Space Capital closes $32M for second institutional fund to continue investing at the intersection of space and tech
Space Capital, a seed stage venture capital firm investing across the space economy, is pleased to announce the successful closing of $32 million for Space Capital II, our second institutional fund. This is our third fund overall and we now manage over $100 million in assets. And we’re just getting started…
This is not a niche investment opportunity. When you think of space the first thing that probably comes to mind is the Apollo moon landings, the International Space Station, grand human achievement. You probably don’t think of entrepreneurs transforming nearly every major industry here on Earth, but that’s the multi-trillion dollar opportunity we are focused on at Space Capital— the space economy is much more than just rockets and satellites.
In fact, space technologies are next generation digital infrastructure, the “invisible backbone” that power our global economy. GPS, Geospatial Intelligence, and Satellite Communications already play a critical role in most major industries and are set to become much more ubiquitous in enterprise workflows:
In the same way that every company today is a technology company, every company of tomorrow will be a space company.
And space technologies have already delivered massive returns for investors. GPS is a space-based technology that has generated trillions of dollars in economic value and some of the largest venture outcomes in history. As outlined in The GPS Playbook, published with Silicon Valley Bank in 2020, we believe that GPS provides us with a playbook for how space-based technologies will create new investment opportunities. Building upon those insights, we recently published The SatCom Playbook: our latest investment thesis for ubiquitous connectivity in a future where every person, device, and object on the planet is connected. With a significant reduction in launch costs, improvements in satellite manufacturing, broad adoption of cloud computing, and a growth in private capital fueling innovation, SatCom is poised to transform how a modern internet experience can be delivered, at global scale. What we’re talking about is the evolution of internet infrastructure, brought about by SatCom, which will enable and enhance some of the most exciting innovations in consumer and enterprise technology.
Space technologies also play a foundational role in enabling climate markets. Our partners are leading the world’s most ambitious climate projects and publishing industry-leading insights, like The Great Climate Opportunity, which unpacks the nearly $1 trillion investment opportunity. Our portfolio includes market leaders delivering climate change solutions.
With this new capital, we will continue leading Seed rounds and supporting companies through Series A. Our thesis in action: we have already made the first eight investments out of Space Capital II, which have been added to the matrix below. Nearly all of the value in the space economy today can be captured in this 3x3 — our thesis, with the opportunity driven by demand for precise positioning, massive datasets, and ubiquitous connectivity.
While this opportunity set alone is massive, new investable opportunities are also beginning to emerge. There has now been $253B of private equity investment into 1,694 unique space companies over the last 10 years. 2021 was a record year for investment in the category, with $46.3B invested across all space technology stacks. It was a particularly massive year for investment in space Infrastructure with $14.5B invested (more than 50% greater than the prior record set in 2020), as we discussed with CNBC. While venture momentum set all-time records for space investments in 2021, much of this capital was chasing solutions based on a 10-year-old launch paradigm. As we look ahead, we see tremendous opportunities to scale mass adoption of the existing infrastructure as we look for radically new approaches to build and operate space-based assets.
With Starship expected to come online in 2022, we are now entering into a new phase of Infrastructure development. SpaceX fundamentally changed the economics of space 10 years ago with the Falcon 9 and now, its massive and fully reusable Starship will have a similar impact, further reducing the cost to orbit, enabling emerging industries, and making existing infrastructure obsolete. As investors in this category, we’re looking for founders who recognize the magnitude of what’s coming and are building for this new reality.
Space Capital is uniquely qualified to run the strategy of today and tomorrow.
Space Capital’s partners have built rockets, satellites, and operating systems. We have founded companies with assets currently in space and have led multiple exits as operators. We have been investing in this category for nearly 10 years and top-tier VC and PE firms have consistently looked to our partners for operational guidance. We also work with a world-class group of operating partners that help us go deep on diligence and support our portfolio companies, when needed.
With the successful closing of Space Capital II, we are pleased to announce the promotion of Justus Kilian to Partner. In addition to the new investments he’s led, Justus has served on the boards for several Space Capital portfolio companies, including ClearRoad and Mobius Labs. He was one of the earliest employees of Space Capital and has been instrumental in building out our portfolio and platform services. He has led the development of our proprietary talent engine: Space Talent, a free career platform and central resources hub built for the global ecosystem of companies at the intersection of space and tech. With over 30,000 jobs across more than 600 companies, it is now the #1 recruitment platform for space companies globally. The platform also helps founders experiment, build, and finance new businesses by providing resources and the opportunity to receive up to $1.5 million in funding from Space Capital.
If you are building, or looking to build, a company at the intersection of space and tech and looking for a partner who can offer much more than just capital, don’t hesitate to reach out: launch@spacecapital.com
