India's space-tech startups steering a rough ride

Hyderabad-based Skyroot has named its satellite launch vehicle Vikram, while Chennai-based Agnikul calls its Agnibaan. If their test flights are successful, the companies plan to provide launch services for sending small satellites to space for applications such as Earth observation and communication.

India opened up its space programme to the private sector last year, hoping to encourage local firms to enter the burgeoning market for small satellite launches. Since then, several startups have announced their ambition to enter the market, including Bengaluru-based Bellatrix Aerospace and Mumbai-based Urvyam. Both are working on rockets but haven’t announced their plans for launch.

In all, there are over 24 space-tech companies in India developing satellites, rockets, engines, propulsion systems, communication solutions, and other space-tech related work.

Agnikul’s focus is on building a single customizable vehicle with four to seven 3D-printed engines for payloads up to 100kg. Skyroot plans to build three Vikram series vehicles to support payloads, ranging between 225kg and 720kg.

Currently, satellite launches cost $30,000-80,000 per kg, depending on the weight of the payload (higher per kg cost for smaller payloads). Skyroot aims to cut that down by at least a third with its Vikram rocket, while Agnikul plans to establish a single reasonable cost across all payload sizes. However, the latter did not share specifics.

The sector has drawn early interest from investors such as Pi Ventures, Speciale Invest, LetsVenture, Graph Ventures, and Omnivore. According to VCCEdge data, Agnikul has raised around $14.5 million, while Skyroot has raised about $12.5 million. Even with ample funding, launching a rocket is fraught with operational and technical challenges. Attempting to build a launcher with venture capital money and a shoestring budget is even more demanding.

According to the Korea Aerospace Research Institute, out of the 11 countries that launched locally assembled rockets between 1957 and 2008, only three managed to place their satellites successfully into orbit in the first attempt.

In 2010, Bengaluru-based Team Indus made headlines when it started working on a mission to send a rover to the Moon as part of the Google Lunar XPrize competition. It is yet to achieve the feat. The competition ended with no winner as no participant could have met the deadline. Team Indus continues to work on platforms for mobility, orbital and landing systems.

“Statistically, based on past data, getting right to orbit in the first attempt is almost nil," said Pawan Kumar Chandana, co-founder and chief executive of Skyroot, acknowledging the challenge. “Most flights fail due to silly mistakes such as a technician forgetting a piece of cloth in a fuel line, or an electrical cable snapping or a bolt breaking due to vibration and structural loads during launch, or even an inertial sensor being assembled in the opposite direction by mistake—anything can go wrong."

Srinath Ravichandran, co-founder and chief executive of Agnikul, corroborates that developing system designs for the first time and setting up infrastructure to test everything accounts for the major cost. As a result, they must operate on tight margins while ensuring there’s no shortage in the supply of electronic components. “The team has to think together of a unified product," he said, adding that they have to manage a very lean process in terms of getting components, assembling them, testing them on the ground, and then moving towards launch.

Both startups are also working with the Indian Space Research Organization (Isro) to leverage their expertise, facilities. Isro has built much of its rocketry supply chain locally in India.

Both startups have also hired talent that worked previously on Isro’s projects. Agnikul has a panel of retired scientists from Isro to approve the designs. “These people have built and launched PSLV (Polar Satellite Launch Vehicle). So, for them, this would be like a toy because it’s a very small rocket compared to PSLV," he said.

But what about contingencies to deal with a possible failure? “In all our pricing models, in all our fundraises, we have built into account runway for at least one or two failures," Ravichandran said. Similarly, Chandana wants to raise more funds to be self-sufficient for 3-4 launches. “We hope it is successful on the first attempt, but in case it is not, we will be gathering the data and coming back stronger in the next attempt," Chandana added.

The global launch services market is valued at $6 billion and is slated to grow six times over the next decade. India has captured just 1% of this opportunity and can raise its share 10-fold to about $600 million by 2030-31. The shift will be driven by startups such as Agnikul and Skyroot.

However, to establish their presence in the long run, the companies will have to focus on ensuring reliability before affordability, said Narayan Prasad, chief operating officer at the Netherlands-based Satsearch, a global marketplace for space products and services. “Most people building a satellite will look for a reliable launch vehicle first and then look at the cost of that particular vehicle. So, the goal should be to prove that their vehicles are going to be reliable. If they are able to do that, they can challenge the international market by offering very competitive prices that attract international companies to come and launch out of India."