Episode 33: Aiming High – Germany Joins the New Space Race

Germany’s space sector is booming, as commercial players increasingly shape what was once a purely state-driven domain. From satellite manufacturing and Earth observation to reusable spacecraft and green propulsion systems, German-based companies are helping make space more accessible, sustainable and economically viable. Supported by strong public-private partnerships, generous funding schemes and a dense ecosystem of research institutions, Germany is on its way to become one of Europe’s key space hubs.

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Our Guests

Pagels Kerp | © Pagels Kerp

Anke Pagels-Kerp is Divisional Board Member for Space at the German Aerospace Center (DLR), where she oversees research and innovation at the interface of government, science and the emerging New Space economy.

Martin Polak | © Martin Polak

Martin Polak is Managing Director of Planet Labs Germany, responsible for the company’s operations across Europe, the Middle East and Africa, and for expanding its satellite manufacturing and Earth observation activities in Germany.

Victor Maier | © Victor Maier

Victor Maier leads the German and Central European business at The Exploration Company, a Franco-German start-up developing reusable spacecraft to provide Europe with independent, sustainable access to space.

Transcript of this episode

[Audio: BIG rocket launch, then „space sounds“ ]

Presenter:

The sound of space travel… at least of the sort, many people have thought of since the moon landings half a century ago. Once upon a time, space was the exclusive domain of national superpowers with massive military power and huge state budgets. But of course a lot has changed since then. 

[Audio: LITTLE rocket launch, then „space sounds“ ]

Today’s NEW space race is also about start-ups, pitch decks and venture capital. That’s creating enormous opportunities for players that weren’t at the vanguard in the past. Including in Europe’s largest economy. Young German-based companies are building carrier rockets and launching satellites, turning Earth’s orbit into the next growth market and making space more accessible. And that’s where we’ll be going this time round, with this episode of Into Germany. Welcome, I’m your host Kelly O’Brien.

[once again space sounds] 

Germany has identified space as a serious business priority. The global sector is booming, currently valued at a record volume of around 630 billion USD. 80 percent of that is commercial share. According to a McKinsey study, the space-based economy could reach 1.8 trillion USD in 2035. Two of the international companies driving this trend in Germany are Planet Labs from the US and the German-French firm, The Exploration Company – or TEC. We’ll meet them shortly. 

But let’s start with more of an overview from Anke Pagels-Kerp. She’s a Divisional Board Member for Space at the German Aerospace Center. As it’s known in German, the Deutsche Zentrum für Luft- und Raumfahrt or DLR, conducts research and development on behalf of the German government. It is the biggest aerospace research institution in Europe with more than 12,000 employees.

Hello, Anke, thanks for joining us on the podcast. Everyone is talking about new space. What distinguishes the new era of space exploration from the „traditional" one?

Dr. Anke Pagels-Kerp, DLR:

There are many different ways to define new space. First of all it's just the wording to describe new approaches from common ones. So 30 years ago, the old space industry, so old space, used the same approaches before the whole system and processes became more and more complex. Now, new companies, young researchers ask themselves: Can we become much faster with shorter processes? We have many exciting projects at DLR. So, for example, we built up the Idefix rover for the Japanese MMX mission to the Martian moon and we built this rover together with CNES in a very short time frame. So from the idea to the building, I think it takes a little bit more than two and a half years. And that was very fast. That means also we decide not to test and test and test. Just to take the risk. So we can do also things very fast. 

Presenter:
The CNES is the French space agency, the equivalent of the DLR. So how is GERMANY positioning itself within this new space movement? What are your main priorities?

Dr. Anke Pagels-Kerp, DLR:

We have lots of new space companies in Germany, from the satellite manufacturing to the earth observation, to programming of applications. And DLR is not a company. And with this in mind, we are a little bit out of this business. The research part of these companies is just a small part of their business case. But the research part at DLR is our biggest part. So we explore, for example, new and uncommon sensors in the same way as before, but we push the colleagues to bring them into orbit, not with a super heavy all-you-can-do satellite, but with smaller and faster approach.

Presenter:
Where do you see the biggest opportunity for innovation?

