Space Companies at Y Combinator
Space Companies at Y Combinator
If you were interested in quantifying the rising interest in starting a space company, the accelerator program Y Combinator (YC) is probably as good an indicator as any. I attended YC’s demo day of their most recent Summer 2021 program. Out of 375 companies in that batch, five were focused on space applications. For comparison, no other batch has previously had more than one space company and most have had none. To put it simply, there seems to be more interest in starting a space company than ever before.
In this post, we’ll talk about the historical relationship between YC and space companies, what the recent batch of space companies are working on, and what it means for the space industry.
What is Y Combinator?
Y Combinator (YC) is a startup accelerator program founded in 2005. Twice every year they accept a batch of very early stage companies to attend a 12-week program which helps those organizations mature their businesses and prepare for fundraising. Startups that participate in YC also receive $125,000 of investment in exchange for a 7% ownership in the companies.
YC is the most successful accelerator program in the world, with highly successful alumni companies including Airbnb, Stripe, Coinbase, DoorDash, and many more. The organization has historically supported mostly software companies. However, there have been a fair number of successful hardware startups as well, including some sporadic space companies in recent years.
The most famous space companies to pass through YC are Relativity Space (Winter 2016 batch) and Momentus Space (Summer 2018 batch). Relativity has most recently been valued on the private market at a $4.2B valuation and Momentus recently went public via a SPAC at a $567M valuation.
The Space Companies In YC’s Summer 2021 Batch
Inversion Space
Tagline: Low-cost return from space
Website: https://www.inversionspace.com/
Inversion Space is offering low-cost services to return items from space to Earth. Their goal is to build the first affordable, high cadence return vehicle for the commercial and defense industries. Inversion is developing two capsules, one that is one foot in diameter and is planning to begin service in 2023 as well as another that is four feet in diameter and is planning to begin service in 2025.
TransAstra Corporation
Tagline: Orbital logistics: Unleashing the space industry, from Earth to asteroids
Website: https://www.transastracorp.com/
TransAstra intends to build and fly space tugs to provide orbital transfer services. In addition, the tugs are also intended for applications of asteroid mining and moving heavy industry into space. They are planning to develop their own proprietary propulsion system on their spacecraft named Omnivore™ which will utilize solar thermal propulsion. The TransAstra CEO was formerly employed as the founding CTO of Momentus Space.
Epsilon3
Tagline: The OS for spacecraft and complex operations
Website: https://www.epsilon3.io/
Epsilon3 is developing an enterprise software platform to manage complex, high-stakes operations conducted by space companies and other industrial organizations. Their tools allow teams to collaborate on testing procedures that are often kept in spreadsheets or on static documents. The software facilitates easily recording and managing the data involved in testing processes.
Turion Space
Tagline: Space Debris removal and satellite servicing
Website: https://turionspace.com/
Turion Space is building spacecraft to remove orbital debris and provide on-orbit satellite servicing. Their spacecraft are meant to rendezvous and dock with orbital satellites and large debris objects using vision sensors and robotic arms. In addition to debris removal, Turion also plans to dock with active satellites to conduct orbit changing and life-extension services.
HEO Robotics
Tagline: We visually monitor space objects for governments and defense
Website: https://www.heo-robotics.com/
HEO Robotics prides itself as the world’s first commercial in-orbit satellite inspection company. They leverage existing Earth observation satellites and use HEO’s proprietary software to point those satellites towards other spacecraft flying nearby.
What It Means for the Space Industry
What I find notable in considering these companies is that the focus of startups in the space industry is shifting from what it had been in past years. In particular, nearly all of these organizations are providing some sort of “in-space service”. Only a couple of years ago, many of these businesses would have seemed far from viable in the near term. However, as launch access to space becomes a more “solved” problem, the industry is shifting more rapidly into considering what next-generation businesses can be built around activities that can be performed in space.
Another personal point of interest is that this batch contains a company that is building enterprise software to address problems in the space industry. As any industry matures and becomes more robust, it begins to develop a market demand for custom software solutions. While Epsilon 3’s software has applications to a broad range of hardware testing operations, the company at least in part represents a thesis that the space industry is now sophisticated enough to demand its own enterprise software products. This to me is an indication of a healthy point in the maturation of the space sector.
Beyond that, I think it’s also encouraging to simply see that this YC batch contains no launch companies given the saturation of organizations in that vertical.
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Amazing and crystal clear writing as I have come to expect from Ian! Really exciting to reimagine the space startup work in the post-launch prohibitive barrier world. Thank you for the continued insights!!
This is really interesting stuff. Good evidence of a classic entrepreneurial process whereby tech, social, or other trends spawn new problems-to-solve and new ventures to solve them.