Moving the needle from idea to prototype, development, investment and scaleup brings a set of challenges for space startups that distinguishes them from their terrestrial counterparts. Research, prototyping, testing and refinement in early-stage development can push timelines beyond what’s comfortable for both founders and investors. For investors accustomed to quicker returns, there is a weighing-up of the potential risk of a slower-paced trajectory.
New talent are likewise working to get a foot-in to a highly-specialised and finite customer base primarily comprising government, research institutions and specialised private entities. It’s a niche clientele and therefore one that intensifies competition for contracts and funding. Then, there’s the capital-intensive tendency of space tech, which can be a deterrent and choker for space-bound founders chasing sustainability and scale.
It’s a set of challenges that Adelaide-based CEO Dr Tony Scoleri knows too well, after founding company AICRAFT in late 2020 to develop tailored artificial intelligence solutions for aerospace and defence customers. But in January, AICRAFT signed a Memorandum of Understanding with space biotech company ResearchSat and the two will work together to utilise edge computing modules designed and manufactured by AICRAFT to facilitate onboard data analysis and data reduction of biological experiments conducted by ResearchSat in orbit.
Both companies are graduates of the Venture Catalyst Space startup accelerator program delivered by the University of South Australia’s Innovation & Collaboration Centre (ICC). Now, they’re planning a sub-orbital demonstrator mission in December 2024.
Wins like this, says Dr Scoleri, are key to propelling scale and investment potential.
“Some investors only consider companies that are ready for scaling up and can prove their growth path,” says Dr Scoleri.
“Having the mentorship of experts provides the guidance to build awareness, avoid pitfalls and focus on strategic elements for growth to the next level.”
AICRAFT and ResearchSat are two of 36 startups since 2018 to go through the Venture Cataylst Space program, which offers a $10,000 equity-free stipend and a custom, industry-informed program to help space startups make it through the early-stage gauntlet to get established, meet development timelines, find customers and entice investment.
Of the companies supported by the program, 90 per cent are still operational and have gone on to raise more than $31 million in declared investment.
Dr Catherine Grace, Director, Space for the South Australian Space Industry Centre (SASIC) calls out both AICRAFT and ResearchSat as two key success stories in Australia’s space ecosystem, bringing critical capability to the sector.
“South Australia is a leader when it comes to recognising potential and developing new talent,” says Dr Grace.
“The Venture Catalyst Space program recognises the importance of innovation and incubation to the Australian space ecosystem. Startups are leveraging the support provided through the program to grow their business and increase economic investment in the sector.”
But both SASIC and the university acknowledge that the next step must be scale. In response, the ICC is teaming with the Australian Centre for Business Growth (AuCBG) to create an accelerator-to-scaleup pathway through the AuCBG’s renowned Growth Ramp program.
Enabled through SASIC funding support, the new Growth Ramp space pathway means eligible space companies can apply for a limited number of fully subsidised places in the six-month scaleup program.
Specifically designed to support business owners, CEOs or managing directors of smaller businesses (with five to eleven employees), Growth Ramp helps companies to scale by refining key pillars like leadership skills in scaleup, sales and marketing fundamentals, how to finance growth, developing growth strategies and best practice in how to build out and manage a growing company.
Growth Ramp is delivered on a cohort basis and is facilitated by successful entrepreneurs who have themselves started, scaled and exited successful companies.
For Dr Grace, the collaboration is a strategic step that is set to amplify the success stories populating South Australia and feeding the nation’s space industry.
“The addition of access to the Australian Centre for Business Growth’s Growth Ramp scaleup program in 2024 is further evidence of South Australia leading the way with this offering of an incubator-to-scale up pathway,” Dr Grace says.
With applications for the 2024 Venture Catalyst Space program open until Sunday, 17 March and Growth Ramp readying for its first space cohort to begin the scaleup program in May, the challenges posed by extended development timeframes, a niche customer base and financial competition may be redefined as stepping-stones.
For Dr Scoleri, the pathway brings next-level promise for space companies like AICRAFT.
“Building a company is a journey and having a program that helps CEOs consolidate and discover how to best scale up their operations is a significant piece in that journey.”
To start a conversation about the 2024 Venture Catalyst Space or Growth Ramp programs and your company’s eligibility, email [email protected].
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