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Accion Systems raises $42 million in Series C to accelerate development of 4th-gen propulsion system
Space propulsion developer Accion Systems has closed its most significant funding round yet. The company raised $42 million in a Series C led by Tracker Capital, bringing its valuation to $83.5 million.
Along with the investment, Tracker Capital also acquired a majority stake in the company. This latest injection of capital will facilitate the development and manufacturing of the company’s fourth generation propulsion system, dubbed the tiled ionic liquid electrospray (TILE) system.
The TILE system uses electrical energy to push charge particles (ions) out its back to generate propulsion. While ion engines have been around for decades, Accion uses a liquid propellant, an ionic liquid salt, instead of gas. The liquid is inert and nonpressurized, meaning there’s no risk of explosion. It also results in a product that doesn’t need bulky components like ionization chambers, and an overall smaller and lighter weight system relative to the spacecraft — key considerations in space, where every gram of payload has a high price tag.
“It lets us build really, really small systems,” Accion co-founder Natalya Bailey explained to TechCrunch. “Instead of trying to take an existing ion engine the size of a Prius and shrink it down, we can start with very small systems because of this propellant.” And she does mean small — each thruster tile is about the size of a postage stamp.
The TILE system is also scalable and modular, meaning it could feasibly be used on anything from CubeSats to propelling an interplanetary spacecraft, Accion CEO Peter Kant added in a recent interview with TechCrunch. “It’s one of the few occasions where the total addressable market and the actual addressable market that we can serve are pretty closely aligned and almost overlap,” he said.
The newest generation of the TILE system is the same size as its predecessors, but Accion is increasing the number of emitters on a given chip — emitters being the technology that actually shoots out the ions, generating the momentum — by almost tenfold. “We get more ions per area and that gives us a whole lot more thrust with the same amount of space,” Kant said.
Accion is looking to ship the first fourth-gen thruster systems in the middle to late summer of 2022.
The TILE system was developed by Accion co-founders Natalya Bailey and Louis Perna while the two were at the Massachusetts Institute of Technology. The tech generated a ton of interest from big aerospace companies, but they decided to found Accion in 2014 rather than sell. The company manufactures and assembles its product at its facility in Charlestown, Massachusetts.
The TILE system was onboard commercial spacecraft, one with Astra Digital and one with NanoAvionics, that went up on SpaceX’s Transporter-2 launch at the end of June. Accion started by focusing on serving smaller spacecraft first, like CubeSats, but Bailey said that was just the beginning.
“We’re going after that segment initially, and then intending to reinvest our learnings in building larger and larger systems that eventually can do big geostationary satellites and interplanetary missions and so on. The systems that went up on the most recent launcher [is] probably good for a satellite up to about 50 kilograms [ … ] For us, it’s on the smaller end of where we intend to go.”
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Masten Space Systems to develop a GPS-like network for the moon
Masten Space Systems, a startup that’s aiming to send a lander to the moon in 2023, will develop a lunar navigation and positioning system not unlike GPS here on Earth.
Masten’s prototype is being developed as part of a contract awarded through the Air Force Research Laboratory’s AFWERX program. Once deployed, it’ll be a first-of-its-kind off-world navigational system.
Up until this point, spacecraft heading to the moon must carry equipment onboard to detect hazards and assist with navigation. To some extent, it makes sense that a shared navigation network has never been established: Humans have only landed on the moon a handful of times, and while there have been many more uncrewed landings, lunar missions still haven’t exactly been a regular occurrence.
But as the costs of going to orbit and beyond have drastically decreased, thanks in part to innovations in launch technology by companies like SpaceX, space is likely to get a lot busier. Many private companies and national space divisions have set their sights on the moon in particular. Masten is one of them: It was chosen by NASA to deliver commercial and private payloads to a site near the Haworth Crater at the lunar south pole. That mission, originally scheduled for December 2022, was pushed back to November 2023.
Other entities are also looking to go to the moon. Chief amongst them is NASA with its Artemis program, which will send two astronauts to the lunar surface in 2024. These missions will likely only increase in the coming decades, making a common navigation network more of a necessity.
