Space is the latest frontier for investors looking to boldly go where only a select few have gone before.
While most of the world’s attention this year has focused on a certain trio of high-profile billionaires, I’ve been participating in a number of virtual conferences and pitch meetings in other parts of the space investment galaxy and I’m encouraged by what I see.
According to consulting firm BryceTech’s 2021 Start-up Space report, space start-ups attracted $7.6 billion in 2020, up from about $3 billion in 2016.
Unsurprisingly about 80 percent of that went to nine companies led by Elon Musk’s SpaceX, Eutelsat/UK government-backed OneWeb, and Jeff Bezos’ Blue Origin.
The remaining 20 per cent, about $1.5 billion, was raised by 115 start-ups, two-thirds of which are located outside the United States.
The space investment community is also going global, closing 140 deals with 124 start-ups.
Last year 55 percent of investors were from outside the U.S.
This growing global community is attracting new investors.
In 2020, about 60 per cent were first-time space investors, the bulk of which were venture capital firms, followed by corporations, and angel investors.
Those investments in space start-ups are driving a global space economy now valued at $447 billion, according to the Space Foundation, an advocacy group that has been tracking and analyzing the sector for close to three decades.
The most prominent change has been the emergence of a commercial space sector, now valued at $219 billion.
In the past, space wasn’t seen as a growth sector because it was dominated by large defense contractors that supplied components and expertise to government organizations, such as NASA and the Canadian Space Agency.
But that model is being upended by private sector players that build and launch satellites, collect data, and explore space.
Consider these three pieces of news from late September 2021.
On September 27, Canadian-based MDA Ltd. announced plans to launch its new synthetic-aperture radar (SAR) satellite, which can cover a 700-kilometre area with 50 metre/pixel resolution and obtain imagery within 60 minutes for public and private clients alike. MDA is also going to Mars, as one of the suppliers for Japan’s Martian Moons eXploration (MMX) mission to explore the planet and its two moons, Phobos and Deimos.
That same day, the New York Times reported the National Geospatial-Intelligence Agency awarded a $10 million contract to private satellite operator HawkEye 360 to track and map global radio frequency emissions to help identify weapons trafficking, foreign military activity and drug smuggling.
The contract comes just as the U.S. Congress is considering a new Senate-backed intelligence bill that would make it easier for the U.S. government to purchase and award more contracts to private sector companies to collect and analyze earth observation imagery.
Three days later there was a second space-based contract announcement. The US Air Force awarded a $20 million contract to Tomorrow.oi to develop and deploy a constellation of small weather satellites to measure precipitation from space. This privately-developed and operated satellite constellation will replace the single satellite currently conducting these measurements, which was jointly launched by NASA and the Japan Aerospace Exploration Agency in 2014.
Based on all the activity, reports and conversations I have experienced in the first three quarters of 2021, I am excited for what the next few months will bring for Terris and the role we can play in this emerging sector.
The space capitalization race is on and I will be watching with interest for what comes next.