The notion of space evokes imagery of the moon, rockets, satellites, the international space station... But in reality, and without many of us realizing, space - or the new space economy – is actually much closer to home and has become an increasingly large part of our daily lives; think smart devices that use satellite data, for one.
Over the past decade or so, the industry has evolved into a small but dynamic ecosystem of innovators emerging alongside traditional incumbents to push back the boundaries of space, on Earth. According to the World Economic Forum, it represents a $1.8 trillion opportunity and will grow at a 9% CAGR between 2023 and 2035, well above the global GDP growth rate.
Gianluigi Baldesi, Charles Beigbeder, Eric Benoist, Laurence Porruncini, Olivier Larangot, Stanislas Maximin
To address its far-reaching potential and the scope of space-enabled technologies, Natixis CIB recently hosted a webinar in collaboration with Audacia. Eric Benoist, Tech & Data Research Specialist at Natixis CIB, and Laurence Porruncini, Tech Banker, Tech Hub at Natixis CIB, spoke to Charles Beigbeder, Expansion Chairman – Audacia; Stanislas Maximin, CEO – Latitude; Gianluigi Baldesi, Head of the Ventures and Financing Office –European Space Agency; and, Olivier Larangot, Head of Corporate Venture Capital – Groupe ADP.
Once dominated by large government agencies, the landscape of the space economy is very different today. Barriers to entry are lower than they have ever been, and many start-ups are carving out a legitimate place for themselves, challenging tradition and innovating alongside more established players who nevertheless continue to play a key role.
The European Space Agency supports ventures from incubation in its Business Incubation Centres (BICs) and technology development with programme directorates to scaling up through anchor customers, the ESA Marketplace, and access to finance via the ESA Investor Network.
Gianluigi Baldesi : Head of the Ventures and Financing Office – ESA
On the investors’ side, the dynamic is also set in motion.
Space is becoming a normal place to do business - the economic equation has changed, the potential is immense. Our mission at Audacia is to accompany entrepreneurs in their space-related activities.
Charles Beigbeder : Expansion Chairman – Audacia
At the heart of progress in space are significant opportunities on Earth, from telecommunications to transportation and logistics, e-commerce, agriculture and even finance. Space also promises to have profound societal impact in domains such as education, land development, food security, climate change monitoring and mitigation.
Groupe ADP takes a very pragmatic approach to space, for example, from a climate perspective. Data we receive from satellites allows us to monitor our emissions from space, . With that information we can act to diminish our carbon footprint.
Olivier Larangot : Head of Corporate Venture Capital – Groupe ADP
Occasionally, the sector is associated with more controversial uses, particularly in the defence arena but in the current geopolitical context, investors and consumers have come to accept that freedom, sovereignty, and security depend in part on space-based information and surveillance.
We live in a world where we can’t afford to question whether we need the data or not, and the data that we are able to gather from space – from satellites – is fundamental to our ongoing freedom.
Stanislas Maximin : CEO – Latitude
Of greater concern is the rapid expansion of commercial satellite constellations and their impact on the environment through the proliferation of debris and the increased risk of collisions. Between 2018 and 2023, more satellites have been put into orbit than in the previous sixty years of the space industry. With thousands more due to be launched before the end of the decade, many worry that we are headed for disaster. Thankfully, the community is not standing idle in the face of these alarming threats.
To ensure safety going forward, there are strategies in place. There are initiatives to map satellites and loose debris in orbit, to remove debris, and regulations to govern new rockets and satellites being launched.
Charles Beigbeder : Expansion Chairman – Audacia
With this in mind, building and growing a sustainable space ecosystem requires significant funding. In the early days of the industry, this came in the form of subsidies, but today, the focus is shifting to private investment.
The European Space Agency is working hard to support start-ups and reduce risks for the private sector. To date, it has set up a network of 30 centers to facilitate the creation of start-ups, assist investors in their due diligence and help them better understand the opportunities at stake.
Historically, funding has been more concentrated in the United States, but Europe is gradually catching up. Venture capital firms such as Audacia and large corporations such as Groupe ADP are certainly playing their part. The challenge remains, however, to attract more late-stage investment.
For entrepreneurs in the field, this means swiftly reaching profitability, and therefore total control over production and operating costs through the deployment of more efficient technologies. In all cases, waves of consolidation may be inevitable.
As the space economy continues to mature, broader solutions such as green finance and stronger international collaboration may be needed to ensure long-term success and secure more stable growth trajectories.
To go deeper into the details of the topics above, and many more:
“Space is for everybody. It’s not just for a few people in science or math, or for a select group of astronauts. That’s our new frontier out there, and it’s everybody’s business to know about space.”
- US astronaut Christa McAuliffe
