Backing AST SpaceMobile Before the Market Believed: The Importance of Conviction in Deep Tech Investing

In a recent episode of The Sourcing Stack by Tracxn, I speak with Alain Gavin, Managing Partner and Chief Investment Officer of PSION Partners, about the early investment team's experience evaluating AST SpaceMobile and its ambition to connect mobile phones directly from space.

When the company was still relatively young, its direct-to-device satellite technology was viewed with considerable scepticism across parts of the industry. Many questioned whether the technology could work. However, the investment team's technical due diligence reached a different conclusion.

The opportunity illustrates an important principle in deep tech investing: recognising transformative potential often requires looking beyond conventional market opinion and understanding the technology, the people building it, and the market they are seeking to address.

In deep tech, conviction should not come from believing in an ambitious vision alone. It needs to be supported by rigorous technical due diligence, exceptional talent and a clear understanding of the commercial opportunity.

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The AST SpaceMobile story is particularly relevant to investors evaluating technologies that challenge established assumptions.

It demonstrates why technical feasibility, market timing and execution capability need to be assessed together, rather than treating market scepticism as proof that an opportunity is not viable.

Recognising the opportunity before market consensus

The investment team at Seraphim Capital first encountered AST SpaceMobile in 2018, when the company was approximately a year and a half old.

Its ambition was to develop direct-to-device satellite technology that could connect standard mobile phones from space, creating a new approach to mobile connectivity.

At the time, this was a challenging proposition. When Alain discussed the technology with people at an industry conference, many questioned whether it could work.

However, the team's technical assessment reached a different conclusion.

Rather than relying solely on prevailing industry opinion, the team examined the underlying technology and its feasibility. Its technical due diligence suggested that the proposition could work.

The team also recognised the exceptional talent the company had assembled across the United States, Europe and Israel, spanning both technical and go-to-market capabilities.

This combination of technical potential and execution capability helped establish the investment team's conviction in the opportunity.

Technical due diligence over conventional opinion

One of the central lessons from the AST SpaceMobile investment experience is the importance of understanding what sits beneath a technology proposition.

In deep tech, new technologies can initially appear difficult to commercialise, particularly when they challenge existing infrastructure or established ways of working.

Industry opinion can provide useful context, but it should not replace independent technical assessment.

For investors, the key questions are whether the technology is technically achievable, whether the team has the expertise to deliver it, and whether the underlying market opportunity justifies the investment.

In AST SpaceMobile's case, the investment team's technical due diligence indicated that direct-to-device satellite connectivity was possible, despite the scepticism Alain encountered across the industry.

This highlights why technical understanding can become an important source of differentiation when evaluating emerging technologies.

The importance of talent and execution

A promising technology is only one part of a successful deep tech investment.

The people responsible for developing and commercialising it are equally important.

Alain highlighted the exceptional talent AST SpaceMobile had brought together across the United States, Europe and Israel. The combination of technical expertise and go-to-market capabilities strengthened the team's assessment of the company's ability to execute.

For investors, this reinforces the importance of evaluating founders and teams beyond their ability to articulate an ambitious vision.

A strong team needs the technical capability to build the product, the operational experience to overcome development challenges and the commercial understanding to bring the technology to market.

The opportunity must also be large enough to support the scale of the ambition.

As Alain explained during the conversation, a great founder in a small market may ultimately build a small company. Market size and timing therefore remain important considerations alongside founder quality.

From an initial missed opportunity to investment

The investment journey was not immediate.

The team did not secure a position in AST SpaceMobile on its first attempt, as a family office came in with a higher valuation.

The opportunity came around again approximately a year later, and the team invested in 2019.

This illustrates another aspect of venture investing: identifying an opportunity and securing an investment are not always the same thing. Timing, valuation and competition for access can all influence whether an investment becomes possible.

Maintaining an informed view of a company's underlying potential can therefore be important when an opportunity does not materialise at the first attempt.

From early conviction to significant market recognition

AST SpaceMobile is now listed on Nasdaq. During the podcast, Alain referenced the company's valuation at approximately $20 billion.

The figure highlights the scale of the opportunity that the investment team had identified when the company was still at an early stage.

However, the significance of the investment story extends beyond the eventual valuation.

It demonstrates the importance of understanding a technology before it becomes widely accepted, assessing its feasibility independently and recognising the combination of talent and market opportunity required to turn innovation into commercial success.

For investors, the lesson is not that every technology challenged by the market will become successful. Rather, it is that opportunities should be assessed on their underlying merits, with technical diligence and commercial judgement playing complementary roles.

What the AST SpaceMobile story means for deep tech investing

The experience reinforces several important considerations when evaluating emerging technology businesses.

First, technical feasibility needs to be established independently. A compelling vision is not enough if the underlying technology cannot be delivered.

Second, the quality and breadth of the team matter. Exceptional technical talent must be supported by the capabilities required to execute and reach customers.

Third, market size and timing are critical. Even a strong technology and capable founding team need a sufficiently large market to support a meaningful business.

Finally, investors should be willing to challenge conventional assumptions when the evidence supports a different conclusion.

These principles are relevant across deep tech sectors, particularly where technologies are complex, development cycles are long and early market understanding may be limited.

Key Takeaways

Look beyond market consensus
Industry scepticism should not automatically rule out an opportunity. Investors need to understand the underlying technology and assess its potential independently.

Technical due diligence matters
In deep tech, establishing whether a technology can actually work is fundamental to evaluating an investment proposition.

Talent is essential to execution
Exceptional technical and commercial capabilities help turn an ambitious technology vision into a viable business.

Market timing and size matter
A strong founder and promising technology need a sufficiently large market to create a substantial company.

Investment opportunities do not always happen immediately
Valuation and competition can affect access to an opportunity, making continued assessment important.

Conviction needs evidence
The strongest investment decisions combine independent technical understanding, team assessment and commercial judgement.

The central lesson from the AST SpaceMobile investment experience is that some of the most interesting deep tech opportunities emerge before the wider market is ready to recognise them.

Identifying them requires more than enthusiasm for innovation. It requires the ability to understand complex technologies, assess whether they can work and recognise the people and market conditions needed to turn them into successful businesses.

For investors, the challenge is to distinguish genuine technical potential from speculation, and to develop conviction based on evidence rather than consensus.

AST SpaceMobile provides an example of why that distinction matters.

Watch the full conversation

In this episode of The Sourcing Stack by Tracxn, Alain Gavin discusses the AST SpaceMobile investment experience, alongside his perspectives on deep tech, founder evaluation, commercial validation and the opportunities shaping the space sector.

Watch the full conversation on YouTube →