Dr. Anke Pagels-Kerp, DLR:

I think quantum sensors and the earth observation to have totally new resolution in earth observation. New propulsion systems, green propulsion systems. New kind of satellites, for example, in the very low earth orbit. Usually, the satellites are in the low earth orbit, so from 400 kilometers and above to the geostationary orbits, for example, at 36,000 kilometers. But the very low earth orbit will be the new area of satellites in the upcoming years so between 150 and 300 kilometers especially for earth observation.

Presenter: 

You mentioned something called IDEFIX – please tell us more.

Dr. Anke Pagels-Kerp, DLR:

IDEFIX rover is one of our main projects this year. The launch will be at the end of this year from the Japanese launch pad. So this is related to new space. We develop new sensors. Quantum sensors for example for earth observation and the idea is to bring these sensor technologies very fast into the market so we have to work very close with companies. But as I said we are not the company to bring them into market so, we have two to work very closely with new space companies.

Presenter:

So let’s get a bit more specific. How does the German Government support the new space sector?

Dr. Anke Pagels-Kerp, DLR:

Germany has different funding schemes through the German Space Agency, but also other programs from the Ministry of Economy. Germany had in the past competitions for micro launcher and small satellites to make the entrance to the market easier for the companies and DLR is collaborating closely with some of these companies but at DLR we have also the possibility to bring our research into the market with our own startups. So for example, ISP Tech is a new space startup for propulsion systems. And this is a startup from our institute in Lampoldshausen for propulsion systems. But I think, for companies the most common funding scheme is through the agency, so they can apply for funding. So the idea is to cover the financial risk in the early stages. 

Presenter:

Remember the name ISP Tech – it’s another hotly tipped German start-up. So Anke, what do you see as the best ways for the public and private sector to work together to speed up innovation?

Dr. Anke Pagels-Kerp, DLR:

We are not a competitor to the industry, so we want to transfer our solutions into the market and for this we need collaboration. We develop our ideas up to a demonstrator level, but for small series and other production lines, the industry should step in and take it over. The best thing for collaboration is if you have the same goal and want to reach it as a team. So if you want to earn money independently of the result, the flying satellites or the project will fail. We have a very good collaboration, for example, with companies in New Zealand. So we are responsible for the research part and the industry is responsible for bringing it into the market, but this is without exchanging of funds. So everybody is responsible just for their own part and at the end we put it together.

Presenter:
Let’s say I have a new space company and am looking to expand internationally – why Germany? 

Dr. Anke Pagels-Kerp, DLR:

As I said before, we have the German Space Agency as a very big funding agency. Germany is the biggest funding partner for ESA. So we got a lot of contracts from ESA, we have great universities, research institutions and companies in Germany and the engineers are very, very well educated. And the distances are short, also the transport route. So if you compare it to the U.S. or to Canada it's very easy to go from Hamburg to Munich in Germany because it's a small country.

Presenter:
Where are the space hotspots in the country at present?

Dr. Anke Pagels-Kerp, DLR:

We have a very big new space cluster around Berlin. These companies build up satellites. Also the region around Oberpfaffenhofen. So usually, companies grow in the area of, for example, next to old space big companies, or in the case of Oberpfaffenhofen next to DLR. I think Ulm can be the next hotspot for quantum sensors. And hopefully also Cologne with our Cologne Space Hub, together with Starlab and, for example, Axiom. I think the infrastructure in this area is very good and we have very good universities, we have the place to build factories, we have research institutions in this area and I think Cologne with the Rhine, with the highways and the airports is a very good area to raise a new space hub in Germany.

Presenter:

So can Germany – or even Europe – really compete against the US and China in this field? 

Dr. Anke Pagels-Kerp, DLR:

I think we have to preserve and strengthen the things we can do very well. We have to find our gaps and I think, we can copy processes if they work well and do not look for the gold standard. Sometimes, I heard it during the last years many times, that we want to be the world's best. I think in these times becoming resilient is more necessary than be the world's best in something.

Presenter:

Thank you, Anke. Resilience IS certainly one of the key issues in business success these days. No one wants to be over-dependent on something or someone out of their control for crucial services. That’s another major driver of the New Space sector in Germany, as we’ll hear in a minute from Martin Polak, whose company Planet Labs is launching a major German expansion. But before that, let’s have a brief German business news roundup.

