Space startups are becoming more acquainted with the U.S. government as a customer and an investor, though the pathways to both remain difficult, a panel of experts said Jan. 14.
In December, Cloud Constellation was finalizing receipt of a $100 million investment that would help the startup deploy a ring of secure data-storage satellites in low Earth orbit. By spring, Cloud Constellation had walked away from the deal, citing a review by the Committee on Foreign Investment in the United States, or CFIUS, as one of the reasons.
The U.S. Treasury Department hasn’t issued final regulations implementing the 2018 Foreign Investment Risk Review Modernization Act, but space industry entrepreneurs already feel the law’s effect.
Virgin Galactic’s merger with a publicly-traded investment company is likely a one-off event based on the company and people involved, and not a sign of more fundamental changes in the industry, investors argue.
Space industry startups used to clamor for public attention. Now, many spend years in stealth mode refusing to disclose even the broad outlines of their plans.
Space startups seeking funding should stay away from increasingly overcrowded parts of the market and instead seek more novel approaches that could offer much bigger returns.
Perhaps the strongest sign to date that the space industry is in some kind of bubble is the creation of Hypergiant Galactic Systems.
Investors continue to fund space startups at an accelerating rate, according to two firms that track activity in the sector.
It should be no surprise that space startups are aggressively pursued by global investors. Properly valuing potential foreign investments requires parsing more than exchange rates.
Venture capitalists see no sign of a slowdown in funding of space-related startups even though only a handful of those companies have provided significant returns to their investors.
Akash Systems, a San Francisco startup that sells RF power amplifiers for satellites, announced Jan. 30 it has raised $3.1 million in seed round funding, which it plans to use to develop its own line of cubesats.
Despite a lack of “megadeals” involving space companies this year, investor interest in the industry remains strong thanks to several factors, according to one assessment.
Relaxing regulations and lowering some of the hurdles that discourage private firms from working with federal agencies would bolster innovation, according to panelists at the 2017 GEOINT Symposium.
Despite an influx of money being invested in space companies in recent years, investors and analysts warned that there is no guarantee this growth will continue in the coming years.