Bengaluru-based Pixxel Space is a rarity in the $13 billion Indian space technology industry. For one thing, Pixxel has received funding from investors in a testament to the company’s potential. It has been selected by the National Aeronautics and Space Administration (NASA) in 2024 to provide Earth observation data on climate change, biodiversity and agriculture for the $476 million Commercial SmallSat Data Acquisition (CSDA) program.
The company, founded by Owais Ahmed and Kshitij Khandelwal in 2019, is also one of the few that is already generating revenue from its business. CEO Ahmed, who holds a master’s degree in mathematics from BITS Pilani, says Pixxel is still a baby when it comes to marketing operations.
“The true measure of the success of a space technology ecosystem is the revenue it generates and how quickly it achieves profitability, even while continuing to invest in R&D,” says Ahmed, 25. “By that measure, we are still at a very early stage.”
His description of Pixxel, which builds high-resolution hyperspectral imaging satellites that provide data on the composition and properties of planetary objects and surfaces, is relevant to India’s entire space technology startup ecosystem.
Although India has about 200,000 startups, the third largest number in the world, India is still a relatively small entity in the space technology industry. Most of its startups are less than a decade old, and are still working on building core capabilities.
“Across the ecosystem, including us, no company has yet done large-scale commercial implementation,” Ahmed told Business Today from the US.
A wide gap, but it is closing quickly
The gap between India and global space leaders like the US is huge. Decades of sustained investment and active participation by non-governmental entities have given mature markets the lead.
The global space economy, estimated at $596 billion in 2024, has seen annual growth of 5 to 8 percent over the past decade, according to a report by the Confederation of Indian Industry and consulting firm KPMG.
India’s growth is certainly nothing to worry about. Industry estimates suggest that the Indian space sector could exceed $40 billion by the end of the 2030s, having expanded from $8.4 billion in 2022 to $13 billion now.
This is promising in a world where the conquest of space is no longer just a matter of prestige; Space has emerged as a stage for demonstrating geopolitical muscle power.
This has been proven through the use of space technologies such as satellite data in the conflict between Iran, the United States and Israel.
From intelligence gathering to non-kinetic warfare, space technology has become a critical, dual-use capability that is shaping modern conflict – a fact also evident during Operation Sindoor, which India launched against terrorist bases in Pakistan in the wake of the Pahalgam attack in 2025.
Momentum is certainly gathering pace in India’s space technology industry. This acceleration has been driven by policy liberalization, increased non-governmental involvement, and increased start-up activity. From less than 250 space technology startups a few years ago, India now has about 400.
For decades, the Indian space program has been synonymous with the Indian Space Research Organization (ISRO).
While ISRO remains the backbone of the ecosystem, government reforms like the Space Policy 2023, setting up of India’s National Space Promotion and Licensing Center to oversee non-government entities and a Rs 1,000-crore Space Venture Fund have opened doors to a new generation of startups across satellite manufacturing, launch and data services.
Investors are starting to notice this. “This is an industry of national importance,” says Arjun Rao, general partner at venture capital fund Speciale Invest. “While India’s space economy is estimated to be worth $40-45 billion in the coming years, this may only scratch the surface of its true potential. Importantly, much of this reflects domestic demand. The biggest opportunity lies in building from India to the world, with startups serving global markets.”
Building pedigrees
Speciale Invest has backed seven space technology startups, including Agnikul Cosmos, known for building the world’s first fully 3D-printed rocket motor and India’s first private launch pad.
Rao admits that these are the early days of the space technology industry. “Even for someone like Elon Musk, it took almost a decade to build and launch a rocket,” Rao says. “You can’t compress that into a few years. These companies need to build a space pedigree — one launch, then a few satellites, then expand. And only then track revenue.”
This is a crucial distinction. Unlike software or consumer startups, space technology is inherently capital-intensive and time-consuming. Revenue generation often follows several successful missions.
Although early-stage financing has improved, growth capital is scarce.
According to Mario Gonsalves, head of the India public sector practice at consultancy BCG, space technology companies globally have raised nearly $28 billion over the past five years. In comparison, Indian startups raised only about $354 million – roughly 1.3% of global capital, despite accounting for 5-6% of startup activity in the same period.
Data from Tracxn, which tracks startup activity, shows that out of 225 space technology startups in 2025, only 78 received funding. Only nine advanced to a Series B funding round or beyond. Even among venture capitalists like Skyroot Aerospace (India’s first space technology company), Pixxel, GalaxEye and Digantara, accessing late-stage capital is a challenge.
Among today’s space technology startups, only Skyroot Aerospace, co-founded by Pawan Kumar Chandana and Naga Bharat Dhaka, has managed to raise nearly $100 million. Skyroot specializes in small satellite launch vehicles, and in 2022 made history with Mission Prarambh, launching India’s first non-ISRO rocket, Vikram-S.
The three largest players – Skyroot Aerospace (~$160 million), Pixxel (~$96 million), and Agnikul (~$75 million) – account for more than half of the total private capital raised in the sector, while most others operate with less than $10 million in funding.
