NASA Looking to Invest in the Future

According the Washington Post, NASA is getting into the ventura capital biz with a new firm, Red Planet Capital, aimed at investing in start-ups developing emerging technologies that might someday prove useful to NASA. (NASA Watch, of course, had the story in February)

Peter Banks, an organizer and manager of the Red Planet project noted:

"We will invest with others in companies making products that aren’t being made elsewhere and that NASA might be able to use. We don’t really expect the companies to be making products that can be used as is on the moon, or in other low-gravity environments. NASA would do the adapting once the technology is developed."

While this is the first time the "federal government has started a venture capital fund for civilian purposes", its not the first time its utilized the venture capital model of investment for the purposes of government technology development. In fact, the present administrator of NASA, Michael D. Griffin, former president of the CIA-sponsored venture fund, In-Q-Tel, which was very successful in delivering technologies to the Agency… some 130 at last count.

Still, the plan is not without its critics already, some of whom wonder how the federal government can really make it in the cutthroat world of venture capital investing. Blogger Rick Rickertsen doubted, in particular, the usefulness of setting up an investment fund, when present VCs would be more than willing to tell the government what technologies are worth investing in:

"The U.S. has the largest, smartest, best funded venture capital industry on the planet (of Earth). There are hundreds of firms with brilliant technologists investing billions of dollars per year in leading technologies of all types — including private space exploration, which will hopefully put NASA out of business. Why on earth does NASA think they need to add to that? It is truly crazy and beyond wasteful. If NASA wanted a window on technology for the Federal Government, all they needed to do was write a letter to all VCs thought the National Venture Capital Association (Cost: about $200) and all of these good patriots would have sent them every promising business plan in their files. Then they would have had a REAL window on technology."

While Rickertsen may have a point, the success of In-Q-Tel and the fact that Red Planet Capital would basically do just what he requested (asking other VCs to send it the "best" business plans in their files) and then evaluate the quality of those business plans, makes me think that his argument might be a little naive. Oh sure, I imagine VC would be more than willing to send the Feds some pretty slick business plans, spending the next few nights dreaming while federal dollar signs danced over their heads, but to think that they’d do so out of the goodness of their hearts… well, that’s just dumb.