The Japanese Earth observation business Axelspace has raised almost $44 million to buy more smallsats for use in other applications and to grow its constellation of satellites.
The Japanese Earth observation business Axelspace has raised almost $44 million to buy more smallsats for use in other applications and to grow its constellation of satellites.
The funding, announced on December 21, was secured from various Japanese companies and venture funds, marking a pivotal moment for Axelspace’s ambitious plans in the space industry.
This latest funding round follows Axelspace’s Series C round in 2021, where the company raised 2.58 billion yen. Since its inception in 2008, Axelspace has amassed a total of 14.3 billion yen in funding. The newfound capital injection is earmarked for expanding Axelspace’s existing satellite constellation, a critical component of its AxelGlobe service, which currently operates five microsatellites providing medium-resolution imagery.
Axelspace’s AxelGlobe service has gained prominence for its ability to deliver valuable Earth observation data. The company’s constellation, consisting of microsatellites, captures and processes medium-resolution imagery that finds applications across various industries, including agriculture, environmental monitoring, and infrastructure development.
While the funding will support the expansion of the satellite constellation, Axelspace has also unveiled plans to allocate resources to its AxelLiner initiative. Launched in 2022, AxelLiner aims to provide a comprehensive “one-stop service” for the production, launch, and operations of smallsats for external customers. This strategic move aligns with a broader trend in the industry, with companies like Axelspace transitioning from building satellites for internal use to offering them as services to other entities.
As part of AxelLiner, Axelspace is collaborating with Japanese firms Misumi Group Ltd. and Yuki Holdings Inc. in an alliance focused on the mass production of smallsats. The first demonstration satellite resulting from this collaboration is scheduled for launch in early 2024.
Yuya Nakamura, President, and CEO of Axelspace expressed optimism about the company’s future, stating, “With this financing, we hope to further solidify the business foundations of both AxelGlobe and AxelLiner services and to establish ourselves as a leading player in providing comprehensive microsatellite solutions.”
Investors in the Series D round emphasized their confidence in Axelspace’s dual role as a satellite manufacturer and data service provider. Jun Takahashi, President of SMBC Venture Capital Management Co., the lead investor in the round, remarked, “We are impressed by its achievement in pioneering the space industry and hold high expectations for their future global contributions as a satellite manufacturer and a data service provider.”
Axelspace’s strategic move into satellite manufacturing and services resonated with investors, reflecting a broader trend of growing interest in entrepreneurial space companies in Japan. The country has witnessed increased investment in the space sector, with companies like Astroscale, a satellite servicing company, raising over $376 million, including a $76 million Series G round earlier this year.
The burgeoning space industry in Japan also saw lunar lander developer ispace going public on the Tokyo Stock Exchange in April, despite a setback with its initial lunar lander mission. Additionally, iQPS, another Japanese company, went public in December, raising $24 million to support the development of a constellation of synthetic aperture radar imaging satellites.
Axelspace’s successful Series D funding round underscores the continued momentum in the Japanese space sector and positions the company for further advancements in satellite technology and services on both domestic and global scales. As the demand for Earth observation capabilities intensifies, Axelspace is poised to play a pivotal role in shaping the future of satellite-based solutions.