Two Colorado-based companies, Ursa Major and Orbit Fab, have laid off employees as they seek to adapt to a new reality of tight funding environment in the space industry. The layoffs come at a time when the sector is experiencing the lowest period of investment since 2015. The job reductions at Ursa Major and Orbit Fab are part of a restructuring process to align with the changing needs of their customers.
Ursa Major, which makes rocket engines, laid off about 80 people, representing 27% of its workforce. The company’s spokesperson confirmed the restructuring but declined to provide the exact number of layoffs. In a statement, Ursa Major said the job reductions are aimed at realigning the workforce to better meet the needs of its national security customers. Although the company last raised funds in October 2022, with a $150 million round at a $550 million valuation, the layoffs indicate the company is struggling to raise more funds.
Orbit Fab, a startup that aims to provide refueling services to spacecraft, let go of 10 employees this week. The company’s Chief Commercial Officer Adam Harris said the restructuring is part of a refined strategy that will enable Orbit Fab to better meet the growing demand for in-space refueling infrastructure for commercial and government markets and missions. The company recently raised $29 million in a Series A funding round in April 2022 at a $113 million valuation.
The Impact of the Funding Environment
The space industry has experienced a record level of funding in recent years, with several companies raising billions of dollars to develop new technologies and services. However, the first quarter of 2023 saw the lowest period of investment in the industry since 2015, according to Space Capital. The trend is partly due to the COVID-19 pandemic, which has affected the global economy, making it harder for companies to raise funds.
The layoffs at Ursa Major and Orbit Fab indicate that the funding environment is challenging, even for established companies and startups that have recently raised funds. The companies’ difficulties in raising more funds suggest that investors are becoming more cautious and selective about where to put their money in the space industry. The layoffs are a reminder that the space industry is not immune to the impact of the funding environment, and companies must adapt to the new reality to survive and thrive.
The layoffs at Ursa Major and Orbit Fab highlight the challenges facing companies in the space industry amid a tight funding environment. The companies’ restructuring process is aimed at realigning their workforce to meet the changing needs of their customers while navigating the challenges of the funding environment. The layoffs are a reminder that the space industry is not immune to the impact of economic factors, and companies must be agile and resilient to succeed.
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