Following SpaceX’s June 2026 IPO, Ross Butler asks Mark Boggett, CEO and General Partner of Seraphim Space, what investors should make of the much wider SpaceTech ecosystem.
The conversation explores why defence is underwriting near-term growth, how AI is unlocking satellite data, why falling launch costs could make orbital infrastructure viable, and where investable opportunities may sit beyond launch and connectivity.
Included in this episode:
Where the investment opportunities sit beyond SpaceX, Starlink and launch
Why war is accelerating revenues across dual-use SpaceTech companies
How AI and lower launch costs could unlock data, energy and orbital infrastructure
How Seraphim invests from accelerator stage through to listed growth capital
The big take
Space is becoming a digital and physical infrastructure layer for the global economy. Defence budgets are accelerating deployment and helping companies move more quickly through their technology roadmaps, but the long-term investment case depends on those capabilities becoming commercially useful at scale.
The key question is not simply whether space creates economic value. It is where that value ultimately accrues: to launch providers, vertically integrated satellite operators, sovereign infrastructure suppliers, data platforms, communications networks or in-orbit service companies.
Mark estimates that SpaceX addresses only around 20% of the broader opportunity, leaving substantial potential in Earth observation, navigation, data processing, orbital servicing, manufacturing, energy and infrastructure.
What sits beyond SpaceX?
The upstream space economy begins with launch, but rapidly expands into several distinct layers.
There are constellations providing Earth observation, communications and navigation. There are businesses monitoring orbital activity and debris. There is an emerging in-space infrastructure market covering communications towers, transport, servicing, manufacturing, data processing and energy generation.
Beyond that sit longer-duration opportunities around lunar activity, resource extraction and human spaceflight.
The downstream market is equally important. It includes ground stations, cybersecurity, the transmission and storage of data, and the software needed to convert satellite observations into commercially useful information.
War is the immediate revenue engine
Asked where current demand is coming from, Boggett’s answer is emphatic: “Defence, defence and defence.”
The ten largest companies in Seraphim’s growth portfolio increased revenues by an average of approximately 80% over the preceding 12 months, with defence demand responsible for that growth. He also describes procurement cycles shortening materially as governments seek to acquire proven capabilities from agile technology companies.
Yet most of Seraphim’s companies were not established as defence contractors. Almost all are dual-use businesses: the same hardware, software and infrastructure can serve both sovereign and commercial customers.
Can Europe close its space capability gap?
Europe is ‘starting from scratch’ in the modern space race.
Germany is enthusiastic, the UK is lacking follow-on funding and falling behind.
Seraphim is a global investor. Mark describes its portfolio as approximately half US-based, with meaningful exposure to the UK and Continental Europe. He expects the US to remain the industry’s principal centre, although Europe’s share could increase as defence capital moves into the market.
When could dual-use revenues become predominantly commercial?
Mark reckons that defence currently represents around 80% of revenues across the sector. He believes that balance could invert within three to five years, although defence itself may continue growing strongly.
Two developments underpin that view.
First, larger constellations are producing richer and more frequent observations of the Earth. As revisit rates improve, data moves closer to real time. That makes it useful to a wider range of customers and increases its potential commercial value.
Second, satellite communications are connecting not only people but machines, sensors, vehicles and other Internet of Things devices. That creates a global communications layer capable of serving industries and locations that terrestrial networks cannot reach efficiently.
Defence spending is effectively helping companies build this infrastructure sooner.
How does AI change the economics of satellite data?
The constraint on commercial adoption has not necessarily been the volume of data collected from space. It has been the difficulty of moving, integrating and interpreting that data.
Historically, using satellite data required specialist teams, expensive systems integration and lengthy implementation projects. Industries such as mining, oil and gas and defence could justify that cost, but many mainstream businesses could not.
AI changes the integration layer.
Companies with AI-enabled data infrastructure can ingest new datasets more quickly, combine them with terrestrial information and incorporate the resulting insights into everyday decision-making.
Why could orbital data centres and energy change the market?
The combination of SpaceX and xAI makes more sense when viewed through the economics of AI infrastructure.
