Space activities are expanding globally with private investment and commercial players also increasingly involved in the research phase and the development of the space economy. Interest in the space frontier has never been greater, with more than 80 nations involved in satellites in orbit by 2022. Space infrastructures not only offer new investment opportunities, but the possibility of structuring real privileged commercial hubs, stimulating players to diversify or concentrate their economic resources in the space economy, considered by analysts as the economic frontier of the future. Tourism, research and defence are currently the main assets of a constantly evolving market, which sees in commercial orbital stations a billion-dollar industry to be built.

PUBLIC INVESTMENT FOR SPACE

Public investment accounts for the largest share of funding in space activities, amounting to around USD 79 billion in 2019. The United States remains the largest space power, with a budget of 0.2 per cent of national GDP, followed by Russia, Saudi Arabia and France (OECD, 2019). However, the number of developed and developing economies currently investing in space is growing. Many of these already have a large portfolio of activities and projects (e.g. France, Germany, Italy and Canada). Moreover, over the last decade, some 20 new countries have chosen to invest in innovative space initiatives and support private projects such as the United Arab Emirates’ planned Mars mission, New Zealand’s small launcher, Luxembourg’s asteroid mining programme or Israel’s lunar mission. In Italy, the space sector is a growing asset, with a solid ecosystem: 7,000 employees, over 200 companies spread across the entire supply chain, and a turnover of around two billion euros per year. Moreover, thanks to the agreements signed between the Italian Space Agency (for EUR 880 million) and the European Space Agency (for EUR 1.3 billion), the implementation of the space programmes envisaged in the National Recovery and Resilience Plan has begun.

PRIVATE FUNDS

The available data on private investments in the space economy show a lower turnover than public funding. Nevertheless, it is clear that the largest resources come from angel and venture capital funds investing in space start-ups and companies with an investment rate of between USD 3 and 3.5 billion. Commercial satellite telecommunications are also on the rise, which have paved the way for private financing in the space sector through equity and bond issues.  While in some cases, mainly in OECD countries, satellite operators have even become listed companies, in others, such as in China, state-owned companies have undertaken restructuring processes to provide more flexibility and openness to their capital. However, most of the recent space companies remain privately financed, even though they are not listed on the stock exchange, e.g. Space X or Blue Origin.

DEFENCE AND AEROSPACE

A number of large aerospace and defence companies have set up venture capital funds to nurture investments in start-ups operating in the development of software, artificial intelligence, augmented reality, sensor technology and autonomous vehicles. Among the most active players are for instance Boeing’s HorizonX Ventures, Lockheed Martin Ventures, Airbus Ventures, Thales Corporate Ventures and the Dassault System Venture Fund. But industry investments by tycoons have also increased significantly over the past five years. However, access to funding will continue to be a challenge for most industry players, whether new or established. The international competition between incumbents and the emergence of new technological solutions and business models continue to characterise future investment prospects, so much so that the drive due to digitalisation is already creating new opportunities through the introduction of new industrial processes specifically dedicated to the space industry, capable of revolutionising the very concept of space to which we are accustomed and transforming space research into an indispensable pillar of the sustainability of the future.