As rocket companies proliferate, new enabling tech emerges as the next wave in the space race

Blue Origin, Rocket Lab, Relativity Space, Slingshot Aeropsace, SpaceX and Virgin Orbit have raised billions of dollars to create new vehicles to launch payloads into space, but as the private space industry develops in the U.S. investors are beginning to back enabling technologies boost the next wave of innovation. Whether it’s satellite manufacturers, new propulsion […]

Blue Origin, Rocket Lab, Relativity Space, Slingshot Aeropsace, SpaceX and Virgin Orbit have raised billions of dollars to create new vehicles to launch payloads into space, but as the private space industry develops in the U.S. investors are beginning to back enabling technologies boost the next wave of innovation.

Whether it’s satellite manufacturers, new propulsion systems for satellites, antennae for data transmission or actually building out the networks themselves, the new space race will be building the next generation of services that the increasing access to space provides.

Last year, investors put at least $2.3 billion into companies angling for their own corner of outer space.

By 2040, Morgan Stanley estimates that the space economy to be worth more than $1 trillion in 2040 — as well as for SpaceX to double, or even quintuple, its valuation — “are significantly tied to the developments related to satellite broadband.”

For the moment, the next wave is still focused on terrestrial applications.

Already, landmark deals are being signed to provide new space-based internet networking services like the agreement between the startup company Astranis and Pacific Dataport to provide high-speed, lower-cost broadband services to Alaska.

With only around $14 million in financing, Astranis has managed to sign its first deal to provide high speed internet to Alaskans by 2020, while OneWeb (which has raised over $1.7 billion) expects its networks to come online by 2022. SpaceX will launch the first Starlink satellites this year, with service coming online in the following years.

Astranis’ decision to work directly with a single customer rather than deploying a massive network points to the fact that companies can start generating real revenues relatively quickly — without the need for global ambitions off the bat.

Indeed, some space investors note that there are significant questions that remain unanswered for both SpaceX and OneWeb .

In a blog post earlier this month, Josephine Millward, the head of research at London-based space investment firm Seraphim Capital wrote:

After years of development, OneWeb and SpaceX will begin to deploy their Low Earth Orbit (LEO) mega-constellations in 2019, albeit their full constellation targets will take several more years. Both are planning global coverage to provide internet broadband to the billions of unconnected. Crucially both still need to define their “go-to-market” strategy and solve the ground segment element of their proposition ahead of commercial roll-out.

Astranis’ satellite-based service is expected to triple the amount of capacity that’s available to Alaskans for internet services and, with a price tag worth tens of millions of dollars, represents the largest contract signed by an early stage startup in the space business to date.

But networking services aren’t the only space-based applications that will gain additional traction in 2019. Using satellite imagery for data analysis, already a big pitch from companies like Satellogic and Planet — and newer companies like Capella Space and Iceye — is an industry that will come into its own, according to Seraphim Capital’s Chief Executive Mark Boggett. Meanwhile, companies like Cloud Constellation are pitching satellite-based data storage as inherently safer than their earthbound cloud computing counterparts.

“These satellite networks are now in place and they’re gathering massive amounts of data,”  says Boggett. “What we’re going to start seeing is companies start using this data.”

Boggett says stay tuned for big fundraising rounds across the board, not only in the satellite networks themselves, but in the services that enable them to refine their data collection techniques and increase the efficiency and power of their transmission capabilities.

These would be what Boggett calls “downlinking” companies and companies that manage satellite mobility in space. Startups like Kymeta, Bridgesat, Ansur, RBC Signals and the Japanese startup Infostellar are all focused on downlinking — taking data from satellites and transmitting it to receivers on earth so the information can be used effectively, or optimizing data collection and transmissions in space.

It’s a market that’s attracted the attention of one of the largest tech companies in the world — Amazon . Viewing the data collection business as an extension of its cloud services, late last year Amazon partnered with Lockheed Martin to announce a base station as a service business called Amazon Base Station (no one accused them of being branding geniuses).

“Customers said that we have so much data in space with so many applications that want to use that data. Why don’t you make it easier,” said Amazon Web Services’ chief executive, Andy Jassy, at the time of the new service’s launch.

Propulsion technologies for satellites once they’re in space are another potential area for increased investment in 2019, according to investors.

Companies like Momentus, which raised $8.3 million in November; Tesseract, a European startup developing propulsion technologies; and Phase Four, the El Segundo, Calif.-based developer of a plasma-based propulsion system, are all bringing products to market.

Phase Four, which is in the middle of raising a new round right now, has actually inked its first supply deals with Capella Space and Tyvak, a division of the startup Terran Orbital, for its thrusters.

“It is an infrastructure arms race to get things efficiently built and deployed into space,” says M. Umair Siddiqui, the chief technology officer at Phase Four. “Now the next companies are racing to own who can manufacture the hardware that is going to generate the revenue in space.”

 

Africa Roundup: Paga goes global and 4 startups raise $99M in VC

Jake Bright Contributor Jake Bright is a writer and author in New York City. He is co-author of The Next Africa. More posts by this contributor Polestar unveils first production EV with aim to overtake Tesla Liquid Telecom goes long on Africa’s startups as future clients Nigerian digital payments startup Paga is gearing up for international expansion […]

Nigerian digital payments startup Paga is gearing up for international expansion with a $10 million round led by the Global Innovation Fund.