NEWS

LESS WAS MORE

8-point-4 billion EUR. That’s how much start-ups in Germany received in venture capital investment in 2025. That’s 20 percent more than in 2024, the third highest sum ever and a clear indication that the sector is returning to the vitality of pre-covid years. The NUMBER of deals, though, actually went DOWN. The trend is clear: Investors in German start-ups are more likely to target their money than spray it around.

 

DYNAMIC DUO

And two innovative German-based start-ups did in fact land big deals in early 2026. Berlin-based Parloa took in 350 million USD in Series D funding. The AI agent tripled its worth within only eight months. And Osapiens from the southwestern German city of Mannheim concluded a 100 million USD series C round. That made the company Germany’s most recent unicorn.

GAMES GERMANS PLAY

A new government report on the gaming sector presents a healthy picture of Germany’s gaming industry. The number of gaming companies nearly doubled over the past five years. More than a thousand gaming firms currently operate in Germany. And annual turnover has risen 22 percent, reaching 3.73 billion EUR.

CLEAN ENERGY RECORD

Renewables accounted for almost 56 percent of electricity consumed in Germany last year. That was more than ever before – and an 11 percent annual rise. Construction on new facilities for generating renewable power continues at pace. The transition is being driven by solar and offshore wind power.

And finally, BIG BOOST

In its first round of financing, German aerospace start-up HyImpulse booked 45 million EUR in venture capital and subsidies in late 2025. The southwest German firm, which specializes in hybrid drives, says it plans to use the money to send a rocket into orbit by 2027. HyImpulse carried out a successful suborbital test flight in Australia in 2024. Bavarian firms Isar Aerospace and Rocket Factory Augsburg are also jockeying to become the first private German company to send a rocket into space.

Presenter:

Okay back on terra firma. Let’s meet Martin Polak, managing director of Planet Labs Germany overseeing operations across Europe, the Middle East, and Africa. Welcome Martin. Tell us: What is Planet Labs? What do you do?

Martin Polak, Planet Labs

So in very simple terms, our mission is to track change on earth. We operate the largest fleet of earth observation satellites ever built in human history and with our constellation of satellites we image the entire land mass of the earth every day. And that enables to make change visible, actionable and accessible for users.

Presenter: 

When you talk about users – who exactly do you mean?

Martin Polak, Planet Labs

The possible spectrum of uses is extremely wide. So it spans from sustainable agriculture, and you know, that means farmers can better understand what is happening on their fields, so you know they can manage the fields more effectively, while at the same time, governments in Europe, for example, who provide subsidy for farmers, they can measure what's being done on the fields and basically do subsidy control. Another set of use cases has to do with land management and land use. So we understand how land is being used, how well land is protected, what the biodiversity is on land, for example, right? But it also spans into water, for example, in freshwater bodies, we can measure the water quality. But also things like erosion of water bodies and so on, the turbidity meaning how clear is the water, partial even the water temperature can be detected from Earth observation data that we produce. But then also defense and security, national security, so some of our largest customers they use our data for situational awareness over very large areas to understand what arms are being produced and how much activity is going on certain let's say airfields or military bases. 

Presenter: 

So you can measure water quality from space… Fascinating! Could you give us a specific example?

Martin Polak, Planet Labs

In 2021, the Brazilian government decided to implement a system that would monitor environmental crimes in the Amazon basin on a daily basis in almost real time. Illegal deforestation, illegal mining, and other environmentally questionable activities on the ground. And the successes of that system have been tremendous. So Policia Federal says that they were able to crack down on illegal deforestation by 55 percent within just the first two years.

Presenter:
Gathering data is one thing. Understanding it is another. How essential has AI become in your work?

Martin Polak, Planet Labs

AI is an absolute game changer for the use of earth observation data and specifically our earth observation data. With the advent of AI and the incredible increase in compute power available, what could be done previously by one analyst in one day can now be done by algorithms within seconds. So it opens totally new world for earth observation altogether. Our vision for the future is what we call the queryable Earth, meaning that analysts or people who use our data, they don't look at the images anymore, but they ask questions similar to you know questions you would ask in Google, and the systems, the algorithms, they would return you the answers they have extracted automatically in almost real time from our imagery.

