To Infinity and Beyond: Investing in Space

By Queenie Mok

A galaxy in space

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Panoramic picture of the Milky Way. (Source: S. Brunier)

On the 11th of July, Richard Branson boarded his Virgin Galactic’s VSS Unity spacecraft and experienced zero gravity. Nine days later, Jeff Bezos also became one of the few people to have travelled to space. These trips are the culmination of years of investment, research and development. However, private space travel is just the tip of the iceberg of an exponentially growing space industry.

Today’s Space Industry

Defining the space industry can be difficult, as it includes not only space technology itself but the commercial opportunities that are generated from observing and using space. The Organisation for Economic Co-operation and Development (OECD) has defined the space economy as “the full range of activities and the use of resources that create and provide value and benefits to human beings in the course of exploring, understanding, managing and utilising space”. It has set the perimeters of the space economy as the following:

  1. Upstream Space Sector: the economy directly related to the creation and implementation of space infrastructure, such as research, launch and the supply of materials and components.
  1. Downstream Space Sector: the operations of space infrastructure and the activities that rely on these infrastructures on earth, such as the market of GPS-enabled devices.
  1. Space-derived activities in other sectors: new activities that have emerged because of the development of space technology, such as the transfers of space technology to the medical sector.

Using different metrics, the global space sector is estimated to be worth between US$350 billion to US$447 billion today. 

Source: The Space Report

Bank of America’s Global Research Senior Aerospace & Defence Analyst Ron Epstein believes that the space industry could be worth US$1.4 trillion in the next decade. 

Historically, only governments have invested in space technology. However, since the end of NASA’s shuttle program in 2011, the space industry has become increasingly commercialised. Today, nearly 80 per cent of spending in space goes toward the private sector. 

The space industry can be separated into the space-for-earth economy and the space-for-space economy. 


The space-for-earth economy is the sector of the space industry that produces goods and services for human consumption on Earth. They include satellite infrastructure and earth observation imagery services. 

In 2019, 95 per cent of estimated revenue from the space industry came from the space-for-earth sector. Launch costs to Low Earth Orbit have decreased significantly. NASA’s space shuttle had a launch cost of US$54,000 per kg when it was still in operation. However, SpaceX’s Falcon 9 advertises its launch cost of US$2,720/kg, representing a reduction of cost by a factor of 20. 

Spurred on by this lower cost, communications satellite deployment has increased by 477 per cent from 2019 to 2020 and the interest in deployment is likely to be sustained. Morgan Stanley expects that in the short-to-medium term, 50 per cent of growth in the space sector will come from satellite broadband services for internet access. 


The space-for-space economy, on the other hand, is the goods and services that are produced for and used in space, such as in-space habitats. Due to scientific limitations, commercial investment in this area has been limited. However, the recent manned space flights carried out by Virgin Galactic and Blue Origin demonstrate that development in this region is likely to be more significant in the future. SpaceX has widely publicised its goal of sending people to Mars and traditional defence giants such as Lockheed Martin and Boeing, have and will continue to be heavily involved in space technology development. Therefore, we may see a renewed interest in this sector.

Investing in the Space Industry

For the majority of us who are not billionaires, paying for a US$450,000 ticket to enter into space is out-of-reach. However, there are several options for those who want to invest in space technology. On the 21st of June, a new ETF (Exchange Traded Fund) with the ticker YODA was listed on the London Stock Exchange, with holdings in Iridium Communications Inc. and Garmin. This was issuer Procure Holding’s second space-themed ETF, after UFO, which is listed on NASDAQ. 

However, analysts warn that some of these ETFs have tenuous links to space. For example, ARKX, the Space Exploration and Innovation ETF from ARK, holds stocks in Boeing and Lockheed Martin, but also in Netflix and ARK’s own 3D printing ETF. Therefore, some caution is required when investing in them.


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Source: Space News

The number of Special Purpose Acquisition Companies (SPACs) dedicated to acquiring space companies is also increasing. Rocket startup Astra became a publicly traded company this year via a merger with Holicity Inc., a SPAC backed by Bill Gates and Craig McCaw in a deal valuing the company at US$2.1 billion. 

New York-based Space Capital expects that the amount raised by space SPACs will reach US$8 billion in the latter half of this year. Investments in SPACs are risky because, at the time of listing, the investors may not be certain of the acquisition target. Moreover, investments in these companies can be speculative as most of them have not been profitable to date. 

Sources: Morgan Stanley, Bloomberg, CNBC, Forbes, BBC

The authors of this publication are not qualified to provide financial or investment advice and as such the content provided should not be construed in this manner. All information is intended purely for educational purposes and is provided for the personal interest of UNIT members. The opinions expressed within the article do not reflect those of UNIT as an organisation, its partners or its sponsors.