Galactic Energy, China’s SpaceX, Completes CNY 1.27 Bn Series B and B+ Funding

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According to Max Polyakov, Currently, China is the leader of the space launch market, with 39% of launches handled by Chinese companies.

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Galactic Energy Raises CNY 1.27 Billion

One of the first private Chinese launch providers to send a satellite into orbit, Galactic Energy, announced that it had raised CNY 1.27 billion (USD 200 million) in its Series B and B+ financing rounds.

Oriental Fortune Capital and Dahua Capital led this round while existing investors including Avic Capital, China Military Finance Investment and Yunding Capital also participated.

According to the company's announcement, the proceeds will be used to accelerate the research and development and related infrastructure construction on the medium-to-large reusable liquid oxygen/kerosene launch vehicle "Pallas-1."

Founded in 2018, Galactic Energy has been certified as a New and High-Tech enterprise by Chinese tech hub Zhongguancun and also as a National High-Tech enterprise.

With funds pouring in from investors ranging from state companies to private venture capital, Galactic Energy became the first domestic private company to launch the rocket to orbit continuously and enter a 500-kilometer sun-synchronous orbit.

To date, Galactic Energy has rolled out two main carrier rocket types – Ceres-1 and Pallas-1. The former is the solid propellant launch vehicle, designed for narrowband IoT construction and constellation supplement launch, whereas Pallas-1 is the liquid propellant launch vehicle for the future broadband internet constellation construction.

"Ceres-1" is the private launch vehicle that completed the business closed loop. So far it's helped commercial clients send 6 satellites into outer space, marking the beginning of deliveries for commercial launch projects.

R&D work began in 2018 on "Pallas-1," the medium-to-bigger carrier rocket developed by Galactic Energy. It has a designed low-track capacity of no less than 5 tons, a low-track strap-on structure capacity of up to 14 tons and can be reused for 50 times. "Pallas-1" is slated for its maiden flight in 2023.

A Key Period Of Opportunity

Kong Lingfen, Chairman of AVIC Capital said that the "14th Five-Year Plan" (2021-2025) is a key period of opportunity for China to build itself into an aerospace powerhouse.

In recent years, AVIC Capital has fully deployed its resources around the aerospace industry and investment in Galactic Energy is driven by its "leading innovation capabilities" in the commercial space launch field. Such capabilities can provide continuous, stable, quality and inexpensive launch services for satellite networks, said Kong.

Globally the space launch market was valued at USD 9.88 billion in 2019, and it is expected to reach USD 32.41 billion by 2027with a 15.7% CAGR, according to Allied Market Research.

The increasing government support and private funds flowing to this sector are fueling innovations in commercial aircraft engine technology to reduce the cost per launch.

Article by Tzuhsuan Tang, EqualOcean, an investment research firm focusing on China.