Presenter:
Planet Labs is undertaking an eight-figure expansion in Berlin, opening a new satellite manufacturing facility and strengthening partnerships with local research institutions and government programs. Why did you decide to invest and grow in Germany?

Martin Polak, Planet Labs

In the future, in the near future, we will build satellites here in Berlin. And this has been driven by local demand combined with talent we find here. So we think that the conditions for expanding our operations and building satellites here in Berlin are very favorable actually here in Germany and in Berlin. We have always had a focus on Europe. 40 percent of our staff globally is based in the EU and we have four different offices throughout Europe already. The recently announced expansion of our manufacturing in Europe, that is just a logical step as we build more satellites and so on, that we do this here in Europe to fulfill local demand.

Presenter: 

How can the public and private sectors best work together to accelerate innovation? What’s your view?

Martin Polak, Planet Labs

Especially Germany has a unprecedented ecosystem of public and semi-public research institutions, and many of them have been long term users of our data sets already. We think that science should always try to leverage data sets available as opposed to trying to replicate, and I think there is definitely room for improvement. Above and beyond I think there is more room to grow to cooperate on the use of our data, especially as it pertains to climate action, to biodiversity topics, to managing natural resources and so on, right? So it's a huge potential. We're on a good way. Number two, also in the procurement mechanisms, we have already a contract with the German government, that provides virtually unlimited access to our data over Germany to institutions of the German federal government. So it's one contract that gives hundreds of different institutions in Germany access to our data. I think that could be used as a blueprint how to efficiently and effectively disseminate data that exists already to different end users. 

Presenter:

What opportunities do you see for smaller startups?

Martin Polak, Planet Labs

I think it is easy for startups to enter this space economy. Startups that have an idea for solving a real world problem, most of them start with free data that is available from the European Commission for example, or from ESA, right? Then there are many different programs, including from Planet, that allow with very low hurdles to obtain also commercial data for trying out or for research and development and so on, right? And then there are different funding vehicles to support startups and so on. So I think that the hurdles are quite low to try out things and then to basically test and convince investors to invest into new ideas.

 

Presenter:

Speaking of support: That’s exactly what we do at GTAI. We worked together on your Berlin expansion.

Martin Polak, Planet Labs

I would like to explicitly thank GTAI, who has supported us in the process of the planning of our manufacturing expansion here in Germany. So thank you very much, GTAI.

Presenter:

It was a pleasure, Martin. Now we’re off to Munich to look at The Exploration Company, a startup developing reusable spacecraft. Victor Maier is leading the German and Central European business at The Exploration Company. Victor, your mission is „to build a globally cooperative future in space“. Tell us more!

Victor Maier, The Exploration Company: 

So the vision is, I think simple, but it's also very ambitious. So we want to make space more accessible, more sustainable, and more cooperative. So what we believe in and what we really fight for is that Europe needs its own independent, reusable transportation systems, not just for cargo, but also ideally eventually for human space flights and then also in orbit operations. And especially right now, in this geopolitical environment we're living in, all the space technology that is developed has a huge and the key word is here dual use application, which means that here is a big potential also to develop technology that is for our security and for our own sovereignty of space technology very very important in Europe. And cooperative future, what does this actually mean? So it's working on the one hand with governments but also with commercial partners. We're enabling scientific, medical and also industrial applications in space. And we're building systems that integrate into the international space stations but also into the future commercial space stations. The International Space Station is going to retire in 2030. There will be other commercial space stations coming and we want to be able to connect actually to all the various stations that are planned around low earth orbit and also for the future lunar missions.

Presenter:

As you’ve just mentioned, European sovereignty is becoming increasingly important in the space economy.

Victor Maier, The Exploration Company:

There’s a race towards space, there's a race towards the low earth orbit, but also towards the moon. And us as Europeans we really have to be careful because what we observe right now on the market is that we are currently bypassed by other nations. If you think about India or Japan, they already now manage to have reusable launchers and reusability is a a big big topic because with this you can actually increase your competitiveness, you can become cheaper. And if you look at Ariane 6, for example, our European launcher, it's a one usage vehicle, so you bring it up into orbit, but then you you throw it away because you cannot reuse it, and then you have to build a new rocket. And this makes it of course, takes a lot of time to get there and costs a lot of money, right? And so for us this accessibility to space is very, very limited. I'm not saying that we we need to be nationalistic in Europe, but it's I think also for the strength of Europe very important to have own capabilities to be a strong partner also for our allies that maybe you know also be attacked and then they need us to help them, right? And I think this is the way we need to see this and also this shift of mindset.

