The space sector is experiencing significant growth globally, but Britain’s part in forging the longer term of the space ecosystem still stays relatively unknown.
During the last three years, over $23 billion has been invested within the space sector globally — reaching the heights of virtually $10 billion in 2021. The worldwide space sector is now value over $469 billion, with 77% accounted for by the business market. Analysts project future growth of as much as 11% each year.
Britain already holds a sizeable proportion of the market, accounting for nearly 15% of worldwide investment, second only to the U.S. We even have among the most notable global businesses, equivalent to the satellite communications company OneWeb. OneWeb operates a whole lot of low Earth orbit satellites to supply low latency connectivity and global web access. This growth is because of falling launch costs and the event of smaller, more advanced satellites that are deployed at speed and scale.
The U.K. can also be competitive when it comes to the variety of deals happening. Last yr 296 SpaceTech firms accomplished funding rounds world wide, and 15% of those deals were investments in U.K. businesses. Overall, the U.K. now hosts a dynamic industrial base of over 1,500 space firms, making the most of the country’s talent pool, world-leading infrastructure and access to export markets.
These figures are right down to several aspects that support the U.K. investment landscape. Firstly, the British government is stepping up its spending on space. It’s deploying £3 billion ($3.9 billion) over the spending review on space activities, which is the primary a part of the £10 billion commitment over the last decade commencing this yr. These investments support each the UK Space Agency, and international collaboration through the European Space Agency.
Secondly, the U.K. is home to the City of London and has access to the vast sources of capital it provides. In a recent webinar, Paul Bate, CEO of the UK Space Agency, highlighted the importance of capital accessibility, adding: “Without capital, there isn’t a sector, now we have to have that ability to grow and fuel that growth. We’ve got considered one of the elemental financial centres of the world and now we have a regulatory framework that’s secure and secure.”
This was considered one of the explanations we first decided to create the Seraphim Space Investment Trust — democratising and opening up access to space for investors while also providing startup and scale-up businesses with the funds they need to take a position, develop and grow. In only eight years, Seraphim has helped to support over 100 firms across a variety of space specialisms. A lot of these firms have gone on to grow to be a few of an important players within the space industry: Iceye, Hawkeye 360 and Astroscale, delivering outsized returns for investors. We’re not alone in seeing the chance of space: Nine of the 15 largest U.K. enterprise capital investors have invested in space since 2015.
Thirdly, the U.K. is leading the way in which in research. It’s home to 4 of the highest 10 universities on this planet. It’s ranked first within the G7 for “Research, Impact, and Reach.” This creates an outstanding pool of talent inside the U.K., whether it’s already within the space sector or helping develop ideas for future firms. The opportunities presented by these institutions, and others, are enormous and represent an actual competitive advantage for the country.
We’re still at first of what is about to be a worldwide, trillion-dollar market by the top of this decade. Due to this fact, the present trends inside the U.K. space sector are reflective of those happening globally. There’s a big sum of money being invested in early-stage investments — with recent records being set for funding in seed rounds and Series A firms.
When taking a look at the sector breakdown of U.K. investment, many of the funding has gone into the “product” sector. These are firms which can be constructing products around satellite data, delivering insights for purchasers that won’t even know satellites are involved! Most of the product firms, particularly within the U.K., specialize in climate data. For instance, Be Zero Carbon raised $50 million late last yr to supply rankings for the voluntary carbon markets, enabled by space data. Investment can also be increasingly prevalent in defence. The war in Ukraine has demonstrated the necessity for rock-solid communications. Our own portfolio company, All.Space, is developing ground terminals that enable seamless communications across every orbit, essential for battlefield logistics.
There are still some improvements that the U.K. could make, equivalent to increasing the variety of spinouts from universities and ensuring the nice research being done at our universities is commercialised quickly. But overall, the country is punching well above its weight in space. I’m very confident that we are going to hear of increasingly more U.K. startups and scale-ups which can be using space to resolve the Earth’s most difficult problems. When combining the federal government’s policy focus, educational facilities and financial capabilities, it provides the right environment to supply entrepreneurs and transform the space sector.