How to start a space company: a founder's checklist.

To start a space company, pick one customer problem that space can solve, test it with real buyers before you build much, then form the business, map which U.S. regulators apply to what you make, choose a funding path that fits your capital needs, and line up first customers early. This checklist takes you through each step in order and links to the official source for every rule, so you can check the details yourself.

It is written for founders who want a practical starting point: engineers leaving aerospace or defense, operators with an idea from the field, and entrepreneurs who want to build a business that serves the space industry. If you are still deciding whether this path is for you, start with my guide on how to become a space entrepreneur, then come back here when you are ready to build.

The space company checklist at a glance

1. Pick a specific problem and a specific buyer.
2. Validate demand before you build much.
3. Choose your business model and where you sit in the market.
4. Form the company and set up the basics.
5. Map your regulatory path early.
6. Plan for export controls from day one.
7. Choose a funding path that fits your capital needs.
8. Build a small team with the right mix of skills.
9. Win your first customers and build your marketing system.
10. Join a community and keep learning.

Step 1: Pick a specific problem and a specific buyer

A space company is a business first. The founders who move fastest start with a problem a specific customer will pay to solve, then work out what role space plays in the answer.

The market is large and mostly commercial. The Space Foundation's The Space Report 2025 Q2 put the global space economy at $613 billion in 2024, with commercial activity making up about 78% of it. That means you are not limited to government buyers, and many of the best opportunities sit outside launch: satellite data and analytics, ground systems, software, components, in-space services, and service businesses that support space companies.

Write down:

• Who has the problem. A job title and a type of organization, not "the space industry".
• How they solve it today. The current workaround is your real competitor.
• What it costs them. Time, money, risk or missed opportunities.
• Why space is part of the answer. Data from orbit, a component for a spacecraft, a service a space company needs, or something else.

Step 2: Validate demand before you build much

Space hardware takes years to develop, so the cost of building the wrong thing is high. Test demand while it is still cheap to change course.

• Hold many short customer conversations. Ask about the problem, how they handle it now and what a better answer would be worth. Don't pitch. Listen.
• Write a one-line offer. What you deliver, who it is for and how they start working with you.
• Ask for a small commitment. A letter of intent, a paid study, a pilot or a pre-order tells you far more than polite interest.
• Start with a minimum version. A study, a software prototype, a ground test or a service engagement can prove value before a flight.

Step 3: Choose your business model and where you sit in the market

How you make money shapes your funding needs, your team and your regulatory load. Common models include:

• Hardware and components sold to satellite builders, integrators and primes.
• Software and data, often sold as a subscription.
• Services, such as engineering support, mission operations, launch brokerage, testing, consulting or marketing.
• Contract research and development, often funded by government programs.
• Downstream products that use satellite data or services to serve industries on Earth, such as agriculture, insurance, logistics or energy.

Also decide whether you will sell to government first, to commercial buyers first or to both. Each path buys differently. Government buyers follow formal procurement processes, while commercial buyers often move faster and focus on cost and return.

Step 4: Form the company and set up the basics

The legal and financial setup of a space company follows the same steps as any U.S. small business. The U.S. Small Business Administration's Launch your business guide walks through them: choose a business structure, register the business, get federal and state tax IDs, apply for licenses and permits, open a business bank account and get business insurance.

Two points matter more in space than in most industries:

• Ownership and control. Some programs depend on who owns and controls the company. For example, the SBIR and STTR programs require a for-profit U.S. business that is majority owned and controlled by U.S. citizens or permanent residents (with some exceptions), with 500 or fewer employees including affiliates (SBIR.gov eligibility). Think about this before you take outside investment.
• Free help is available. The SBA's local assistance network includes Small Business Development Centers, SCORE mentors and Veterans Business Outreach Centers. APEX Accelerators help small businesses get ready to sell to the government. If you are a veteran or service member, the SBA's Boots to Business program is built for you.

Get qualified legal and accounting advice for your situation. This checklist is a starting point, not legal advice.

Step 5: Map your regulatory path early

Which U.S. regulators you deal with depends on what you build and operate. Find out early, because some reviews take months and they can shape your design.

