Japanese Space Tech Innovator Letara Secures $16M to Broaden Its Horizons Beyond Satellite Thrusters

Japan is investing heavily in its growing space sector while relaxing rules on defense exports, in an effort to foster a domestic aerospace industry populated by startups with international aspirations.

Letara, a startup based in Sapporo, is aiming to take advantage of this momentum. Initially focused on hybrid propulsion systems for small satellites, the company now intends to expand into creating larger rocket systems aimed at the space, defense, and security sectors, according to co-CEO Shota Hirai.

This expansion is being supported by ¥2.6 billion (approximately $16 million) in recent funding, as Letara seeks to transform years of academic research into a viable business. The funding round was jointly led by Headline Asia, JIC Venture Growth Investment, and Incubate Fund, with additional backing from strategic investors like NES Corporation, an energy firm; Toyoda Gosei, a supplier of rubber and plastic parts to Toyota; and Frontier Innovations, a Greece-based data analytics company.

“With this investment, we aim to extend our research beyond simply demonstrating the thruster in space,” Hirai stated. “We plan to investigate a broader array of applications in both the space and defense sectors, and to develop hybrid rocket systems tailored to those needs.”

Letara’s core technology features a hybrid rocket design that separates solid fuel from the liquid oxidizer required for combustion. Common materials like plastic and rubber serve as the solid fuel. The company has created a proprietary manufacturing technique to mix, shape, and compress these materials, ensuring reliable ignition and consistent burning. This results in a propulsion system that provides greater thrust with reduced waste compared to traditional hybrid rockets that typically rely on pricier paraffin wax.

The company aims to tackle three main challenges that have hindered the use of hybrid propulsion: generating adequate thrust, ensuring performance stability, and managing combustion effectively, according to Hirai.

The potential for Letara is significant. The global market for hybrid rocket propulsion is anticipated to grow from $848 million in 2024 to $2.6 billion by 2032, representing a compound annual growth rate of 15%, indicating a rising demand for such technology.

Letara, however, is not the only entity in the race. Several companies, including Japan’s Interstellar Technologies, China’s Galactic Energy, South Korea’s InnoSpace, and Singapore’s Equatorial Space, are also advancing hybrid rocket technology. Additionally, German startup HyImpulse and Australian Gilmour Space are exploring similar avenues, along with various U.S. firms developing alternative propulsion and launch systems.

Origins in Academia

The concept behind Letara was conceived by co-CEOs Landon Thomas Kamps and Hirai during their research on rocket propulsion at Hokkaido University. They recognized that the safety and ease-of-use of hybrid rockets could make them beneficial beyond conventional space programs, especially with the growing presence of private companies in the sector.

Since its establishment in 2020, when it spun out from Hokkaido University, Letara’s ambitions have evolved alongside the needs of the market. Initially focused on satellite thrusters, the company is now exploring defense contracts and launch services to better position itself against not only domestic competitors but also international players.

“Large spacecraft require high-thrust propulsion systems, particularly for transitions from low Earth orbit to geostationary orbit and for navigating through high-radiation areas like the Van Allen belt quickly,” stated Hirai. “Moreover, there is an enormous, increasing demand for launch vehicles.”

Letara’s target audience includes satellite manufacturers and operators, launch service providers, and government entities. The firm believes commercial satellites represent its most significant market for in-space propulsion, while government interest in rocket systems is growing, especially within Japan. The company claims to have secured contracts with rocket and satellite firms, as well as government agencies, though it has not disclosed the financial details of these agreements.

A key upcoming milestone for Letara is an orbital firing test in collaboration with an international partner, which the company views as crucial for its commercialization strategy. It also plans to develop a repeatable manufacturing process, supported by stringent quality controls, and establish a dependable supply chain for its fuel and tanks to enable large-scale production.

Regarding the potential for using recycled plastic as fuel, Letara has indicated that this is “very much a possibility” with its hybrid technology, albeit additional testing and development will be necessary.