Valerie MendoncaValeries Mendonca is involved in research at IIM-A Ventures as a Manager - Insights where she leads the case studies function.
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Note
This case study was created by the team at IIM-A Ventures and published on their platform.
IIM-A Ventures is an investor in PierSight. This article reflects their views on the ecosystem and PierSight.
We have republished the case study without alteration. The original writeup can be found on their website.
PierSight Space is an Ahmedabad-based spacetech startup founded by Gaurav Seth and Vinit Bansal in September 2023. It is building a constellation of Synthetic Aperture Radar (SAR) Satellites for improved coverage and real-time insights into the oceanscape. SAR technology enables all-weather imaging of the world's oceans, making persistent maritime surveillance an objective possibility. It unlocks the potential for real-time situational awareness and costs significantly less than existing solutions for ocean monitoring. PierSight aims to provide insights and maritime intelligence that are proactive rather than reactive after an incident.
Spacetech landscape
The domain of space affairs has expanded rapidly in the last decade. Earth is currently encircled by over 9900 satellites, 84% of which are in the Low Earth Orbit (LEO), and nearly 2800 satellites are slated for launch each year. Space-based and enabled applications have humanitarian potential beyond revenue generation. They are crucial in climate monitoring, food security, and disaster management. Consequently, the space sector has seen accelerated growth in the last decade.
The Indian government has fostered a supportive entrepreneurial environment and policy framework to facilitate spacetech expansion. Most recently, it implemented the Indian Space Policy of 2023, which encourages greater private sector participation in the entire value chain of the space economy. Additionally, the 2024 Union Budget announced an INR 1000 crore (approximately USD 125 million) venture capital (VC) fund to grow the space economy and drive spacetech research and innovation at a commercial scale.
PierSight is part of a rapidly growing cluster of spacetech ventures utilising data and insights from space to solve problems on Earth. According to a 2023 Deloitte report, downstream applications—which refers to the deployment of space assets for solving problems on Earth—are the space economy’s most critical revenue and impact-generating segment. In particular, within Earth Observation (EO), the ability to provide high-resolution and reliable imagery of the planet has immense disruptive potential. These startups are solving crucial socioeconomic and strategic challenges in a progressively competitive space.
Spacetech startups in India have engaged end-to-end in the spacetech value chain, attracting significant investment and media interest. They have made strides in crafting indigenous launch vehicles, satellites, and communication systems, creating infrastructure to ease space operations, and building apparatuses and systems that solve climate issues and mitigate space pollution.
These startups are based in cities like Bengaluru—with a well-developed technological nucleus—or Chennai, Hyderabad, and Mumbai—where they can leverage collaboration and incubation with academic behemoths. Their technological capabilities benefit from the entrepreneurial ecosystems for spacetech in these regions. There is a general perception and assumption that Ahmedabad lacks the concentration of spacetech resources that would enable startups to thrive. In this context, Gaurav and Vinit’s decision to establish PierSight in Ahmedabad seems counterintuitive to investors and other stakeholders.
Entrepreneurial Ecosystem Model
The Entrepreneurial Ecosystem Model developed by Daniel Isenberg examines the role of social, cultural, economic, and structural factors in the entrepreneurial journey. Broadly defined, an ‘entrepreneurial ecosystem’ is a “set of interdependent actors and factors coordinated in such a way that they enable productive entrepreneurship within a particular territory.” The domains of policy, markets, culture, finance, human capital, and support networks interact in elaborate and dynamic ways. Alongside the entrepreneur's ability to leverage resources and networks, these elements influence startup outcomes.
We apply Isenberg’s Entrepreneurial Ecosystem Model to analyse if and how PierSight is leveraging the evolving spacetech ecosystem. Our inquiry is also influenced by the general perspective that Ahmedabad is not the nexus of a technological ecosystem.
Markets
As of 2023, according to an estimate by the World Economic Forum and McKinsey, the global space economy is valued at USD 630 billion and is projected to reach USD 1.8 trillion by 2035.
India’s space economy is 2-3% of the global pie – valued at USD 8.4 billion. According to internal estimates by the Indian National Space Promotion and Authorisation Centre (IN-SPACe), it is anticipated to grow to USD 44 billion by 2033.
Governments and the private sector are increasingly collaborating on space exploration efforts in India and globally. Space capabilities are increasingly becoming a distinct factor in calculating the global balance of power. The new space race is somewhat entrepreneur-centric—motivated by commercial, scientific, and societal goals. The global Earth Observation (EO) segment of the space economy is currently valued at USD 3 billion. It is expected to grow three-fold to USD 9-10 billion by 2035. At present, the Indian Space Research Organisation (ISRO) operates a constellation of about 44 remote-sensing satellites, but constraints of coverage, data capture frequency, and use-cases have limited its commercial applications.