Presenter:
You mentioned reusability being a major issue because it reduces production costs. I guess, it’s also about sustainability…

Victor Maier, The Exploration Company:

We believe that the future of space transportation is about reusability, it's about using non toxic propellants. We're speaking here about green propellants and also circular. We're developing these engines and these thrusters completely in house because it's a technology that is not existing in Europe in that way. You're usually today using hydrazine. It's a well known technology, it's a well known propellant. And it's something you know you can get cheap. But the problem is, it's toxic not only for environment but also for people, and then you know you have difficulties, issues how to store it, how to handle it also on the launch pad. And so this is something that we would like to get rid of. 

Because for every industry it has become also kind of a yeah a scalable nature. I mean, you don't have a plane that you just use once, you don't have a car that you just use once. You want to re-recharge it, refuel it. And why should it be different for space, right? And the vehicle that we're developing and building, it's highly reusable. The heat shield that we're using, it's a heat shield that we develop completely and produce completely in house. And it's not ceramics, it's actually a so-called ablative material. We can actually take it off and we can bring on new tiles and then actually very quickly go back to space. We don't have to rebuild again the full structure, we don't have to rebuild the full tanks, the onboard computer. So everything, the whole technology inside stays safe and we can reuse it. 

Presenter:
Lower costs, less environmental footprint, shorter production times – all essential steps toward making space more accessible.

Victor Maier, The Exploration Company:

Space is not only for space, it's really for the people here on Earth. A lot of people would ask: Hey, why do we put so much money into space? But I think it's a real benefit for the people here on Earth. Think about how often you use the navigation system with your phone or with your car, how often you communicate via satellites just by doing bank transfers and these kind of things. You can really see that there is now a movement happening from the government side and also from the institution side where they're shifting their mindsets. Going from the traditional space mindset that they're now starting to go into more commercial space mindset, as we call it, like into public private partnership. But this is a model that we have really pushed a lot at the exploration company here in Europe. 

What we are proposing is going to a service contract, which means we as a company we have already commercial customers, we have also private investors, and we're offering already a service. In our case, it's going towards the space station and bringing cargo to the station and also to commercial stations and bringing it back down. So kind of a DHL delivery service, you could say from Earth to space. And we provide the service, it costs 150 million euro, and you pay it, and then you get the service. And this is a different approach because now we sign first contracts with for example, the European space agency, they have signed a contract with us to do this service. They say, I I buy your service, you take care about you know making sure that it works, and this is up to us. And as we have also the private investors on our side, they of course want to see that we make it happen on time, on quality, on cost. So we have on this side this pressure to be also on time. And this makes a very dynamic. Also the German space agency they bought the service to fly several science experiments to the space station. It's a very very good sign to see that the agencies are now changing here their mindset.

Presenter:

Last November, the European Space Agency held its Ministerial Council in Bremen, which is another of Germany’s space hotspots. The European member states committed a record 22 billion EUR for ESA programs over the next three years – a clear political signal. Germany alone is pitching in more than 5 billion EUR, making it the largest single contributor.

Victor Maier, The Exploration Company:

I mean, you see it with the announcement of Boris Pistorius, our Minister of Defense, who said we are going to put 35 billion into defense for space systems out of Germany for Europe and for our NATO obligations to be also a strong partner. Space hardware per se is an expensive topic, right? If you just look at our Nix capsule, for example, only to develop the vehicle, we're currently calculating 450 million euro for as development costs. And this, of course, we need to get on the one hand from the private investment and also from customer contracts or public investment. 

Presenter:

How important is a European investor base for you, both financially and strategically?

