Investors Once Again Star Gazing 鈥� Space Tech Funding Jumps

For investors, space isn鈥檛 the final frontier 鈥� but it鈥檚 once again proving popular.

Last month Huntington Beach, California-based asteroid mining startup 鈥� 鈥� locked up a $40 million Series A led by . While the round wasn鈥檛 huge and certainly didn鈥檛 send shockwaves through the venture community, it was the latest good-size round that has helped space tech startups nearly reach last year鈥檚 venture funding total 鈥� just two-thirds into this year.

Funding to VC-backed space tech startups has nearly reached the $6 billion mark this year, per SA国际传媒 . For all of last year, space tech 鈥� defined here as space travel, satellite communication and aerospace 鈥� startups raised $6.2 billion. That number represented the second consecutive down year after raising a record total of $12.3 billion in 2021.

There is an important caveat to those numbers 鈥� Costa Mesa, California-based . The startup鈥檚 massive $1.5 billion Series F last month certainly helps with space tech鈥檚 funding numbers. While mainly known as a defense tech firm, it does fall into the space tech category since it is an aerospace startup and the . (In fairness, its massive $1.5 billion Series E in late 2022 is also included for that year鈥檚 space tech funding).

Big cash

Even without Anduril鈥檚 round, space tech would be on pace for a better funding year than 2023, and there have been numerous other large rounds. Some of the biggest rounds in the U.S. include:

In July, space startup raised a fresh $200 million round to build out its Omega satellite program. The new round was co-led by and . While Astranis did not release a valuation number, the company raised a $200 million round at a $1.6 billion valuation in April 2023, in a deal led by Andreessen Horowitz.
In June, space manufacturing company locked up a $95 million Series B led by and to ramp up its production of satellite buses. The Los Angeles-based space tech startup is helping streamline the approach to satellites with the ability to mass produce spacecraft buses 鈥� the main body and structural component of satellites 鈥� to help growing demand from customers like the .
In January, Hawthorne, California-based announced it had raised a $117 million Series B that included $25 million in debt. , the venture arm of defense prime contractor RTX (formerly ) and , participated in the round. The company builds 鈥渉ighly automated precision component factories鈥� mainly to produce components for the space and defense industries.

China鈥檚 space dreams

Speaking of large rounds, five of the top seven rounds raised by space tech startups have gone to Chinese firms.

Companies such as 听 and all have raised rounds of more than $100 million.

While it鈥檚 certainly not shocking to see China-based space tech startups raise money normally, the venture market in the country has been hit hard by government regulations and rising political tensions with the West.

Total funding to startups in China bottomed out in Q2 when it hit only $7.4 billion 鈥� a stunning 42% decline from Q1, which saw $12.8 billion invested, and the lowest since Q3 2014, per SA国际传媒 data.

Ties to defense

While the big rounds for Chinese space tech startups may seem odd, the overall rising venture dollars in the sector isn鈥檛, especially considering its close relationship with defense tech 鈥� which has seen a surge of interest recently.

Venture funding for defense tech startups is ready to set new records this year. So far in 2024, startups in the sector have raised $2.5 billion 鈥� per SA国际传媒鈥� nearly matching the record high of $2.6 billion set in 2022. Last year, such startups collected only $2.1 billion total.

While not all space tech startups are defense-related, many do have defense uses and there is significant overlap in the two industries.

There is real reason to believe as long as defense tech is thriving, so will space tech startup funding 鈥� and vice versa.

Methodology

Space technologies are being defined by the industries of space travel, satellite communication and aerospace as according to SA国际传媒 data. Funding numbers include pre-seed, seed and all venture rounds.