Space policies in India have become much more transparent: Pixxel Founder

Ayushi Kar Mumbai | Updated on December 14, 2020

There is not a single VC firm in India that can put in $100 million cheques: Pixxel Founder

Pixxel, India’s first private satellite-imaging company, recently entered into an agreement with NewSpace India Limited, a Government of India company under the Department of Space to launch Pixxel’s first remote-sensing satellite on an ISRO PSLV rocket in early 2021. The Bengaluru-based company is building constellations of high-resolution earth imaging satellites to provide global imagery at a daily frequency to customers in a wide range of industries worldwide. BusinessLine spoke to Awais Ahmed, Founder & CEO, Pixxel, on the growth of the sector and funding in space technology. Edited excerpts:

How do you perceive the various steps taken by the government in enabling the entry of private players?

Countries that have significant companies come up in the space sector, have clear-cut policies that liberalised space. That is what we are seeing in India, today. Earlier, satellite communication companies had to go to multiple different ministries such as the Wireless Planning Commission, Department of Telecommunication, and no one really had much clarity regarding how to get around the regulatory barriers. With the establishment of IN-SPACe, it has become the nodal agency for anything space-related, coordinating between different agencies and different sectors.

The recent drafts of SATCOM policies for communication satellites, and draft remote sensing policies have also been promising. ISRO has one of the best fleets of imaging satellites, yet geospatial data is woefully underutilised in India. Further, it is hard for Indian companies to buy data from foreign players with the NRC acting as a middle-man, costing them weeks to get the data. Second, there was no policy, method or framework in place to understand as a company how to launch a satellite. The new draft of the remote sensing policy has removed the NRC as a middleman, opened access to the treasure trove of remote sensing data already collected by ISRO itself; and generally, the rules and laws have become simpler for space companies to operate easily.

This is the catalyst that is needed for growth and will bear fruit in 5-10 years... I think at the moment we are heading in the right direction; the policies have become much more transparent and clear than the ones we saw in other countries. So if we are able to pass the draft polices as well, I see it as a positive change.

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Did you face any challenges while raising money for your venture?

The ecosystem in India has to grow leaps and bounds in order to keep track, this is a capital-intensive industry. Presently, there is not a single VC firm in India that can put in $100-million cheques, while places like the US have 50 or so organisations that can do that. Initially, when we went to raise money, no company wanted to look at it. First, we were a hardware company; on top of that, we were space hardware. Also, we were students, making this a risky investment. What came to rescue for us was the vast network that BITs has, allowing us to raise enough money to build a prototype. This initial funding allowed us to show traction and execute our idea, showing people that there is potential here. This allowed us to put together a seed round to raise money to build our first satellites.

So, some shift is also happening, with more and more VCs looking in the early stages in the hardware bit. What we don’t see is late-stage investors that can put in large chunks of money that we need. One thing that can be potentially done here is to provide a lot of government support through either setting up grants of sovereign funds. If you look at Japan or Finland, a lot of space tech companies that have done well from there have had predominant funding come from government-backed sovereign funds.

Are you planning to raise additional funds soon?

For long-term sustainability, we are going to launch three satellites first, and on the basis of these we will go out to raise more money to set up the entire constellation. We predominantly expect this capital to come from international markets where the risk appetite is higher and there is more capital.

What is your plan for revenue generation?

We will continue to generate revenue on the software and analytics side of things. The cameras that we built to be anchored in satellites in space are quite small and power-efficient, and do not need a satellite to demonstrate their use cases. By attaching them to a drone or airplane you can demonstrate their use case in a limited area…..selling this to our customers will help us generate revenue for the moment.

Which industries are showing the most interest to buy your technology?

The government has always been a big buyer of imagery, so we know that market is always going to be there. Presently we are focussing on precision agriculture and oil and gas. Imaging technology can be used here in a myriad of ways — from scanning large areas of land to understand when to sow your seed, which fertilisers to use when and why; to helping oil and gas companies identify where exactly the leaks are happening.

The reporter is an intern with BusinessLine’s Mumbai Bureau

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Published on December 14, 2020

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