For investors, space is not the final frontier — but it’s proving popular once again.
Last month, a startup that mines asteroids in Huntington Beach, California— AstroForge — has closed a $40 million Series A round led by Nova ThresholdWhile the round wasn’t huge and definitely didn’t send shockwaves through the enterprise capital community, it was the latest good-sized round to assist space tech startups nearly match last yr’s total enterprise funding — just two-thirds so far this yr.
Funding for VC-backed space tech startups nearly hit $6 billion this yr, in line with Crunchbase data. For all of last yr, space technology startups — defined here as space travel, satellite communications, and aeronautics — raised $6.2 billion. That figure marked the second consecutive yr of declines after a record $12.3 billion in total raised in 2021.
There is an essential caveat to those numbers — Costa Mesa, California Anduril Industry. The startup’s massive $1.5 billion Series F last month definitely helps fund space technology. While it’s primarily often known as a defense tech company, it does fall into the space tech category because it’s an aerospace and aerospace startup, and The US Space Force uses its software(To be fair, the massive $1.5 billion from the late 2022 E round is also included in this yr’s space tech funding.)
Big money
Even without Anduril’s round, the space tech can be on track for a higher funding yr than 2023, and there have been loads of other big rounds. Some of the largest rounds in the U.S. include:
- In July, a space start-up Astranis raised a latest round of funding of $200 million to expand its Omega satellite program. The latest round was co-led by Andreessen Horowitz AND Lift Bam. While Astranis didn’t disclose the valuation amount, the company raised $200 million in a round at a valuation of $1.6 billion in April 2023, in line with Bloomberg’s report in a transaction led by Andreessen Horowitz.
- In June, the company that produces space equipment Top $95 million Series B round was blocked, led by XYZ Venture Capital AND CRV to ramp up satellite bus production. A Los Angeles-based space technology startup is helping streamline the approach to satellites by enabling mass production of spacecraft buses—the essential body and structural element of satellites—to satisfy growing demand from customers like US Department of Defense.
- In January in Hawthorne, California Hadrian announced that it has raised $117 million in Series B funding, $25 million of which is debt. RTX Projectsthe enterprise capital company of the essential defense contractor RTX (formerly Raytheon) and a16zparticipated in the round. The company builds “highly automated precision component factories” primarily to provide components for the space and defense industries.
China’s space dreams
In terms of enormous rounds, five of the seven largest rounds raised by space technology startups went to Chinese corporations.
Companies like Yuanxin Satellite, Tianbing Technology AND Deep Blue Aerospace all raised funding rounds exceeding $100 million.
While it’s definitely not surprising that Chinese space tech startups are raising funds as usual, the country’s enterprise capital market has been hit hard by government regulations and rising West-China political tensions.
Total startup funding in China hit its lowest point in the second quarter, when it totaled just $7.4 billion. That’s a staggering 42% drop from the first quarter’s $12.8 billion and the lowest total since the third quarter of 2014, in line with Crunchbase.
Connections with defense
While large funding rounds for Chinese space tech startups could appear odd, the overall surge in enterprise capital in the sector is not, especially given its close ties to defense technologies, which have seen a surge in interest recently.
Venture capital funding for defense tech startups is poised to set latest records this yr. So far in 2024, startups in the sector have raised $2.5 billion, in line with Crunchbase data — nearly matching 2022’s record of $2.6 billion. Last yr, such startups raised just $2.1 billion in total.
While not all space technology startups are defense-focused, many of them have applications in the field, and there is significant overlap between the two industries.
There is reason to consider that as defense technology continues to advance, so will funding for space technology startups—and vice versa.
Methodology
Space technology is defined by the space travel, satellite communications, and spaceflight industries, in line with Crunchbase data. Funding numbers include pre-seed, seed, and all-enterprise rounds.