From launching satellites by the Soviet and US governments for warfare to SpaceX inventing the fastest mode of transportation to travel around the globe in 90 minutes, space tech has seen multitudinous developments in all of its aspects. Participation and contribution to this industry is now considered a parameter of development. “Space Race” is real and all the leading nations compete in terms of innovation and problems space technology can solve.
INTRODUCTION
Latest liberalization by governments across the globe to open up this sector to private players calls for faster innovation, greater capital deployability, and more effective use of resources and knowledge. The recent developments and successes in reusable launch vehicles got the scientists’ head spinning and the market recalculating the commercial value this industry can provide. With the governmental organizations finally accepting to underplay their monopoly in this industry, newer and individualistic minds are coming together to play their cards rights.
SCOPE
Advancement in scientific studies led to study cosmic bodies, weather, and to aid disaster management. This has now transformed into observing climate changes, monitoring shifts in quality of air and water, and even space mining.
Commercialization came into picture with the boom of mobile phones, broadcasting services, then the IoT. This new genre of data has multiplied its uses and demand for the same. This inevitably elevated the need for spacetech across the global market.
With the widened scope of commercialization, standards and need for infrastructure to cultivate these activities and aspirations is now picking pace faster than ever. Spacetech is at present “the next thing” every country with ample resources is looking forward to lead, making it a $600 billion industry by 2025.
SEGMENTS
SpaceTech divisions can be broadly identified as upstream (transportation of objects into space, ground stations, and space exploration) and downstream (data and services that result from upstream) activities.
With the industry catching horizontal and vertical momentum, two other divisions can be identified as midstream (end-to-end services) and supporting (underpin technologies) activities with the industry catching horizontal and vertical momentum.
GLOBAL SPACETECH ECONOMY
According to the most conservative estimates, the global spacetech industry accounts for 0.5% of the total global GDP. Dispositions of the whole sector is rapidly shifting. While the Traditional Space Industry was once dominated by governmental entities, the New Space Industry is dominated by emerging private entities, emerging entities. Therefore, it is a massive opportunity for private investors as “Commercial SpaceTech” is on an expeditious rise.
However, the synergy of governmental and private entities has proved effectiveness, with regards to capital optimization, knowledge and resource sharing, and for required regulatory frameworks, which boosts the growth rate of the whole industry.
With a total of $28B invested in 3,086 companies, the US is the undisputed market leader of industry investments on the global front. China stands second with $4.786B invested in 112 companies. The biggest annual returns of the recent years are collected by Manufacture and Satellite companies.
The largest capitalization is obtained by Space Medicine and Cloud companies. Significant increase has been observed in the utilization of developments in Air and Spacecraft and Space Missions.
EMERGING TRENDS AROUND THE GLOBE –
OPPORTUNITIES AND INNOVATIONS
SMALL SATELLITES
Cheaper, enables mass production, well suited for proprietary wireless communications, scientific observation, data gathering, and monitoring earth using gps.
Notable Startups:
Space Inventor (Denmark) – Pico-satellite tradition.
EnduroSat (Bulgaria) – NanoStats and space services.
ADVANCED SPACE MANUFACTURING
Large space structures, reusable launch vehicles, space shuttles, satellite sensors, and automation using advanced robotics, 3D printing, and light- based manufacturing.
Notable Startups:
Momentus (USA) – Affordable space transportation using reusable rockets. After the drop- off, the vehicle de- orbits to another orbit.
Equatorial Space Systems (Singapore) – Commercial sub-orbital rockets delivering small payloads above the Karman line (boundary between space and atmosphere).
NOVEL SPACE COMMUNICATION SYSTEMS
Advanced communications through high- capacity antennae, ground stations, and LEO satellites.
Notable Startups:
Thorium Space Technology (Poland) – Develops ultra- flat, scalable active- matrix antenna.
Arctic Space Technologies (Sweden) – Brings computational power next to the software- driven ground station.
SPACE TRAFFIC MANAGEMENT
Feasible solutions for debris retrieval and space traffic management.
Notable Startups:
ClearSpace (Switzerland) – Develops technologies to remove unresponsive and derelict satellites from space. First mission in 2025.
OrbitGuardians (USA) – Commercial provider to remove space debris smaller than 20cm.
SMART PROPULSION
Given costs and environmental impacts of space missions, there is a need for electric, green, water- based, iodine- based propulsion systems.
Notable Startups:
ThrustMe (France) – Develops electric propulsion system using iodine as a propellant.
