After a successful first flight, Apex, a company that makes satellites, has raised $95 million to grow its business.
The Los Angeles-based company launched and took delivery of its first spacecraft, a model named Aries, in March. That mission seems to have gone off without a hitch, which doesn’t happen very often in the space business. Now that the company has a history of successful flights, it is fully focused on growth.
Among other things, that means making more of the Aries car and putting money into making Nova, a spaceship that weighs about twice as much as Aries. Ian Cinnamon, CEO and co-founder of Apex, told TechCrunch that the company is on track to make five Aries this year alone.
Apex was created with the idea that making satellite buses was one of the main things stopping the growth of the space business. Cinnamon and his cofounder, Maximilian Benassi, want to commercialize (make and sell in standard formats) satellite buses. Until now, these buses had to go through custom engineering processes and had very long lead times. They also want to make it easier for more companies to send their payloads into orbit.
Launch costs have gone down thanks to SpaceX Falcon 9 ride-share missions, which has raised demand for access to space. These changes have also made it possible for a productized spacecraft to do well on the market. Customers are paying the same amount for a ride to orbit up to a certain volume size. Cinnamon and Benassi understood that spacecraft could be made the same, and even a little over-engineered, so the customer wouldn’t have to pay more for launch.
Cinnamon said that the business has a strong base thanks to its focus on productization. “We can very clearly point out, here’s the selling price, here’s our unit economics, and here’s the margin we have for every single satellite bus that we’ve sold or are in the process of selling,” he said. “We’re also very honest with our customers about the fact that we’re not trying to have the lowest prices on the market. Sometimes we can charge more for very fast delivery.”
It’s clear that buyers were drawn to this clear picture of the economy. “Investors still have that strong desire to put their money to work on businesses where they can really see the fundamentals,” Cinnamon said. There’s been a lot of talk about hard tech lately.
Cinnamon says that one thing that is working in the company’s favor is that most buyers don’t want to buy just one satellite, but several, and they often want to make purchases over time as a constellation is built.
There are almost fifty people working for the company, and that number will probably double by the end of the year.
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XYZ Venture Capital and CRV, two early investors in Apex, led the funding round. Upfront, 8VC, Toyota Ventures, Point72 Ventures, Mirae Asset Capital, Outsiders Fund, and GSBackers were among the new investors, as well as existing investors Andreessen Horowitz, Shield Capital, J2 Ventures, Ravelin, Robinhood co-founder Baiju Bhatt, and Avalon Capital Group.
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