SANTA FE, N.M. — Japanese Earth observation company Axelspace has raised nearly $44 million to both expand its satellite constellation and provide smallsats for other applications.

The Tokyo-based company announced Dec. 21 that it raised 6.24 billion yen ($43.9 million) in a Series D round from several Japanese companies and venture funds. The company, which last raised 2.58 billion yen in a Series C round in 2021, has brought in 14.3 billion yen since its founding in 2008.

The company currently operates five microsatellites that provide medium-resolution imagery through a service it calls AxelGlobe. Four of those satellites launched in 2021, three years after its first satellite. Axelspace said the new funding will support expansion of its satellite constellation but did not provide details about the plans.

The Series D round will also go towards an initiative Axelspace announced in 2022 called AxelLiner, where the company will produce microsatellites for other customers. The goal of the service is to provide a “one-stop service” for the production, launch and operations of smallsats for other customers.

At the time of the AxelLiner announcement, the company said it would work with two other Japanese firms, Misumi Group Ltd. and Yuki Holdings Inc., in an alliance for mass production of smallsats. The first demonstration satellite of that effort is scheduled for launch in early 2024.

“With this financing, we hope to further solidify the business foundations of both AxelGlobe and AxelLiner services and to establish ourselves as a leading player in providing comprehensive microsatellite solutions,” Yuya Nakamura, president and chief executive of Axelspace, said in a statement about the financing round.

Axelspace is part of a trend of companies that initially built satellites for their own businesses but now offer them to others. Spire, which operates a large cubesat constellation for weather and tracking data, has won several customers for its “space as a service” business line, offering satellites and related capabilities.

Several Axelspace investors cited that move into satellite manufacturing and services as a key factor in their decisions to participate in the round. “We have decided to invest in the space industry, a new growth engine for Japan, and specifically in Axelspace,” said Jun Takahashi, president of SMBC Venture Capital Management Co., lead investor in the round. “We are impressed by its achievement in pioneering the space industry and hold high expectations for their future global contributions as a satellite manufacturer and a data service provider.”

“We have decided to invest in Axelspace, a pioneer in the field of microsatellites, in the hope that they will become a global unicorn company from Japan and take the company to the next level,” said Yasuhiko Yurimoto, chief executive of Global Brain Corporation, another investor in Axelspace.

The funding round is the latest sign of growing investor interest in Japan for entrepreneurial space companies. Satellite servicing company Astroscale, based in Tokyo with operations in several countries, has raised more than $376 million, including a $76 million Series G round in February. That round included a strategic investment from Japanese satellite manufacturer Mitsubishi Electric.

In April, Japanese lunar lander developer ispace went public on the Tokyo Stock Exchange shortly before its first lander crashed on final approach to the lunar surface. It is working on a second lander scheduled to launch in 2024.

Another Japanese company, iQPS, went public on the same exchange Dec. 6, raising $24 million. The company said the funding would support its development of a constellation of synthetic aperture radar imaging satellites.

Jeff Foust writes about space policy, commercial space, and related topics for SpaceNews. He earned a Ph.D. in planetary sciences from the Massachusetts Institute of Technology and a bachelor’s degree with honors in geophysics and planetary science...