Dawn Aerospace (New Zealand and Netherlands) – Builds same day reusable launch vehicles and high- performance, non- toxic propulsion systems for satellites of all sizes.
SPACE ACTIVITY MANAGEMENT
Management of activities which include tourism, industrial missions, satellite servicing, food production, waste disposal, and space station improvement.
Notable Startups:
Laviathan Space Industries (USA) – Space station network consisting of 14 space stations using artificial gravity to advance space travel, trade, and tourism.
Obruta Space Solutions (Canada) – New satellite servicing with refueling services and upgrades to extend their operational lives.
SPACE MISSIONS
Addressing space exploration challenges in panning, executing, monitoring, to find better opportunities and increase innovation.
Notable Startups:
Lunar Space Corporation (USA) – Provide rapid solutions and mission- specific intelligence to improve mission planning. Majors in lunar environmental intelligence.
Helios (Israel) – Provides in- situ resource utilization (ISRU) technology to realize the vision of setting permanent lunar and martian bases.
SPACE MINING
Mining of celestial bodies to extract platinum, gold, iron, and even water. Analysts predict that it could potentially turn into a billion- dollar industry.
Notable Startups:
Asteroid Mining Corporation (UK) – Provides different spacecrafts for prospecting, exploration, and extraction from selected mining candidates of the near- earth asteroids.
High Earth Orbit Robotics (Australia) – Combines intelligent control with space- based cameras to acquire high- quality imagery of satellites, space debris, and resource- rich asteroids.
LOW- EARTH ORBIT SATELLITES
LEO satellites do not particularly follow a set path around the earth, hence making them a bigger source of data while cost cutting.
Notable Startups:
SpaceAble (France) – Provides an on- demand in- situ asset inspection solution for LEO satellites.
WARPSPACE (Japan) – Offers LEO optical telecommunication services with its optical data relay network in the medium- earth orbit (MEO) for satellite operators.
SPACE DATA
Use of AI, blockchain, and big data to offer secure data solution needs of processing, treating, analysing, and managing said information.
Notable Startups:
Kleos (Luxembourg) – Delivers data products via application programming interfaces (APIs) to suit customer’s requirements.
LEOLabs (USA) – Provides data services for precision tracking and monitoring of satellites using its orbital products and phased- array radars.
INDIAN SPACETECH ECONOMY
Source: Mordor Intelligence, Allied Market research, EY analysis
- Over the years, India has become a leader in third- party launch services with ISRO generating a revenue of $167.5m (2014-19) by launch of satellites of 26 countries.
- Several private companies are using cutting- edge technologies to play the opportunities in the space domain in line with the ‘Atmanirbhar Bharat’ vision.
- Notable expertise has been achieved around the launch of LEO, MEO, and GEO satellites and orbit management solutions.
- Launch segment and small satellites being the key areas of focus for startups and SMEs.
- Further growth owing to expansion economical launch services, rise in navigation satellites, demand for communication satellites.
- Inclusion of private players brings competition, leading to low- cost and mass production, further leading to increase in demand.
INDIA’S LEADING STARTUPS
INDIAN SPACETECH STARTUP ECOSYSTEM
NEW SPACE INDIA LIMITED (NSIL)
NSIL is a company wholly owned by the Indian government, under the administration of Department of Space. It would act as a commercial arm to ISRO, acting as an interface for interacting with the industry, undertaking commercial negotiations, and provide attentive support.
INDIAN SPACE RESEARCH ORGANIZATION (ISRO)
ISRO will transition out of being present in manufacturing of operational space systems and shall be transferred to industries for commercial explorations. It shall focus on R&D in advanced technology, providing newer systems and realisation of space objectives for meeting national ambitions.
Another task under the new policy is for ISRO to share technologies, products, processes, and best practices with other governmental and non- governmental entities.
INDIAN NATIONAL SPACE PROMOTION AND
AUTHORIZATION CENTRE (INSPACe) 
INSPACe’s main mandate is to create a stable and predictable regulatory framework that will ensure to provide a level playing field for the non- governmental entities. It will act as a promoter by setting up industry clusters and as the regulator, issue guidelines for liability issues.
Detailed Role of INSPACe:
PROMOTIONAL
DIRECTORATE
- Developing India’s space startup ecosystem.
- Setting up IT infrastructure and the IN-SPACE Digital Platform (IDP).
- Increasing student involvement in the space sector for future improvements.
- Creating international prospects for Indian space enterprises by establishing
a spaceport and ground station hub. - Promoting space tourism and raising public understanding of the importance of space technology.
