India’s Space Business Is Catching Up Fast

When the first rocket was launched in 1963, India was a poor country chasing the world’s most advanced technology. The projectile carried the nosecone by bicycle to the launch pad and carried a small payload 124 miles above the Earth. India barely pretended to keep up with the United States and the Soviet Union.

India has gained a more secure footing in today’s space race.

In a sleek and spacious rocket hangar an hour south of Hyderabad, India’s tech startup hub, a crowd of young engineers peered at a tiny experimental cryogenic thruster engine. The two founders of Skyroute Aerospace conversed between bursts of hissing steam as they watched the launch of India’s first private satellite last November carry their own designed rocket. He described the exhilaration of the moment. These new thrusters will bring Skyroute’s next thruster into orbit this year with a much more valuable payload.

India is suddenly home to a registry of at least 140 space tech start-ups, forming a local research arena transforming the connection between Earth and the final frontier. This is he one of the most popular sectors for venture capital investors in India. Startup growth has been explosive, jumping from the initial five companies at the start of the pandemic. And they see a large market to serve. Pawan Kumar Chandana, 32, CEO of Skyroute, estimates that the company will need to launch 30,000 satellites around the world in the next decade.

India’s importance as a scientific powerhouse is drawing attention. When President Biden hosted Prime Minister Narendra Modi in Washington last month, a White House statement said the two leaders “called for greater commercial cooperation between the U.S. and Indian private sectors across the space economy value chain.” rice field. Both countries see space as an arena where India can play a role against its mutual rival China.

For the first 30 years, the Indian Space Research Organization (ISRO), the local version of NASA, made the country proud. India’s first satellite image graced his two rupee note until 1995. After that, India did not pay much attention to India for some time. Young researchers focus on more concrete developments in information technology and medicine, and also have space ambitions. Today, India is not only the most populous country in the world, but also a large, rapidly growing economy and a thriving center of innovation.

The space business has also changed. Space technology is driven by private companies rather than big government budgets and serves small-scale commercial purposes. Imaging systems send information about the Earth back to Earth, helping Indian farmers insure their crops and commercial fishing vessels tracking catches. Satellites deliver telephone signals to some of India’s most remote areas and help operate solar power plants far from India’s big cities.

Since Mr. Modi announced in June 2020 that he will promote the space sector and open it up to private companies of all kinds, India has set up a network of businesses powered by its own research and homegrown talent. I’ve raised Last year, space startups raised $120 million in new investment, a rate that doubles or triples each year.

ISRO (pronounced ISS-ro) gives room to new private players and shares a lucrative legacy with them. Its spaceport on the coastal island of Sriharikota is near the equator and suitable for launches to various orbital levels. The agency’s “workhorse” rocket, he is one of the world’s most reliable rockets for heavy loads. Nearly 95% success rate cuts satellite insurance costs in half, making India one of the most competitive launch sites in the world.

And then there’s the money brought in by the launch of equipment into space. That market is worth about $6 billion this year and could triple in value by 2025.

In Hyderabad, the working loft where the satellite will be deployed and where Dhruva Space, India’s first space company, is housed, is adorned with dummy satellites, atmospherically controlled laboratories known as clean rooms, and artificial gravity test equipment. scattered. Kranti Chand, the company’s head of strategy, spends about a week in Europe each month and another week in the US to attract customers and investors.

It was Elon Musk who stole India’s and the world’s lightning in the space business. His company, SpaceX, and its relaunchable rockets have cut the cost of sending heavy objects into orbit beyond India’s ability to compete. Even today, at $6,500 per kilogram from U.S. spaceports, SpaceX launches are cheaper than anywhere else.

Affordable engineers are plentiful in India, but their low salaries alone won’t keep them competitive. As such, Indian companies like Skyroute will focus on more specialized services.

“We are like taxis,” said Chandana. His company charges higher fees for launching smaller payloads, but SpaceX is “similar to a bus or train, taking all the passengers and delivering them to one destination,” he said.

SpaceX has pushed the energy of Indian startups into space. By the time Modi made it a priority, several of ISRO’s in-house engineers had started getting into the game, including Skyroute’s Chandana and his partner Bharath Dhaka, 33.

One of India’s advantages is geopolitical. Two countries that have long offered lower-cost launch options are Russia and China. But the war in Ukraine almost ended Russia’s role as a competitor. British satellite startup OneWeb was hit $230 million after Russia seized 36 of its spacecraft in September. OneWeb then relied on her ISRO in India to send the next constellation of satellites into orbit. Similarly, the U.S. government would likely approve of U.S. companies sending military-grade technology through India rather than through China.

The size of India’s vendor ecosystem is staggering. A decades-long deal with ISRO has brought together around 400 private companies around Bangalore, Hyderabad, Pune, etc., each dedicated to manufacturing specialized screws, sealants and other products suitable for their space. increase. For one launch he could have 100 people working together.

Skyroute and Dhruba operate in the relatively important areas of launch and satellite delivery, but together they account for only 8% of India’s space business pie. An even larger portion comes from companies that specialize in collecting data transmitted by satellites.

Pixxel is a start-up to watch in this space. We have developed an imaging system that detects patterns on the surface of the earth that are outside the range of normal color vision. Headquartered in Bengaluru, with offices in Los Angeles, it contracts with a secret agency within the Department of Defense. A larger portion of the satellite business will inevitably be directed towards consumer broadband and television services, transmitted from low earth orbit.

In the Skyroute hangar, the engineer turned entrepreneur, educated at two homes of the Indian Institute of Technology, worked in the field at ISRO, and speaks the language of venture capital fundraising. increase. After the “seed round,” Chandana said: “Next is Series A, about 11 million, and a bridge round he’s at 4.5 million.”

After four rounds, their company is now valued at $68 million. However, it has no plans to cash in anytime soon. They are clearly more excited about science than business, which neither studied. Chandana said running a company is “just common sense.”

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