Space technology start-up Skyroot Aerospace has recently created a flutter by raising $51 million, or `403 crore, in Series-B financing led by Singapore’s long-term investment fund GIC. This is the largest funding for a start-up in the segment. It will help the small launch vehicle or rocket man ufacturer boost its capabilities and tap into the $469-billion global space economy. Founded in 2018 by former ISRO engineers Pawan Kumar Chandana and Naga Bharath Daka, Skyroot plans to cater to the burgeoning demand from the international small-satellite market. “This round puts us on a trajectory of hyper growth by funding all of our initial developmental launches and enables building infrastructure to meet the high launch cadence required by our satellite customers,” says Chandana, also the CEO of the Hyderabad-headquartered firm.
How critical is the Skyroot fundraise for the Indian space-tech sector? Pawan Goenka, Chairperson of IN-SPACe—a single window nodal agency for promot ing and regulating space-tech players— explains, “Skyroot’s funding is very significant because it paves the way for similar big-ticket investments.” Although they trail countries like the US, the UK, China and Germany, Indian space-tech start-ups are seeing things improve, as the average funding size has increased to $17 million in 2022 from $0.5 million in 2019, according to data from Tracxn Technologies. “The funding in space-tech is driven by fac tors such as favourable government policies like privatisation and opening up of FDI in the sector, lower manufacturing and development costs, and increasing demand for satellite-based data,” says Neha Singh, Co-founder of Tracxn.
According to Awais Ahmed, Co-founder and CEO of Pixxel, a Bengaluru-based hyper-spectral (information processing in electromagnetic spectrum) small satellite maker, the commercialisation of the Indian space sector has opened up a world of possibilities for new-age entrepreneurs. In March, Pixxel raised $25 million in a Series-A round. In the past three years, the sector has garnered $170 million in funding. So far, most of the funding has been received for small payload launch vehicles, satellite-based services and propulsion systems. “Private players are quickly identifying the opportunities in space-tech to develop solutions,” says Tracxn’s Singh.
So, when will the segment see the emergence of a unicorn? IN-SPACe’s Goenka feels that space-tech start-ups need to be ever-mindful of delivering a return on investment to attract capital. “A unicorn would mean the companies have shown that kind of value creation. A major achievement from one of the six leading players will result in higher valuations. I would be delighted if a year from now, we see a unicorn emerging in the sector,” he observes. The countdown for that seems to have begun.