Opportunities in Europe for Young Space Entrepreneurs: Tips from the ESA ISD21 from successful space startups
Every year ESA invites members of the space community to attend its Industry Space Days. This year the virtual event had over 2100 registered visitors and more than 400 organisations signed up for a virtual booth. The networking carousel was a really good way for business opportunities (compliments to the organising party!) and especially the Young Entrepreneurs Session from ESA YGT’s really stood out with interesting topics. They touched upon the subject of how to get money in a different way and the exciting new era of New Space for young entrepreneurs. We may answer some of your questions and give tips in our summary of the talk.
As NL Space Campus, we connect interesting parties and organisations for business and knowledge development. And we offer a platform for start-ups, young professionals, and young entrepreneurs to grow their knowledge to get more out of the space community. Therefore, the YGT YPAG Entrepreneurs panel discussion about how to become an entrepreneur in the space sector, was really on point with what we want to share with you, and we think you may benefit from. So, we summed up some tips for you from the panel.
Almost closing the event, the Young Graduate Trainee’s Young Professionals Advisory Group (YGT YPAG) Entrepreneurs from ESA, Johann Diep, Kim Borgen and Jakob Peters, held a session with successful young entrepreneurs. Together with Maureen Allanic and Julia Donnerer they set up a panel with an amazing group of inspiring speakers. At the start of the panel, it was noted that during the entire event New Space was a common subject. But, being entrepreneurs, it was mostly about the commercial viability of space and the multiple ways to raise money and finance a space venture.
Equity crowdfunding as a way of raising money
Eivind Liland, CEO of Orbital Machines, shared his knowledge about how he got around 1 million Euros by way of Equity Crowdfunding. If you are not familiar with it, it might be an interesting way to turn to. They started with a Norwegian platform, but some more known interesting platforms are Crowdcube, Seedrs and there are some large ones in Europe. “We raised ~180keur and ~200keur in two rounds on a Norwegian platform, then ~€550keur on Seedrs. We have been able to match almost all the investments with grants“, Liland explaines. If you want to use crowdfunding as a way of getting funds, Liland gives the advice “to sell a vision that people can get excited about and believe in. It brings you shared motivation, but also having such a large pool of investors, is that you can get valuable information, productive input and good connections and tips from the community itself. We now have over 1000 investors and shareholders of Orbital Machines, and we made some really good new connections through them”.
Business Angels get bragging rights for investing in you
Someone commented: we talked about profits and shares, but what are other reason to invest, what do you get your investors in return? Mike Lawton, founder of Oxford Space Systems and now onto his second space venture, Oxford Dynamics answered: Business Angels. “It’s basically giving bragging rights for rich people”. One of his BA’s told him once: “It’s like the fashion industry for us; I want to be seen investing in something that interests me and topical – and I’ve always been excited about space”.
Covid brings patience and team spirit
How about failure? “Creating a company during covid was a challenge”, says Arthur Pourcel from Venture Orbital Systems. “We learned patience because the possibility of delays is always there. And we also created a strong team spirit with the team not even being 15 people back then. It creates a different mindset for everyone, especially about working remote”. And Lawton adds: “You really need to trust the people you work with and it takes a leap of faith when hiring someone you have never met in person”.
Interview your potential investors back
“Also watch out for investors”, Lawton says. “You should interview your investors as much as the other way around. In my first venture – before Oxford Space Systems - I had an investor that threatened me several times, and it turned out he’d actually been in jail and physically assaulted a person! It was clear he had to be removed from the business”.
Tribalism in a fast-growing company is toxic for your projects
What Lawton also brought in was to watch out for the chance of tribalism in a company during the pandemic and Ibrahim Ata, head of sales and marketing at Rocket Factory Augsburg, confirms. He says: “Being in a start-up, we actually did not look for subjugates in new people but looked at what they had been doing in their life and composed a team of the most motivated people, who share the same spirit, we could find. During their time at the company, they all underwent a tremendous growth professionally and personally. We are now more than 130 people from over 30 countries and it’s important to be a family to those people. They don’t have much else to do than work here. If you are growing so much, you don’t wat to have tribalism growing, it’s toxic for your projects. It takes a full-time job to keep the team together”.
Use branding as growth potential
What would it take to make Europe the next Silicon Valley in space? Turns out, the biggest difference between the United States and Europe, is that everyone there loves space. They walk around with NASA logos on their T-shirts and the numbers of views for SpaceX launches online go through the roof. There are not many people here even looking at the James Webb Launch(which will happen on Christmas!). For example: automotive spends almost 10 precent of their budget in branding and everyone can name at least 5 car brands, without owning a car. Space is not even spending 1 precent on branding. Lawton says: “We’re really crap at promoting and raising the profile of ourselves outside of our industry. We should stop being so humble and promote our fantastic successes and maximize the growth potential from promotion”.
Doing business in Europe offers the largest talent pool available
Why start a business in Europe and not the United States? Ata excitingly tells us that we have an amazing talent pool in Europe. In the Unites States you must employ someone from the States. In Europe we also employ people from the States, but we are not limited to that talent pool. Also, in Europe there is a nice living standard, everything is taken care of and there is more money coming from institutions”. He adds: “People like living in Europe”.
Last investment tips
Even though covid brings challenges to currently starting a business (and there is a lot going on besides the usual processes you would do to start any business in space), it’s also an exciting time and there are loads of opportunities. There’s specific countries and cities wanting to be seen as the place to locate a new space business, as the UK is making a lot of government money available for space start-ups and scale-ups, Luxemburg is powering ahead too. There’s now dedicated investment funds and accelerators looking specifically to support young aspiring entrepreneurs on their journey, for example Seraphim and Starburst, both with a very strong European focus.
So even though not everyone in Europe walks around with an ESA sweater and is waiting anxiously for the next launch (Christmas tip!), there’s some amazing opportunities Europe offers Space Entrepreneurs!
Want to know more?
If you are interested to take your business to the next level on NL Space Campus, you can send an email to our commercial programme manager Raoul, to find out more: R.email@example.com. And to grow your network with business opportunities and likeminded people visit our networking event every last Thursday of the month. See you there in 2022!
You can find more about the talks that happened at the ISD21 here: https://www.esa.int/About_Us/Business_with_ESA/Small_and_Medium_Sized_Enterprises/European_space_industry_meets_at_ESA_s_virtual_Industry_Space_Days