State of European launch startup funding

A look at a record-breaking 2023

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Towards the end of 2022, I published the first State of European Launch Startup Funding report. At the time, availability of funding for European launch startups was bleak. In 2021, the industry managed to raise €149 million in funding. In 2022, that figure had fallen to just €60 million. Fortunately, 2023 gave the industry a little light at the end of the tunnel. 

At the end of 2022, the total funding secured by all European launch startups since 2011 was €419 million. In 2023, that figure rose to €781 million, an 86% increase in the industry's total funding to date. In the first month and a half of 2024 alone, another €70.5 million has been added to that figure, with PLD Space securing a €40.5 million loan from the Spanish Government and Latitude closing a €27.5 million Series B funding round. With the addition of that early 2024 funding, the total comes to €850 million. This figure is also on the low side as the amounts awarded as part of France 2030 projects have largely not been made public. This could add between €20 million and €50 million in additional funding to the growing tally. 

While these numbers are important, the more important aspect of the industry’s 2023 funding efforts is the fact that many launch startups secured the requisite funding to bring their development efforts up to a maiden orbital flight. At the end of 2022, Orbex was the only European launch startup that had secured sufficient funding to complete a maiden flight of its Prime launch vehicle. As of the end of January 2024, PLD Space, MaiaSpace, Rocket Factory Augsburg (RFA), and Isar Aerospace have been added to that list. This is, however, conditional on a near flawless run up to a maiden flight. While MaiaSpace and Isar likely have provisions for a mishap or two, PLD Space, RFA, and Orbex will be counting pennies should something unexpected occur. And this may not even be in their control.

Germany’s HyImpulse is preparing to launch its suborbital SR75 launch vehicle. The company had initially planned to launch the rocket from SaxaVord in the UK and had even secured a license to do so from the country’s Civil Aviation Authority. However, the company was forced to pivot to a backup site in Australia after financial troubles temporarily halted the construction of the launch facility. SaxaVord is noteworthy as the planned host of the maiden flights of the RFA ONE and Latitude Zephyr vehicles. Fortunately, it does appear that SaxaVord has secured the necessary funding to continue construction of the facility. While Zephyr isn’t expected to take to the skies until 2025, RFA is aiming to debut its RFA ONE vehicle from SaxaVord sometime this year.

Another interesting honorary addition to the funded-up-to-a-maiden-flight club is Italy’s Sidereus Space Dynamics, which secured an additional €5.1 million in seed funding. This will allow the company to begin initial hop tests of its reusable single-stage-to-orbit EOS launch vehicle. The first low-altitude test flights of EOS are currently expected to take place in mid-2024.

Big winners from 2023

Without a doubt, the largest winner from 2023 is Isar Aerospace, with the company closing its €155 million Series C funding round. The company is developing its two-stage Spectrum launch vehicle, which will debut at Andoya Spaceport in Norway. In November 2023, it was announced that construction of the new orbital launch facility had been completed. Isar currently has the run of the place, with no other launch company currently having committed to utilizing the facility. With Isar closing its Series C, it has now raised approximately €325 million, a significant portion of the €851-million total. However, unlike many years when Isar’s funding efforts completely dwarfed all others, in 2023, it had some competition.

MaiaSpace has been around for just two years, having been officially founded in early 2022. While the company did initially state that it would be looking to secure private investment in 2023, its funding windfall ended up coming from its parent company, ArianeGroup. The Ariane 6 manufacturer committed an additional €123 million in funding to ensure MaiaSpace could continue its race towards an ambitious debut of Maia set for late 2025. While this does appear overly ambitious, the company is leaning heavily on the years of work that ArianeGroup has put into the development of the Themis reusable booster demonstrator and Prometheus rocket engine projects. The company is essentially just working on the upper stage, kick stage, and the fairing. Although, this certainly makes it sound far more simple than what actually needs to be done. It is ambitious, just not as ambitious as it first appears.

PLD Space only secured around €4 million in funding in 2023. It did, however, manage a maiden flight of its suborbital Miura 1 launch vehicle. This was a significant accomplishment for the company, which had been working towards the milestone since its founding in 2011. The company’s funding win came in January 2024 when it received a €40.5 million loan from the Spanish government. The funding will be used for the development of the company’s larger Miura 5 vehicle, which is capable of deploying 450-kilogram payloads into low Earth orbit. While the amount is significant, it does come with some pretty significant strings. The terms of the loan require PLD Space to repay the full amount through royalties over the first 10 years of the commercial operation of Miura 5. The company is, however, also looking to add additional funding to its coffers. In February 2023, PLD Space explained that it was moving forward with a Series C funding round. The company expects the size of the round to be approximately 150 million.

2023’s biggest winners primary came from France and Germany. In 2023, German companies secured €194.9 million in funding. France narrowly missed out on the top spot with a total €158.2 million raised. While UK launch startups raised only €3.8 million in 2023, the figure is somewhat misleading. In addition to the grant provided to Orbex, the UK Space Agency committed €4 million to RFA and €3.9 million to HyImpulse, both of which have committed to launching orbital flights from SaxaVord. 

Conclusion

Last year proved that European launch startups can secure significant amounts of funding. It also proved that European governments are waking up to the fact that sovereign launch options are an important strategic capability that needs to be fostered. They’re not all the way there just yet, but Spain making a large contribution to the development of Miura 5 is a significant step. 2024 will be a time to prove that the funding can be put to good use, though.

RFA and Isar are planning maiden orbital flights in 2024, with Orbex potentially being a third addition to that list. HyImpulse will launch its SR75 suborbital vehicle for the first time, and Sidereus will begin low-altitude tests of its EOS vehicle. Additionally, outside the startup realm, ArianeGroup needs to pull off a flawless maiden flight of Ariane 6, and Avio needs to find a way to bring some kind of reliability back into its Vega lineup. Success in 2024 will open up additional funding. Failure will certainly not make it easier for companies still seeking funding to bridge the gap leading up to a maiden flight.