NEW YORK CITY, March 18, 2020 — VirginGalactic may have become the face of the commercial space industry when its stock briefly skyrocketed in February. However, a new investor playbook released today by Space Capital, an early-stage venture capital firm exclusively focused on the space economy and Silicon Valley Bank (SVB), the bank of the world's most innovative companies and their investors shows the real potential for exponential returns can be found in three critical space-based technologies: next-generation GPS, Geospatial Intelligence, and space-based communications.
“Increasing convergence between the space and technology sectors will continue to create significant opportunities for investors over the next decade,” said Chad Anderson, Managing Partner ofSpace Capital. “Space-based technology has already generated trillions of dollars in economic value and some of the largest venture outcomes in history. This playbook provides clear guidance on how these technologies are creating new global innovation platforms with high return potential for investors.”
The report, called “The GPS Playbook,”offers a detailed analysis of these emerging markets, and the vast economic potential they offer. The first is GPS, which is undergoing significant changes in its tech stack due to the convergence of space-based signals and computer vision. This is ushering in a new era of precise positioning that will unlock millions of new applications that were not possible before, particularly in augmented reality (AR). What this ultimately means for investors is that GPS is poised for continued growth over the next decade as the mass adoption of AR is realized.
Similarly, Geospatial Intelligence (also known as Earth Observation data) is another area where the space and tech sectors are converging. This market is significantly undervalued at present by the space industry, which is forecasting only incremental growth from $3 to $7billion annually by 2028. However, this report estimates that the GeospatialIntelligence market is poised to grow 10x and has a future economic value on par with GPS. Using the magnitude and timeline of GPS as an analogy, Space Capital and SVB predict that space-based Communications and Geospatial Intelligence could generate $1trillion of equity value over the next decade, as distribution unlocks innovation and capital.
“Commercial space can be a challenging sector for investors to assess where the best returns can be found,” said AnnKim, Managing Director and Sector Head of Frontier Technology at SVB. “We feel it is important to provide the investment community with a roadmap of these opportunities, as the market is far more dynamic than many realize and is currently in the midst of a major transformation toward the mass adaptation of space-based technologies for terrestrial industries.”
The GPS Playbook report also provides a useful historical analysis of GPS commercialization, offering a model for investors to better understand how space-based technology provides a platform for innovation on a global scale.
To access this report, go to www.spacecapital.com/publications/the-gps-playbook-report.
ABOUT SPACE CAPITAL
Space Capital is an early stage venture capital firm investing in the Space economy, specifically focused on unlocking the value in Space technology stacks such as GPS, GeospatialIntelligence, and Communications. We are actively investing out of our second fund and manage over $35 million in assets. Our sector focus enables us to be a true partner to our portfolio companies and unlock significant value far in excess of our investment capital.
ABOUT SILICON VALLEY BANK
For more than 35 years, Silicon ValleyBank (SVB) has helped innovative companies and their investors move bold ideas forward, fast. SVB provides targeted financial services and expertise through its offices in innovation centers around the world. With commercial, international and private banking services, SVB helps address the unique needs of innovators. Learn more at www.svb.com.
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