When it comes to creating images of the earth from above, satellites, drones and planes are the air and spacecraft that tend to come to mind. But a startup called Near Space Labs is taking a very different approach to high-resolution photos from up high.
It’s building aircraft that are raised by helium balloons and then rely on currents to stay up, move around to take pictures from the stratosphere, and eventually glide back down to earth. On the back of significant traction with customers using Near Space’s images, the startup has raised $20 million to expand its business.
Bold Capital Partners (the firm founded by Peter Diamandis of XPRIZE and Singularity University fame), is leading the Series B round, with strategic backer USAA (the U.S. Automobile Association) participating alongside Climate Capital, Gaingels, River Park Ventures, and previous backers Crosslink Capital, Third Sphere, Draper Associates, and others that are not being named. Near Space has now raised over $40 million, including a $13 million Series A in 2021 that we covered here.
The startup is the brainchild of Rema Matevosyan (CEO), Ignasi Lluch (CTO) and Albert Caubet (chief engineer), all three technical founders who worked in space and physics technology and research prior to starting the company.
Matevosyan is Armenian, growing up in what she described as a “very technical” family of physicists, programmers and amateur astronomers. After studying mathematics as an undergraduate in Yerevan, she moved to Moscow for graduate school, and it was there, at the Skolkovo Institute, that she first met Lluch, who had come to study there from Spain.
Both were drawn to what at the time was thought of as the MIT of Russia, and indeed — it was around 2017 — the institute then was in a joint venture with MIT to fill out that ambition.
It was through that relationship that the trio applied to an accelerator in the U.S. called Urban-X in New York. Matevosyan found living in the U.S. to her liking and she stayed and now runs the company out of there.
If Near Space is about floating high above the earth to get a better perspective on what is going on down below, there is a metaphor in that description for Near Space and its founders.
The partnership between Skolkovo and MIT that attracted Matevosyan and Lluch to study and eventually meet ended in February 2022, one of the by-products of the sanctions that the U.S. levelled on Russia in the wake of its invasion of Ukraine. Meanwhile, the Urban-X accelerator was shut down by its primary backer, BMW, shut down this year.
Near Space is still here, though, and it’s growing.
Matevosyan said that one of its biggest customer segments to date has been the insurance industry, which takes subscriptions to receive Near Space imagery to help track and understand the impact of large-scale disasters like fires and hurricanes. (USAA is a major insurer and financial services provider, alongside its other activities for motorists who are in the military, veterans and their families.)
For now, Near Space covers only specific areas of the U.S. But the plan is to scale this up, something Matevosyan said can be done relatively easily, since the company requires no special licenses to fly since its Swift robots (the aircraft it has designed) are only ‘powered’ by balloons and then need only wind currents and are unmanned to move about the stratosphere.
Its ambition is ultimately to cover 80% of the U.S. population twice a year with its 7cm imagery. Near Space claims that it can capture pictures in hours what it might take 800,000 drones days or weeks to execute.
It will also be building a more customized coverage plans for customers, which it says will be more tailored to those end users’ operations.
Today, those users are primarily in the area of insurance, but some of the funding will also be used to expand its opportunities in other segments. Matevosyan cited agriculture as one area where it believes it could have an opportunity.
A lot of farms, small and large, have tried to use drones to determine the state of their crops, but this was not scalable, she said, because it was not accurate enough. “Drones were taking small samplings and extrapolating [but] that really didn’t take off, because if a chunk of land is not healthy, that doesn’t necessarily mean that the rest of the farm is unhealthy.” And using drones to survey everything proved too costly to execute. Satellites, meanwhile, are not able to provide decent enough resolution for the right cost to those would-be customers.
One area that seems obvious but that Near Space has yet to pursue is military usage. Matevosyan describes the Swift as “dual use,” which incidentally could also include a limited amount of payload too, but to date she said that it has yet to pursue anything outside of commercial use cases.
Given the direction the world is moving in and the current geopolitical climate, it will be interesting to see if that remains the case for a technology that seems supremely versatile and relatively cheap.
In the meantime that is one reason why investors have been so interested.
“The idea of low-cost aerial imagery is valuable for many parties, not just insurance,” said Will Borthwick, the principal at Bold that led on this investment. That goes beyond even the usual suspects who might be buying aerial imagery. “Even when you think about the advent of AI, which requires timely and high-quality data to work properly, it’s the moment in time for something like this.”
