FOSSA Secures €6.3M to Expand Cubesat Fleet and Commercial IoT Services

FOSSA, a Spanish operator specializing in tiny picosatellites, has successfully secured €6.3 million ($6.8 million) in a Series A funding round.

The funds, co-led by Portuguese early-stage investor Indico Capital Partners and the venture arm of Japanese aerospace component maker Nabtesco, will enable FOSSA to develop around 20 slightly larger cubesats, advancing their mission to offer full commercial connectivity services for remote monitoring and tracking devices.

Since its inception four years ago, FOSSA (Free Open Source Software and Aerospace) has deployed 17 picosatellites in sun-synchronous orbit.

These initial satellites primarily served to demonstrate basic connectivity using Long-Range radio (LoRa), a low-power wide-area network protocol popular among Internet of Things (IoT) devices. Despite their demonstration purpose, the picosatellites have already generated over a million euros in revenue through proof of concept work with several companies, including Microsoft.

FOSSA has raised nearly €10 million to date, including government grants.

“All but one of the 17 picosatellites FOSSA has deployed have de-orbited...The most recent batch of four satellites, launched earlier this year, were retired sooner than expected due to a solar storm.” - Julián Fernández, Co-founder and CEO

These picosatellites were designed for an operational life of up to two years, while the upcoming satellites, with a volume of a three-unit (3U) standard cubesat measuring 30 centimeters a side, are expected to operate for up to five years and offer greater resistance to solar storms.

FOSSA plans to launch the first three upgraded satellites for commercial service in October. These satellites will enable the company to provide connectivity to an IoT device roughly every 11 hours. The startup, which initially aimed to deploy its first commercial satellites on a SpaceX Falcon 9 last year, now intends to have 80 spacecraft in orbit by the end of 2025, significantly reducing latency to near real-time.

“Considering our costs for the satellite, which is really inexpensive, we’re looking at around 20 satellites guaranteed with this funding...The rest is going to have to come either from the revenues or from future fundraising.” - Julián Fernández, Co-founder and CEO

A mix of government and enterprise customers are already lined up for the initial commercial services, which are slated to begin before the end of 2024.

FOSSA’s long-term plan involves leveraging its integrated business to offer secure connectivity from dedicated satellites to the national security and defense markets. This revenue stream would support the infrastructure needed to serve utilities and other corporate customers focused on connectivity and asset management services.

“The technology is the same, it’s just a different way of selling it,” - Julián Fernández, Co-founder and CEO

The global IoT market is projected to grow 20% annually through 2030, reaching $4 billion.