Financing for Private Space Companies Slipped in 2018, But Remains at a High Level
The torrid pace of private investments in space startups slowed somewhat last year, but remains at a high enough level to fuel further development of the burgeoning sector.
Investors ranging from venture capital firms to aerospace and tech companies to prominent billionaires like Jeff Bezos pumped a total of $3 billion in equity investments into companies like SpaceX, Rocket Lab, HyperSat, and iSpace, investment firm Space Angels said in its quarterly report on the sector. That was down from $4.6 billion raised in 2017, but consistent with the trend seen over the past four years averaging about $3.5 billion annually.
Traditional venture capital firms have become a strong part of the mix, Chad Anderson, CEO of Space Angels, says. “Venture capital investment in space is now a generally accepted theme,” he says, adding that 41 of the 100 largest VC firms have invested in at least one space startup. “Given all this, we expect significant investment in space to continue in 2019.”
SpaceX, Musk’s rocket launching firm that is also trying to build a massive satellite network to provide Internet service, raised nearly $800 million in two deals, Space Angels said. Rocket Lab, which is launching smaller rockets from bases in New Zealand and Virginia, raised $140 million. HyperSat’s $85 million deal will help the company advance its plan to launch six high-resolution imagery satellites into low Earth orbits. And iSpace, the Japanese company planning to send landers to the moon, raised $90 million.
Accel Partners, Andreessen Horowitz, and Playground Global were among large VC firms that made their first space investments in 2018, Space Angels said. Billionaire businessmen Amazon (AMZN) CEO Jeff Bezos, Budget Suites hotel chain founder Robert Bigelow, Virgin Group founder Richard Branson, and Tesla (TSLA) and SpaceX CEO Elon Musk, also contributed hundreds of millions of dollars in 2018 to space startups they started in prior years.
The two largest types of startups within the sector attracting new money in 2018 were companies launching rockets, at $1.6 billion, and companies creating satellite networks, at $1.2 billion.