AI systems require growing amounts of compute and energy. SpaceX controls reusable launch, a large-scale satellite-manufacturing operation, an orbital communications network and, following its combination with xAI, an artificial-intelligence platform.
Mark argues that this creates an unusually integrated position from which to develop orbital computing infrastructure.
Energy is potentially the larger opportunity. Mark believes access to abundant solar energy in space could eventually support computing and other industrial processes.
What business models and investment moats are emerging?
Mark believes the strongest companies tend to be vertically integrated. They design and manufacture satellites, develop their own software and AI, operate their constellations and maintain direct relationships with end customers.
That creates a rapid feedback loop. Customer requirements feed directly into software, operations and the next generation of hardware without depending on multiple external suppliers.
Vertical integration is expensive and operationally difficult, but it can increase speed and defensibility. Boggett notes that Seraphim encourages portfolio companies to patent not only hardware designs but manufacturing methods, operational processes, algorithms, failure-recovery procedures and sector-specific uses of their data.
The resulting intellectual-property portfolios can become significant barriers to entry. They also reinforce the power-law nature of venture investment: the leading company attracts customers, capital and talent, making it progressively harder for later entrants to catch up.
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Private Markets Capability for Wealth Advisers
Clients are increasingly asking not only whether they should invest in private markets, but how private equity and private credit fit within a portfolio, what the liquidity trade-offs are and what the underlying risks actually look like.
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Ross Butler is the host of Fund Shack and the author of Invest Like A Barbarian: Share in the Spoils of a Private Markets Revolution.
He has spent more than 25 years working across private capital as a journalist, policy adviser and consultant. His previous roles include Editor of Real Deals, Secretary of the EVCA Professional Standards Committee and Director of the Listed Private Capital Association.
The wider SpaceTech market extends beyond launch and connectivity into Earth observation, satellite communications, navigation, orbital servicing, manufacturing, energy, data processing and in-space infrastructure. Mark Boggett argues that SpaceX addresses only part of the broader opportunity.
Why is defence driving SpaceTech revenues?
Defence is currently the strongest source of near-term demand for many SpaceTech companies. According to Mark, defence budgets are helping dual-use companies accelerate revenues, shorten procurement cycles and move more quickly through their technology roadmaps.
What are dual-use SpaceTech companies?
Dual-use SpaceTech companies build hardware, software or infrastructure that can serve both defence and commercial customers. This allows companies to benefit from sovereign demand while developing capabilities that may later scale into broader commercial markets.
How does AI change the economics of satellite data?
AI can make satellite data easier to integrate, interpret and use in everyday decision-making. Instead of requiring specialist teams and long systems-integration projects, AI-enabled infrastructure can combine satellite data with terrestrial data and turn it into commercially useful insight.
Could orbital infrastructure become an investable market?
Orbital infrastructure may become more viable as launch costs fall and demand for compute, energy and communications grows. The opportunity could include orbital data centres, in-space servicing, manufacturing, communications infrastructure and space-based energy systems.
Can Europe close its space capability gap?
Europe has meaningful SpaceTech talent and defence demand, but Mark argues that the US remains the principal centre of the industry. Europe’s position may improve if defence funding and follow-on capital become more available.
Where might investment value accrue in SpaceTech?
Value may accrue to vertically integrated satellite operators, AI-enabled data platforms, sovereign infrastructure providers, communications networks, orbital servicing companies and businesses that control proprietary data, hardware and customer relationships.
What makes a SpaceTech company defensible?
Mark argues that defensibility often comes from vertical integration, direct customer relationships, proprietary data, manufacturing capability, algorithms, operational processes and intellectual property built around specific use cases.
Private markets were designed around illiquidity, but the industry is now too large and too complex to rely solely on traditional exits. In this episode, Ross Butler speaks with Alex Branton, Chief Investment Officer at Nodem Capital, about what NAV really means, how private markets liquidity tools are evolving, and why NAV lending sits somewhere between credit, secondaries and structured equity.