“Unlike Earth, the moon isn’t equipped with GPS so lunar spacecraft and orbital assets are essentially operating in the dark,” Masten’s VP of research and development Matthew Kuhns explained in a statement.
The system will work like this: Spacecraft will deploy position, navigation and timing (PNT) beacons onto the lunar surface. The PNT beacons will enable a surface-based network that broadcasts a radio signal, allowing spacecraft and other orbital assets to wirelessly connect for navigation, timing and location tracking.
Image Credits: Masten Space Systems (opens in a new window)
The company already concluded Phase I of the project, which involved completing the concept design for the PNT beacons. The bulk of the engineering challenge will come in Phase II, when Masten will develop the PNT beacons. They must be able to withstand harsh lunar conditions, so Masten is partnering with defense and technology company Leidos to build shock-proof beacon enclosures. The aim is to complete the second phase in 2023.
“By establishing a shared navigation network on the moon, we can lower spacecraft costs by millions of dollars, increase payload capacity and improve landing accuracy near the most resource-rich sites on the moon,” Kuhns said.
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Extra Crunch roundup: Security data lakes, China vs. Starlink, ExtraHop’s $900M exit
News broke this morning that Bain Capital Private Equity and Crosspoint Capital Partners are purchasing Seattle-based network security startup ExtraHop.
Part of the Network Detection and Response (NDR) market, ExtraHop’s security solutions are for companies that manage assets in the cloud and on-site, “something that could be useful as more companies find themselves in that in-between state,” report Ron Miller and Alex Wilhelm.
Just one year ago, ExtraHop was closing in on $100 million in ARR and was considering an IPO, so Ron and Alex spoke to ExtraHop CTO and co-founder Jesse Rothstein to learn more about how (and why) the deal came together.
Have a great week, and thanks for reading!
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.
Xometry is taking its excess manufacturing capacity business public
Image Credits: Prasit photo (opens in a new window)/ Getty Images
Xometry, a Maryland-based service that connects companies with manufacturers with excess production capacity around the world, filed an S-1 form with the U.S. Securities and Exchange Commission last week announcing its intent to become a public company.
As the global supply chain tightened during the pandemic in 2020, a company that helped find excess manufacturing capacity was likely in high demand.
But growth aside, it’s clear that Xometry is no modern software business, at least from a revenue-quality profile.
It’s time for security teams to embrace security data lakes
Image Credits: Malorny (opens in a new window) / Getty Images
The average corporate security organization spends $18 million annually but is largely ineffective at preventing breaches, IP theft and data loss. Why?
The fragmented approach we’re currently using in the security operations center (SOC) does not work. It’s time to replace the security information and event management (SIEM) approach with security data lakes.
The reduced reliance on the SIEM is well underway, along with many other changes. The SIEM is not going away overnight, but its role is changing rapidly, and it has a new partner in the SOC — the security data lake.
China’s drive to compete against Starlink for the future of orbital internet
Image Credits: STR/China News Service (CNS)/AFP (opens in a new window)/ Getty Images
There has been a wave of businesses over the past several years hoping to offer broadband internet delivered from thousands of satellites in low-Earth orbit (LEO), providing coverage of most of the earth’s surface.
In tandem with the accelerated deployment of SpaceX’s Starlink constellation in 2020, China has rapidly responded in terms of policy, financing and technology. While still in early development, a “Chinese answer to Starlink,” SatNet, and the associated GuoWang are likely to compete in certain markets with Starlink and others while also fulfilling a strategic purpose from a government perspective.
With considerable backing from very high-level actors, we are likely to see the rollout of a Red Star(link) over China (and the rest of the world) over the coming years.
This SPAC is betting that a British healthcare company can shake up the US market
Image Credits: Nigel Sussman (opens in a new window)
Babylon Health, a British health tech company, is pursuing a U.S. listing via a blank-check company, or SPAC.
