The startup and SME landscape in the space industry has grown significantly, in both value and scale, in recent years, with increasing opportunities for both funding and technical support.
To keep the value chain sustainable and on track to continue healthy growth, startups and SMEs must leverage the global space industry network in order to participate, innovate, collaborate, and distribute their products and services.
This is true both in space technology startups (upstream) and in space data applications startups (downstream).
A Trillion Dollar Industry
Space is booming. Starting primarily as a government endeavour, nowadays space is largely driven by the private sector. Morgan Stanley estimates that the global space industry could generate revenue of more than $1 trillion or more in 2040, up from $350 billion in 2021, with the most significant short- and medium-term opportunities coming from satellite broadband Internet access.
Morgan Stanley estimates that satellite broadband will represent 50% of the projected growth of the global space economy by 2040—and as much as 70% in the most bullish scenario. Launching satellites that offer broadband Internet service will help to drive down the cost of data, just as demand for that data explodes.
In an interview with the US Chamber of Commerce, Lisa Callahan, Vice President and General Manager of Commercial Civil Space at Lockheed Martin Space, echoed this sentiment. She notes the movement in the private sector will benefit science and research for Earth as well.
“The rapid growth that we’re seeing in this market is amazing,” said Callahan. “There’s a huge amount of new technology and innovation that’s flowing into the space sector [and it has] a huge amount of private and capital investment coming into the market. And this investment in my mind is not just going to benefit the science and exploration that we do in [low earth orbit] and beyond. But it’s also going to create innovations that can benefit us back here on Earth.”
Also in Europe the space industry has been transformed in the last few decades, with downsizing of technology and lower barriers to entry opening up the market. As a result, smaller companies can take a leading role in a sector traditionally dominated by well-financed giants, such as Airbus. “Our role is increasing; not in turnover but [in] that we can deliver fully-fledged space-based products and services,” said Hans Bracquené, chair of SME4Space, an association of European space SMEs. (source)
Space Technology Startups
According to a recent article in the New York Times, “Investors are putting more money than ever into space technology. Space start-ups raised over $7 billion in 2020, double the amount from just two years earlier, according to the space analytics firm BryceTech. That trend is continuing this year, said Carissa Christensen, BryceTech’s chief executive.”
The article continues by saying that “the boom, many executives, analysts and investors say, is fuelled partly by advancements that have made it affordable for private companies — not just nations — to develop space technology and launch products into space.”
Not only do startups have better access to funding, they also have increasingly easy access to technology. One of the drivers of the commercial space industry is the availability of (relatively cheap) off-the-shelf components for satellites and other infrastructure. This is facilitated for example, among others, by platforms like the satsearch digital marketplace, that were not accessible even five years ago.
As recent as 2021 satsearch introduced new digital channels to provide marketing opportunities and Sales Qualified Leads (SQLs) to both emerging and established space companies, helping SMEs scale up their businesses as well as explore new avenues in the emerging markets. Such approaches have gained significant further traction in the industry for a variety of reasons, one of which is, unfortunately, the ongoing Covid-19 pandemic.
From utility management to rocket science research, the pandemic has showcased that digital platforms have much to offer to growing and maturing sectors such as the space industry. In 2021 satsearch generated hundreds of millions of Euros’ worth of business opportunities for suppliers; helping the market to keep moving despite significant restrictions and delays on travel, in-person meetings, conferences, and even some aspects of manufacturing, testing, and launch.