Key Takeaways
NAV lending is not just a financing tool. It can be used for DPI acceleration, defensive liquidity or genuinely accretive investment opportunities.
Secondaries, structured secondaries and NAV loans sit on a spectrum. The distinction between debt and equity becomes less clear as loan-to-value increases.
NAV is not cash in the bank. It is a manager mark, shaped by valuation policy, comparable multiples, auditor review and GP judgement.
Evergreen funds sharpen the valuation question. If investors are buying and selling at NAV, the robustness of that NAV becomes central.
Private credit headlines may be overstating systemic risk. The bigger issue may be liquidity expectations inside certain fund structures, rather than underlying credit collapse.
Why does NAV matter so much in private markets?
NAV, or net asset value, is one of the most important reference points in private markets. It is used to value portfolios, calculate performance, support secondary transactions, price evergreen vehicles and underpin NAV lending facilities.
But NAV is also one of the most misunderstood concepts in the asset class.
In public markets, price is visible and continuous. In private markets, value is assessed periodically, often by the GP, based on company performance, comparable multiples, market evidence and valuation policy. That does not make NAV meaningless, but it does mean investors need to understand what sits underneath the number.
For Alex Branton, NAV is not simply a valuation figure. It is a signal. It tells investors something about the manager’s view of the portfolio, the quality of the underlying assets, the potential liquidity of those assets and the degree of confidence a lender or secondary buyer may have in the mark.
How has the private markets liquidity toolkit evolved?
As Ross observes, private markets have historically created value through illiquidity. Investors commit capital, managers invest it over time, and capital comes back when assets are sold.
That model still matters. But as private markets have scaled, a much broader ecosystem of liquidity tools has emerged.
Alex breaks the market down into several major categories.
LP-led secondaries
The traditional secondary market allows an LP to sell an existing fund interest to another buyer. This might involve a single LP position or a portfolio of fund stakes.
For large, institutional portfolios, this market can be highly active. For smaller or more complex positions, liquidity can be much harder to find.
GP-led secondaries
GP-led solutions include continuation vehicles, fund recapitalisations and strip sales. These allow a GP to hold assets for longer, provide optional liquidity to existing investors or bring in fresh capital around specific assets.
Single-asset continuation vehicles are an especially important part of the current market because buyers can underwrite a specific company rather than accepting a whole portfolio.
Structured secondaries and preferred equity
Structured secondaries are designed for situations where the buyer and seller cannot agree a clean market price.
Rather than forcing a binary sale at a disputed valuation, the parties agree an upfront amount, a preferred return and a future sharing mechanism. In practice, this allows liquidity to be created while leaving some upside participation with the original owner.
NAV lending
NAV lending allows a fund, LP or family office to borrow against the value of an underlying private markets portfolio.
At low loan-to-value ratios, this looks like credit. At higher loan-to-value ratios, it begins to look more like a structured secondary, because the capital provider is taking more equity-like risk.
That is why the episode repeatedly returns to the idea of a spectrum. These tools are not cleanly separated. They overlap.
Is NAV lending debt, equity or secondaries?
One of the most useful frameworks in the episode is Alex’s explanation that NAV lending exists on a continuum.
At one end, a NAV loan may be a conservative facility against a diversified portfolio, perhaps at 10 to 20 per cent loan-to-value. That is fundamentally a credit product.
At the other end, a capital provider might offer 60 per cent of NAV upfront, receive a preferred return and then share future proceeds. That starts to resemble preferred equity or a structured secondary.
The distinction matters because the higher the LTV, the more the lender is exposed to the actual exit value of the assets. In other words, the transaction begins to move from lending against value to participating in value.
This is why the language around NAV lending can be confusing. The same term can describe a conservative fund-level loan, a liquidity bridge, an offensive investment facility or something much closer to an equity risk-sharing arrangement.
What are NAV loans actually used for?
The controversy around NAV lending often assumes one narrow use case: a manager borrowing against a portfolio to distribute cash to LPs and improve DPI.
That does happen, and it is the use case that creates the most scepticism.