- Developing IN-SPACe talent and knowledge.
PROGRAM MANAGEMENT & AUTHORIZATION DIRECTORATE
- Policy node for DoS / ISRO.
- Authorization of NGES for space activities.
- Interact with the NGEs and technical staff.
- Authorization of NGES for space activities.
PROMOTIONAL
DIRECTORATE
- Make it easier to use DoS facilities.
- Provide technical assistance to NGEs in order to complete tasks.
- Evaluate ideas, finalize MoU execution and authorization.
- Establish a technological incubation center for startup guidance.
- Allocate resources, monitor and manage activities.
- Assist in the establishment of new industrial facilities.
FUNDING OVERVIEW
In global statistics, the US stands in number one position with regards to the number of startups and the amount of funding they receive. Asia exhibits confidence and potential and seems to be raising in terms to financing this industry. Lately the Middle East is starting to appear in the “Space Race”.
INDIAN STARTUP FUNDING HIGHLIGHTS
| S.No | Name | Stream and Stage | What They Do | Total EquityFunding and Valuation | Notable Investor(s) |
| 1 | Dhruva Space, 2012 | Upstream, Seed | Offer satellites, earth stations, and launching services | $6.6M,
$38.2M as on Nov 19, 2022 |
Arvog, Indian Angel Network, Blue Ashva Capital, 12 E 37 |
| 2 | Aadyah Aerospace, 2016 | Upstream, Seed | Self-designing satel- lites, launch vehicle subsystems, and drones | $6.2M,$11.2M as on Jul 08, 2021 | Keiretsu Forum |
| 3 | Satellize, 2018 | Upstream, Seed | Development of customised nanosatellites | $316K,$1.73M as on Apr 01, 2019 | Astir Ventures |
| 4 | GalaxEye, 2020 | Upstream, Seed | Provides multi-sensor imagery via satellites | $3.85M,$16.2M as on Oct 13, 2022 | Speciale Invest, Shambho Trust, LetsVenture |
| 5 | InspeCity, 2022 | Upstream, Seed | Offers satellite
life-enhancing and deorbiting services |
$1.5M,$4.84M as on Apr 11, 2023 | Antler, Veda VC |
| 6 | Bellatrix Aerospace, 2015 | Upstream, Series A | Development of advanced in-space propulsion systems and rocket propulsion technologies | $11.3M,$35M as on Jun 03, 2022 | Parampara Capital, BASF Venture Capital, Inflexor, IDFC |
| 7 | Astrogate Labs, 2017 | Upstream, Series A | Enabling high-speed communications for small satellites | $628K,$2.89M as on Nov 28, 2020 | Speciale Invest, Anicut Capital, Satsure |
| 8 | Newspace Research and Technologies, 2017 | Upstream, Series A | Unmanned air systems, collective robotics, GPS-denied operations | $33M,$192M as on Apr 11, 2022 | India Discovery, Pavestone Capital, QRG, DS Group, Consolidated Technical India |
| 9 | Digantara, 2018 | Upstream, Series A | Developing a space debris detector | $12.5M,
$5.9M as on Jul 06, 2021 |
Kalaari Capital, True Start Advisory, Peak XV Partners |
| 10 | AgniKul, 2016 | Upstream, Series B | Developer of launch vehicles for nano and microsatellites with LEO and HEO operability. | $67M,$181M as on Jan 04, 2023 | Pi Ventures, Mayfield,Celesta Capital |
| 11 | Skyroot, 2018 | Upstream, Series B | Developer of the space-launch vehicle with a small payload | $99.4M,$163M as on Sep 07, 2022 | Sherpalo Ventures, WAMI Capital, GIC, AUM Ventures |
| 12 | Pixxel, 2018 | Upstream and Downstream, Series B | AI-powered insights that discover, solve and predict climate issues in real time usinghigh-resolution hyperspectral imaging satellite constellation | $76.7M, | Radical Ventures, Accenture, Google, iDEX, NB Ventures |
| 13 | Astrome, 2015 | Downstream, Series A | Provides products and technology to beam internet access from space | $5.01M,$16.1M as on Jul 19, 2021 | ManSat, Integra Micro Systems, Urania Ventures |
| 14 | SatSure, 2017 | Downstream, Series A | AI interfaced satellite imagery solutions for multiple sectors | $20M,
$25.8M as on Oct 30, 2021 |
Baring PE, Flow Ventures, Promus Ventures, HDFC, Kotak Mahindra |
| 15 | Blue Sky Analytics, 2018 | Downstream, Seed | Geospatial data intelligence leveraging cloud and AI to build an API-based catalogue of environmental datasets | $1.34M,
$6.21M as on Aug 08, 2020 |
Godspeed Advisors, Beenext, Rainmatter |
| 16 | Kawa Space, 2018 | Downstream, Seed | Critical earth observation infra | $1.4M,
$10.5M as on Aug 04, 2022 |
Speciale Invest, AngelList, LetsVenture, Red Spring Innovation |
PRIVATE INVESTMENT CLIMATE
India is in the limelight for its “indigenous innovations”. Scientists and entrepreneurs equally have their intensions and expectations concentrated in this industry at the moment. And with the growth that this industry is experiencing around the world, this is just the beginning.
