Internet-in-space provider Kepler raises US$92-million

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Canadian space startup Kepler Communications Inc. has raised US$92-million to expand the capabilities of its growing deployment of small satellites in low Earth orbit that deliver the internet to other objects circling the planet.

Past backer IA Ventures led the deal, which was also backed by shareholders Costanoa Ventures, Canaan Partners, Tribe Capital, BDC Capital’s Industrial Innovation Venture Fund and other investors. Kepler has raised US$200-million-plus to date; the latest funding will get the Toronto company to profitability, chief executive Mina Mitry said in an interview.

Kepler is set this month to launch its latest two nanosatellites, about the size of cereal boxes, which will bring it to 21 orbiting about 550 kilometres above Earth. They provide internet connectivity over radio frequencies to other objects in orbit.

This fall it will launch two larger satellites, each about the size of a small car, to test and validate optical communications technology that would enable higher-speed data relays to weather satellites and even the International Space Station. It plans to then launch an optical data relay infrastructure and bring optical services to customers by early 2025, launching more satellites to increase service levels and handle higher data volumes, Mr. Mitry said.

Technology companies, including space startups, have contended with difficulties raising money since late 2021. But Mr. Mitry said Kepler not only increased its valuation but was also able to raise money without agreeing to the onerous terms many investors have demanded of late.

“It was a very clean deal, which reflects the strength of the company,” he said.

Kepler caused a stir in the fall of 2021 when it applied to the International Telecommunication Union for permission to put a constellation of almost 115,000 satellites in the sky, joining other machines launched by the likes of SpaceX, Amazon subsidiary Kuiper Systems LLC and Canada’s Telesat. Observers are worried about a cluttered view – but also chaos in the heavens from collisions that could damage spacecraft, affect communications on Earth and put lives at risk.

Kepler’s plan was only to send up 200 of its own satellites, with the rest reflecting the plans of its customers to put their own fleets into orbit.