Space Capital: Investing in the Space Economy
Space Capital is a New York-based seed stage venture capital firm with over $100M under management, investing in space technologies that power the world's largest industries.
The Greatest Business Opportunity of our Lifetime
When you think of space the first thing that comes to mind is likely the Apollo moon landings, the Space Shuttle, or the International Space Station – all grand human achievements. What you probably don’t think about are the thousands of entrepreneurs who are quietly transforming nearly every major industry here on Earth, by finding new ways to harvest space-based data and integrate it into terrestrial operations.
This is the multi-trillion dollar opportunity that we are focused on at Space Capital. It is our view that the Space Economy is much more than just rockets and satellites. Its real potential is to be found in data, not hardware.
GPS, Geospatial Intelligence (GEOINT), and Satellite Communications (SatCom) are the “invisible backbone” that powers multi-trillion dollar global industries today. And amid these challenging economic times, one thing remains certain — space-based technologies are playing an increasingly vital role in our economy and will continue to transform the world’s largest industries for decades to come. That’s why we like to say: in the same way that every company today is a technology company, every company of tomorrow will be a space company.
In our seminal thesis paper, The GPS Playbook, we explored how a space-based technology generated trillions of dollars in economic value and some of the largest venture outcomes in history (Uber, Lyft, Yelp, Niantic, etc.). We believe that the history of GPS provides a framework for understanding how space-based technologies have become a platform for innovation on a global scale; specifically, the development of technology layers on top of space-based infrastructure and the distribution of data for mass adoption, which unlocks thousands of unique applications. We believe that GPS provides a playbook for how other space-based technologies like GEOINT and SatCom will create new investment opportunities. Both of these technologies have similar growth potential to GPS and we are investing to unlock that value.
Since 2017, the Space Investment Quarterly has been the source of record for startup activity and investment trends in the Space Economy. Total private market equity investment across the Space Economy has now reached $286.5B with 1,788 unique companies funded since 2014. A full 86% of that capital has gone to the Satellites industry, which is powering terrestrial markets, while 12% has gone to Launch, and just 2% has gone to what we call Emerging Industries, which includes new markets like Stations, Logistics, Lunar, and Industrials.
However, most of this capital has been chasing solutions that are based on a 10-year-old (Falcon 9) launch paradigm, which will soon be obsolete.
With Starship expected to come online soon, the Space Economy is entering a new phase of infrastructure development that will significantly impact the opportunity set. It will make existing infrastructure obsolete, accelerate growth in existing markets, and enable entirely new ones. This new infrastructure will enable new use cases, while advances in terrestrial tech will continue to accelerate growth. For example, recent advancements in AI are enhancing the capabilities of companies within the Distribution and Applications layers, particularly within the GEOINT sector. We are actively investing in founders who are leveraging space data and cutting-edge technologies to revolutionize global industries.
The Space Capital advantage: unmatched experience
The Space Capital team is comprised of the world’s most experienced investors and operators in the category and, as such, is uniquely qualified to run the strategy of today and tomorrow.
We understand what we’re investing in at a very deep level. Our partners have built rockets, satellites, and operating systems. We have founded companies with assets currently in orbit and have led multiple exits as operators. We have been pioneering investment in this category for 10 years. And now we have literally written the book on the subject with The Space Economy: Capitalize on the Greatest Business Opportunity of Our Lifetime, published by Wiley.
We're atypical investors. We’re not rushing to get into the hot new category. We are thesis driven, which means that we shy away from momentum and try to think about where the market’s going to be in 3-5 years. That means that we don’t get as many quick markups, but in a correcting market like this we show much better – by providing essential data and insights to enterprises and governments, our portfolio has proven to be highly resilient across market cycles.
And our disciplined strategy is proven and repeatable. We did not invest at inflated valuations during the market mania over the past few years. In 2021 the market was devoid of all pricing discipline, yet we were able to achieve 9% ownership (of a 10% target) across the Fund 2 (2021 vintage) portfolio. And 36% of our Fund 2 portfolio companies were written up in 2022 during the steepest decline in the financial markets.
Recent data from VC Platform shows that funds with a focus on platform outperform and, at Space Capital, we have invested intentionally in ours. A key tenant of our platform is Space Talent, which we launched in 2019 to provide a free career 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.
As the diversity of these job opportunities shows, space is no longer a niche field – limited to aerospace engineers and defense contractors. It is growing rapidly and integrating into many traditional industries. Software developers aren’t just needed in Silicon Valley – they’re now critical for emerging space companies too. Similarly, data analysts and engineers with experience in GEOINT and SatCom will be increasingly important in traditional industries, such as agriculture, insurance, construction, etc.
We stand on the brink of a new era, as every industry is now being reshaped by space technology. Consider how much the world has changed since the dawn of the World Wide Web in 1993. Space technology will be equally, if not even more transformative, over the coming years. These technologies are powering the future and to disregard their influence is to be blind to the heartbeat of tomorrow's global economy. If you are an investor interested in learning more or about the growing market opportunity, or if you’re a founder building in this category, connect with us at: firstname.lastname@example.org