Japanese Space Startup Letara Raises $16 Million to Expand Hybrid Rocket Technology
Japanese space startup Letara has raised ¥2.6 billion (approximately $16 million) in a new funding round to expand its hybrid propulsion technology beyond small satellite thrusters. The Sapporo-based company plans to develop larger rocket systems to target the broader space, defense, and security markets.
The funding round was co-led by Headline Asia, JIC Venture Growth Investment, and Incubate Fund. Strategic investors also participated, including energy company NES (Networked Energy Services) Corporation, Toyota Group automotive supplier Toyoda Gosei, and Greece-based IT firm Frontier Innovations.
Letara's expansion comes as Japan increases its financial backing of the domestic space industry and eases restrictions on defense exports. The government initiatives aim to foster homegrown aerospace startups capable of achieving global reach.
Developing Hybrid Propulsion Systems
Letara was spun out of Hokkaido University in 2020 by co-CEOs Landon Thomas Kamps and Shota Hirai, who began researching rocket propulsion during their academic careers. The startup's technology utilizes a hybrid rocket design that separates solid fuel from a liquid oxidizer.
The system uses inexpensive, widely available materials like plastic and rubber as solid fuel. Letara has developed a proprietary manufacturing process to mix, shape, and compress these materials to ensure reliable ignition and consistent burning. According to the company, this approach delivers more thrust with less waste than traditional hybrid rockets that rely on expensive paraffin wax.
Co-CEO Shota Hirai stated that the company's technology aims to solve three historical limitations of hybrid propulsion: generating sufficient thrust, maintaining performance, and controlling combustion. Hirai noted that large spacecraft require high-thrust propulsion to transition quickly from low Earth orbit (LEO) to geostationary orbit (GEO) through the high-radiation Van Allen belt.
Targeting Global and Government Markets
With the new capital, Letara plans to move past initial space demonstrations. The company is targeting satellite manufacturers and operators, launch providers, and government agencies. While commercial satellites represent its largest market for in-space propulsion, Letara is also pursuing defense contracts and launch services.
The startup has already secured orders from rocket and satellite companies, as well as the Japanese government, though the financial details of these contracts have not been disclosed. Letara's next major milestone is an in-orbit firing test conducted with an overseas partner.
To scale its operations, the company must establish a repeatable manufacturing process with quality controls and secure a reliable supply chain for fuel and tanks. When asked about the potential use of recycled plastic as fuel, Letara indicated that this remains a possibility for its hybrid technology, though it requires further testing and development.
A Growing Competitive Landscape
The global hybrid rocket propulsion market is projected to grow from $848 million in 2024 to $2.6 billion by 2032, representing a compound annual growth rate (CAGR) of 15%. This projected growth has attracted several international competitors.
Other companies developing hybrid rocket technology include Japan's Interstellar Technologies, China's Galactic Energy, South Korea's InnoSpace, Singapore's Equatorial Space, Germany's HyImpulse, and Australia's Gilmour Space. Additionally, several firms in the United States are developing competing propulsion and launch systems.
