Fundraising is key for Chinese aerospace startups to survive as competition intensifies

A batch of new companies have entered the space industry, thus intensifying the competition.

Photo by SpaceX on Unsplash

China’s private space industry is likely to boom in the near future.

At the same time, the competition is leveling up. The startups are doing whatever it takes to compete against each other, from coming up with the best product, to pulling off PR tricks.

Here are three reasons why the competition has intensified recently:

  1. Chinese private aerospace companies have gone through a development cycle of 3 years. Most early-founded companies have raised their Series A funding round and now in seek of a larger amount of capital to fuel their development.
  2. Since last year, Chinese government’s favorable policies and attitude have encouraged a batch of new companies to enter the industry.
  3. To excel in the space industry, companies would need hefty investment and have to wait for a long period before all efforts pay off. Meanwhile, the total amount of capital and resources available in China market for the private aerospace sector is relatively limited.

So, on one hand, the competition accelerates the development of the space industry, as well as helps educate the market. On the other hand, the competition makes it harder to distinguish truth from false information thanks to the PR stunts.

Companies, especially those appeal to the same vertical market, are expected to lock horns with each other in the near future.

Before the emergence of a major player, the war is likely to continue and become increasingly brutal. That means the capability of fundraising will become one of the most important capabilities for aerospace startups in addition to their technological advances.

And it’ll only become more and more important as competition intensifies.

 

Writer: SHI Yaqiong

Editor: Ben Jiang