A few details worth knowing from the official sources:

• FAA. The process starts with a pre-application consultation. Once an application is accepted, the FAA lists 180 days for license evaluation and 120 days for permits, both statutory requirements (FAA licensing process). If you are flying a payload on someone else's rocket, the launch operator holds the launch license, but the FAA still reviews payloads, and a payload owner or operator can request that review directly (14 CFR 450.43).
• FCC. Satellite and earth station systems need FCC authorization, and applicants must show how they will limit orbital debris. Under the FCC's five-year rule, satellites in low Earth orbit must be disposed of as soon as practicable and no more than five years after their mission ends. It applies to satellites launched after September 29, 2024 (FCC orbital debris FAQ). The FCC also has a streamlined process for small satellites and small spacecraft (Part 25).
• Remote sensing. Anyone operating a private remote sensing space system in the United States, or a U.S. person operating one abroad, needs a license. The office encourages an Initial Contact Form and consultation first, and lists up to 60 days to process a complete application (CRSRA licensing).

Space attorney Trevor Hehn talked through what space law means for new space businesses on episode two of the Space Launch Podcast. It is a good listen before you meet your own counsel.

Step 6: Plan for export controls from day one

Export controls affect who you can hire, who you can share technical data with and where you can sell. They apply from the start, not only when you ship something overseas.

• ITAR (International Traffic in Arms Regulations) is run by the State Department's Directorate of Defense Trade Controls. Under 22 CFR Part 122, U.S. companies that manufacture or export defense articles, or furnish defense services, generally must register with DDTC, even if they never export.
• EAR (Export Administration Regulations) is run by the Commerce Department's Bureau of Industry and Security and covers commercial and dual-use items, which can include some spacecraft, components and related technology.
• The FAA's export controls guidebook for the commercial space industry is a plain-language overview of both.

Practical steps: work out which regime your product and technical data likely fall under, set simple rules for who can see controlled data, and get export-control advice before you hire or share technical files with anyone who is not a U.S. person.

Step 7: Choose a funding path that fits your capital needs

Match your funding to your model. A service business can often start from revenue, while a launch or satellite company needs significant outside capital.

• Customer revenue. Paid studies, pilots and service work fund early growth and prove demand at the same time.
• Bootstrapping. Many service and software businesses start with personal savings and grow from revenue.
• Non-dilutive government funding. The SBIR and STTR programs fund research and development at eligible U.S. small businesses without taking equity. Several agencies run them, including NASA and the U.S. Space Force through SpaceWERX, its innovation arm. Topics, rules and deadlines differ by agency and change often, so check SBIR.gov and each agency's current solicitation.
• Government contracts. To sell to the federal government, you will need to register in SAM.gov. APEX Accelerators can help you get ready.
• Accelerators, angels and venture capital. Space and deep-tech investors fund companies with large markets and strong teams. Raising from them is a big commitment, so make sure your milestones and timeline fit what they expect.

Whatever you choose, keep costs lean and your runway visible. Long sales cycles and long development timelines make cash planning critical.

Step 8: Build a small team with the right mix of skills

Early space companies need three kinds of strength in the room, even if one person covers two of them:

• Technical. Someone who can build and test the product credibly.
• Commercial. Someone who can find buyers, shape the offer, sell and raise money.
• Regulatory and contracts. Someone who understands licensing, export controls and, if you sell to government, procurement. This can start as an advisor or outside counsel.

Advisors, fractional experts and a strong peer network can fill gaps until you can afford full-time hires.

Step 9: Win your first customers and build your marketing system

Don't wait for a finished product to start marketing. Buyers who watch your progress are more likely to trust you when you launch.

• Start with your network and the people you met during validation.
• Make an easy first offer, such as a pilot, study or workshop, so a buyer can start without a large commitment.
• Lead with the outcome, such as lower risk, faster schedules, better data or lower cost, before the technical details.
• Show up where buyers are. That means LinkedIn, industry events, podcasts and communities. My guide to space industry conferences and trade shows lists the events worth your budget.
• Track every conversation. A simple CRM keeps follow-up from slipping. My CRM guide for space startups shows a setup you can build in a week, and the free Space CRM Kits give you ready-made pipelines.

When you are ready to turn this into a repeatable system, my space startup marketing playbook walks through offers, channels, funnels and the numbers to track. For the bigger picture of how space companies win customers, read my space marketing guide.

Step 10: Join a community and keep learning

The space industry is small and built on relationships. A peer group helps you avoid mistakes others have already made, find co-founders and advisors, and hear about customers and programs early. Space Entrepreneurs, the free community I host on Skool, was built for founders at exactly this stage.

Common mistakes when starting a space company

• Building for years before talking to customers.
• Choosing a market that is too broad instead of a specific buyer with a specific problem.
• Treating regulation as a later problem. Licensing and export controls can shape your design and your hiring.
• Underestimating timelines and cash needs in an industry with long development and sales cycles.
• Ignoring ownership rules that affect eligibility for programs like SBIR.
• Leading with specifications instead of the outcome the customer wants.

Start your space company with people who have done it

Frequently asked questions