Charter Space raises $5M seed round for satellite insurance

Charter Space, based in El Segundo, California, said Wednesday it is already servicing more than 50 companies across the U.S. space and defense industrial base, following the May launch of its nationally licensed insurance brokerage. Insurance-focused Crystal Venture Partners led the round, joined by fintech investors QED and Blank Ventures, early-stage firm Hustle Fund, and Gaingels, an investment syndicate backing startups with underrepresented leadership.

Insuring objects that go to space remains rare, even though mishaps are common enough that companies constantly plan for contingencies. Founder and CEO Yuk Chi Chan says that’s largely because of the high cost of underwriting something like a satellite — on its website, Charter Space describes the common experience of regular insurers as having “heard a bunch of scary science words and freaked out.” Chan and co-founder Yukun Yin originally set out to build centralized software pulling together the technical, manufacturing, and test data aerospace companies need, before realizing that data had value when plugged into the underwriting process itself.

“We want more satellites to get insured, because that means that everything as a whole is much, much safer,” Chan told TechCrunch last year, adding that broader insurance coverage would let space companies draw on debt and credit rather than relying solely on venture capital or growth equity.

Space companies have historically had few financial-services options, since the industry was long dominated by governments and defense contractors that moved slowly after the Cold War. The boom in new space companies over the past decade — spurred largely by SpaceX’s Falcon 9 lowering launch costs — has created new satellite makers, spaceships, and launch providers, and with them, demand for insurers like Charter Space. Crystal Venture Partners managing partner Jonathan Crystal said the company sits at the intersection of the commercial space economy’s growth and the need for a modern approach to insuring its increasingly complex risks. Florida insurance regulation commissioner Michael Yaworsky, whose state remains the country’s leading launch location, called insurance “the precondition for growth in space.”

Charter Space has raised $8 million to date. It will use the new funding to grow its sales organization and insurance offerings, including coverage for “novel mission concepts” such as space-based nuclear power, lunar missions, and in-space servicing of other spacecraft.

Why it matters

As more private players enter orbit, insurance is becoming the financial infrastructure that lets space companies tap debt and other capital sources beyond venture funding — a shift Charter Space is betting will accelerate as underwriting data improves.