Venture Capital

A venture capital firm that only invests in space is going public so retail investors can take a shot at backing the next Elon Musk

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Private investment into the commercial space industry is booming, topping $8.9 billion last year.

  • Venture capital firm Seraphim Capital is, unusually, planning to IPO and aims to raise $211 million.
  • The space-focused fund wants to capitalize on the excitement around commercial space.
  • Entrepreneurs like Elon Musk, Jeff Bezos, and Richard Branson are all privately investing in space.
  • See more stories on Insider’s business page.

A venture capital fund that focuses on space startups is going public, giving retail investors a potential shot at backing the next SpaceX.

London-based Seraphim Capital is aiming to raise $211 million as part of plans to IPO in on the London Stock Exchange in the summer. It’s targeting a net asset value return of 20% on an annualized basis in the long term.

Founded in 2016, Seraphim Capital has invested in over 50 companies to date, several of which are unicorns above a valuation of $1 billion. One firm, quantum computing startup Arqit, is set to list in a SPAC deal at a $1.4 billion valuation.

“Space is a massive sector already and the broad consensus is that over course of next of the next 10 to 20 years we are set for major growth,” James Bruegger, chief investment officer at Seraphim told Insider. “Our decision to go public is informed by the same fundamental changes that brought around our first fund in 2016, which is that we feel the sector is at a key inflection point.”

The newly public entity, Seraphim Space Investment Trust PLC, will continue to invest in startups in the industry. It will also buy up some of Seraphim Capital’s existing seed assets as part of the deal, including stakes in Arqit; Spire Global, a provider of satellite-based global weather forecasting, and cellular broadband company AST & Science. Seraphim Capital’s investors will use the cash to buy shares in the public entity.

Amazon and Blue Origin founder Jeff Bezos is one of a raft of high-profile entrepreneurs investing their private wealth into space tech.

Space tech has had something of a PR boost thanks to commercial space firms SpaceX, Virgin Galactic, and Blue Origin.

Private investment into the commercial space industry is booming more generally, reaching a record $8.9 billion last year, according to figures from Space Capital. The wider market is estimated to be worth $366 billion, and could be worth as much as $1.4 trillion by 2030, per Bank of America.

It’s unusual for venture capital companies to go public, and Seraphim’s aim is to open up the mostly privately-funded space tech market to a wider set of investors in the public markets.

This would give the opportunity for retail investors to benefit if Seraphim’s investments ended up being the next SpaceX, unlike private funds. Another London-based venture capital firm, Draper Esprit, went public in 2016 and has backed successful startups such as neo-bank Revolut, car marketplace Cazoo, and software startup Uipath.

While venture capital funds must return their investors’ cash and raise again in tight lifecycles, Seraphim can operate an “evergreen” fund topped up by investor money.

“The opportunity in space is bigger than what we can cover with a traditional fund and the vision of the companies we’re backing is making science fiction into science fact and we want to remove constraints on how long we can support companies we want to back.”

The company also runs a space tech accelerator called Space Camp which is aimed at early-stage startups looking to raise seed funding, and it also helps prepare companies for Series A rounds. Seraphim ran this event remotely during COVID-19.

“There’s a halo effect in this industry where top entrepreneurs like Elon Musk, Jeff Bezos, and Richard Branson all pouring their own private wealth into space,” Bruegger added. “This is a lead indicator for the industry and an area we think our new vehicle can capitalize on and public market investors will benefit from.”

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