The Rise of Space Infrastructure: A New Era of High-Yield Opportunities

The space economy is no longer the domain of visionaries alone—it's a battlefield for capital, innovation, and national security. As global defense budgets balloon and venture capital pours into space infrastructure, a new class of startups is emerging as the backbone of this multi-trillion-dollar industry. For investors, the question isn't whether to bet on space—it's how to identify the most undervalued players poised to dominate this next frontier.

The Rocket Fuel: Defense Spending and Venture Capital

The U.S. Department of Defense's $175 billion Golden Dome missile defense program is a seismic catalyst. This initiative isn't just about intercepting threats—it's about building infrastructure to secure America's dominance in orbit. Meanwhile, Seraphim Space reports that global space startup funding hit $3.1 billion in Q2 2025, with 65% of that capital flowing into Series B and C rounds. These late-stage deals signal investor confidence in startups that can deliver mission-critical solutions, not just moonshots.

Government contracts are the secret sauce. Unlike commercial markets, where ROI timelines can stretch for years, defense and intelligence agencies offer non-dilutive funding, R&D support, and guaranteed early adoption. For example, the U.S. Space Force's $237 million STEP 2.0 IDIQ contract—awarded to 12 companies including Blue Canyon Technologies and York Space Systems—is a goldmine for startups that can prove operational readiness.

The Hidden Gems: Startups with Dual-Use Superpowers

Let's spotlight three undervalued contenders that combine defense-grade innovation with commercial scalability:

1. Impulse Space
2. Funding: $300 million Series C (largest in Q2 2025)
3. Technology: In-space transportation vehicles for last-mile payload delivery.

4. Government Ties: Aligned with the Golden Dome program, this company is solving the “logistics problem” of space, much like FedEx did for Earth. With $175 billion in defense spending, its vehicles could become the arteries of a growing orbital economy.

5. Muon Space

6. Funding: $181 million total, including a $44.5 million Series B extension.
7. Technology: LEO satellite constellations for real-time Earth intelligence.

8. Opportunity: As wildfires, floods, and geopolitical tensions escalate, governments and insurers will pay a premium for Muon's data. Its recent partnership with the Earth Fire Alliance to monitor wildfires is just the tip of the iceberg.

9. Orbit Fab

10. Funding: Secured contracts with the U.S. Space Force and commercial clients.
11. Technology: In-orbit refueling infrastructure.
12. Investment Thesis: This is the “gas station” for the space economy. Without Orbit Fab's fuel depots, satellites and spacecraft can't operate sustainably. Its partnerships with Lockheed Martin and Northrop Grumman give it a leg up in a sector that's still in its infancy.

Why Now? The Perfect Storm of Demand

The convergence of three trends makes this a golden era for space infrastructure:
- Defense Demands: NATO and NATO-aligned nations spent $2.46 trillion on defense in 2024, with Germany and Poland surging ahead. Startups with military-grade tech (e.g., True Anomaly's autonomous orbital vehicles) are in high demand.
- Commercial Scalability: From satellite-based GPS alternatives (like Xona Space Systems) to in-space manufacturing (e.g., Varda), these companies are solving problems that apply to both governments and corporations.
- Capital Availability: With 70% of Q2 2025 funding flowing to U.S. startups, the ecosystem is primed for consolidation and acquisition by defense giants.

The Risks and the Rewards

Space infrastructure is capital-intensive and technically complex. Delays in R&D or regulatory hurdles could derail even the most promising startups. However, the upside is staggering. Consider K2 Space, which raised $110 million to build satellites for government missions. If it secures a contract with the DoD, its valuation could multiply by 10x within two years.

For investors, the key is to focus on startups with defensible moats—proprietary tech, strategic government partnerships, and clear revenue paths. Avoid companies that rely solely on speculative use cases (e.g., Mars tourism). Instead, prioritize those solving near-term problems for high-margin clients.

Final Call: Buy the Rocket, Not the Moon

The space economy is no longer a speculative play—it's a sector with tangible infrastructure, contracts, and cash flows. As the U.S. and allies pour money into securing their orbital dominance, startups like Impulse Space, Muon, and Orbit Fab are the ones building the tools for victory.

For those willing to dig into the data, now is the time to allocate capital to space infrastructure. The next great wealth creation story isn't on Wall Street—it's orbiting the Earth.