Difficult to understand what the ‘New Space’ sector is? Hard to understand why Luxembourg is trying to attract at least a few research centres in order to nurture a highly-qualified research ecosystem (invaluable to industry in general)? Unable to imagine that financial and public support for space in the United States, China, Japan and the Gulf States is far more important than in our latitudes, when access to space is a key issue for connectivity, potential rare materials and European sovereignty? You only have to go and take a look this week at the Space Week conferences--organised by the Luxembourg Space Agency to put the grand duchy at the centre of the map--to realise this.

But The Exploration Company (Tec) is the best case study for understanding what’s at stake. Born in Bordeaux and in Germany at the same time, the space startup led by Hélène Huby (ex-Airbus and ex-Ariane Group) in November announced that it had raised €150m, making it Europe’s biggest Series B fundraiser in the sector and bringing the total amount of money at its disposal to €216m since its creation in 2021.

Its flagship product, the Nyx capsule--designed to be reusable and refuelable in orbit--can be launched from any heavy launcher and is capable of serving a variety of space stations. Nyx is designed to carry cargo to future commercial space stations, with missions planned to the Gateway station in lunar orbit. It will be capable of returning to Earth with up to 3,000kg of cargo--the largest mass return capability available anywhere in the world, said the press release--and can then be refurbished for its next mission. The cost of this service will be 25% to 50% lower than that of other vehicles. Tec plans to launch its medium-sized capsule, Mission Possible, in 2025, with 300kg of payload for its customers. The maiden flight of Nyx Earth is scheduled for 2028, carrying cargo for ESA to the International Space Station.

‘Historic’ investors (EQT Ventures, Red River West, Cherry Ventures, Promus Ventures--linked to Luxembourg--and Omnes Real Tech Fund) have been joined by two European sovereign wealth funds, French Tech Souveraineté (managed by Bpifrance for France) and the DeepTech & Climate Fonds (for Germany). Tec has already signed a contract with the US space agency, which describes the European startup as a potential rival to a certain SpaceX, even though the American champion has two businesses: the launcher and the capsule. In May 2024, the European Space Agency (ESA) announced that it had awarded SpaceX a first contract worth €25m for a cargo service to the International Space Station in 2028 (ending 17 years of discussions…) after signing another industrial contract a year earlier.

At the time, and even if comparisons of this kind have their limits, the Franco-German startup was better endowed than SpaceX before the flight of its first rocket, since Elon Musk indicated that he had injected $100m of his own funds between 2002 and 2006, before the first official fund-raising, $1bn from Google and Fidelity Investments, in 2015. Today, SpaceX has raised $7.2bn, part of which was used to launch Starlink and its satellite connectivity service. It is in scaling up that we will really see European ambitions. Only partly, since SpaceX has only really been able to get off the ground because Nasa has placed a large number of public orders, quite happy not to have to develop its launchers itself! More than $12.5bn, according to our own calculations. Hence an equation with several unknowns: will investors and the ESA be able to have such deep pockets to make the Franco-German project a ‘comparable’ success?

“This significant fund-raising reflects not only the talent and commitment of the Tec team, but also the fact that building major global companies with European roots can only be done by fostering trust and cooperation between European countries. 98% of our shareholders are European, which shows that the continent can finance bold entrepreneurs. Space will play a crucial role in defining the future of humanity, and I want to help build a peaceful and cooperative future. Our European DNA fits in perfectly with this mission,” said the company’s founder and CEO, Hélène Huby.

And where does Luxembourg fit in? Space projects in these areas are very capital-intensive: you need a lot of money to see a venture through to the end, and this is where the differences between the United States and the rest of the world always lie. But discussions are continuing between his company and the Luxembourg authorities. “It should come down one way or another,” said a generally well-informed source.

That said, Luxembourg’s strategy, after an initial phase focusing on space resources, continues to seek to achieve critical mass and concentrate research centres, which encourage the emergence of an ecosystem of highly qualified experts. This is also evident in the research structures, whether at the University of Luxembourg (3), the Luxembourg Institute of Science and Technology (4) or even within the world’s first research centre dedicated to space resources (Esric).

As in the defence sector, where Luxembourg will have to invest massively to meet its obligations to Nato, and even more if the former and future American president, Donald Trump, “invites” his allies to go further than 2% of GDP each--2% of GNI for Luxembourg. “We have several projects in this area. There is the Luxembourg Cyber Defence Cloud, LCDC [editor’s note: a private cloud accessible via a private network and not via the internet, hosted in secure data centres located in the country. The budget is €250m until 2035]. Since 2021, we have been operating the Luxembourg Defence Cyber Range, a training environment used for the ongoing training of cyber experts,” defence minister Yuriko Backes (DP) told Paperjam in an interview on Monday. “Luxinnovation, in collaboration with the directorate of defence, has carried out a mapping of all the companies in Luxembourg that are active in the defence sector, either directly or indirectly. Together, we published the ‘Luxembourg Industry and Research Capabilities for Security & Defence’ catalogue last June at the Eurosatory international exhibition for land and air defence and security, an event at which Luxembourg had a stand.”

With 67 players in the space sector (according to our count based on the directory of the Luxembourg Space Agency) and 1,500 people working in the sector--half of them at satellite telecommunications network provider SES--the ecosystem is obviously small. Everyone realised that with former economy minister (LSAP) gone, the ambitions to host 150 companies in the short term had become wishful thinking.

This year, apart from the fact that we no longer know whether Kleos Space has found a buyer or remains officially bankrupt, Xstream Engineering has been placed in liquidation and Luxsense has disappeared off the radar as part of the . It is also difficult to guarantee the survival of the Luxembourg entities of major international groups, which are subject to the wishes of their senior management, often far from Luxembourg: Despite ‘complicated’ financial results, iSpace Luxembourg is not under threat, since its parent company has opened a €10m credit line to plug the holes; the debts of EarthLab (consolidated in Leonardo Spa) and the difficulties of some of the other players, who have had to refinance with their main shareholder or scale back their ambitions, show how precarious the balance is as big as the dreams of space.

In mid-November, one of Luxembourg’s stars, Spire, announced that it was selling its maritime activities to Kpler for around $241m in order to pay off all its outstanding debts and invest in short-term growth opportunities. The transaction includes a purchase price of $233.5m and $7.5m for services over a 12-month period after closing. This is 5.8 times the revenue generated by the company over the last 12 months. Spire will retain its satellite network, technology and infrastructure and will continue to serve its aviation, weather and space customers, as well as the existing part of the US government's maritime customer portfolio. On Tuesday, we learnt that CEO Peter Platzer is stepping aside and will remain executive chairman, but will promote his operational director, Theresa Condor, to the position of CEO. The founder will remain in charge of securing major opportunities to stimulate the company’s growth strategy.

This article was originally published in .