Isar Aerospace Secures $91M Funding for Satellite Launch Vehicle

The aerospace sector is currently experiencing a surge in entrepreneurial endeavors, with talented engineers choosing to establish their own startups rather than accepting positions within established corporations. These innovators are securing funding from increasingly ambitious venture capitalists to transform groundbreaking concepts into viable businesses. Recently, a Munich-based startup has secured the largest funding round to date for a European space technology company.

Isar Aerospace, focused on developing a micro-satellite launcher that is considerably smaller and more affordable than existing larger launch systems, has received €75 million (approximately $91 million) in investment. These funds will be allocated to ongoing research, development, and production efforts, leading up to the company’s anticipated first commercial launches in early 2022.

This launcher represents a significant advancement in design, and its success would position Isar as the first European company to successfully create a satellite launcher capable of competing in the global satellite market.

The Series B funding round was spearheaded by Lakestar, with substantial contributions from Earlybird and Vsquared Ventures. Existing investors, including Airbus Ventures, former SpaceX Vice President Bulent Altan, Christian Angermayer’s Apeiron, and UVC, also participated, alongside new investors HV Capital and Ann-Kristin and Paul Achleitner.

Isar’s previous funding round of $17 million, led by Earlybird and Airbus Ventures, was completed in December 2019.

The company originated as a spin-off from TUM – the renowned Munich Technical University – where co-founders Daniel Metzler, Josef Fleischmann, and Markus Brandl all pursued engineering studies. Fleischmann previously gained recognition as a member of the TUM team that won the prestigious Hyperloop competition in the United States. He received a compelling job offer from a prominent U.S. venture, but ultimately chose to return to Germany to establish Isar.

According to Metzler, there is considerable unmet demand from organizations seeking to utilize satellite technology to enhance or replace existing data sources. This demand extends beyond traditional sectors like government and communications to include industries such as navigation, GPS, mapping, agriculture, media, and internet companies, as well as any entity requiring the high-speed, extensive data access only achievable from space.

Currently, launching satellites into orbit is a complex and expensive undertaking.

Launchers are typically large and have infrequent launch schedules, requiring significant advance planning and investment to secure launch capacity. Even with reservations, launches can be delayed due to technical issues or unfavorable weather conditions.

The growth of private companies like SpaceX, which are increasing the availability of rockets, and the expansion of launch sites to more locations, have partially addressed this issue by increasing launch frequency.

Isar, however, is pursuing a distinct strategy by developing not only a new launch facility but also a novel rocket design that will be smaller and more cost-effective. This approach aims to simplify and reduce the expense of booking satellite launches, with a target payload capacity exceeding 1,000 kilograms.

Metzler explained that Isar’s innovations include propulsion systems utilizing a lighter, alternative fuel compared to conventional launchers. The company is also adopting a streamlined design approach to further minimize production costs.

Metzler stated that the current cost of launching a satellite typically ranges from $30,000 to $40,000 per kilogram. “Our goal is to reduce this to approximately $10,000 per kilogram,” he said.

The company’s proposition has already generated $500 million in “customer inquiries,” representing preliminary commitments for sales as its launchers become operational.

Isar identifies satellite launches as a critical bottleneck that requires resolution.

“Having access to space once a week is a significant improvement over the current situation, which often requires planning launches years in advance,” Metzler commented, outlining Isar’s vision for the future. He also noted that Isar is committed to sustainability, designing components to either return to Earth for reuse or be safely disintegrated in the atmosphere.

Looking ahead, Isar may also explore space exploration and other developmental areas, an ambitious long-term plan that has garnered support from investors.

“We are delighted to support Isar Aerospace as the leading institutional investor in its efforts to commercially develop space capabilities for Europe. Micro-satellites in low Earth orbit are poised to become a crucial platform technology with immense innovation and business potential in the coming decades. Therefore, a competitive space industry in Europe is essential to ensure we do not merely observe the next technological advancements,” said Hendrik Brandis, co-founding partner of Earlybird. “I am particularly pleased that we were able to fully fund this substantial round with German capital, demonstrating the successful growth of the startup and venture capital ecosystem in our country in recent years.”