:Funding for space startups more than doubled in the first quarter as government spending remained robust setting the stage for the space economy to grow stronger, venture capital firm Space Capital said on Thursday.
Geopolitical uncertainties have largely driven the surge in funding, as geospatial data and images collected by satellites are used by government agencies for everything from analyzing weather patterns and agriculture to changes and movements along international borders.
“While we still have some consolidation to get through, the overall space economy is rebounding and it is now replete with a number of rising stars,” said Chad Anderson, the venture capital firm’s managing partner.
Funding for space startups rose to $6.5 billion in the first quarter ended March 31, from $2.9 billion a year earlier, and inflows were up 33 per cent from the fourth quarter, as investment in geospatial intelligence overtook satellite communications for the first time, showing the growing demand for such data.
Meanwhile, pricing for satellite capacity has also fallen helping attract companies to use assets in space for commercial purposes.
The first quarter saw many milestones including SpaceX’s successful Starship flight test to United Launch Alliance’s launch of Astrobotic and Intuitive Machines’ mission, which was the first touchdown on the lunar surface by a U.S. spacecraft in more than half a century.
The space economy’s size is set to triple to $1.8 trillion by 2035 and roughly rival the size and reach of the global semiconductor industry, according to a World Economic Forum report released earlier this week.
This underscores the potential impact on investors, businesses, and government entities, who stand to gain significantly from the growth of the space sector.