While we wait for Robinhood’s IPO, The Exchange dove into its fundraising history, its product, its numbers and, bracing ourselves for impact, its projections.
The hidden benefits of adding a CTO to your board
Image Credits: Westend61 / Getty Images
Conventional wisdom says your board should include a few CEOs who can offer informed advice from an entrepreneur’s perspective, but adding a technical leader to the mix creates real upside, according to Abby Kearns, chief technology officer at Puppet.
Beyond their engineering experience, CTOs can help founders set realistic timelines, help identify pain points and bring what Kearns calls “pragmatic empathy” to high-pressure situations.
They can also be an effective advocate for founder teams who need help explaining why a launch is delayed or new engineering hires are badly needed.
“A CTO understands the nuts and bolts,” says Kearns.
6 career options for ex-founders seeking their next adventure
Image Credits: Marie LaFauci / Getty Images
As someone with “founder” on your resume, you face a greater challenge when trying to get a traditional salaried job.
You’ve already shown that you really want to lead a company, not just rise up the ladder, which means some employers are less likely to hire you.
So what should you do? Especially if your life partner and/or bank account are burnt out on the income volatility of startups?
Here are six options for ex-founders planning their next move.
How bottom-up sales helped Expensify blaze the path for SaaS
Image Credits: Nigel Sussman
In the fifth and final part of Expensify’s EC-1, Anna Heim explores how the company built its business, true to form, in an unexpected way.
“You’d expect an expense management company to have a large sales department and advertise through all kinds of channels to maximize customer acquisition, Anna writes. But “Expensify just doesn’t do what you think it should.
“Keeping in mind this company’s propensity to just stick to its guts, it’s not much of a surprise that it got to more than $100 million in annual recurring revenue and millions of users with a staff of 130, some contractors, and an almost non-existent sales team.”
How is that much growth possible without a sales team? Word of mouth.
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Equity Monday: Jeff’s going to space, and everyone wants a piece of Flipkart
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines.
This is Equity Monday, our weekly kickoff that tracks the latest private market news, talks about the coming week, digs into some recent funding rounds and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here and myself here.
It’s WWDC week, so expect a deluge of Apple news to overtake your Twitter feed here and there over the next few days. But there’s a lot more going on, so let’s dig in:
- The Weekend: A supercharged, supercharged Model S Tesla car is not coming out. Instead, a merely supercharged version will come out. It’s still stupid fast and expensive. And Nigeria’s war with Twitter continued, with new efforts from the African nation to limit access to the social media service within its borders.
- This Morning: Flipkart is raising $3 billion at a roughly $40 billion valuation. The deal underscores not just how big the Indian tech scene is, but also how much investor interest there is in e-commerce bets more generally. And Jeff Bezos is going to space. Soon!
- Funding Rounds: Trulioo raised a $394 million Series D. The Canadian startup is now worth far more than $1 billion. And Chinese company Kanzhun is going public in the United States, which raised an eyebrow here amongst the Equity Morning Crew.
- Take The Damn Equity Survey: Take it! All the cools kids are taking it!
And that’s your start to the week. More to come from your friends here on Wednesday, and Friday. Chat soon!
Equity drops every Monday at 7:00 a.m. PST, Wednesday, and Friday at 6:00 AM PST, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts!
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OroraTech’s space-based early wildfire warnings spark $7M investment
With wildfires becoming an ever more devastating annual phenomenon, it is in the whole planet’s interest to spot them and respond as early as possible — and the best vantage point for that is space. OroraTech is a German startup building a constellation of small satellites to power a global wildfire warning system, and will be using a freshly raised €5.8 million (~$7 million) A round to kick things off.
Wildfires destroy tens of millions of acres of forest every year, causing immense harm to people and the planet in countless ways. Once they’ve grown to a certain size, they’re near impossible to stop, so the earlier they can be located and worked against, the better.
But these fires can start just about anywhere in a dried out forest hundreds of miles wide, and literally every minute and hour counts — watch towers, helicopter flights and other frequently used methods may not be fast or exact enough to effectively counteract this increasingly serious threat. Not to mention they’re expensive and often dangerous jobs for those who perform them.
