Kepler Communications Secures US$16M in Series A Funding – Still Waiting on FCC

Kepler's Kipp satellite. Credit: Kepler Communications.

Kepler Communications, which is planning a constellation of 140 small communication satellites in Low Earth Orbit, announced today it has raised US$16M in Series A funding.

The raise

This brings to US$21M that Kepler has raised to date. This despite the U.S. Federal Communications Commission (FCC) moving exceptionally slow in approving their spectrum license to operate in the U.S. Kepler is already licensed to operate in Canada.

The Series A funding round was led by Costanoa Ventures and included participation by Deutsche Bahn’s Digital Ventures. IA Ventures which led their Seed Series round are also involved in this round along with other unnamed returning investors.

Greg Sands, the Founder and Managing Partner of Costanoa Ventures will join the Kepler Board and had this to say.  “We are uniquely excited by Kepler as compared with all the recent nanosatellite communication companies because they have demonstrated that their satellites are filling global gaps in connectivity. Kepler has incredible technology, with KIPP having already demonstrated the highest data throughput ever achieved in a nanosatellite. They have strong customer traction, with early polar customers already making use of PolarConnectTM.”

Currently Kepler has one satellite, KIPP, operating in Low Earth Orbit. That satellite was launched on January 19 on a Chinese Long March 11 rocket. This was the first time a Canadian satellite had launched on a Chinese rocket and caused a few eyebrows to be raised in Ottawa. Kepler was extremely sensitive and secretive about the contracted Chinese launch. Regardless, the precedent was set, and it’s only a matter of time before another Canadian satellite launches with China as Canada as no capacity to launch its own satellites.

Kepler’s next satellite, CASE, which is similar to KIPP, is scheduled to launch around November 22 on India’s Polar Satellite Launch Vehicle (PSLV) C43 from the Satish Dhawan Space Centre.

A third satellite, TARS, which is a larger CubeSat at 6U versus the 3U for KIPP and CASE, is being built by AAC Clyde which built the first two satellites. According to Kepler “TARS will expand on the success of the two 3U predecessors by carrying a full suite of upgraded communications and processing units developed by Kepler to deliver both broadband and narrowband telecommunication services.” TARS is scheduled to launch in the second half of 2019.

Delay Tolerant Data Movement
Delay Tolerant Data Movement. Credit: Kepler Communications.

Delivering to customers

Kepler has also unveiled a new website that provides substantially more information on the company and the suite of products it is now marketing.

One of those products, PolarConnectTM, is already being used by customers. Kepler describes the product as “a communications solution specifically designed for high latitudes where high bandwidth services are unavailable.”

F. Laeisz, a large German shipping company that’s been in operation since 1824, has been testing PolarConnectTM on their icebreaking vessel, the Polarstern which operates most of the time outside of traditional satellite coverage.

Thomas Liebe, chief operator of the Polarstern, said “with the Kepler system, for the first time we are able to send massive files like operational data, scientific data, videos, or photos. These are bandwidth intensive and we have no other way to send the data if we used traditional systems.”

It seems from the early trials that Kepler may have found a product line fills a market niche not being served yet.

The FCC issue

However, while Kepler is making strides in getting customers, it is still being held back by the FCC. Access to the U.S. market is an important part of Kepler’s long term plan.

On October 4, Nickolas Spina of Kepler met with Rachael Bender from the FCC Chairman’s Office to discuss their application. It is one of many meetings Kepler has had this year in an effort to move its application forward. In a follow-up letter sent the following day, it states that “Kepler highlighted that as it awaits licensing within the US, it is delaying business opportunities and servicing of existing US customer demand.”

Kepler also made the following points in the meeting on its proposed satellite constellation that would service U.S. customers;

  • The immediate introduction of a low-cost system targeted directly at the global expansion of the Internet of Things (“IoT”), for low and high bandwidth requirements alike.
  • The ability to offer service capacity with the first deployed satellite, where each additional satellite is used to increase said capacity, and without the requirement for an extensive ground network.
  • The planned establishment of near real-time data backhaul for other satellite operators, relieving the coordination burden, and allowing other satellite operators a more continuous stream of data.
  • The relatively small number of continuously deployed satellites; accurate satellite positional knowledge; continuous tracking, telemetry & control; and the natural elimination of any potential debris due to the specific orbit selection and satellite design.

In their presentation Kepler also outlined their Orbital Debris Mitigation plan which had been previously discussed in a September 19th meeting.

Total Probability of Collision

  • Estimated <0.001, which is compliant with NASA Orbit Debris Requirement 4.5.2.1.
  • Modelled using most conservative assumptions over 15 years of full network operations.
  • No debris will survive re-entry.

Space Situational Awareness

  • High‐accuracy positional knowledge maintained and shared with other operators.
  • Space data sharing agreements already in place with JSpOC.

Maneuverability

  • Global TT&C through inter-satellite links provides collision avoidance agility.
  • Active conjunction monitoring and maneuvering from launch to reentry.
  • No conjunctions experienced with existing satellite.

GEN1, GEN2 and GEN3 Constellations

Kepler plans on launching up to another 15 satellites as part of what it’s calling its GEN1 constellation by the end of 2020.

The funds raised in today’s Series A round will be used to grow revenues and get the GEN1 constellation built and launched. According to Kepler “the focus of their GEN1 constellation will be on delivering their high-capacity and affordable store-and-forward services beyond the capabilities offered by KIPP, CASE, and TARS.”

The GEN2 constellation would see another 50 satellites built and launched in 2021.

Kepler says the “GEN1 and GEN2 constellations predominantly focus on store-and-forward and IoT services, but will have the necessary technology to lead to in-space connectivity.”

Once the GEN2 constellation is launched, Kepler will focus on GEN3 which would be the next generation and add an additional 80 satellites to be built and launched by the end of 2022.

Kepler has set itself an aggressive schedule in trying to get the complete constellation of 140 satellites built and launched by the end of 2022. They will need to increase revenues, raise more funds, and importantly, get the FCC to approve their spectrum license. In the meantime, this Canadian startup appears to be making some positive moves on a path to success.

MDA

About Marc Boucher

Marc Boucher
Boucher is an entrepreneur, writer, editor & publisher. He is the founder of SpaceQ Media Inc. and CEO and co-founder of SpaceRef Interactice Inc. Boucher has 18 years working in various roles in the space industry and a total of 25 years as a technology entrepreneur including creating Maple Square, Canada's first internet directory and search engine.