of biggest bottlenecks you're facing right now?
We are actually very constrained on launch right now, as everybody is. We're so constrained that we're trying to book now on Relativity Space's first launch in January.
Ah, all right. [laughter] I'm really excited about that. I think that would be super cool to have a launch on that.
And for those of you, we've covered Relativity Space in a podcast before. This is Eric Schmidt's company where he's CEO. He bought it from Tim and Jordan when it missed a financing. And Relativity Space is about the size of New Glenn, half the size of Starship.
But if you're building toward the Pez dispenser, actually, that's a problem. That's a really interesting how that's going to work out.
Yeah, it is a problem. I think we're going to have to have two form factors. I mean, the primary one we're working on right now is for Pez, but I think we're going to need a form factor that will fit on... Also, Stoke Space is the only one which has a reusable upper stage, or the only one that right now is seriously working on a reusable upper stage. So, we're also looking at a Stoke launch vehicle form factor. But to be frank, the Relativity one is... Maybe just to take a step back. So, the business has two phases. The first phase is while launch cost is relatively high, we're launching on Falcon 9 and others. We're primarily serving edge and cloud, you know, providing edge and cloud services for other spacecraft, particularly, you know, DoD and Earth observation constellations. And then on a sort of three to four-year time frame as Starship ramps up cadence and production, that's when we switch over to competing with all terrestrial data centers on energy cost. But yeah, so all of these, when I say we're launch constrained right now, I'm even talking about for the first business. We've got three launches booked for next year, but if you want to book anything for 2028 on Falcon 9, there's just nothing available.
The government's just plumped down 20 launches, which has bumped everything back. And so, yeah, unless you can get some priority, and we're going through various channels to try and get some priority on that. But...
So, this is GPUs for use of processing in space.
Yes, correct. So, we will receive, for instance, raw imagery, hyperspectral or SAR or other types of satellite sensing data. Instead of having to wait for a ground station and downlink enormous amounts of data, we can process all of that on the edge. And actually, this is one of the demonstrations we've just done: process a whole bunch of SAR data, identify the coordinates of a tank, and then just downlink the coordinates of that tank. And rather than having to, you know, it could take three days to get enough ground station passes to get 100 GB of SAR data off a satellite. Rather than doing that, we can receive all of that data optically in space, process it on orbit, and then just downlink the insight. And that's the use case we're building towards right now.
I'm curious... [clears throat] I'm curious, Philip. So, the premise there is presumably bandwidth is scarcer maybe than launch. So, you have to do a lot of edge inference in LEO or wherever you're doing this. I'd love to ask you sort of a similar question that I asked Will Marshall of Planet in a previous pod episode. Let's project out 10 to 20 years, well past the current bottleneck in heavy lift or heavy launch capability. What do you think, as the founder and CEO of one of the incumbent Dyson Swarms — plural — what do you think the Dyson Swarm or Dyson Swarms of, call it, 20 years from now look like? Does it look like LEO? Does it look like sun-synchronous orbit? Does it look like the moon? Does it look like a Dyson Swarm around the sun? Paint a picture for us of what 20 years from now the Dyson Swarm or Swarms look like.
Mhm, that's a good question. I hope within 20 years we've started putting significant amounts of compute in a sun orbit, probably starting with the Lagrange points. Although you probably don't want to clog them up too much, but even just a distinct sun orbit that, you know, trails Earth or is in front of Earth. Because certainly you could fit about 10 terawatts of compute in the dawn-dusk sun-synchronous orbit. And then you're back to flying in orbits which have an eclipse, you know, sort of 45 minutes of every 90-minute orbit in eclipse. That then drives the cost up significantly because you need batteries and all these other things.
Scarcity of real estate. Yeah. SSO's going to get crowded. That's — you're one of the few people, Philip, I hear talking — this is like overpopulation on Mars — talking about SSO getting crowded due to the SSO Dyson Swarm and then overflowing back to other orbits. That's fascinating.
