Space infrastructure startup Starcloud has raised $170 million in a Series A funding round, achieving a valuation of $1.1 billion and becoming the fastest-ever unicorn in Y Combinator's history at just 17 months old. The round was led by Benchmark and EQT Ventures, with participation from Macquarie Capital, NFX, Y Combinator, and angel investors including former Boeing CEO Dennis Muilenburg and former Starbucks CEO Kevin Johnson. This brings Starcloud's total funding to $200 million, following a previous $34 million raise from investors like Andreessen Horowitz and In-Q-Tel, the CIA's venture capital arm.
The company's ambitious goal is to build data centers in low Earth orbit to bypass the energy and land constraints that hinder terrestrial construction. CEO Philip Johnston stated, "The AI revolution is colliding with the physical limits of our terrestrial energy grid. By moving AI compute to space, we unlock access to unlimited solar power and completely remove the energy bottleneck." Building a data center on Earth can take up to five years due to permitting and energy delays, a problem Starcloud aims to eliminate.
In a significant milestone, Starcloud launched its first satellite, Starcloud-1, in November 2025. The satellite carried an Nvidia H100 GPU into orbit, marking the first deployment of such a chip in space. The mission successfully completed the first AI model training in orbit, running a version of Google's Gemini model. The satellite was designed and built in a record 21 months on a pre-seed budget of $3 million.
The company is now preparing for its second launch in October 2026. The Starcloud-2 satellite will carry AWS Outposts hardware, generate 100 times more power than its predecessor, and feature the largest commercial deployable radiator ever sent to space. It will be the first to run commercial cloud workloads for paying customers, including early client Crusoe.
Starcloud has long-term plans for a constellation of 88,000 satellites and expects space-based data centers to become cost-competitive with Earth-based facilities by 2028 or 2029. The new funding will accelerate the development of next-generation Starcloud-3 satellites, expand manufacturing, support hiring, and secure future launch contracts. The company is not alone in this pursuit; SpaceX and Blue Origin have also announced similar orbital data center ambitions.
