Luxembourg’s efforts to build a sustainable space ecosystem are bearing fruit after Earth observation startup CONTEC raised $50m in Series C, bringing its total funds raised to $62m.
Founded in 2015 by Korean Space Agency alumni Dr. Sunghee Lee in Daejeon, South Korea, the company opened a European office in Luxembourg in 2019 following meetings at ICT Spring in 2018. Strategic connections were rapidly made with the European Space Agency, among others. A lot has happened since then, said Dr Lee, when he returned to ICT Spring 2022.
A few weeks ago, the firm supported the KSLV launch, a Korean Space Agency mission in which it received government satellite data at several ground stations in Sweden, Ireland and Alaska, USA. CONTEC also recently began implementing a ground station in Finland for a customer, as part of a contract agreement. And then, of course, there’s the $50m raised in Series C funding, which closed in May.
How do they do it?
The firm has raised an accumulative total of $62m, but not without some blood and tears. “At Series A I would give 45 pitches to investors and get nothing. Most investors then didn’t even know about the space industry,” Dr Lee explained, adding: “I had to explain the industry.” The first funding was secured in 2018 from South Korean investors. Dr Lee said that he had an easier time for Series B, where the Korean Development Bank and Korean Investment Bank got on board. The main challenge he faced for Series C was that the “Korean investors didn’t want to have foreign investors. When we opened, around 20 investors wanted to place their money from the Middle East, Singapore and USA. But they were a little bit late. South Korea had already invested.”
Earth observation for B2B and B2G
CONTEC’s business model is capturing electric optimal and radar images and monitoring changes in cities or maritime locations, which can be provided in raw format or processed using CONTEC’S algorithm as well as the service of raw data receiving with their own global ground station(GSaaS). The firm opened a Luxembourg office as a marketing hub, targeting B2B and B2G customers.
Meanwhile, its R&D activities are carried out in South Korea. The solution is used in the B2G segment for smart city models to monitor and check for illegal construction, for instance. The maritime sector is also a key area for B2G customers, who need to monitor the locations of containers. “In South Korea there is a new government city using our smart city monitoring service to detail interesting objects, like sports complex construction, rivers etc. We can detect the changes and inform them,” said Dr Lee.
On the B2B side, Earth observation focuses on agriculture for food manufacturing customers, to estimate wheat and rice yields in order to better predict costs.
More announcements will follow in 2023. The biggest is expected in August when CONTEC will become a listed company on the Korean stock exchange. Dr Lee hopes this move will bring in around $100m to develop new optical ground stations for radio communication in Australia, the Middle East and in the US in Texas or Colorado. Dr Lee and his team also want to develop another service in Space Situational Awareness services. For this they plan to install a telescope to track space debris. This will be installed at the Australia ground station, once it is built.
And lastly, CONTEC will deploy its own cubesat in 2023 to gather its own Earth Observation data, to build on its satellite image application service.
