Space Investment Faced Headwinds in 2022
The past year was a rocky one for space investments, according to the Space Investment Quarterly Q4 2022 report. In fact, the report calls the year "the most difficult investment environment since the Great Recession 15 years ago."
That may partially be attributed to a record in space investment in 2021, when the industry saw $47.4 billion poured into the industry. Last year, private investments in space declined by 58 percent, according to the report. The companies most impacted seemed to be late- and growth-stage efforts, while early-stage investments seemed to hold their own. One exception was SpaceX, which raised some $2 billion last year.
The first half of the year was dominated by the Russian invasion of Ukraine, and Earth observation and satellite communications companies were in the spotlight. The second half of the year saw the long-anticipated and delayed launch of Artemis 1, and companies with technology designed for lunar exploration drew a lot of interest.
Space Investments may be Wary of Startups in 2023
The Space Investment Quarterly report indicates that start-up companies may face a difficult year in 2023. Investors will potentially shift away from "momentum investing" and put more weight on companies with more mature products, positive economics and strong leadership. But that may not be entirely negative, the report's authors say. "We believe that less speculation will result in fewer competitors, and a larger talent poos that will make the next two years an attractive time to start and invest in space companies," the report states.
The United States and China led space investments by geography, accounting for 75 percent of all investments. The satellite industry gobbled up 89 percent of total investments by industry. The data shows that there were a total of 420 investment rounds that accounted fo $20.1 billion, with late stage rounds accounting for more than half of that amount.
For Q4, the majority of the space investment rounds were early-stage, according to the report. Axiom Space led space investments in the quarter, raising $50 million in a Series D round, followed by SlingShot Aerospace, which raised $40 million in a Series A round.
Venture Capital investors were particularly active in Q4, investing $2.6 billion in 58 companies.
(Source: Space Capital Q4 report. Images from file)