But Alex argues that the market has changed significantly. Before Covid, NAV lending was more closely associated with DPI acceleration. Today, he suggests, the dominant use case has shifted towards accretive investment during the life of the fund.
Examples include:
buying a discounted secondary position in a strong portfolio company
funding a strategic acquisition
supporting a winner inside the portfolio
avoiding a slow or impractical LP co-investment process
solving temporary liquidity constraints without selling a prized asset
This distinction matters. A NAV loan used to disguise weak exits is very different from a NAV loan used to double down on a high-quality asset at an attractive price.
The structure may be similar, but the signal is completely different.
Why is NAV lending controversial?
The controversy comes from the possibility that NAV lending can be used badly.
Ross compares NAV loans to dividend recaps at the fund level. That analogy is useful because, like dividend recaps, the structure itself is not inherently good or bad. The question is why it is being used.
Alex describes the problematic scenario clearly. A GP may hold a portfolio at elevated valuations, perhaps from 2018 or 2019 vintages that were acquired in a low-rate environment. The market may no longer agree with those marks. LPs may be asking for liquidity. Rather than selling assets and crystallising a lower valuation, the GP borrows against the portfolio and distributes capital.
That creates several concerns.
First, it may give the appearance of DPI without a true exit.
Second, it may delay recognition of weaker asset values.
Third, the NAV lender becomes structurally senior to LPs from future distributions.
Fourth, it can create a perception of misalignment between GP, LP and lender.
That is the source of the scepticism. If the assets are so strong, why not sell them?
Why might NAV lending be less risky than the headlines suggest?
Alex pushes back against the idea that NAV lenders are indiscriminately financing weak portfolios.
His argument is that the lender’s own incentives create discipline. NAV lenders are typically offering their investors a debt-like, low-loss product. They therefore need to be highly selective.
Conservative LTVs matter. A normal NAV facility may be around 10 to 15 per cent loan-to-value. The underwriting bar is high, and many potential transactions are rejected quickly because the use case, portfolio quality or valuation does not work.
There are also governance mechanisms. In newer funds, NAV lending powers may be built into the fund documents. Where facilities are used to take money out of the fund, LPAC consultation is often expected. The greater the potential alignment issue, the more explanation is required.
The result is a more nuanced picture. NAV lending can be misused, but the market also contains important guardrails: conservative LTVs, lender discipline, portfolio underwriting and LP governance.
Who provides NAV lending?
The NAV lending market includes both banks and specialist non-bank lenders.
Banks typically focus on very low-LTV facilities against cash-flowing portfolios. They may lend where repayment can be supported by expected dividends or distributions, rather than relying on an uncertain exit. For banks, NAV facilities can also form part of a broader relationship that includes subscription lines, capital call facilities, IPO work or other services.
Specialist non-bank lenders operate differently. Larger platforms such as 17Capital provide NAV and preferred equity facilities to major buyout funds, often at significant scale.
Nodem Capital sits in a different part of the market. Alex describes its focus as the mid-market of NAV lending, particularly facilities in the $20 million to $100 million range for mid-sized private equity firms, family offices and investors whose portfolios may be too specialist, too small or too inefficiently priced for the largest providers.
He also identifies a gap below $20 million, where high-quality family office or HNW portfolios may struggle to access appropriate financing because the transaction size is too small for banks or scaled lenders.
What does secondary pricing reveal about private markets?
A recurring theme in the episode is that liquidity is highly concentrated.
In venture, Alex notes that much of the liquidity is concentrated in a small number of well-known names. The same principle applies, to a degree, in private equity. If investors talk about private market pricing, they may really be talking about a handful of highly visible companies.
For large, high-profile private companies, secondary markets can be relatively efficient.
For smaller, subscale or minority positions, especially in European mid-market or growth portfolios, liquidity can be much weaker. A high-quality portfolio may still attract bids far below NAV simply because the buyer requires a margin of safety and the market is thin.
That is where NAV lending or structured solutions may be useful. If the holder likes the assets and disagrees with the secondary market price, borrowing against the portfolio may be preferable to selling at a deep discount.