The company is exploring the release of its payments product in Ethiopia, Mexico, and the Philippines—CEO Tayo Oviosu told TechCrunch.

Paga looks to go head to head with regional and global payment players, such as PayPal, Alipay, and Safaricom according to Oviosu.

“We are not only in a position to compete with them, we’re going beyond them,” he said of Kenya’s MPesa mobile money product. “Our goal is to build a global payment ecosystem across many emerging markets.”

Launched in 2012, Paga has created a multi-channel network and platform to transfer money, pay bills, and buy things digitally 9 million customers in Nigeria—including 6000 businesses.

Since inception, the startup has processed 57 million transactions worth $3.6 billion, according to Oviosu. He joined Cellulant CEO Ken Njoroge and Helios Investment Partners’ Fope Adelowo at Disrupt San Francisco to discuss fintech and Africa’s tech ecosystem.

South African fintech startup Jumo raised a $52 million round (led by Goldman Sachs) to bring its fintech services to Asia. The company—that offers loans to the unbanked in Africa—has opened an office in Singapore to lead the way.

The new round takes Jumo to $90 million raised from investors and also saw participation from existing backers that include Proparco — which is attached to the French Development Agency — Finnfund, Vostok Emerging Finance, Gemcorp Capital, and LeapFrog Investments.

Launched in 2014, Jumo specializes in social impact financial products. That means loans and saving options for those who sit outside of the existing banking system, and particularly small businesses.

To date, it claims to have helped nine million consumers across its six markets in Africa and originated over $700 million in loans. The company, which has some 350 staff across 10 offices in Africa, Europe and Asia, was part of Google’s Launchpad accelerator last year. Jumo is led by CEO Andrew Watkins-Ball, who has close to two decades in finance and investing.

Lagos based Paystack raised an $8 million Series A round led by Stripe.

In Nigeria the company’s payment API integrates with tens of thousands of businesses, and in two years it has grown to process 15 percent of all online payments.

In 2016, Paystack became the first startup from Nigeria to enter Y Combinator, and the incubator is doing some follow-on investing in this round.

Other strategic investors in this Series A include Visa and the Chinese online giant Tencent, parent of WeChat and a plethora of other services. Tencent also invested in Paystack’s previous round: the startup has raised $10 million to date.

Paystack integrates a wide range of payment options (wire transfers, cards, and mobile) that Nigerians (and soon, those in other countries in Africa) use both to accept and make payments. There’s more about the company’s platform and strategy in this TechCrunch feature.

South African startup Yoco raised $16 million in a new round of funding to expand its payment management and audit services for small and medium-sized businesses as it angles to become one of Africa’s billion-dollar businesses.

To get there the company that “builds tools and services to help SMEs get paid and manage their business” plans to tap $20 billion in commercial activity that the company’s co-founder and chief executive, Katlego Maphai estimates is waiting to move from cash payments to digital offerings.

Yoco offers a point of sale card reader that links to its proprietary payment and performance software at an entry cost of just over $100.

With this kit, cash-based businesses can start accepting cards and tracking metrics such as top-selling products, peak sales periods, and inventory flows.

Yoco has positioned itself as a missing link to “solving an access problem” for SMEs. Though South Africa has POS and business enterprise providers — and relatively high card (75 percent) and mobile penetration (68 percent) — the company estimates only 7 percent of South African businesses accept cards.

Yoco says it is already processing $280 million in annualized payment volume for just under 30,000 businesses.

The startup generates revenue through margins on hardware and software sales and fees of 2.95 percent per transaction on its POS devices.

Yoco will use the $16 million round on product and platform development, growing its distribution channels, and acquiring new talent.

Emerging markets credit startup Mines.io closed a $13 million Series A round led by The Rise Fund, and looks to expand in South America and Asia.

Mines provides business to consumer (B2C) “credit-as-a-service” products to large firms.

“We’re a technology company that facilitates local institutions — banks, mobile operators, retailers — to offer credit to their customers,” Mines CEO and co-founder Ekechi Nwokah told TechCrunch.

Most of Mines’ partnerships entail white-label lending products offered on mobile phones, including non-smart USSD devices.

With offices in San Mateo and Lagos, Mines uses big-data (extracted primarily from mobile users) and proprietary risk algorithms “to enable lending decisions,” Nwokah explained.

Mines started operations in Nigeria and counts payment processor Interswitch and mobile operator Airtel as current partners. In addition to talent acquisition, the startup plans to use the Series A to expand its credit-as-a-service products into new markets in South America and Southeast Asia “in the next few months,” according to its CEO.

Nwokah wouldn’t name specific countries for the startup’s pending South America and Southeast Asia expansion, but believes “this technology is scalable across geographies.”

As part of the Series A, Yemi Lalude from TPG Growth (founder of The Rise Fund) will join Mines’ board of directors.

 

Digital infrastructure company Liquid Telecom is betting big on African startups by rolling out multiple sponsorships and free internet across key access points to the continent’s tech entrepreneurs.