OroraTech’s plan is to use a constellation of about 100 satellites equipped with custom infrared cameras to watch the entire globe (or at least the parts most likely to burst into flame) at once, reporting any fire bigger than 10 meters across within half an hour.
Image Credits: OroraTech
To start out with, the Bavarian company has used data from over a dozen satellites already in space, in order to prove out the service on the ground. But with this funding round they are set to put their own bird in the air, a shoebox-sized satellite with a custom infrared sensor that will be launched by Spire later this year. Onboard machine learning processing of this imagery simplifies the downstream process.
Fourteen more satellites are planned for launch by 2023, presumably once they’ve kicked the proverbial tires on the first one and come up with the inevitable improvements.
“In order to cover even more regions in the future and to be able to give warning earlier, we aim to launch our own specialized satellite constellation into orbit,” said CEO and co-founder Thomas Grübler in a press release. “We are therefore delighted to have renowned investors on board to support us with capital and technological know-how in implementing our plans.”
Image Credits: OroraTech
Those renowned investors consist of Findus Venture and Ananda Impact Ventures, which led the round, followed by APEX Ventures, BayernKapital, Clemens Kaiser, SpaceTec Capital and Ingo Baumann. The company was spun out of research done by the founders at TUM, which maintains an interest.
“It is absolutely remarkable what they have built up and achieved so far despite limited financial resources and we feel very proud that we are allowed to be part of this inspiring and ambitious NewSpace project,” APEX’s Wolfgang Neubert said, and indeed it’s impressive to have a leading space-based data service with little cash (it raised an undisclosed seed about a year ago) and no satellites.
It’s not the only company doing infrared imagery of the Earth’s surface; SatelliteVu recently raised money to launch its own, much smaller constellation, though it’s focused on monitoring cities and other high-interest areas, not the vast expanse of forests. And ConstellR is aimed (literally) at the farming world, monitoring fields for precision crop management.
With money in its pocket Orora can expand and start providing its improved detection services, though sadly, it likely won’t be upgrading before wildfire season hits the northern hemisphere this year.
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Benchmark Space Systems and Starfish Space team up to advance orbital docking and refueling
Humans may not have totally mastered getting objects to space, but we’ve done a pretty good job so far. The hundreds of satellites that orbit the Earth are proof enough that “send stuff to space” is firmly in humanity’s capacity. But what about refueling, repairing or even adding capabilities to spacecraft or satellites once they’re up there?
In the past few years, a host of companies have started to turn what has long been seen as a pipe dream into a real possibility. Now, satellite servicing company Starfish Space and space mobility provider Benchmark Space Systems will be entering into a new partnership aimed at advancing these much-needed capabilities — and their first demonstration will take place next month, on space startup Orbit Fab’s Tanker 1 mission.
Orbit Fab, which was a finalist in our TechCrunch Disrupt Battlefield in 2019, will be sending up an operational fuel depot on a SpaceX Falcon 9 in June. The tanker is the first of what Orbit Fab is envisioning as a “gas station in space” — in-orbit propellant available to satellite customers that will no longer be limited in terms of their spacecraft’s active life by the amount of fuel they take up on launch.
Benchmark Space Systems and Orbit Fab already have an agreement to combine Benchmark’s Halcyon thruster system and the fuel depot startup’s fluid transfer interface (imagine a refueling apparatus) into an integrated propulsion package.
This is where Starfish Space comes in. It will be testing its CEPHALOPOD rendezvous proximity operations and docking (RPOD) software with Benchmark’s Halcyon thruster system to make sure that the refueling demonstration is as accurate as possible. The RPOD software is entirely autonomous and can give small servicing vehicles up to eight times more maneuvering capability, the company says.
Demonstration missions like the one in June are just the beginning. Refueling capacity could not only extend the mission length of satellites and other spacecraft, it could help open the door to new types of space missions and the emerging space economy.