There is a growing end-user demand for frequent and consistent analytics that are site or use-case specific. Indian spacetech startups have been experimenting with and developing new imaging technologies to provide tailored satellite data insights. PierSight is developing its SAR satellite constellation for the specific purpose of maritime surveillance. It is building unique vantage points of the world’s oceans, which enables them to build for broader coverage and increased persistence, and provide data and analytics in real-time.
Policy
Space-oriented technological prowess is growing into an integral element of national power, and consequently, the regulatory environment for spacetech has undergone significant amendments. In 2023, the government announced the Indian Space Policy that enables Non-Government Entities (NGEs) to engage end-to-end in all domains of the space sector. The policy revisions reflect the understanding that bringing in the private sector can address the capacity deficit for scaling spacetech, as startups are far more nimble and effective in developing new and niche technologies.
A snippet from the policy affirms that:
- NGEs can “establish and operate remote sensing satellite systems within and outside India through self-owned, procured or leased satellites” and develop and augment satellite communications, remote sensing, and navigation.
- The government will also focus on “promoting space-related education and innovation, including support to space-sector startups.”
The shift in regulatory tailwinds was one of the key factors in the founders’ decision to launch a spacetech venture. Gaurav Seth, who worked at Space Applications Centre, Ahmedabad (SAC), was the project lead for a SAR-based Venus mission set to launch in 2023. The pandemic pushed the launch back by ten years to 2033, putting him at loose ends with his career trajectory. He knew Vinit Bansal through his work—Vinit handled tech sales in the defence and space sector for National Instruments (NI). Vinit’s expertise in prototyping space technologies and Gaurav’s technical experience brought the cofounders together. Gaurav validated the idea of using SAR satellites for Earth Observation in the scientific community by writing and presenting a research paper at a conference organised by SAC. In Gaurav’s words:
That was sort of an aha moment—I just thought of an idea, wrote a paper, and we created a prototype in 3 weeks, which usually used to be done in 12 to 16 months, and it was kind of a breakthrough. So that was the genesis of PierSight.
Finance
Government support and private sector driven innovation are boosting interest and investment in Indian spacetech. According to an Inc42 report, between 2014 and 2023, more than 150 Indian spacetech startups secured over USD 285 million in funding, of which USD 125 million was invested in 2023 alone. Entrepreneurs and investors recognise the immense potential for spacetech to yield benefits for fields such as agriculture, weather forecasting, disaster management, defence, and communication. It is important to note that spacetech projects have long runways and require heavy capital investment. As Vipul Patel, Partner—Seed Investing at IIMA Ventures, explained:
For a deeptech company, the model of technology is a 50% contribution to success. The other 50% is your ability to raise capital and attract the necessary resources.
The Indian government’s allocation of INR 1000 crore (USD 125 million) to a VC fund for spacetech is likely to catalyse private sector investments. Although details of disbursal have not been announced, this kind of financial support can bolster growth and innovation, help early-stage startups avoid the “valley of death” and encourage experimentation.
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To remove further structural financial barriers for startups in the space industry:
- The government has amended the FDI policy to allow up to 100% foreign direct investment in manufacturing and procuring satellite systems.
- The Goods and Services Tax (GST) Council has announced a 0% GST regime for spacecraft (including satellites) and suborbital and spacecraft launch vehicles.
- The government has exempted the customs duty on certain critical minerals essential to the space sector.
New spacetech startups are leveraging this conducive financial environment. PierSight raised approximately USD 600,000 in pre-seed funding and nearly USD 7 million in seed funding in January 2024. Their pre-seed funding came from Techstars—whose Space Accelerator Program they participated in—a few angel investors, and a micro VC firm, All In Capital. They nearly matched this funding with investments from friends and family, who contributed USD 250,000–300,000 to the round. As they contributed the biggest share of the pie, Gaurav said that “the round was led by friends and family.”
Culture of innovation and experimentation
The space sector in India has demonstrated remarkable innovation and success. ISRO has defined the nation’s space industry over the past decades, and its satellite developments have revolutionised telecommunications, remote sensing, and weather forecasting. Spacetech startups have raised the benchmark for progress by exploring advanced technologies such as 3D printing of engines, reusable launch vehicles, space debris detectors, and high-resolution remote sensing imagery for various use cases.
India’s first lunar exploration mission in 2008, Chandrayaan I, found clear evidence of water molecules on the moon. In 2013, ISRO successfully carried out the Mars Orbiter Mission, becoming the first Asian power to reach Mars. Most recently, in August 2023, India became the first country to land a spacecraft on the unexplored south pole of the moon with Chandrayaan III.
