China's Chang Guang Satellite raises $376m

Chang Guang previously raised RMB250 million ($37 million) in an angel round in 2018 at a valuation of more than RMB4 billion.

Participants in the latest round include CICC Capital, Haitong Innovation - a PE vehicle tied to Haitong Securities - Shanghai-based Rosefinch Investments, Matrix Partners China, Shenzhen Capital Group, voice recognition start-up iFlytek, Estar Capital, Shanda Capital, and CAS Star, a state-owned incubator of hard technologies. Existing backers such as Jilin Province Guidance Fund and education technology company Chenrui Tech re-upped.

Chang Guang was established in 2014 as China’s first satellite developer. It has followed an evolutionary curve from camera maker to satellite assembler to imaging services provider, and now focuses on remote sensing.

There are three main satellite applications: communication, which typically involves serving phone users in off-the-grid locations; navigation, where China’s BeiDou is supposed to serve as an alternative to the US-developed Global Positioning System (GPS); and remote sensing, for example, providing high-definition images of areas hit by natural disasters.

Chang Guang has launched 28 remote sensing satellites and developed the Jilin-1 satellite constellation comprising 25 satellites. Jilin-1 is said to be able to offer coverage of any place in the world eight to 10 times per day. It can also upgrade global maps twice a year and national maps seven times a year.

Revenue is generated from the sale of the pictures taken by these satellites. Users include specialist agricultural insurers who need up-to-date information at short order to assess their liabilities following a natural disaster. Thanks to its close relationship with Jilin provincial government, Chang Guang counts the military as a client, an edge its rivals have yet to acquire. The company wants to expand its customer base to include more private enterprises.

The next step is to put 60 satellites in orbit, which would give it the ability to revisit anywhere in the world within 30 minutes. The goal after that is 138 satellites, with the revisit time dropping to 10 minutes. Chang Guang will also target key areas, providing images of great accuracy - and with rapid updates - to customers across agriculture, forestry, water conservancy, and transportation.

Several Chinese satellite specialists have received VC funding. They include Galaxy Space, which is backed by the likes of Shunwei Capital, 5Y Ventures, and IDG Capital, and Comm Satellite. The latter has raised over RMB100 million from unspecified investors. 

Other space tech investment has largely focused on commercial rocket developers. In September, LandSpace raised RMB1.2 billion ($175 million) in a Series C extension led by Sequoia Capital China, the VC arm of property developer Country Garden, Matrix Partners China, and Co-Stone Capital. This came on the heels of a Series B - also worth RMB1.2 billion - for i-Space, a competing commercial rocket developer.

Landspace, i-Space and OneSpace are the local market leaders, but they have different development strategies. While Landspace focuses on mid-size liquid fuel launchers, OneSpace concentrates on solid fuels. I-Space has competency in both areas, across small and large payloads.

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• Topics
• Greater China
• Expansion
• Technology
• China
• Matrix Partners
• Shenzhen Capital Group
• CICC
• Defense & aerospace