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Aevum is building a modular autonomous drone for space and terrestrial deliveries
Logistics and delivery providers are territorially split between Earth and space, with companies like Amazon and FedEx working to master ground, air and drone transportation, and new entrants like SpaceX honing its expertise in space launch.
Autonomous transportation startup Aevum wants to do both. And it was just issued a patent that will help it move dexterously between space launch to low Earth orbit, and air cargo and drone deliveries here on Earth.
The key is Aevum’s unmanned aircraft system, which it calls Ravn X. So far, Aevum has only publicly discussed its plans for Ravn X in the context of space launches. It works like this: Ravn X uses conventional jet fuel and takes off from an airport runway, like a plane, but it has a rocket nested in its belly that deploys at high altitude to deliver payload to space. As the second stage detaches, Ravn X returns to Earth using conventional touch-down techniques, ready for another delivery.
The new Aevum patent, which was issued on May 4, is for a unique modular payload design positioned in the belly of the drone. With the new system described in the patent, that rocket payload module can be switched out for a cargo bay to carry deliveries around the world, or a drone module that can carry up to 264 smaller drones for last-mile delivery services. Theoretically, Ravn X could depart from an airport, deliver its payload to space, return back to the airport to be reloaded with a filled cargo module, then take off again for earthbound deliveries.
While the exact amount a Ravn X can carry depends on the distance it’s traveling, the Ravn X air cargo will be able to carry up to 15,000 lbs and the space delivery payload will be able to carry up to 330 lbs. As of now, the rockets are expendable, but the company has plans for 100% reusability across its space launch and air cargo operations.
Aevum’s business model includes operating autonomous transportation and logistics as a service and partnering with existing logistics providers. One interesting possibility for the company is partnerships with logistics giants that so far have been effectively cut off from space deliveries due to the vertically integrated models of companies like SpaceX, which handle logistics and launch services in-house.
“We aim to enable FedEx, Amazon, UPS, DHL and others to build upon the logistics infrastructure they have already mastered,” Aevum CEO Jay Skylus said. “Any or all of these respected giants could partner with Aevum or purchase a fleet of Ravn X for their own and add space launch to their offerings. Space logistics should no longer be separated from general logistics.”
Aevum founder and CEO Jay Skylus with Ravn X. Image Credits: Aevum
Likewise, large companies that have struggled to establish drone delivery services could use the Ravn X’s drone module to deliver and deposit drones over a central area, like a city center, for last-mile deliveries.
“The patent is so significant because what the patent allows you to do is say — the existing FedEx and UPS logistics architecture that’s sorting 70,000 packages an hour right now could not service the needs of defense and space because fundamentally that logistics infrastructure was designed to go from Earth to Earth and not Earth to space,” Skylus explained. “But if you really look at the problem and study it in detail, you know the missing link to allow this existing infrastructure to now be able to service the space domain — that missing link is what we just patented.”
Skylus imagines Ravn X fleets operating around-the-clock. “In my company, what matters is asset utilization. For any reusable flying machine, it doesn’t generate revenue on the ground. My machines will fly around the clock, every day,” he said in a statement.
The company still has a ways to go before it takes to the skies, however. Ravn X is still undergoing ground test operations and will begin flight testing this year at an FAA-licensed testing facility for unmanned aircraft systems. Aevum’s intention is to fly with the United States Air Force’s ASLON-45 mission this fall and to take its air cargo service live next year.
Because Ravn X has so many different capabilities, it will need to pursue a few different FAA certifications: for space launches, a license from the FAA Commercial Space Transportation office; for cargo operations, an FAA aircraft type certification and standard airworthiness certification.
“What we’ve patented is the next layer and large batch of connections in the global logistics infrastructure,” Skylus said. “Space logistics shouldn’t be separated from logistics that already exist.”
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Alba Orbital’s mission to image the Earth every 15 minutes brings in $3.4M seed round
Orbital imagery is in demand, and if you think having daily images of everywhere on Earth is going to be enough in a few years, you need a lesson in ambition. Alba Orbital is here to provide it with its intention to provide Earth observation at intervals of 15 minutes rather than hours or days — and it just raised $3.4 million to get its next set of satellites into orbit.
