Exclusive: Arctus Aerospace To Raise $3 Mn To Build UAVs For Earth Observation

Deeptech startup Arctus Aerospace is in talks to raise $2.4 Mn to $3 Mn in its pre-seed round from a group of investors, including South Park Commons and gradCapital, sources told Inc42.

The round, which will be led by an overseas VC firm, is in the final stages of closing, and will be announced soon, the sources added.

The startup, which is currently in pre-revenue stage, will deploy the fresh capital towards product development.

A questionnaire sent to Arctus founder Shreepoorna S Rao didn’t elicit any response till the time of publishing this story.

Founded in 2023 by IIT Madras alumnus Rao, Arctus started with a vision to provide unmanned aerial vehicles (UAVs) for defence forces. However, it later pivoted to operate as a data-as-a-service (DaaS) provider.

The startup aims to deliver imagery data, collected through its medium altitude long endurance (MALE) UAVs and then processed using AI, to refineries, mapping firms, agriculture, among other sectors. This data can be used to monitor crop health, identify operational inefficiencies in plants and areas for better safety audits, and more.

Arctus’ UAVs operate at an altitude of 45,000 feet. They have a payload capacity of 200 kg, can operate for 24 hours, and carry up to 10 cameras for providing high-resolution imagery.

The startup’s manufacturing and R&D facility is based in Bengaluru. Besides India, it plans to provide its services to clients in North America, Europe, Australia, and the Middle East.

Arctus aims to take on satellite imagery providers, like Pixxel, Dhruva Space, Digantara, and KaleidEO, with its cost-effective offering. While building and launching earth observation satellites is expensive, Arctus’ UAV costs around $2 Mn and has a service life of about 10 years. This will make its offering viable, the aforementioned source said.

“Satellites need to recover their investment within this short 4-5 year period (of their service life) while also generating profits, which makes their offerings significantly more expensive,” the source added.

As per aGlobal Market Insights report, the global satellite-based earth observation market was estimated estimated to be worth $3.9 Bn in 2025 and grow to $5.1 Bn by 2030, on the back of increasing demand for geospatial information, climate change monitoring, government and military applications, proliferation of cloud computing and AI analytics, and more.

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