There is diversity, vis-à-vis upstream and downstream segments of this sector, opening up wider avenues of innovation and need for them to be successful.
Demand for services from this industry is persistent, especially with its revalued commercial value. Even though there is new blood intending to create supply, investors seem to take a back seat to follow through.
Spacetech is in its very early stages of growth in the private investment sector and now would be the best time for participate. With the Indian government making it more convenient for private setups to thrive, startups that can set shop sooner can have a ‘first mover advantage’ by the time the Space Policy 2023 is fully implemented and awareness as such reaches its peak.
PRIVATE INVESTMENT HURDLES
The collective investor sentiment towards the innovation-driven-upcoming-commercial industry seems positive but the same doesn’t seem to play out individually.
There are 2 significant hurdles that are currently hindering its prospects of growth:
1. The sector is extremely capital intensive.
2. Timeline to experience outcomes/ returns.
From the enterprise’s point of view:
- Not being able to prove their capabilities. Need a prototype to secure capital, need capital to make a prototype.
- Being compared to ISRO. Years of monopoly has taken front seat rather than trusting the creator.
- Losing potential investors due to their investment timeframes, risk appetite, fear of failure, and lack of knowledge.
From the investor’s point of view:
-
- Each step in any manufacture/ operation setup costs tens of crores.
- Capital being stuck for 8-12 years.
- Chance of failure is perceived to be high. This could be due to lack of awareness/ knowledge.
- Individual risk appetite.
- Risk of picking the wrong apples while the tree is still being sowed.
In lines with the most basic principle of investing, it is important to realise that the earliest participation would be most rewarding. And this industry as such requires you to get onboard at the startup’s most initial stages. Investing in later stages might seem “safer” but we should also bear in mind that “later” and “safer” are even more expensive than right now. So pick those apples now and pick them precise.
WHERE DO WE GO NOW?
Even though India has seen a startups in the spacetech sector since 2012, it has caught exponential momentum since the government widened the scope of private players in 2020. This is now fueled by the success of Chandrayaan-3 and the Indian Space Policy 2023.
With the recent successful funding stories of Pixxel, Agnikul Cosmos, Skyroot Aerospace, Bellantrix Aerospace, and Dhruva Space, budding scientists feel a higher need to participate and create their identity.
Upcoming trends that are expected to be witnessed by the Indian spacetech industry are classified as the following. This also indicates the need for innovation in the mentioned segments.
Upstream Sector:
- Indian Navigation System
- Telecommunication Satellites
- Satellites for Improved Internet Services
- Launch Vehicles for all Categories
Downstream Sector:
- Earth Observation Satellite Applications – Agriculture, Infrastructure and Urban Monitoring, ClimateTech, Maritime
- Defence Applications
- Telecommunication Applications
Midstream Sector:
- End-to-end Services
- Commercial Crew Supply
- Human Rated Systems
Supporting Sector:
- Space Activity/ Traffic Management
- Space Debris Management
- Technology for Space Suits
REFERENCES
- Global Space Habitat Report 2023-2030, GlobalNewswire Indian Space Policy 2023, StudyIQ
- Spacetech Industry Trends and Innovations 2024, StartUs Insights
Sector- Space, Invest India - Traditional Space and New Space Industry in India- Current Outlook and Perspectives for the Future, ResearchGate
- Developing the Space Ecosystem in India: Focusing on Inclusive Growth, EY-ISPA Report
- Indian Spacetech Startup Landscape and Market Opportunity Report 2023- Inc42
- Inside India’s Spacetech Boom, Inc42
- Space Tech Analytics
- Seraphim Space Index Q3 2023
- Traction Reports, Tracxn
