Thursday, October 6

Space Tech Startups: For VCs, it’s More than a Jab on the Edge of Space

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Space tech startups lure global venture capitalists as Jeff Bezos and Richard Branson complete their edge of the space mission! Global space tech startups are now enjoying the new wave attracting more investments than ever. For venture capitalists, space tech startups are the next most lucrative sector after edtech. Collectively, the world didn’t solve pressing climate challenges, but determined space tech as an urgent and timely goal before NASA issued a lockdown on space voyages suspecting extraterrestrial invasion.

Space tech startup funding comprises venture funding for space travel, satellite manufacturing, aerospace technology, etc. This would mean that venture capitalists have a buffet of choices when space technology is a $200 billion market spanning startups manufacturing products for use on earth, in the air, the suborbital, and on the edge of space. Space tech startups that have enjoyed $5.5 billion in 2020 have raised $3.6 billion across 94 deals in the first six months of 2021. The $5.2 billion in venture funding for space tech startups include funding for SpaceX’s $850M and Relatively Space’s $650M.

Space Tech Startups: The New VC Appetite

Now you see how the above figures explain 2021’s appetite for space or related market startups. And we are still half a year away from closing. We can’t wait to discover a host of new startups by independent founders or enterprises mushrooming in the space to onboard more venture capitalists to realize their cool. Not only are venture capitalists seeking to jab the space with ultra-cool Virgins and Origins, but entrepreneurs consider this the most opportune moment as the number of space startup funding rounds increases exponentially. Get your space technologies, which could be as simple as a propulsion jet manufacturing or material fabric to furnish rockets and dress the astronauts. We take it from Phase Four which manufactures radio-frequency thrusters for satellite propulsion that raised $26 million in a Series B investment round led by New Science Ventures LLC.

Nothing New

What may appear like the impact of Branson and Bezos in the space technology sector started two years ago, accelerated by a growing number of startups building satellite technologies and investors with predictive mindsets able to read the aftermath of a robust space infrastructure to propel investments and civilian astronauts to space. In this regard, San Francisco, CA, based Alsop Louie Partners’ investment portfolio invested in the afore discussed Phase Four and Ursa Major Technologies that develops high-performing and low-cost, reliable engines for launch and hypersonic applications. In 2019, Alsop Louie Partners invested in Aurora Insights, which develops technologies to map radio frequency (RF) from collection platforms in space (satellite), in the air (aircraft), and on the ground (vehicles and fixed ground sensors).

Global VCs Explain their Take

Steve Jurvetson, co-founder of Future.Ventures and a board member of SpaceX believe that the growth of the space tech startup is not confined to propelling rockets to space but to the development of telecom communication, imaging technologies, satellite support, and space industry peripheries. According to Vikram Godse, Managing Partner, Mayfield India invested in space tech startup Agnikul; the Indian space technology ecosystem has picked up perfect momentum with Indian VC investors. For Mark Kahn, Managing Partner at Omnivore, “Satellite imagery and remote sensing data are invaluable tools for forecasting agricultural output, regulating crop inputs, and even calculating how much carbon farmers are sequestering. Multispectral, synthetic aperture radar (SAR), and hyperspectral satellites can create rich datasets, yielding deep insights to make farming more profitable, resilient, and sustainable.” Source: Financial Express.

Space tech Startup Fund Democratized

The UFO ETF fund manager, Andrew Chanin, informs that funding in space tech has witnessed mercurial growth courtesy of the billionaire space trips. It would be too delimiting to imagine fund allocation for only space-bound startups for scientific or commercial interests. Hence, according to Chanin, “The real money from space launches is likely to come from the increased use of satellites for communication and internet services. The satellite industry is one of the most misunderstood parts of the space economy.” According to Chanin, “Navigation and GPS leader Garmin (GRMN), mobile mapping firm Trimble (TRMB), communications company Iridium (IRDM), satellite manufacturer Maxar (MAXR) and satellite media firms DISH (DISH) and Sirius XM (SIRI) are some of the big holdings.” Source: CNN

Space Tech Startup Scene in India

Founded in 2015, Bellatrix Aerospace is an Indian space R&D company specializing in satellite propulsion. In May, Bellatrix Aerospace test-fired India’s first privately built Hall Thruster, a highly efficient electric propulsion system. Based in Coimbatore, Tamil Nadu, India, the space tech startup raised $3 million in funding from nine investors, including SINE, Survam Partners, and Karsemven Fund.

Founded in 2018, Skyroot Aerospace is an Indian private aerospace manufacturer and commercial launch service, provider. In June 2021, the firm shared the plan to acquire a new talent and complete the development of Vikram-1. Based in Hyderabad, India, the space tech startup raised $14.9M in funding in three rounds, the latest being the Series A round on May 19, 2021. The top investors are Anil Chalamalasetty, Mahesh Kolli, and US-based Sutton Capital.

Founded in 2019, Pixxel Space Technologies, Inc. is a space technology company working towards creating the world’s highest resolution hyperspectral imaging satellite-imaging constellation. In May, Pixxel shared the plan to launch 36 satellites to obtain images with 50 times more information than traditional satellite images. Based in Bangalore, India, the space tech startup raised $8 million in total funding in five rounds from fifteen investors, including Omnivore, Techstars and Ryan Johnson.



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