The issue is not talent or innovation, India has both. The constraint is patient capital willing to support long carrying cycles.
This ecosystem is less than a decade old, and by space technology standards, very early. Even if estimates put the Indian space economy at $40-$45 billion in the coming years, we are still just scratching the surface of a much larger global opportunity.
-Arjun Rao,General Partner, Speciale Invest
Early stage by design
Global benchmarks, such as SpaceX and Rocket Lab, often dominate the comparisons. But industry figures say such parallels are premature.
Gonsalves explains that India’s space technology ecosystem is still at an early stage in terms of design. Non-governmental investment only began in 2020, and the absence of late-stage capital continues to limit its size.
The journey from prototype to scale-up in space technology – especially for launch companies – is inherently capital-intensive and long-term.
As Skyroot’s Chandana explains, the process involves sustained investments in R&D, propulsion testing and subsystem validation, with each cycle becoming progressively more complex and expensive.
For a startup launch company, achieving its first successful orbital flight is not a near-term milestone. It typically takes approximately a decade of development, multiple testing cycles, and significant capital expenditures. “Investors who understand this timeline from the beginning are very important,” says Chandana.
This raises the question: Are Indian investors going along with such long incubation cycles, especially in a system often driven by high return expectations and clear exit paths?
Chandana says the level of awareness is increasing. “The early backers of Indian space technology — who invested in it when there was no national space policy and no defined exit path — were true believers in the sector. They understood the timelines involved and set an important precedent,” he says.
To date, a significant share of capital in Indian space technology comes from global investors such as Lightspeed and Accel, with only a few local venture firms actively participating.
Investor awareness and comfort have improved from three years ago, says Rahul Chandra, managing director of Arkam Ventures, which is backing Skyroot Aerospace. Crucially, India’s space technology capabilities are increasingly seen as of global importance. It is this potential to build international markets – not just domestic demand – that continues to attract global capital.
Three to five Indian space technology companies will be relevant businesses at the global level. The rest will merge, turn to defense subcontracting, or fail. This is not a failure of the ecosystem; This is how ecosystems work.
-Mario Gonsalves,India Leader – Public Sector Practice, BCG
Domestic venture capital continues to move toward companies operating in the software, SaaS, and AI sectors, leaving hardware-heavy companies relatively underfunded.
A recent report from Arkam Ventures expects $3 billion to $5 billion in private capital to flow into the space technology sector by 2030.
Government-backed demand is emerging as a critical enabler. Through programs such as Innovations for Defense Excellence (iDEX) that aim to advance defense and space and increase the procurement of space solutions, early revenue visibility for startups is improving.
The parallel push for exports, combined with a more open FDI regime, is also expected to mitigate capital inflows and outflows, strengthening the financial foundation of the ecosystem.
However, the sector is still in its early stages. The absence of semi-mature companies in key sectors such as satellite imaging, communications and launch services means that the ecosystem is still evolving. The next phase of growth will hinge on a handful of startups that demonstrate commercial viability at scale.
Exit strategy
Even more important is the need for space technology companies to provide an exit strategy to their investors.
Equally important is commercial implementation, i.e. reaching orbit, proving cadence and manufacturing at scale.
Skyroot’s Vikram-S flew as a suborbital demonstration vehicle in 2022. Agnikul conducted a suborbital demonstration of the Agnibaan SORTeD vehicle in June 2024.
Skyroot is now targeting the launch of Vikram-I, which will become the private sector’s first private orbiter, around May 2026, in an event that will mark a turning point for Indian space technology.
Space applications – Earth observation data, and supporting services in agriculture, disaster management, rural connectivity, and climate monitoring – account for 75% of the value of space technology and are dominated by government-run infrastructure.
Government procurement will be very important for startups, because this does two things at once: it creates a fundamental demand in a sector where product development cycles are long and technical validation is extremely important; Secondly, it gives startups credibility.
“In space technology, an early contract is not just revenue, but also proof that the product works in a mission-critical environment, which can significantly reduce business risk for future customers and investors,” says Chandra of Arkham Ventures. “But I would not consider government procurement to be the most important source of revenue for the sector as a whole. It is an important mechanism to de-risk early, not the entire market. And the opportunity itself is broader than government demand.”
Long-term growth will depend on a diverse revenue mix across government, enterprise, global customers and data-driven applications.
Suyash Singh, co-founder and CEO of GalaxEye, which is building India’s first multi-sensor imaging satellite, says Indian startups are largely on par in terms of capability with their global counterparts.
“We may be six months to a year behind, but we have the launch vehicles and the capacity to build satellites,” he says. “What we are lagging behind is capacity. We don’t yet have thousands of satellites in orbit.”
As space becomes a central component of economic power and national security, India’s ambitions are no longer optional, but rather strategic. The country has built capacity, stimulated startup momentum, and opened up politics.
The next phase will test execution, i.e. raising capital, creating a global business, and achieving meaningful exits.
@Palak Agarwal64
