Venture Capital

Why the global aerospace industry may see a start-up boom

Khairiyah Ramthan
Space industry is seeing a renaissance

The global aerospace industry is fast becoming venture capitalists' new frontier, according to Francois Chopard, the CEO of aerospace accelerator Starburst Accelerator.

Speaking to CNBC's "The Rundown" on Wednesday, Chopard said, "We've seen a couple of announcements for start-ups willing to build electric commercial aircraft, so it's not only space that is booming, but more the global aerospace sector that is looking for disruptions."

With Jeff Bezos announcing his plans to sell $1 billion in Amazon stock each year to finance his space venture, Blue Origin, as well as the recent successful launches of Elon Musk's SpaceX rocket, Chopard said he's bullish on the global aerospace sector as a whole.

"We just realized recently that with the success of SpaceX and a couple of others, it was feasible for entrepreneurs with great ideas and great technologies to bring satellites with rockets and send them to space," he said.

April 12 marks the International Day of Human Space Flight, commemorating the first human space flight by Soviet cosmonaut Yuri Gagarin in 1961. So in the spirit of space exploration, Chopard said the aerospace industry is seeing more tech-driven breakthroughs globally.

"We've seen from the last five years dozens and dozens of start-ups, not only from the U.S., but also from Europe and Asia," he said.

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His company, Starburst Accelerator, was founded in 2012 and has accelerated over 160 start-ups, with a $5 million average funding target. The company has innovation hubs in Paris, Los Angeles, Munich and Singapore.

Starburst Accelerator launched a new venture called Starburst Ventures late last year. It raised $200 million to back aerospace tech start-ups over the next three years. Chopard said the venture is an essential push to help those companies in an increasingly competitive industry.

"It has been very difficult in the past, but we've seen a couple of deals mainly happening in Silicon Valley, so we wanted to leverage that start with more investors and with more focus on the aviation and aerospace."

Despite geopolitical tensions like those between the U.S. and Russia, Chopard said he is optimistic about the future of the industry.

"Space collaboration between the U.S. and Russia is not new, it's been going on for the last 20 years and they have achieved amazing things together, like the International Space Station," he said, adding that the aerospace industry as a whole may have "the capability of making millions."