Victor Maier, The Exploration Company:

It's not only about some satellites that you put in orbit. In the end it's a very strategic topic and Europe needs European companies backed by European capital, I would say it like this, to secure long term autonomy. And our investors include major European funds and this creates of course long term stability, the alignment also with European strategic interests and the credibility when it comes to partnering with agencies like the European Space Agency, the German Space Agency or the European Commission. The message it sends when you have European investors is very clear that also Europe believes in building its own capabilities for space flight, for cargo, for in orbit operations. And I think this is also very important.

Presenter:
You have a Franco-German background and just recently have expanded your industrial presence in Germany, including new headquarters near Oberpfaffenhofen and the acquisition of the additive-manufacturing specialist Thrustworks. How do you see your activities here evolving in the coming years?

Victor Maier, The Exploration Company:

I think Germany for sure is one of the most attractive countries in Europe for several reasons. The strengths are definitely this world class engineering talent, especially when it comes to software development, guidance navigation control, where it's about simulation, manufacturing, so you know the whole assembly, the integration, the testing that we need. We really have a very good ecosystem of universities here in Germany. You have an unbelievably strong industrial base. If you think about automotive industry, you know, if you think of serial production. This is really like competencies that we need in the future for space as well. And who is not better equipped than the automotive industry, knowing exactly how this works? Robotics… Germany is unbelievably good in robotics. Also when it comes to aviation and materials, there's a big industrial base and ecosystem here where we can transfer this knowledge very well into the new space ecosystem. Also deep tech research institutions like the German Space Agency, that is also located all around Germany. Germany is really the anchor for European space economy. We are here because the talent is here, the research ecosystem is here, and also this industrial depth that is irreplaceable.

Presenter:
The space industry is becoming increasingly commercial. What will the market look like in the next decade?

Victor Maier, The Exploration Company:

I think it will be defined by three major shifts. So on the one hand the commercial space stations that I already addressed. So in 2030, maybe 2031, the ISS is going to retire. And then you will have commercial stations that will be around the low Earth orbit. This will mean that we will need in Europe our own access, so that's why we are right now building this vehicle. And then you will see the companies, the industries that I mentioned to you before, they will have actually an affordable and an available access towards this new environment.

The other major shift I see is within orbit operations. So right now already the agencies and also the governments are interested in how to refuel satellites, how to perform inspection of satellites if something is like broken because of space debris. How can we then you know service a satellite or a station even and how can we even manufacture in space? And then I think the next the third major shift that we're going to observe is the lunar economy. And Europe cannot, you know, afford to be just a follower or to be a passenger. We need to really be able to be like a leading player here. And in this case, space I would say is not just longer a scientific domain. For Europe, it really becomes now also a commercial and economic domain. It will create new jobs, you know, it will create new competences, new talents that we have here in Europe and it will unleash, unleash really huge potential. And I hope that society is actually seeing this benefit and will understand it.

Presenter:

That’s a great vision to wrap up our discussion with. Thank you Victor for sharing your perspective and The Exploration Company’s Plans. Much obliged as well to Martin Polak from Planet Labs and Anke Pagels-Kerp from the DLR. As usual, before we end, we’ll have a look at How Germany Works.

How Germany Works

So as we’ve been hearing, there is a lot of state support in Germany for the new space sector. Let’s unpack it. Under the current government, space is subsumed under the Ministry for Research and Technology. But the Ministry for Economic Affairs and Energy also plays a huge role. The heads of both were present when Planet Labs announced its Berlin expansion in 2025, and the head of the Defense Ministry also attended the space industry trade fair where the announcement took place. Then there’s the DLR, which is mirrored on the EU level, and cooperates closely with corresponding agencies in neighboring countries, first and foremost France. Finally, there are a host of state initiatives and programs to stimulate new space start-ups and innovation. As a result international businesses have no shortage of potential partners at the heart of Europe. And THAT’S HOW GERMANY WORKS.

[audio: space and rocket sounds]

Presenter:
There you have it. Expanding to Europe’s largest market could be just the thing to help YOUR aerospace company really take off. And Germany Trade and Invest can advise you and help you on your way… all at no cost because we’re a government agency. Let’s talk space at gtai.com. We’re also keen on your opinions, suggestions and questions. Please leave a comment in your favorite podcast app or drop us a line. You’ll find all the details in our show notes. 

So, thanks for listening, auf Wiederhören, keep your eyes on the stars – and remember: GERMANY MEANS BUSINESS.