This is one of the episode’s most important distinctions: low secondary pricing does not always mean poor asset quality. It may also reflect market inefficiency, scale constraints and liquidity scarcity.
How robust is NAV?
How robust are manager marks?
The best GPs are rigorous and can be trusted to a meaningful degree. But NAV still involves discretion. Managers use comparable multiples, company performance data and valuation analysis. Auditors provide a sense check. Yet the GP’s input remains significant.
The real test is not just the reported NAV, but the relationship between NAV and actual transaction evidence.
If comparable assets are selling at materially lower multiples than those used in a fund’s marks, that matters. A NAV lender will usually make its own assessment. If the lender disagrees strongly with the reported value, it may walk away. If it has some reservations, it may lend at a lower LTV.
The message for LPs is equally important. NAV is useful, but it is not the same as cash. Investors need to understand how marks are built, how they compare with realisations and whether the GP is adjusting valuations appropriately when market conditions change.
For long-term LPs in closed-ended funds, final cash distributions ultimately matter most. But for secondaries, NAV loans and evergreen funds, NAV becomes much more consequential because it is the basis on which people enter, exit, lend and transact.
Why do evergreen funds sharpen the valuation issue?
Evergreen funds are one of the most important developments in private markets access.
They simplify the experience for wealth investors. Instead of dealing with capital calls, long fund lives and complex cash flow management, an investor can allocate to a structure that looks and feels more like a mutual fund, while still providing exposure to private assets.
Alex is broadly positive about this development. He sees evergreens as a route to democratising access and bringing wealth capital into private markets.
But the structure introduces a new challenge: implied liquidity.
Traditional LP funds do not give investors an option to redeem. That hard commitment is part of the structure. Evergreens, by contrast, often offer periodic liquidity, perhaps around 5 per cent per quarter, subject to gates.
That creates the possibility of an asset-liability mismatch. The underlying assets may be long duration, but investors may expect shorter-term access to capital. If negative headlines cause outflows, gates may be triggered. The underlying asset problem may be manageable, but the optics can become difficult.
Ross pushes back on the idea that retail capital is inherently short-term. His view is that individuals can be long-term investors too, provided expectations are properly set. Alex agrees. The deeper issue is not necessarily investor type, but education, suitability and the risk of overselling liquidity.
What is NAV squeezing, and should investors worry?
The episode also touches on the debate sometimes referred to as NAV squeezing, although Ross suggests NAV stretching may be the better phrase.
The issue is this: if a secondary buyer acquires a portfolio at 80 cents on the dollar, can that buyer then mark the same portfolio at 100 cents on the dollar inside its own fund?
To some critics, that looks like an immediate valuation uplift without economic creation.
But Ross and Alex both take a more nuanced view. A discounted transaction price may reflect forced liquidity, market friction or the seller’s specific circumstances. It does not always mean that 80 is the “true” long-term value.
The philosophical question is whether price equals value.
If one believes the transaction price is the value, then marking at 100 looks wrong. If one accepts that private market transactions can occur at discounts for structural reasons, then the higher mark may be legitimate, provided the methodology is transparent and defensible.
For investors in evergreen funds, this matters because new investors may be buying in at NAV. They therefore need to understand how assets are valued, particularly where the fund acquires assets at discounts in the secondary market.
Is private credit facing a systemic problem?
The final section of the conversation turns to private credit, the recent media focus on software exposure and the so-called SaaS apocalypse.
Alex does not see a systemic issue.
He distinguishes between bank lending and non-bank private credit. Broadly syndicated loans are more visible, while private credit is less transparent. That opacity can make it harder to know precisely how much stress exists, particularly because lenders can amend, extend and refinance rather than immediately recognise defaults.
He acknowledges that there may be weakness at the smaller end of the market and that software exposure is meaningful within direct lending. But he also argues that many software-related borrowers remain recurring revenue businesses with healthy cash flows.
His broader point is that the market may be conflating two different issues:
actual credit defaults
liquidity pressure in certain fund structures
Gating, investor outflows and negative headlines do not automatically mean a systemic credit crisis. They may instead reflect a mismatch between investor expectations and the liquidity profile of the underlying assets.
