Welsh space technology company Space Forge has closed a £22.6 million Series A funding round, making it the largest Series A investment in UK space technology history. The NATO Innovation Fund led the round and showed strong institutional backing for the Cardiff-based startup’s plans to manufacture advanced materials in orbit.

Why Make Materials in Space?

Space Forge’s technology uses space’s unique conditions. Zero gravity stops the convection currents that create defects in crystal formation, while the vacuum and extreme temperatures create conditions that can’t be replicated on Earth. This allows the production of semiconductor materials and crystals with fewer flaws.

“We’re stood on the shoulders of about 50 years of research when it comes to not only knowing that this is possible, but also knowing that there is a profound improvement in doing so,”

explains CEO Joshua Western. The improved materials perform better in quantum computing and defence applications.

Early testing shows potential for growth. Space Forge is working with BT to test how space-grown crystal materials could reduce power consumption in 5G towers. Research suggested that space-made materials could cut CO2 emissions by 75% and energy use by 60% in key infrastructure.

Strategic Military Interest

The NATO Innovation Fund’s involvement highlights the technology’s military importance. Major defence contractor Northrop Grumman has partnered with Space Forge, showing the technology’s potential for both commercial and national security uses.

This defence,e angle matters more, given semiconductor supply chain risks. Europe imports 80% of its chips, with 90% of the world’s most advanced semiconductors coming from Taiwan creating significant geopolitical vulnerability.

Getting Materials Back to Earth

Space Forge has developed its own technology for bringing materials back, including the Pridwen heat shield and Fielder, a floating net for soft water landings. Western describes their method simply:

“We deploy something that looks very much like an umbrella, [but] that’s space grade, and that allows us to float back from space down to the ground.”

The company doesn’t build rockets, instead working with existing launch providers. This lets them focus on their main technology while using what Western calls “solved problems” in the launch industry.

Bouncing Back from Failure

The funding comes after a major setback in 2023 when Virgin Orbit’s launch failure from Cornwall destroyed Space Forge’s ForgeStar-0 satellite after just six and a half minutes. Although it was costly, the failure provided valuable lessons for future missions.

ForgeStar-1, set to launch later this year, will be the company’s first real test in orbit. The mission, called “The Forge Awakens,” aims to prove the entire manufacturing and return process works. Success will lead to ForgeStar-2, which is designed for larger-scale operations.

Who’s Investing and Why

The Series A round attracted sophisticated investors, including the World Fund, the National Security Strategic Investment Fund (NSSIF) and the British Business Bank. Other participants included Innovation Investment Capital, Gaingels, SpaceVC, and several technology-focused investors.

“We urgently need a resilient, homegrown supply of the next-gen supermaterials required for the future of compute,”

said World Fund general partner Daria Saharova, highlighting the mix of climate and technological independence concerns driving investment.

The Challenges Ahead

Getting to a commercial scale won’t be easy. Space Forge claims that its technology could be carbon-negative. However, the actual environmental impact depends on achieving enough scale to offset the carbon cost of space missions. The company must also handle the tough engineering challenges of operating in space where extreme temperatures and radiation create constant problems.

Space Forge has opened a European office in Portugal’s Azores, positioned for satellite recovery operations. This expansion reflects the practical needs of building industrial-scale space manufacturing.

The company is part of a growing field of space manufacturing ventures working on everything from pharmaceutical research to telecom hardware. However, commercial success across this sector still depends on bringing down both launch costs and operational complexity.

Space Forge’s upcoming missions will be a crucial test not just for the company but for the entire concept of space-based manufacturing. The results will help determine whether making advanced materials in orbit can move from science fiction to commercial reality.