Spire, a San Francisco-based satellite-powered data company, has just landed $40 million in Series B funding led by an earlier backer, Promus Ventures. Bessemer Venture Partners and Jump-Capital also joined the round, as did previous investors RRE Ventures and Lemnos Labs.
The financing brings the company’s total funding to roughly $80 million – a fair amount for a company that employs just 57 people and turns three in September. Then again, Spire has huge ambitions to become a big player in the weather data market and to strengthen its position as a provider of maritime data. In fact, says David Cowan, a partner with Bessemer, by some time next year, Spire “will have the largest constellation of satellites known to man.” (The number to beat, by the way, is 75, which is roughly the number of satellites in the constellation of communications company Iridium.)
Yet that’s just the start, insists founder and CEO Peter Platzer, a physicist with a Harvard MBA who eventually sees Spire curbing illegal animal trading and human kidnapping, among other things. We chatted about it yesterday. Our conversation has been edited for length.
A couple of years ago, there were a lot of firms talking about the satellite constellations, but not many have made it this far.
What helped us a lot was a focus on business and technology from day one. Our first employee was in business development. Our fourth hire was a senior executive from Wall Street. We also steered away from taking pictures from space, which is what a lot of companies have been trying to do. Rather, we’re listening to data from space, which makes us more flexible. If you’re flying a radio, you can tune into entirely different markets; the information contained tends to be much more than in a picture.
What’s an example of what you mean?
Take keeping track of ships. In theory, you could try to take pictures all the time of all the oceans, though 90 percent of the time, you wouldn’t see anything and half the time there would be clouds in the way and you still wouldn’t see anything except an occasional ship. Radios can meanwhile listen all the time and can pick up vessel tracking information [from the ship’s] sensors about where it is, what type of cargo it’s carrying, where it’s going, and where it’s been.
Except when those ships turn off their transponders, which seems like a big problem. The European Union Naval Force estimates that pirates cost the world $6 billion annually.
The percentage of ships that turn off [those signals] is .25 percent, so it’s actually a small portion – though it may be a very interesting portion. Even then, there are multiple ways for us to figure out if they’re trying to “spoof” us [including by comparing GPS from the satellite with GPS from the ship signal].
GPS. Sensors. Your satellites are made with off-the-shelf, cell-phone-like components, is that right? What do they use and how much do they cost to produce?
The first camera we worked with was literally a GoPro camera. Our processor is a run-of-the-mill microprocessor that’s been slightly adapted to fit onto spacecraft. We use the same microSD cards that you use for your photos, though they’re industrial grade.
You’re planning to put a lot of satellites in space. Whose rockets will you use?
We have launched or plan to launch with pretty much every rocket company out there: Orbital Science, Space X, [we’ll use] Soyuz spacecraft. We’ve also started talking with all the new entrants, including the [spaceflight company] Virgin Galactic and Rocket Lab [in New Zealand]. Our first satellite was in space by June 2013, nine months after we were founded; we’ve had four satellites [launched into space] altogether, and we expect to have 20 by year end and 100 [in space] by 2017.
These are small satellites. Why not pack the rockets with even more of them?
Space is almost unlimited. The reason we limit [how much we send] is because shipping containers are often structured in multiples of two satellites and it’s a very natural unit to purchase for [these] launches.
You’ve been producing maritime data for a while. Now, you’ve also set your sights on weather data. How big a market is that?
Well, the U.S. is facing a weather data blackout next year [that will last] half a year to half a decade because three satellites the government depended on are past their lifetimes and expected to expire. The impact could be quite substantial. About a third of the global economy is impacted by weather, and there are already an estimated $2.5 trillion dollars lost every single year because of inaccurate weather forecasts.
So you’ll be providing the U.S. government data in the absence of those obsolete satellites. Is that forever? Is the government turning over weather data entirely to commercial enterprises?
I don’ t know, but with Space X, for example, there’s an agreement with the government that Space X will send stuff to the International Space Station for 10 percent of what the cost used to be. So instead of half a billion dollars, Space X will do it for $50 million. Meanwhile, the missions of [the] Orion [spacecraft, which are designed to carry astronauts] remain government funded. I think we’ll see similar a transition in weather data.
Beyond maritime and weather data, what’s next?
I don’t want to show too much of my hand, but one area that I’m quite interested in is the huge problem of kidnapped children in less well-connected countries like Latin America and China. One way to counter [these crimes] is to give the children a watch or pendant or other piece of clothing that’s benign but embedded with a sensor and beacon that can be picked up with our satellites, even if they’re in the Amazon rainforest of a rural part of China. That’s just one application that we think would have huge implications.