Alba attracted our attention at Y Combinator’s latest demo day; I was impressed with the startup’s accomplishment of already having six satellites in orbit, which is more than most companies with space ambition ever get. But it’s only the start for the company, which will need hundreds more to begin to offer its planned high-frequency imagery.
The Scottish company has spent the last few years in prep and R&D, pursuing the goal, which some must have thought laughable, of creating a solar-powered Earth observation satellite that weighs in at less than one kilogram. The joke’s on the skeptics, however — Alba has launched a proof of concept and is ready to send the real thing up as well.
Little more than a flying camera with a minimum of storage, communication, power and movement, the sub-kilogram Unicorn-2 is about the size of a soda can, with paperback-size solar panel wings, and costs in the neighborhood of $10,000. It should be able to capture up to 10-meter resolution, good enough to see things like buildings, ships, crops, even planes.
Image Credits: Alba Orbital
“People thought we were idiots. Now they’re taking it seriously,” said Tom Walkinshaw, founder and CEO of Alba. “They can see it for what it is: a unique platform for capturing data sets.”
Indeed, although the idea of daily orbital imagery like Planet’s once seemed excessive, in some situations it’s quite clearly not enough.
“The California case is probably wildfires,” said Walkinshaw (and it always helps to have a California case). “Having an image once a day of a wildfire is a bit like having a chocolate teapot… not very useful. And natural disasters like hurricanes, flooding is a big one, transportation as well.”
Walkinshaw noted that they company was bootstrapped and profitable before taking on the task of launching dozens more satellites, something the seed round will enable.
“It gets these birds in the air, gets them finished and shipped out,” he said. “Then we just need to crank up the production rate.”
Image Credits: Alba Orbital
When I talked to Walkinshaw via video call, 10 or so completed satellites in their launch shells were sitting on a rack behind him in the clean room, and more are in the process of assembly. Aiding in the scaling effort is new investor James Park, founder and CEO of Fitbit — definitely someone who knows a little bit about bringing hardware to market.
Interestingly, the next batch to go to orbit (perhaps as soon as in a month or two, depending on the machinations of the launch provider) will be focusing on nighttime imagery, an area Walkinshaw suggested was undervalued. But as orbital thermal imaging startup Satellite Vu has shown, there’s immense appetite for things like energy and activity monitoring, and nighttime observation is a big part of that.
The seed round will get the next few rounds of satellites into space, and after that Alba will be working on scaling manufacturing to produce hundreds more. Once those start going up it can demonstrate the high-cadence imaging it is aiming to produce — for now it’s impossible to do so, though Alba already has customers lined up to buy the imagery it does get.
The round was led by Metaplanet Holdings, with participation by Y Combinator, Liquid2, Soma, Uncommon Denominator, Zillionize and numerous angels.
As for competition, Walkinshaw welcomes it, but feels secure that he and his company have more time and work invested in this class of satellite than anyone in the world — a major obstacle for anyone who wants to do battle. It’s more likely companies will, as Alba has done, pursue a distinct product complementary to those already or in the process of being offered.
“Space is a good place to be right now,” he concluded.
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Weather platform ClimaCell is now Tomorrow.io and raises $77M
Weather intelligence platform ClimaCell today announced that it has raised a $77 million Series D funding round led by private equity firm Stonecourt Capital, with participation by Highline Capital. This brings the company’s total funding to about $185 million. In addition to the new funding, ClimaCell announced that it has changed its name to Tomorrow.io, with “The Tomorrow Companies Inc.” as its new legal name.
Today’s announcement comes only a month after the company announced that it would launch a fleet of small radar-equipped weather satellites to improve its weather monitoring and forecasting capabilities. That’s also, at least in part, where the name change comes from.
Image Credits: ClimaCell/Tomorrow.ai
Originally, ClimaCell/Tomorrow.io built out a novel technology to collect weather data using wireless network infrastructure and IoT devices. That’s where the “cell” in ClimaCell came from. But as the company’s CEO and co-founder Shimon Elkabetz told me, while the company isn’t abandoning this approach, its focus today is much broader.
