For investors, space isn’t the final frontier — but it’s once again proving popular.

Last month Huntington Beach, California-based asteroid mining startup — AstroForge — locked up a $40 million Series A led by Nova Threshold. While the round wasn’t huge and certainly didn’t send shockwaves through the venture community, it was the latest good-size round that has helped space tech startups nearly reach last year’s venture funding total — just two-thirds into this year.

Funding to VC-backed space tech startups has nearly reached the $6 billion mark this year, per Crunchbase data. For all of last year, space tech — defined here as space travel, satellite communication and aerospace — startups raised $6.2 billion. That number represented the second consecutive down year after raising a record total of $12.3 billion in 2021.

There is an important caveat to those numbers — Costa Mesa, California-based Anduril Industries. The startup’s massive $1.5 billion Series F last month certainly helps with space tech’s funding numbers. While mainly known as a defense tech firm, it does fall into the space tech category since it is an aerospace startup and the U.S. Space Force uses its software. (In fairness, its massive $1.5 billion Series E in late 2022 is also included for that year’s space tech funding).

Big cash

Even without Anduril’s round, space tech would be on pace for a better funding year than 2023, and there have been numerous other large rounds. Some of the biggest rounds in the U.S. include:

• In July, space startup Astranis raised a fresh $200 million round to build out its Omega satellite program. The new round was co-led by Andreessen Horowitz and Bam Elevate. While Astranis did not release a valuation number, the company raised a $200 million round at a $1.6 billion valuation in April 2023, per a Bloomberg report in a deal led by Andreessen Horowitz.
• In June, space manufacturing company Apex locked up a $95 million Series B led by XYZ Venture Capital and CRV to ramp up its production of satellite buses. The Los Angeles-based space tech startup is helping streamline the approach to satellites with the ability to mass produce spacecraft buses — the main body and structural component of satellites — to help growing demand from customers like the U.S. Department of Defense.
• In January, Hawthorne, California-based Hadrian announced it had raised a $117 million Series B that included $25 million in debt. RTX Ventures, the venture arm of defense prime contractor RTX (formerly Raytheon) and a16z, participated in the round. The company builds “highly automated precision component factories” mainly to produce components for the space and defense industries.

China’s space dreams

Speaking of large rounds, five of the top seven rounds raised by space tech startups have gone to Chinese firms.

Companies such as Yuanxin Satellite,  Tianbing Technology and Deep Blue Aerospace all have raised rounds of more than $100 million.

While it’s certainly not shocking to see China-based space tech startups raise money normally, the venture market in the country has been hit hard by government regulations and rising political tensions with the West.

Total funding to startups in China bottomed out in Q2 when it hit only $7.4 billion — a stunning 42% decline from Q1, which saw $12.8 billion invested, and the lowest since Q3 2014, per Crunchbase data.

Ties to defense

While the big rounds for Chinese space tech startups may seem odd, the overall rising venture dollars in the sector isn’t, especially considering its close relationship with defense tech — which has seen a surge of interest recently.

Venture funding for defense tech startups is ready to set new records this year. So far in 2024, startups in the sector have raised $2.5 billion — per Crunchbase data — nearly matching the record high of $2.6 billion set in 2022. Last year, such startups collected only $2.1 billion total.

While not all space tech startups are defense-related, many do have defense uses and there is significant overlap in the two industries.

There is real reason to believe as long as defense tech is thriving, so will space tech startup funding — and vice versa.

Methodology

Space technologies are being defined by the industries of space travel, satellite communication and aerospace as according to Crunchbase data. Funding numbers include pre-seed, seed and all venture rounds.

Related Crunchbase Pro list:

• Space Tech Funding
• Global Defense Tech Funding

Related reading:

• Defense Tech Startup Anduril Raises Massive $1.5B Round At $8.5B Valuation
• Anduril Industries Valued At $14B After $1.5B Series F
• Astranis Aims For The Stars With New $200M Round
• Space Tech Startup Lands $95M For Satellite Buses
• Venture Funding To China-Based Startups Dries Up 

Illustration: Dom Guzman