UK aims to become space startup haven to achieve growth target

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Providing technical support and competitive financing is the strategy to lure startups

HARWELL, United Kingdom — The U.K. plans to become a haven for space startups from all over the world as it aims to grow its space industry to control 10 percent of the global market by 2030.

According to Graham Turnock, the chief executive officer of the U.K. Space Agency, to achieve the ambitious growth target the U.K. will look to grow existing companies, support the creation of new ones, as well as encourage firms funded elsewhere to relocate to the U.K. by providing competitive early stage financing.

“We are looking for a large number of new startups, inward investment in particular,” Turnock told SpaceNews on the sidelines of the 13th Appleton Space Conference that took place  Dec. 7 at the Rutherford Appleton Laboratory (RAL) here.

“What we want to do is to attract companies that maybe started up somewhere else but then come to the U.K. because we can provide the finance, we can provide the clustering, we can provide technical support and maybe the grants that the public sector can’t offer.”

At the conference, Turnock announced the U.K. Space Agency would provide 200,000 British pounds ($268,000) to kick-start four new space tech business incubators. The four new incubators will be in London (supported by Seraphim Capital), Hampshire (supported by Oxford Innovation), Westcott (supported by the Harwell-based Satellite Applications Catapult) and at the University of Leicester (supported by the university itself). The new incubators will each receive 50,000 British pounds from the U.K. Space Agency, according to Turnock.

This will take the total number of U.K. space startup clusters to 15. The biggest U.K. space cluster, located in Harwell, currently houses 80 space companies at various stages of development.

Speaking at the Appleton Space Conference, Joanna Hart, development manager of the Harwell Space Cluster, said the Science & Technology Facilities Council, which oversees the development, hopes to see the cluster grow to 200 companies by 2030.

The U.K. government’s plan to attract companies from abroad is already bearing fruit. At the Appleton Space Conference, the U.K. Satellite Applications Catapult announced it would fund an in-orbit demonstration mission led by Orbital Micro Systems, a former Boulder, Colorado-based startup that had relocated to the U.K. in June this year. U.K. Innovate, the U.K.’s innovation agency, awarded Orbital Micro Systems 1.5 million British pounds to support the development of their coffee can-sized microwave radiometer sounding spectrometer that will be tested for the first time in the demonstration mission aboard a three-unit cubesat made by Clyde Space.

Orbital Micro Systems’ chief executive officer William Hosack told SpaceNews that the accessibility of governmental funding had been the main draw that brought the team to the U.K.

“If you are trying to get launch support from NASA it can take you a year just to go through the application process and the communication is very limited,” Hosack said. “They are able here to work a little bit quicker and there is a lot more transparency in the whole exercise.”

He further added that the level of financial support available through U.K. Innovate would not be accessible in the U.S.

“If you were looking for support from the U.S. Small Business Administration, the best they would give you would be loan,” Hosack said. “They don’t have this type of a mechanism at all.”

According to Turnock, Orbital Micro Systems certainly bucks a trend – the U.K. has been witnessing a massive brain drain to North America over the past three to four decades. Moreover, many U.K.-based startups believed their fortunes might be better in the U.S. due to better availability of venture capital.

Orbital Micro System, which hopes to ultimately operate a constellation of 36 to 40 weather microsatellites, hopes Silicon Valley investors will eventually look across the ocean.

Hosack added that the appetite for investment into small satellite Earth-observation startups slowed considerably from its peak about five years ago. The investors are now looking for more mature and tested technologies than they were willing to fund before, he said.

“Pretty much everybody else is still in this ‘are we going to survive?’ mode,” Hosack said. “So when we are talking to them, they are like, ‘we are very interested, we like what you’ve got,  but you’ve got to show us what it actually does from orbit first.’ That’s what we need to close up and complete. And we are glad that we found a willing partner.”

Orbital Micro Systems plans to launch its first satellite in autumn 2018 with NanoRacks. The firm envisions the entire  satellite constellation could be fully operational by 2020 providing data on temperature, humidity and precipitation worldwide with a 16 square kilometer resolution and a refresh rate of 15 minutes.