Apex, a startup that plans to mass-produce satellite buses, has raised $16 million to fund the development of its first large-scale factory. On June 22, Apex announced the start of a Series A round led by venture capital firms Andreessen Horowitz and Shield Capital. The company has raised more than $27 million to date, including a kickoff round it announced in October 2022.

The funds will go towards what the company calls Factory One, a 4,600-square-foot manufacturing facility in Los Angeles that it will use to boost production of the Aries satellite bus. The company, which is currently building the first Aries spacecraft, plans to increase production to five in 2024, 20 in 2025, and 100 in 2026.

Apex’s CEO, Ian Cinnamon, said in an interview that the company was able to raise more money for the Series A round than originally planned, thanks to the strong interest from investors. “We’re incredibly grateful that there is so much demand and we have so many investors willing to invest, but unfortunately we didn’t have the space to bring them in.”

He said the fundraising environment for space companies has changed over the past year due to broader macroeconomic issues such as high inflation and interest rates, as well as rivalries between companies in the industry. This leads investors to companies that focus on short-term income-generating products and services.

“In today’s environment, investors are really looking for companies with clear revenue paths and business models that will not only grow significantly in the future, but also have solid business models in today’s market,” he said. “These are things that are real businesses today that can grow in the future.”

Apex is building the first Aries satellite, called “Call to Adventure,” announced in April. This spacecraft will be launched in early 2024 as part of the joint SpaceX Transporter-10 mission. The spacecraft will carry payloads for three customers: space refueling company Orbit Fab, autonomous satellite technology developer Ubotica, and an unnamed tier 1 defense contractor. Cinnamon said he couldn’t disclose the contractor, except as a “house name”. He added that this task has now been fully fulfilled.

He said Apex has received a lot of attention among potential customers for this first flight, so he managed to find three customers with such different missions that they could be placed in the same spacecraft without any conflict. But in the future, the company plans to sell satellites to individual customers rather than placing multiple customers on a single satellite, a model known in the industry as “kondosat.”

“One reason we don’t want to continue building condos is because it’s not easy to coordinate all these efforts,” he said.

A series of funding and client announcements for its first mission comes shortly after Apex released a tool on its website that allows customers to customize satellites. It offers a variety of power, communication and drive options, as well as the price of this option, similar to those used to order a vehicle, car, or computer.

Cinnamon said the company is offering this configuration tool because it plans to offer a limited number of options for satellites, which it likens to retail storage units or SKUs. Apex also minimizes the amount of installation or one-time engineering (NRE) it offers customers.

“If you don’t do NRE and you have a certain number of SKUs, that means we know exactly what our costs and business are,” he said, providing “transparent” pricing of satellite buses. “We believe the industry deserves this kind of transparent pricing and removing the many barriers that I believe slow the industry down and hinder innovation.”

He said “thousands” of people have tried the tool since it became available earlier in the month, prompting inquiries from potential customers to confirm that the prices listed online are correct. He didn’t confirm whether it led to any orders, but said the company has sold some of the second set of five satellites it built in 2024. Source