The U.K. government announced Wednesday a £20 million ($24.8 million) investment in Orbex, a Scottish spaceflight startup aiming to rival Elon Musk’s SpaceX.
The investment — part of a larger funding round that’s being raised by the firm — was revealed at the European Space Conference in Brussels.
Orbex raised £23 million for its latest fundraise. Other investors involved include Denmark’s Export & Investment Fund, Octopus Ventures and former Informatica CEO Sohaib Abbasi.
The British government also currently holds a stake in Eutelsat OneWeb, which was formed through a 2023 merger of the two firms. The government initially backed OneWeb in 2020 as part of a $1 billion rescue deal with Indian conglomerate Bharti.
What is Orbex?
Orbex is a startup that develops both small and medium-sized space rockets. The firm uses a renewable form of propane known as bio-propane to fuel its rockets.
It is aiming to launch its first rocket, called Prime, toward the end of 2025. Measuring 19 meters long, Prime is designed to transport small satellites into low-earth orbit.
The government said its investment in Orbex would contribute to its ambition to regularly launch U.K.-made rockets from British soil.
Supporting Orbex will help “turbocharge the country’s position in the space sector,” said British Tech Minister Peter Kyle in a Wednesday statement.
Orbex CEO Phillip Chambers said that the government’s investment “demonstrates its confidence in the UK’s space rocket manufacturing and launch sector.”
“This investment paves the way not only for us to launch our first rocket this year but also to develop a larger rocket to enable us to compete in the European Launcher Challenge,” Chambers said.
“These development goals are crucial to our longer-term development,” he added.
The SpaceX of Europe?
Orbex isn’t the only British startup taking on SpaceX. Skyrora, another space firm, told CNBC in November that it is aiming to launch satellites from U.K. soil for the first time later this year.
Rocket Factory Augsburg (RFA), a German startup, is also planning a U.K. launch for 2025.
Orbex, Skyrora and RFA specialize in so-called microlauncher rockets, which are typically much smaller in size than others and are designed to carry far lighter payloads.
Orbex touts its rockets as a more sustainable way of sending small satellites into orbit. A University of Exeter study from 2021 found that a single launch of its Prime rocket would produce up to 96% fewer carbon emissions than comparable space launch systems using fossil fuels.
Speaking on CNBC’s “Squawk Box Europe” last week, RFA CEO Stefan Tweraser said that developing sovereign space capabilities in Europe is “super important” given the industry’s strategic significance.
“The regulatory framework and the competitive positioning of Europe, a commercially successful operation, and a degree of service that offers support for every satellite operator are the foundation for us to be successful, despite the deep pockets of the U.S.,” he said.
