Spacetech (2024)

1. Blast off

   There’s a number of would-be launches that are due in 2025, including Isar Aerospace’s first rocket launch as well as TEC’s mid-sized capsule dubbed Mission Possible, which will carry up to 300kg of customer payloads. The next year will be critical for testing Europe’s launch capabilities and whether it can eventually become competitive with SpaceX.

   In anticipation of upcoming flights, the European Space Agency also announced in November that it will co-invest roughly €44m and extend the contracts of four commercial launch companies — HyImpulse, Isar Aerospace, Rocket Factory Augsburg and Orbex (the only non-German company) — to help fund the transition from the development phase to the operational phase of their launches.

2. Data for defence

   Spacetech startups have also been exploring more defence applications. Companies like Finnish startup ICEYE, which deploys radar satellites that collect images of the Earth’s surface, have been bolstering its cooperation with the Ukrainian Ministry of Defence to further its use of remote sensing data for defence.

   Another startup making waves using satellite data for maritime applications: Unseenlabs, a French startup which has built a satellite constellation to track clandestine ships across the oceans, raised €85m in equity and debt at the start of 2024 and has a contract with the French Navy.

   As war rages on in Europe, startups will likely be bidding for more defence contracts. Whether those contracts are won is another matter, as startups often complain of arduous processes building relationships with the government.

3. Public and private partnering up

   Agencies like the European Space Agency (ESA) have been more cooperative with private companies and startups: earlier in 2024, ESA awarded The Exploration Company and Thales Alenia Space a contract to provide cargo return services to the International Space Station. TEC was given an initial €25m to build a commercial cargo service to low-Earth orbit by 2028. Some have compared it to a similar — though much bigger — contract awarded to SpaceX over a decade ago that helped it skyrocket to success.

   There will likely be more collaboration to come. For one, the NATO Innovation Fund — the €1bn fund backed by 24 NATO allies to invest in deeptech and defence startups — has begun investing in companies like Isar Aerospace and space-focused VC Alpine Space Ventures, pointing to a more friendly attitude towards European space upstarts among the NATO nations and a start at making good on NATO’s aspirations to adopt more spacetech.

   Just this month, the European Commission and ESA also signed a contract for the Infrastructure for Resilience, Interconnectivity and Security by Satellite (IRIS²) programme, a public-private partnership of nearly 300 multi-orbital satellites, teaming up with satellite network operators like SES SA and Eutelsat SA as well as others like Thales, Airbus and Deutsche Telekom. The partnership is aimed at bolstering Europe’s space sovereignty and connectivity for government, commercial and private users.

   However, VCs are still sceptical that European governments can act fast enough to move the needle for spacetechs, and we may see a number of them float away while trying to secure revenue-generating contracts.

   “You have a lot of European startups that get caught in the early stages, where they just don't get the meaningful contracts they're required to move on to the next stage of a growth stage company,” Maureen Haverty, principal at VC firm Seraphim Space, told Sifted earlier this year.

4. Germany vs. France

   Between 2015-2023, German spacetechs have raised more capital than French startups, with about $731m compared to France’s $529m, per Sifted data.

   In fact, it’s Germany that boasts a few of the buzziest startups to raise funding this year, with Munich-based Isar Aerospace and The Exploration Company (which also shares an HQ in France) securing sizable rounds.

   Still, France has long been a hotspot for spacetech. The country has allocated €1.5bn in recent years to its space agency CNES from the France 2030 programme, and France continues to signal support for the industry: earlier this year French President Emmanuel Macron called for a “European preference” for buying within areas like space.

   A number of startups from the region have also raised notable rounds this year, including small rocket developer Latitude’s $30m raise and satellite inspection and repair startup Infinite Orbits’ €12m.

   As France and Germany often find themselves battling it out for the top VC ecosystem writ large (behind the UK, of course), keep an eye on which spacetech champions arise out of the regions.

Who early stage startups are up against