Apart from the scientific and political goals these missions achieve, they are crucial for expanding the horizon of possibility for Indian space ventures. Gaurav and Vinit’s association with ISRO during this prolific phase set the standards for innovation and experimentation that they are now working towards surpassing with PierSight. There have also been success stories from the private sector; startups have improved remote-sensing technologies, optimised the use of satellite data, and crafted indigenous satellites and communication systems. For instance, Pixxel was the first Indian startup to deploy its satellite, Shakuntala, into a low Earth orbit in April 2022. Skyroot became the first Indian startup to successfully launch a private rocket into space in November 2022. PierSight's vision of transforming the maritime industry through space technology plugs into the groundbreaking potential of this burgeoning entrepreneurial space.
Human capital
Talent—in the form of skilled workers, experienced entrepreneurs, and knowledgeable investors—is a crucial component of a thriving startup ecosystem. PierSight has grown from just two cofounders at inception to six people at the end of 2023 and to a team of twenty by mid-2024. In the early stages, concurrently alongside pitching, Gaurav and Vinit reached out through their networks—former co-workers, people from other organisations or companies they had previously worked with—and leaned on friends and family for hiring recommendations to put together the initial core team. Apart from personal and professional networks, they have tapped into the larger workforce pool on job boards such as LinkedIn for specific technical specialities.
The cofounders have tremendously benefited from their association with the Jet Propulsion Laboratory (JPL) —from their time at the Space Accelerator Program—and ISRO. Gaurav has leveraged contacts and knowledge pools to gain vital information and technical capabilities. For instance, one of PierSight’s mentors is a retired ISRO scientist who has settled in Ahmedabad—this is a pedagogical and not a transactional labour relationship. Their time does not have a monetary value attached and is a resource unavailable in the market. Through technology demonstrations, brainstorming and problem-solving, and mentoring support, PierSight is learning from spacetech giants.
Supports
Since India’s private sector involvement in spacetech is in its nascency, regulatory shifts must be backed by robust infrastructural support that foster innovation and technology development.
In 2020, the Department of Space established IN-SPACe as the single-window authorisation and clearance agency for space launches. Its headquarters are located in Ahmedabad, and it offers technical expertise, assistance, and incubation for NGEs and startups. IN-SPACe has built extensive testing infrastructure at its headquarters, including prototyping facilities, validation setups, and design software. Access to this asset has reduced PierSight’s structural investment in prototyping and manufacturing their satellites. This infrastructural access is another factor in building the startup out of Ahmedabad.
PierSight is currently incubated at IIMA Ventures, Ahmedabad, which has been another resource for networking opportunities and business support. It offers the team the convenience of office space and workplace infrastructure in proximity to the IN-SPACe facilities. PierSight has been able to draw on work or business contacts for mission-critical components such as its microchips and electronics. Vinit brought in his experience and contacts with the semiconductor industry from his time at NI, which have been immensely advantageous. Moreover, the decades-old presence of SAC in the city—established in the 1970s—has cultivated a vibrant vendor and knowledge ecosystem. The research institute is responsible for developing space-borne instruments for communication, navigation, and remote sensing. It has a multidisciplinary focus and collaborates with industry and academia for research and development. As Vinit put it:
The payload part of ISRO’s satellites is done in Ahmedabad, so the city has an immense amount of knowledge and resources for building payload electronics in India.
SAC has encouraged the development of technical know-how, material resources and suppliers, technicians and workforce, and other elements necessary for building satellites and payloads locally. These form a dynamic resource pool for spacetech startups in Ahmedabad that PierSight has been able to leverage.
Conclusion
This case study gives the reader a snapshot of the entrepreneurial ecosystem within which PierSight has leveraged physical, material, human, knowledge, and social resources to make rapid strides in its journey. PierSight is working towards its maiden satellite mission, a demonstration called Varuna, which is slated for launch later this year. They are also focused on fundraising, expanding their customer base, and growing their team. In the long term, their efforts are directed towards fulfilling the vision of a satellite constellation for maritime surveillance. Gaurav and Vinit believe that the future of spacetech is in Ahmedabad. The entrepreneurial ecosystem available there opens up opportunities for spacetech experts to engage in technological innovation and new venture creation.
Endnotes
- NGE refers to: (i) a company incorporated under the Companies Act, 2013 or (ii) a partnership firm established under the Limited Liability Partnership Act, 2008, (iii) Trusts under the Indian Trusts Act 1882, or (iv) Association of persons or body of individuals incorporated under relevant statutes in India. Indian Space Research Organisation (2023) Indian Space Policy - 2023.
- SAC is the ISRO arm responsible for designing and operationalising space-based instruments.
- NI, now a part of Emerson, is a provider of software-connected automated test and measurement systems.
- Techstars’ Space Accelerator Program was organized in partnership with NASA’s Jet Propulsion Laboratory (JPL) and the US Space Force in September 2023. 12 startups, including PierSight, participated in the three month program, which was hosted in the thriving space ecosystems of Los Angeles, Colorado, and Washington DC.
Written by
Written by
Valerie Mendonca
Valeries Mendonca is involved in research at IIM-A Ventures as a Manager - Insights where she leads the case studies function.