The Econet Wireless subsidiary is also partnering with local and global players like Afrilabs and Microsoft­­ to create a cross-border commercial network for the continent’s startup community.

“We believe startups will be key employers in Africa’s future economy. They’re also our future customers,” Liquid Telecom’s Head of Innovation Partnerships Oswald Jumira told TechCrunch.

With 13 offices on the continent, Liquid Telecom’s core business is building the infrastructure for all things digital in Africa.

The company provides voice, high-speed internet, and IP services at the carrier, enterprise, and retail level across Eastern, Central, and Southern Africa. It operates data centers in Nairobi and Johannesburg with 6,800 square meters of rack space.

Liquid Telecom has built a 50,000 kilometer fiber network, from Cape Town to Nairobi and this year switched on the Cape to Cairo initiative—a land-based fiber link from South Africa to Egypt.

Though startups don’t provide an immediate revenue windfall, the company is betting they will as future enterprise clients.

“Step one…in supporting startups has been….supporting co-working spaces and events with sponsorships and free internet,” Liquid Telecom CTO Ben Roberts told TechCrunch. “Step two is helping startups to adopt…business services.”

Liquid Telecom provides free internet to 30 hubs in seven countries and is active sponsoring startup related events.

On the infrastructure side, it’s developing commercial services for startups to plug into.

“At the early stage and middle stage, we’re offering startups connectivity, skills development, and access to capital through the hubs,” said Liquid Telecom’s Oswald Jumira.

“When they reach the more mature level, we’re focused on how we can scale them up…and be a go to market partner for them. To do that they’ll need to leverage…cloud services.”

Microsoft and Liquid Telecom announced a partnership in 2017 to offer cloud services such as Microsoft’s Azure, Dynamics 365, and Office 365 to select startups through free credits—and connected to comp packages of Liquid Telecom product offerings.

On the venture side, Liquid Telecom doesn’t have a fund but that could be in the cards.

“We haven’t yet started investing in startups, but I’d like to see that we do,” said chief technology officer Ben Roberts. “That can be the next move onwards… from having successful business partnerships.”

And finally, tickets are now available here for Startup Battlefield Africa in Lagos this December. The first two speakers were also announced, TLcom Capital senior partner and former minister of communication technology for Nigeria Omobola Johnson and Singularity Investment’s Lexi Novitske will discuss keys to investing across Africa’s startup landscape.

More Africa Related Stories @TechCrunch

African Tech Around the Net

Starry wants to put high-speed 5G internet in reach of everyone

Starry, a Boston startup, wants deliver high-speed 5G internet in major cities at a reasonable price. Today, it announced it is expanding service from its initial launch in Boston to New York City. The company also announced a deal with Related Companies, a large national affordable housing owner, to host Starry equipment on its buildings […]

Starry, a Boston startup, wants deliver high-speed 5G internet in major cities at a reasonable price. Today, it announced it is expanding service from its initial launch in Boston to New York City. The company also announced a deal with Related Companies, a large national affordable housing owner, to host Starry equipment on its buildings and offer Starry service to its tenants.

The Starry solution consists of three parts: The beam sits on a high roof. The point sits on a lower roof and the consumer gets a Starry Station, which acts as a modem of sorts to deliver the internet service to the home. As they put it, internet access becomes an extension of the property.

Diagram: Starry

While the hardware solution is impressive in itself, it allows Starry to offer high-speed internet to consumers at a more affordable price point than traditional large providers. Company founder and CEO Chet Kanojia says his company can provide up to 200 Megabits per second service, up and down, for just $50 a month with no data caps or long-term contracts. Installation is free and the company includes 24/7 customer care at no additional cost.

While it’s hard to compare pricing across services, Starry should appeal to cord cutters, who have dropped cable TV for more affordable streaming alternatives and have been looking for a way to free themselves from large internet service providers. It’s fair to say that no other provider offers this kind of speed up and down for that price.

The solution requires high rooftops to place the enabling infrastructure and the arrangement with Related is particularly interesting in this context. The deal is good for both parties, giving Starry the infrastructure it needs to place its equipment in major cities, while providing Related tenants with low-cost internet access starting later this year.

“Our first strategic partnership is with Related Properties, which is a big property ownership company in all the major cities. It allows us to basically extend our network using their infrastructure, rooftops and buildings,” Kanojia said.

The startup plans to provide service to other New York City residents starting in parts of Manhattan and Brooklyn this fall, and expanding to other parts of the city over time. They have further plans to expand to Washington and LA later this year with 18 other cities coming on board in the next year.

The company launched in 2014 and spent a couple of years developing the hardware part of the solution. It has raised $163 million, according to data supplied by the company. The most recent round was $100 million Series C in July. It’s worth noting that their new partner, Related joined that most recent investment.

Kanojia helped launched Aereo, a startup that wanted to deliver low-cost television by placing antennas on rooftops and letting consumers view broadcast TV over the internet. That idea was shot down by the US Supreme Court when broadcasters sued for copyright violations, and the company went out of business soon after. Starry could be seen as an extension of that idea, but delivering internet instead of the TV signals themselves.