Space Data Startups
“Satellite-based earth observation (EO) companies have a plethora of opportunities in Europe. If provided a strategic map to direct their resources, European companies can cast a wide net over the market – from intelligence, surveillance, and reconnaissance (ISR) to software utility and application management. The downstream segment remains the key to unlocking the door to new avenues for the EO applications. Considering the incoming wave of applications, specifically in sustainable development, and several government initiatives EO companies should take advantage of this opportunity to strengthen their investment and create a strong foundation for exploring new gateway of opportunities in EO.“Omkar Nikam, Co-founder, Access Hub – Space, Defence, & Security
A position paper published by the European Association of Remote Sensing Companies (EARSC) in 2020 states that “the Earth Observation (EO) industry is very dynamic and for some years has been showing a good and regular growth. Currently, the space-based EO industry represents a market worth around €4 billion globally and €1.2 billion for the European market. The EARSC Survey of the State and Health of the European EO Services industry 2019 shows that in 2018 the industry counted more than 500 companies throughout Europe with 8396 employees. The survey underlines a steady growth in the number of companies (company creation rate of 10 % per year) and employment (increase of rate 10 % per year from 6,920 in 2016 to 8,396 in 2019) and foresees a promising future for the sector.”
“This growth in the commercial market is driven strongly by the public sector. Even if the creativity and search for profit is a commercial imperative, the space sector and especially EO services are governed by an interaction between the private and public sectors. Even if formal public-private partnerships do exist, they are not common. Informal arrangements are prevalent throughout the sector given the importance of global surveillance to most governments.”
Much of this growth, and the accompanying opportunities for startups and SMEs is due to the Copernicus Earth Observation and Galileo and EGNOS GNSS programmes of the European Commission, making a vast quantity of space data available for free for developers of applications.
Copernicus builds on a constellation of satellites that makes a huge number of daily observations – taking advantage of a global network of thousands of land, air, and marine-based sensors to create the most detailed pictures of Earth. The technological prowess of Copernicus, especially in terms of availability and accessibility, has made Copernicus the largest space data provider in the world, currently delivering 12 terabytes per day.
The vast majority of data/information delivered by Copernicus is made available and accessible to any citizen, and any organisation around the world on a free, full, and open basis. There are many ways to access this data, as described here or here.
EO companies with actionable strategies and specific purpose-oriented applications will drive more growth in this decade. For example, climate change has been a serious issue for decades, but it is only in 2021 we saw numerous countries taking initiatives and injecting capital into agencies, organisations, and companies that are driven by a specific purpose such as sustainability are recording healthy growth overall.Omkar Nikam, Co-founder, Access Hub – Space, Defence, & Security
Public-Private-Partnerships (PPP) and Horizon Projects
According to satsearch, collaborative and partnership approaches have proven to be one of the most successful ways to achieve common goals in the space industry, and this trend is continuing. As an example, in December 2021 Europe produced two of the biggest consortiums of companies that are aligned towards the common goal of enhancing the NewSpace ecosystem.
The “New Symphonie” consortium, led by Euroconsult and ANYWAVES, has brought together 20 companies under one umbrella to lead NewSpace solutions studies for space-based connectivity.
Some of these important 2021 highlights have set a new benchmark for future emerging players looking to leverage international opportunities through collaboration and partnerships.
One of the ways for space startups and SMEs to benefit from public funds is the Horizon Europe programme. Over the years, Groundstation.Space has published several articles about how to access these funds, and developed the Open Calls platform to find opportunities for YOUR business.
Connect with YOUR market
There have never been more opportunities for space startups and SMEs to connect with the global market than in 2022! How you benefit from these opportunities are up to you and depend on your specific products, services and markets. We asked our friends at satsearch for their tips on how to connect to new market opportunities in 2022:
“To better connect with your market this year, think about context. And use this to create useful content online, in a consistent manner, across a variety of channels.”Hywel Curtis, Head of Marketing at satsearch
Hywel Curtis has more tips: “Don’t just try to fight the algorithms on social media by crafting some perfect multimedia presentation you hope will go viral (because there’s no guarantee that it will); instead, find ways of continually sharing the honest context of the dry facts and figures of your products.”
“Context is the missions that you’ve been a part of, the historical R&D excellence that spun out your innovation, the data that proves your performance claims, the problems you are solving or hope to one-day solve, but it is also the set-backs and failures that have made you create improvements and grow as a team.”
As you have seen in this article, there are lots of tools and services available to space startups and SMEs in any field. In addition to the tools mentioned in this article, Groundstation.Space has specialists who are looking forward to helping you connect with YOUR market in 2022 and beyond! Just get in touch!