France: Euroconsult has published its latest report on ‘Top NewSpace Startups to Watch’ that assesses 20 startups via business-based criteria in robust individual profiles in order to track their current standing, challenges, and future potential within the rapidly-evolving space/satellite value chain.
The trajectory of these startups’ impact can be described as either incremental (e.g., adding launch capacity to a supply-constrained market), disruptive (e.g., shifting the fundamental economic model for their own segment), or enabling (e.g., shifting a fundamental economic model for an upstream or downstream market). Contemplation of exit strategies and impacts provide frameworks for tracking these startups over time.
“All NewSpace startups that qualified for this report were North-American-based, with clusters in Seattle, Silicon Valley, and Washington D.C. Based in Vancouver, UrtheCast is the only one not located in the U.S.,” said Sima Fishman, Managing Director of Euroconsult U.S.A. and editor of the report. “More than 40 different investors hold stakes in these 20 companies, with a handful investing in more than one.”
Functional areas attracting a great deal of startup interest include Earth observation, satellite communications (satcom) constellations, and space transportation (i.e., launch) and exploration. Some balance between these three allows for inclusion as well of two companies distributing equipment whose new technology may enable different economic models.
Several themes have emerged as success factors. Market and application development are predictably prevalent. Companies who are struggling to raise funding would generally benefit from an anchor customer to provide some comfort to investors about the market possibility; this seems to manifest in partnering approaches being taken to distribution (and supplier relationships as well for that matter). In looking at overlap between these operations, as well as overlap with other existing businesses, it is noticeable that there are some areas in which the first to launch could stop a competing startup from completing their investment, rewarding the first mover with a sustainable advantage.
One of the focal areas for the report is watching what comes next for these NewSpace actors. All of the constellations anticipate multiple launches between 2016 and 2019, with some launch schedules extending even beyond that time frame. Fundraising will continue to be an issue, particularly for the expensive satcom constellations, in some cases on a make-or-break basis. Prototypes, initial customer trials, and scaling for production are on the calendar for both profiled equipment-based startups. Finally, operational testing and research and development toward next generation product refinements round out the consolidated list of what to watch for from these companies in the next few years.
While Euroconsult’s recently published Prospects for the Small Satellite Market takes a consolidated approach by presenting the various factors that will drive/inhibit growth in demand for small satellites over the next ten years, categorizing by mass/client/application/region, Top NewSpace Startups to Watch focuses on the specific companies within the space/satellite value chain, giving highly detailed individual profiles covering the outlook, innovations, environment and success factors that must be achieved for each company to move beyond the startup phase. Taken together, these two reports bring a detailed view of both existing and potential business opportunities in this explosive new sector.