Yeah. Yeah. Well, because there's only one SSO orbit that is, you know, it's a very rare and beautiful orbit, that dawn-dusk sun-synchronous orbit which flies over the terminator line. I mean, 10 terawatts is a lot of compute. That's like 20 times the entire US power grid. And probably in 20 years, my expectation roughly is that in 10 years we might hit a point where most new compute capacity is being deployed in space. If you ask me, what is the total percentage of compute in space at that point? It's still probably less than 5%. In the same way, you know, right now, in certain parts of the world at least, you know, Norway or whatever, most new cars coming off the production line are electric. But if you want to know what is the percentage of the fleet which is electric, it's like 4% still. And it just takes a long time to replace all of the capacity that we're building on Earth terrestrially right now. So, in 10 years I would say most new compute capacity will be being built in space. In 20 years it could be a... I would be surprised if more than half of all compute is in space in 20 years even. But beyond that, certainly there'll come a point that's probably more like a 50-year time frame where 99% of all compute is in space.
I'll also just have to ask a second elephant in an increasingly crowded room. If heavy launch is the main bottleneck over the next few years, is there some plan in a back room somewhere for you either to build or buy your own vertically integrated heavy launch provider if that's the main constraint?
We are in quite serious discussions to partner with various launch providers. Probably shouldn't go too much down that. Yeah, it's early days, and, you know, if SpaceX can provide the capacity, we'll be very happy customers of SpaceX. Yeah, if not, then we'll need to figure out something. If you ask me, do I think SpaceX has a monopoly in launching in five years? The answer is yes. In 10 years, the answer is no. You know, we'll all realize...
And we'll talk about Rocket Lab's purchase of Iridium in a moment. And in fact, what I'd love to do is jump into a few stories, Philip, and have you comment alongside the mates here. Yeah, the first story is a recent conversation by Elon about basically space-to-Earth telephony. So, let's jump into that. So, I'm going to play a short video. This is a video clip of Elon speaking at the All-In Summit. And then let's talk about it afterwards.
So, the phones that are able to use the spectrum that was acquired probably stopped shipping in around two years. And then we also need to pull the satellites that are going to communicate on those frequencies. So, in parallel with building the satellites and working with the handset makers to add these frequencies to the phones. And then the satellites and the phones will then handshake very well to give high-bandwidth connectivity. But the net effect is that you should be able to watch videos anywhere on your phone.
So, fascinating story. Vertical integration again, the whole stack. SpaceX owns it: launch, satellite, spectrum, and increasingly compute. So, direct-to-phone is an interesting product. It's going to be space-based internet to everybody on the planet. Thoughts on this? We're going to see the telecom industry getting disrupted.
Yeah, yeah. And he didn't mention it here. And to a point on that speculation, he didn't mention it here. And I think he's talking about working with phone providers. It would not surprise me at all if they either buy or start manufacturing their own phones as well. I don't know, what was your read of that? My read was he was talking about working with phone providers and not talking about building their own phone. But at some point I would be surprised if they don't think about building their own phone.
Well, you know, it's been rumored — the Tesla phone's been rumored for a long time. And Elon famously does not work well with others. He tends to buy them or blow past them. So...
And did you see recently the possible acquisition of T-Mobile?
Yeah, the rumors are out there. [laughter] And also with Charter Communications.
I mean, Starlink is the most unbelievable business. Starlink is going to produce hundreds of billions of dollars of free cash flow in the next sort of five to 10 years. You know, they're going to have direct-to-cell. They're going to have unbelievable bandwidth on almost, you know, unless you're really in the middle of Manhattan, I think Starlink will be the best option for most people. Yeah, I can't see a world where on Starlink revenues alone SpaceX isn't the most valuable company in the world.
We've been projecting $10 trillion by 2030 in terms of valuation and scaling toward $100 trillion.
