Reusable rocket startup Stoke Space raises $260 million in Series C round

By Akash Sriram

(Reuters) – Stoke Space raised $260 million in a late-stage funding round to finalize the development of its Nova reusable medium-lift rocket and complete construction of its launch facility in Florida, the company said on Wednesday.

Reusable rockets, pioneered by Elon Musk’s SpaceX, have demonstrated that they bring down costs for launch vehicles and space transportation.

With mega constellations for satellite communications, space-based imaging and intelligence set to go into space in the coming years, demand has been booming for low-cost rockets, with supply largely dominated by SpaceX.

“There’s really only one meaningful launch service provider in the industry right now… and there’s a desperate need for an alternative launch service provider,” Stoke Space co-founder and CEO Andy Lapsa told Reuters in an interview.

Stoke Space successfully completed test firing of its first-stage engine – dubbed Zenith – last month, making it the only company apart from SpaceX to have developed and tested a full-flow staged combustion rocket engine, known for its efficiency.

“At the end of the day, you want the vehicle to operate much like an aircraft operates, where it spends more time in the air than on the ground,” said Lapsa, who previously led development of rocket engines at Jeff Bezos’ space company Blue Origin.

Bill Gates’ Breakthrough Energy Venture, the University of Michigan and Y Combinator were among investors in the latest Series C round, the company said.

The Washington-based startup declined to provide the valuation at which it raised funds.

Space startups raked in $8.6 billion in investments last year, up 25% from 2023, with growing interest in companies that make rockets and satellites and funding is poised to grow in 2025, according to a report by investment firm Seraphim Space.

Stoke Space’s funding comes just a day after space technology company Loft Orbital raised $170 million led by Tikehau Capital and Axial Partners.

(Reporting by Akash Sriram in Bengaluru; Editing by Shailesh Kuber)