InspeCity raises $1.5M in pre-seed capital to build green propulsion systems, orbital transfer vehicles (OTVs) and in-space servicing & life-extension of satellites — all technologies needed to support a sustainable ecosystem in space.
We at Speciale Invest have been incredibly optimistic about the Indian Space Tech ecosystem. It started with the first cheque in 2018 in Agnikul Cosmos — building launch vehicles with 3D printed engines, and was followed by investments in satellite communication (Astrogate Labs), downstream satellite data analytics (Kawa Space) and sensor fusion of satellite data (GalaxEye Space). Having invested in the earth to space segment, ‘in-space’ was the next frontier for us to explore.
The macro tailwinds
While estimates vary across sources, it is fair to say that there are at least 4000 operational satellites orbiting the Earth today. We could see anywhere between 65,000 to 100,000 satellites in orbit by 2030. The bulk of these are expected to be microsatellites in the 50–200 kg class, and would cost a few million dollars to build and launch. In some cases, this can extend to tens of millions of dollars.
As these expensive assets — the life blood of the growing space economy valued at 1 trillion dollars in 2040 — increase in numbers, the need for propulsion systems, OTVs (to deliver the satellite to the target orbit) and life extension services will become the need of the hour.
But some things suck today
Anomalies and failures of satellites in space are fairly common
Astonishingly, as reported by NASA in 2019, between 2000–2016, 41.3% of all small satellites launched failed or partially failed. Of these small satellite missions, 24.2% were total mission failures. The launch vehicle failure only accounted for 6.1%, which means that the bulk of the failures happened with satellites in-orbit.
Of the 2040 Starlink satellites launched to date, approximately 3% of them have been reported to have failed. One report says that of the 60 satellites launched on Starlink V1.0 Flight 22, on a Falcon 9 in March 2021, about 12–15 (20–25%) of them appear to have had a loss/failure. The actual number of failures are expected to be much higher than reported.
A 2021 NASA paper that examined a non-exhaustive list of satellite failures noted that there were 53 separate occasions where deployment related anomalies and failures were reported. (In-space satellite anomalies are mission-degrading events — ranging in severity from temporary errors in noncritical subsystems to loss-of-contact and complete mission failure — that negatively affect on-orbit operational spacecraft). The real number of such anomalies is estimated to be far higher. Common anomalies were in the deployment of the solar array (55%) and antenna deployment (40%), with many satellites reporting multiple anomalies.
So why does this matter?
The vast majority (68%) of spacecraft suffered some degree of mission or performance degradation. 32% of the deployment anomalies resulted in the substantial reduction of the spacecraft performance capabilities and/or partial loss of the mission, and in six instances, the spacecraft and/or the mission were completely lost.
The same report outlines the known and reported insurance claims on these anomalies ranged close to a billion dollars, with actual numbers expected to be significantly higher.
The main conclusion is that in most occurrences, the deployable failure is serious enough to reduce the capabilities of the spacecraft and affect the mission scope, duration and objectives, and the operators are often forced to carry on and do the best they can with a degraded satellite.
A need to re-positioning satellites often
With increasing space debris, satellites are often required to carry out manoeuvres to move themselves away from the trajectories of the debris — NASA reported that the ISS does such a manoeuvre at least once a year. However, as satellites become smaller, it becomes increasingly expensive for them to carry their own propulsion systems — making a case for external aid for re-positioning.
A push for quick de-orbiting of end-of-life satellites
The US Federal Communications Commission (FCC) in September 2022 has adopted new rules requiring all satellites to be deorbited to a graveyard orbit within 5 years of their end of mission. This makes the case of OTVs being used for end-of-life deorbiting. The satellite can hence, spend its entire useful life in providing services and hence, revenue to its operator.
InspeCity can solve for these problems
InspeCity builds orbital transfer vehicles (OTVs) powered by a green propulsion system that will deliver satellites to their respective orbits. The OTV will remain in its orbit, dock on to a customer satellite when necessary and carry out life-extension services which include, external inspections, refuelling, re-positioning, end of life de-orbiting, repairs etc.
Small satellites often cost a few million dollars to build and launch (larger ones can cost 100s of millions of dollars). InspeCity’s OTVs can aid in carrying out any positioning or deorbiting manoeuvres, thereby allowing the satellite to spend its precious resources on making money for their operator.
The Life-extension OTVs, through refuelling and maintenance activities, would allow operators to potentially double the life span of the satellites at a fraction of the cost of building and launching a new one (especially large telecom and navigation satellites) — all of this leading to additional hundreds of millions of dollars of revenue for the operator.
What gave us conviction in InspeCity
While the macro factors are all pointing towards a huge opportunity in in-space activities, we soon understood that building propulsion systems and OTVs are only the directional steps needed to get to the main goal — life extension.
But even with propulsion and OTVs, while the market is fairly populated, there are very few which have shown space heritage (deployed and proven their systems in space). In that sense, it is largely a level and open playing field. For example, the OTV landscape in Europe. Even with more than half a dozen players, there is only one (D-Orbit) that is operational today.
There is a strong India play here — the indigenous OTV and life-extension landscape is fairly open. The Govt of India too, in their continued push to indigenize and build a self-sustaining space tech ecosystem, has encouraged the development of OTVs carrying robotic arms for on-orbit maintenance and refuelling, autonomous docking and others via the iDEX Prime Challenges.
The large share of our conviction comes from the team — in Prof. Arindrajit Chowdhury and Dr. Tausif Shaikh, we saw a team that was driven by a long term vision of building a sustainable ecosystem. Both of them have spent over a dozen years each working on propulsion technologies through their PhD programs at Penn State University and IIT Bombay respectively. Prof. Arin, in his previous role of advising space startups has developed a keen eye on the business aspects as well. Both of them come with a strong desire to learn and improve themselves — traits that are vital when building an early stage startup.
When Prof. Arindrajit Chowdhury first outlined his vision for building cities in space, it sounded right out of science fiction. With his uncanny ability to weave a story using pop-culture references, he helped us understand how by building the technologies that will help sustain an ecosystem in space, the end goal is not so unreal after all.
The pre-seed round of funding led by Speciale Invest and supported by Antler India, Matrix DeVC, Veda VC and SINE IIT-Bombay join us in our conviction in InspeCity. The $1.5M raise will help the team show the space heritage of the propulsion systems on both microsatellites and CubeSats, and show on-ground demonstrations of the autonomous docking system and other critical sub-systems. It will also enable them to build a test facility and expand the team to build the critical subsystems required.
The team has already been awarded an $200K (INR 1.5Cr) grant from iDEX to develop micro propulsion systems for cubesats.
We wish the InspeCity team the very best of luck in pushing the frontiers of space exploration.
To join the InspeCity team, write to them here
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We at Speciale Invest believe in supporting breakthrough technologies that have the potential to solve pressing global problems.
As early stage investors, we like to get our hands dirty early on and support founders in their zero to one journey with patient capital, business development opportunities and hiring. We enjoy and thrive in the risk that comes with backing deep-tech startups at the pre-product stage and help through product-market fit, early customers and scale-up.
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