Just twenty years ago, there were only a handful of space companies in Finland—and almost all of them had the same employer.
‘Most space projects in Finland were for the European Space Agency (ESA), so practically everyone in the industry was working for them in one way or another. There weren’t many growth opportunities, since ESA projects depend on the size of membership fees,’ explains Jaan Praks, professor of space technology at Aalto University.
Now, there are over 200 companies in the field, and the private funding raised by them is among the largest in Europe.
How did this happen?
The change gained momentum in 2010 when Professor Jaan Praks wanted to introduce a new, challenging project to his special course on space technology—and he and his students began building Finland’s first satellite.
‘There was bold attitude at Aalto and a great spirit of renewal that brought me in as a teacher. Aalto was eager to support students and was willing to invest in the project financially. We received a small initial budget and later a larger funding, which enabled us to build and launch the Aalto-1 student satellite,’ Praks recalls.
Aalto-1 was primarily built in Otaniemi, but it was also a broader national collaboration project. The four-kilogram, milk-carton-sized satellite carried high-tech Finnish instruments: a spectral camera from VTT, a radiation detector from the University of Helsinki and University of Turku, and a plasma brake developed by the Finnish Meteorological Institute.
In addition to highlighting the importance of active work and financial support, Praks emphasizes the role of collaboration.
‘In a small country, the field is tight-knit, and there's a high level of trust between different players. A good example of this is the fact that the partner organizations’ devices were added É«É«À²-1 without official contracts—everyone wanted to be part of Finland’s first satellite and everyone took responsibility of their own share.’
The launch of Aalto-1 also acted as a catalyst for Finland’s own space legislation. Students involved in the project went on to establish several new space companies. Many students from the space technology course—and later its follow-ups—have become professionals and passionate satellite entrepreneurs whose services are trusted by companies and governments around the world.
‘Traditionally, space technology has been conservative and cautions, avoiding overpromising. But we took a proactive, startup-minded forward-leaning approach from the beginning, and that attitude shift is now driving the entire Finnish space sector forward. With private investment, the sector experienced strong growth, new expertise emerged, and business models diversified. At the same time, satellites have become increasingly essential to the functioning of society,’ Praks explains.
Otaniemi has evolved into a bustling space campus, home to space companies, research institutes, and ESA’s business incubator, ESA BIC Finland. Earlier this year, Finland celebrated joining NASA’s Artemis Accords and the awarding of ESA’s Phi-Lab Finland innovation program, coordinated by Aalto.
The €4.4 million program is a significant achievement, says project manager Miika Kostamo.
‘We’re among the first five countries in Europe to receive this program. The incubator has supported startups in their early stages, and now we can also accelerate the commercialization of advanced research.’
The program funds special data-based innovations developed in Finland, such as space sensors, remote sensing systems, positioning solutions, and the processing of space-derived data into user-friendly services. Grants range from €200,000 to €500,000 and are available to research groups and companies.
‘The EU's biodiversity regulation, for example, significantly increases the need for easy-to-use and reliable applications for authorities and forest owners to monitor biodiversity,’ Kostamo notes.
International studies have shown that investments in space activities return six to seven times their value to society via benefits in other sectors—so space business contributes to Finland’s economy on a larger scale.
In 2023, the global space economy was worth $630 billion. By 2035, it is projected to reach $1.8 trillion.
So how does small Finland compete in such a massive, global market?
Very well, says Kostamo.
Between 2018 and 2022, the global space sector grew by 30%. During the same period, the revenue of Finnish space companies tripled.
‘Being small is a strength. We don’t have the scale for large satellite systems, so we focus on small and agile solutions, which has enabled rapid technology development. Collaboration is easy and smooth—experts in flagship projects all know each other. The main challenges have been securing funding for scaling and finding enough talent—there’s strong demand for space professionals.’
So how can we meet the growing demand for talent—now and in the future?
Aalto University still offers Finland’s only Master’s and PhD programs in space technology, but that’s not the only route into the field, Praks emphasizes.
‘The great thing about space is that people can enter it from many different areas of expertise. We need mathematics, radio tech, quantum tech, physics, antenna engineering, and AI—but also international business, management, and design. The growth and diversification of the sector has increased the demand for all kinds of skills.’
Education and successful companies are also attracting talent from around the world, Kostamo notes. The field’s international character is visible both among Aalto’s students and the staff of Finnish space companies.
‘Space business also requires strong research expertise from other fields, which we have throughout Finland—from forestry know-how in Joensuu to global south expertise at the University of Turku. What Finland needs to invest more in is understanding other countries’ cultures, networks, and business models—just having a great product isn’t enough in business.’
What’s next on Aalto’s space front?
‘We’re keeping busy,’ Jaan Praks says with a smile.
‘The science satellite Foresail-1 Prime is heading to space later this year, and the student-built Aalto-3 will likely follow next year. We’re involved in several ESA missions and are negotiating at least one new mission related to space weather. We also have joint projects with several Finnish space companies—so our labs are buzzing with people.’
Miika Kostamo is also eagerly anticipating the launch of the ESA Phi-Lab call for applications, which begins April 23.
‘We have strong research expertise in Finland. Now we have the opportunity to turn that into new business and support the entire Finnish space ecosystem.’
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