“Skyroot has become the poster child. Several more spacetech companies will get funded because two young scientists proved it could be done 100% indigenously, at a fraction of global capex, in record time,” Vikas Choudhury, founding partner at Playbook Partners, told Fe.The optimism, however, masks a highly uneven funding landscape. According to Tracxn, India’s spacetech ecosystem has raised about $871 million across 241 funding rounds till July 2026. Yet more than half the funding raised during 2025 and 2026 went to just five startups: Skyroot Aerospace, Digantara, EtherealX, Bellatrix Aerospace and AgniKul Cosmos.
The imbalance is more visible at the company level. Of the 334 spacetech startups in India, only 106 have secured institutional funding, while just 25 have progressed beyond the Series A stage. Most of the funded companies are yet to turn profitable as they continue investing in research, testing and manufacturing infrastructure.
Growth-Stage Capital Bottlenecks
Industry executives say the shortage is no longer at the seed stage, where investor interest has improved, but at the growth stage, where companies require significantly larger investments to commercialise technologies and expand production.
“Capital allocation for spacetech companies is concentrated in the seed stage. An equally difficult challenge begins once a company moves beyond prototyping and enters the scaling phase,” Choudhury said, adding that startups need growth capital to build infrastructure, develop market traction and compete globally.Experts say Skyroot’s success alone is unlikely to broaden the ecosystem unless investors begin backing companies across the space value chain. While launch companies have attracted the bulk of investor attention because of their strategic importance, satellite manufacturers, earth observation firms, communications companies and downstream applications will also require sustained capital if India is to build a globally competitive space industry.
Reaching orbit is only the entry ticket. The companies that scaled globally built commercially viable businesses alongside their technology platforms,” Choudhury said.
With India’s space economy projected to expand from about $8 billion to $44 billion by 2033, investors believe Skyroot’s success has removed a key technology risk for the sector. Whether that results in a broader funding pipeline, however, will depend on investors backing the ecosystem beyond a handful of proven companies.
