Bengaluru: Soon after the successful lift-off of Axiom-4 this week, Hyderabad start-up SkyRoot Aerospace entered into a partnership with Axiom Space, the American space company, to look at opportunities to advance space exploration. In a LinkedIn post, Skyroot’s co-founder and CEO Pawan Kumar Chandana wrote that the partnership “builds an opportunity to explore integrated launch and orbital solutions that will shape humanity’s future in space”.
Several space tech start-ups in India are banking on the success of the mission to reignite investor interest and attract more funding opportunities. The microgravity experiments that will be conducted by IAF Group Captain Shubanshu Shukla and other members of the Axiom-4 crew, and the potential collaborative commercial space partnerships has generated a wave of interest.
“This will bring back the venture capitalists to space and encourage them to seek out space companies again,” said Saisree Eega, CEO of Chennai-based Satlabs Space System that aims to build and launch low-cost satellites for secure communication.
Most space-based satellite start-ups divert their time into building defence-related equipment to secure available funding, which delays their core product development. Investors, too, hesitate to devote money to space tech due to the delay in return on investment, as opposed to trending fields like artificial intelligence.
Unlike Eega, Guerin Technologies co-founder Suhas Bannur gave a more realistic assessment. “The success of the Axiom mission might open up the market for others. But I’m not going to expect it to happen in the next two-three years,” Bannur told The Print. Guerin Technologies builds low-cost launches of large and complex satellites into space.
Also Read: Shubhanshu Shukla becomes 634th human to orbit Earth. What Orbital Astronaut Number pins signify
Funding woes
To encourage private sector partnership in space in 2020, the Indian government launched a single window agency for all space sector activities of private entities—Indian National Space Promotion and Authorisation Centre, or IN-SPACe.
Through IN-SPACe, the government will fund up to 60 percent of the project cost for start-ups or MSMEs, and 40 percent for large industries. According to the IN-SPACe website, around 80 MoUs were signed by early 2025, with more than 600 applications for space-related activities.
In early March this year, Union Minister Jitendra Singh announced a Rs 1,000 crore funding scheme to boost space sector start-ups. The fund will be managed by SIDBI Venture Capital Limited to help them become globally competitive.
Currently, to engage with ISRO (Indian Space Research Organisation), a start-up is asked to go through IN-SPACe to place the order for a bid. According to the norms, the lowest money quoted in the tender is given the order—a typical case of L1 Tender.
Instead, as Bannur suggested, the authorities should go for “T1-based Tender”, where the efficiency of the technology is what is measured, as opposed to who quoted the lowest possible money.
Born out of Indian Institute of Technology Madras (IIT-M), and just two years old, Satlabs Space System aims to launch low-cost satellite networks.
The founders are doubtful about raising money only through government grants given the small size of Satlabs, according to Eega. To secure the available grants, the founders spend time building equipment like drones, or sensors pertinent to defence applications, where the current grant ecosystems have more provisions for funds. “That is when we can probably get some money to start the company. That basically kills two-three years of our initial time, which we should be spending on our final product,” she said.
She gave the example of Space X’s partnership with government agencies like NASA. Space X had initial funding to invest in high risk rocket technology, and can sustain itself even if a test launch fails. Hence, government agencies like NASA are assured of the financial capital these companies already have, and might further fund them.
“None of the (small) start-ups in India have that kind of money to blow, which makes it hard for us to prove the capability to the space agencies, which will not help us get any money,” Eega added.
Young start-ups want the government’s help in the initial stages to reach out to potential venture capitalists. But in India, there’s still an ongoing debate about the role of private and public sectors. The uncertainty has baffled entrepreneurs as to who should do what. As the government runs its own space launch programmes, a lack of clarity in the role of private sector’s involvement in such missions creates confusion over whether it is nurturing private industry or competing with it.
“Is the government completely nurturing the private industry in India, or is it also competing with the private space in that particular area?” asked Satlabs Chief Technology Officer Sooraj Gopakumar.
An effective path is often found by understanding the potential strengths, where both public and private entities can collaborate to fill the gaps rather than the government assuming sole responsibility for every need, he added.
Then the government can validate the companies’ efforts through written letters. Such a word from the government amps up the investors’ confidence, who will be ready to fund a government-validated space start-up, according to Eega.
Returns require patience
Even in investor circles, drones, satellites and, of course, rockets create the most buzz.
But space expiration is about so much more—human health, life sciences, material research, novel pharmaceutical development and biotechnology.
In the Axiom-4 mission, Shukla has carried with him samples from scientific institutions, like Indian Institute of Science (IISc) to test how organisms behave in microgravity conditions after long hours of space flight. There are six other experiment samples from different research institutions across the country. These experiments will help nurture the microgravity research ecosystem in the country linked to the Indian Space Programme, according to ISRO.
In the case of applications like space life sciences, there is still an awareness gap among investors. As they pour in money, they usually expect to get returns in less than five years.
But outputs from upstream space activities, like those related to the Axiom-4 mission, take time. “Investors need to be patient enough in this case,” said Sibsankar Palit, executive director of LIFE-To & Beyond Foundation, a not-for-profit space organisation based in West Bengal that focuses on space outreach and research.
In the ongoing work by the Tsiolkovsky Space Life Science Working Group, Palit and others report a lack of understanding of the wide range applications of space life sciences start-up. The report is yet to be formally published.
The lack of awareness is considered one of the reasons that stops investors from betting on start-ups. “It need not mean that they have to like to invest for a lifetime, but at least have (the funds and investment period) extended,” Palit said.
The success of Axiom-4 is likely to ignite a spark among VCs as they may now think twice before rejecting a space start-up’s pitch. But the consensus is that VCs will have to rethink their approach regarding return on investment.
“It is encouraging that (the success of Axiom-4) shows that there is money in space. Companies in space should be encouraged,” said Eega.
(Edited by Mannat Chugh)
Also Read: India will soon have its own satellites to monitor spy satellites. How the technology works