“The mission is really to help countries, businesses, organizations, to better manage their weather-related challenges,” he said. “And the ambition was always to be that largest weather enterprise in the world, the most disruptive, the most industry-defining. And I think this is the perfect timing for us to come up with a new name, not only because of the funding but because we were able to explain to ourselves that really, we’re helping others take control of tomorrow, today.”
That’s something Stonecourt partner Rick Davis agrees with. “While the company’s growth has been tremendous since launch, there is a larger opportunity at play here,” he said. “What Tomorrow.io is building, corroborated by their recent announcement of launching radar-equipped satellites into space, is only further proof that this company represents the future of weather forecasting for the entire planet. The privatization of the weather industry is now, and that type of vision is what compels the team here at Stonecourt Capital.”
As Elkabetz noted, Tomorrow.io isn’t a typical investment for a private investment firm like Stonecourt. Last year, the firm acquired 365 Data Centers, but it is also backing the Denver-based freight rail company Alpenglow Rail, for example.
And while many of Tomorrow.io’s customers saw their business decline during the pandemic (the company counts Uber and Delta among its users, for example), Elkabetz tells me that its team focused on diversifying its customer base and managed to sign up a number of large logistics companies, including major railways in the U.S. and Mexico, but also smaller companies in the drone, autonomous driving and electric vehicle space. In total, the company says, it saw a 200% net revenue retention rate and its annual contract value grew 850% during the past two years.
The company plans to use the new funding to launch more satellites, but also to improve its overall product and accelerate its go-to-market activities.
“We’re an interesting company because we’re a SaaS company that is now going to space,” Elkabetz said. “A lot of the Earth observations companies are now scratching their heads and saying, ‘Oh, we can’t just sell observations, it’s not monetizable or becoming a commodity. We now need to become a software company and build the platform and do the analytics.’ Good luck.”
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Acquisition-happy space infrastructure company Redwire set to go public via SPAC
The latest in a string of space tech SPACs announced this year is Redwire, an entity created by a PE firm in 2020, which has acquired a number of smaller companies including Adcole Space, Roccor, Made in Space, LoadPath, Oakman Aerospace, Deployable Space Systems and more — all within the last year or so. Redwire announced that it will go public through a merger with special purpose acquisition company Genesis Park Acquisition Corp., and the combined company will list on the NYSE.
The deal puts Redwire’s pro forma enterprise value at $615 million, and is expected to provide an additional $170 million to Redwire’s coffers post-merger, including a PIPE valued at over $100 million. Unsurprisingly, one of the uses of the proceeds that Redwire intends to pursue is continued M&A activity to build out its list of service offerings in the space domain.
Redwire’s mandate isn’t specifically to go after new space companies, and instead its targets share in common expertise in a particular, rather narrow slice of the severally crowded space market. It’s capabilities include on-orbit manufacturing and servicing; satellite design, manufacture and assembly; payload integration; sensor design and development; and more. The idea appears to be to build a full-stack infrastructure company that can offer tip-to-tail space technology services, exclusive really only of launch and ground station components (for now).
It’s a smart approach for a bourgeoning new space economy where increasingly, technology companies who want to operate in space would rather focus on their unique value proposition, and outsource the complex, but mostly settled business of actually getting to, and operating in, space. Other companies are addressing the market in similar ways, with launchers bringing more of that part of the process in-house so their payload customers basically only have to show up with the sensor or communication device they want to send to space, and the launcher providing everything else — including even the satellite, in the relatively near future.
Redwire has proven revenue-generating power, with projected 2021 revenue of $163 million, and many of the companies now operating under its umbrella are fairly mature and have been operating cash flow positive for many years. Accordingly, a SPAC as a path to public markets likely does make sense in this particular instance, but the increasing frequency and volume of space companies choosing this route, is, on the whole, a trend to watch with healthy skepticism.
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