This is not complacency. Alex says the market should be watched carefully. But his base case is that the current anxiety is overblown.
What is Nodem Capital’s role in the market?
Nodem Capital is positioned as a specialist NAV lender for the mid-market.
Alex describes the firm as a UK asset manager backed by a family office, with a focus on understanding private markets portfolios that may not fit neatly into bank or large-platform underwriting models.
The ambition is to become a go-to liquidity partner for family offices, mid-sized private equity firms and investors with good portfolios that are not well understood by the broader market.
The point is not that every situation requires a NAV loan. Sometimes a secondary sale, a structured solution or another form of liquidity may be more appropriate. But Alex sees value in helping investors understand the full range of options before deciding which tool fits the problem.
The bigger lesson from this episode
The episode is not simply about NAV lending. It is about the way private markets are changing as they scale.
Private markets were built around patience, commitment and illiquidity. Those features remain central to the asset class. But as the market grows, investors, managers and advisers need more tools to deal with delayed exits, ageing portfolios, wealth capital, continuation vehicles and secondary pricing.
The liquidity toolkit is expanding because the old model is under strain.
But innovation always creates trade-offs.
NAV lending can be accretive, or it can disguise weak exit activity.
Evergreens can democratise access, or they can oversell liquidity.
Secondaries can reveal market discipline, or they can reflect temporary pricing inefficiency.
NAV can be a useful measure, or it can be mistaken for cash.
That is why the signal matters. In private markets, the use of liquidity tools tells investors something about quality, confidence, incentives and discipline.
The challenge is not simply to create liquidity. It is to create liquidity without damaging the alignment that made private markets valuable in the first place.
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About Ross Butler
Ross Butler is the host of Fund Shack and the author of Invest Like A Barbarian: Share in the Spoils of a Private Markets Revolution.
He has spent more than 25 years working across private capital as a journalist, policy adviser and consultant. His previous roles include Editor of Real Deals, Secretary of the EVCA Professional Standards Committee and Director of the Listed Private Capital Association.
NAV, or net asset value, is a key reference point for portfolio valuation, fund performance, secondary transactions, evergreen fund pricing and NAV lending. But NAV is not the same as cash. It is a manager mark shaped by valuation policy, comparable multiples, auditor review and GP judgement.
What is NAV lending?
NAV lending allows a fund, LP or family office to borrow against the value of an underlying private markets portfolio. At low loan-to-value ratios it looks like credit, while at higher loan-to-value ratios it can begin to resemble preferred equity or a structured secondary.
Is NAV lending debt, equity or secondaries?
NAV lending exists on a continuum. A conservative NAV facility against a diversified portfolio may be a credit product, while a higher-LTV structure with preferred return and upside sharing can look more like structured equity or a secondary transaction.
What are NAV loans used for?
NAV loans can be used to accelerate DPI, provide defensive liquidity or fund accretive investment opportunities. Examples include supporting a strong portfolio company, funding a strategic acquisition, buying a discounted secondary position or avoiding a forced sale of a prized asset.
Why is NAV lending controversial?
NAV lending becomes controversial when it is used to distribute cash without a true exit, delay recognition of weaker asset values, or make the NAV lender structurally senior to LPs. The concern is not the tool itself, but why it is being used and what it signals about the portfolio.
Why might NAV lending be less risky than headlines suggest?
NAV lending may be less risky than some headlines suggest because lender incentives create discipline. Conservative LTVs, portfolio underwriting, rejected transactions and LP governance all act as guardrails against weak or misaligned uses of the structure.
How do evergreen funds change the NAV debate?
Evergreen funds sharpen the NAV question because investors may enter and exit at NAV. If an evergreen fund offers periodic liquidity while holding illiquid private assets, valuation robustness and liquidity expectations become central to investor trust.
Is private credit facing a systemic problem?
Alexander Branton does not see a systemic private credit crisis. He distinguishes between actual credit defaults and liquidity pressure in certain fund structures, arguing that negative headlines and gating do not automatically imply widespread underlying credit collapse.
