VCs in Space

The space industry is commercializing rapidly, with over 100 VCs actively investing in space startups. Audacy presented this week at PingWest’s annual SYNC conference to share why the space industry is the next venture capital frontier. PingWest is a top Chinese tech media company that organized an impressive event. We were honored to be included in the speaker lineup alongside executives from Zendesk, Indiegogo, Baidu, Comma.ai, and partners from VC funds like GGV Capital and Battery Ventures.

After our presentation, we had several attendees ask us about venture funding in space, and specifically Chinese investment in space startups. So we thought we would take this opportunity to share what we know about the space investment landscape.

Investing in Space

In 2015, VCs invested $2 billion in commercial space startups, almost double the amount invested in the previous 15 years combined. The chart below shows that space represents by far the largest portion of frontier technology investments. Some of the most active VCs in the space industry include Bessemer Venture Partners, First Round Capital, Founders Fund, Khosla, and RRE Ventures. That said, there are many other venture funds that are actively investing in or looking to invest in space. According to a January 2016 report from the Tauri Group, there are 250+ investors that have disclosed investments in space startups, including 110 VCs. Audacy had 8 investors (7 VC, 1 Angel) in our Seed round from all over the world.

CBinsights Frontier Tech Funding

Chinese Investments in Space

Venture funds in China and in the U.S. with Chinese roots are increasingly investing in space startups. Funds like Legend Star, HIT Robot Group, Chun Xiao Capital, Land Stone Capital, and Haiyin Capital have all recently made space industry investments (in both Chinese and foreign space startups). U.S.-based funds like Innospring and Danhua Capital (both Audacy investors) also have an interest in space.

Why Invest in Space?

With the industry growth and continued commercialization of space, it makes sense that investors are increasingly choosing to put their money into space startups. Space industry revenues grew to $335 billion in 2015. The satellite industry alone (which makes up over 60% of the space industry) grew 3% last year, with total revenues of $208 billion.  As of December 31, 2015, there were 1,381 operational satellites on orbit. This increase of almost 40% over the last five years has been largely driven by the growth in small satellites in Low Earth Orbit (LEO), a core Audacy customer segment.

At Audacy, we hope to see these investment trends continue as the commercial space ecosystem continues to evolve!

Sources:

https://space.taurigroup.com/reports/Start_Up_Space.pdf

http://www.sia.org/wp-content/uploads/2016/06/SSIR16-Pdf-Copy-for-Website-Compressed.pdf