The space economy: how to invest in space and SpaceX
Space is coming closer to home, playing an ever-increasing role in our lives. The investment opportunities in the space economy are expanding rapidly. Novaspace estimated the size of the space economy at $626 billion in 2025, with $236 billion accounted for by the space market and $329 billion by space-enabled applications. Unlike the space races of the mid-late 20th century, driven primarily by government spending, this time private companies provide around 70% of the capital for space exploration, offering unprecedented access to the growing space economy.
The future of the space economy is highlighted by recent developments such as the Artemis moon flight, which underscores renewed focus on moon landings and the potential for human missions to Mars. NASA estimates that the ‘Moon to Mars’ programs could create 69,000 jobs and support over $14 billion in economic output. The Lunar economy could be worth $127 billion by 2050, according to PwC.
Economic activities in space itself are just beginning to be explored, including asteroid mining for key resources, running data centers in space, and constructing research labs in zero-gravity conditions. Evelyn Chow, portfolio manager of the Neuberger Berman Next Generation Space Economy Fund, notes that these activities are still technologically nascent, with commercialization likely some time away. Orbital data centers, for example, would be prohibitively expensive to launch, even with advancements in solar power and semiconductor hardware.
Launch costs have significantly decreased over the past 17 years, from approximately $15,600/kg to less than $1,000/kg, with projections suggesting costs could drop to $200/kg by the mid-2030s. This reduction is largely due to innovations like reusable rockets, such as SpaceX’s Falcon 9, which has brought launch costs down to around $1,500/kg. SpaceX’s upcoming Starship model could halve this cost further. SpaceX dominates the launch industry, with 161 out of 199 licensed space launches in the previous year, accounting for over 80% of the market share.
SpaceX’s Starlink network, comprising over 9,000 satellites, provides global internet connectivity, generating 50-80% of SpaceX’s revenue. Additionally, SpaceX owns xAI, which develops the chatbot Grok and the social media network X (formerly Twitter), linking AI development with space-based solar power solutions. SpaceX is reportedly filing for an IPO, targeting a valuation of $1.75 trillion, which would make it one of the world’s most valuable companies.
Investors can gain exposure to SpaceX through various funds and trusts, such as Scottish Mortgage, which holds 19% of its portfolio in SpaceX. Competitors like RocketLab and AST SpaceMobile offer alternative investment opportunities, though they are still far behind SpaceX in market share and revenue. Other space-related companies, such as BAE Systems, Leonardo, and L3Harris, provide diversified exposure through satellite systems, communications, and missile technology. Industrial firms like Mitsubishi Heavy Industries also offer space-related exposure through satellite manufacturing.
The space economy’s growth potential is supported by companies supplying mission-critical components, satellite data, and infrastructure, ensuring broad market participation regardless of specific winners in the launch or connectivity battles.
Source: MoneyWeek