In A Rare Acquisition, Elon Musk’s SpaceX Is Buying Satellite Connectivity Startup Swarm

In a rare move from Elon Musk’s company, SpaceX is acquiring satellite connectivity startup Swarm Technologies. This will be the first of its kind deal for a 19-year-old space company. The startup operates a constellation of 120 satellites and a ground station network. The company has around 30 employees currently working for it. As part of the deal, SpaceX will absorb all the sandwich-sized satellites and employees. As per the deal, Swarm will become a wholly-owned subsidiary of SpaceX. According to an August 6 filing with the Federal Communications Commission, Elon Musk’s company will also get control of Swarm’s ground and space licenses along with any licenses pending before the commission.

The development is a sharp departure from the established strategy of the company. The company has been so far developing all its technologies internally. As per the filing, the deal was signed between the two companies on July 16. But the filings do not have any mention of financial details or terms of the transaction. Neither Swarm nor SpaceX has commented on the development. The filing states that the merger will benefit the companies. This will increase the ability of SpaceX to provide innovative satellite services as the company will have access to the intellectual property and expertise developed by the startup. For Swarm’s part, the startup will benefit from access to resources and better capitalization.

How exactly SpaceX will be benefited from the deal is something unclear at the moment. This is because Swarm performs in a different and SpaceX’s Starlink totally different way. The satellites of Swarm are as small as the size of any notebook. With the help of these satellites, the company is providing services for a wide variety of Internet of Things uses. Swarm CEO Sara Spangelo had recently said that the company is working to achieve the goal of a 150-satellite constellation. The startup was valued at USD 85 million during a fundraising round in 2019. Earlier in 2018, it had raised USD 25 million Series A funds.