On the morning of January 12, ISRO’s PSLV-C62 lifted off from Sriharikota carrying EOS-N1, a hyperspectral earth observation satellite, along with a cluster of 15 other payloads. The mission reflected India’s growing space ecosystem, with satellites from private Indian players and a handful of international ones.
Three Indian startups were eager to demonstrate a proof-of-concept for space technologies that had taken years to develop. The launch was meant to hit a milestone.
But soon after the take-off, the mission fell short.
Indian Space Research Organisation (ISRO) detected a third-stage anomaly, cutting the flight short before the payloads could be deployed. Satellites meant to activate in orbit never separated from the rocket. They got lost from the intended trajectory.
For founders watching this telemetry, a new, stark reality came to the fore. The mission ended early.
The aftermath was quieter, faster, and more revealing than the launch. While the loss of hope was immediate, the recovery began just as fast.
ISRO chairperson V Narayanan reported that the vehicle encountered disturbance roll rates and deviated from its flight path. “We are analysing the data, and we shall come back at the earliest,” he said.
Post this, engineers began assessing what failed. Founders had to call customers and investors to recalibrate timelines. Regulators issued statements of support. Not many spoke of the panic and roadblocks that these startups might face.
The impact went beyond startups, prompting ISRO to reassess future missions. What does recovery look like, and what does this reveal about India’s private space sector?
“It was rather unfortunate,” Bhaskar Majumdar, managing partner at Unicorn India Ventures (UIV), told AIM. “The PSLV is the workhorse of the Indian satellite programme and has one of the lowest failure rates of 6%.”
Majumdar, whose firm has invested in deep tech and space tech startups, noted that the timing was unsettling for many in the ecosystem. To date, the PSLV rocket has been used in 60 launches, with two aborted missions.
Last year, during the launch of the EOS-9 surveillance satellite into the intended orbit, its launch vehicle, PSLV-C61, also encountered a similar technical issue.
It is ironic that both missions (C-61 and C-62) failed within eight months and faced similar problems. Majumdar pointed out that the timing was unsettling for many in the ecosystem.
“It is a matter of concern for ISRO as this not only slows down startups but becomes a blot in the space programme, especially when we are doing complex missions like Mangalyaan and Chandrayaan,” he added.
India’s space startup ecosystem is no longer experimental. It is commercial, customer-facing, and capital-intensive. A launch failure of this sort not only delays science but also pauses revenue, pilot projects, and contracts. And Indian space startups are no longer optimising only for the success of their satellites or payloads but for recovery in such scenarios.
What Breaks & What Survives
TakeMe2Space (TM2S), a Hyderabad-based space startup, sent its 14 kg MOI-1 satellite on this launch. MOI-1 aimed to be an ‘AI lab in space’ for about 15 customers. This satellite also featured EON Space Labs’ miniaturised, ultra-lightweight space telescope, MIRA, which had recently passed thermo-vacuum testing, qualifying it for space operations in accordance with NASA standards.
Since no launch sequence was initiated, MOI-1 was not ejected and therefore did not power on,” TM2S founder and CEO Ronak Kumar Samantrayv said.
MOI-1 was designed to test an ambitious goal. The satellite aimed to run AI models directly in orbit, reducing dependence on ground processing. Samantray said four customers were prepared to push the AI models into satellite mode. He added that this process is now on hold until they can get the satellite into orbit as quickly as possible.
What did not pause was rebuilding.
The startup had already prepared for failure scenarios during assembly. The team built multiple versions of every subsystem, partly to manage late-stage risks. That decision has now shaped the recovery timeline.
Samantray stated that they have a complete set of satellite components on hand and expect to assemble a new MOI-1 by mid-March. They are also considering alternative launch options, such as ISRO’s SSLV rocket, with plans to return to orbit before August.
The setback still carries a cost. Customer pilots are delayed, and the demonstration data for TM2S has not been generated. This issue is common among startups that sent payloads, including Hyderabad-based Dhruva Space, which supported five payloads on the mission covering satellites, launch coordination, and ground systems.
Sanjay Nekkanti, CEO and co-founder of Dhruva, stated that their current goal is a prompt and steady turnaround, enabling both their team and clients to prepare for upcoming launches in less than a few weeks.
Dhruva’s model heavily emphasises the ground segment. While satellites might fail to reach orbit, ground infrastructure remains operational. That distinction is important when customers are already managing systems.
According to investor Padmaja Ruparel, co-founder of IAN Group, most Dhruva customers on the mission already had ground infrastructure delivered and operational. That infrastructure will support future launches without requiring replacement.
From a programme perspective, this reduces the cost of failure. Ruparel added that Dhruva is already working with its customers to announce the next set of missions soon.
Bengaluru-based OrbitAID was another Indian startup that launched its AyulSAT payload onboard this mission. It was India’s first tech demonstrator for in-orbit satellite refuelling, testing the transfer of propane fuel in space to extend satellite life, reduce debris, and build an ‘on-orbit economy’ using its unique docking interface.
This 25kg payload aimed to validate fuel, power, and data transfer, with future plans for a chaser satellite for full ship-to-ship docking. Had this PSLV mission succeeded, AyulSAT could have marked a milestone for India in on-orbit servicing and space sustainability.
Patience, Capital, and Confidence
For investors backing space startups, launch anomalies test more than technology. They test conviction. Majumdar characterised deep tech investing as demanding a different mindset. He noted that failures are not re-evaluated after they occur but are considered a normal part of the growth process.
He noted that investor response is crucial during failure, as entrepreneurs face pressure from customers, teams, and cash flow, and that a withdrawal then worsens the damage.
UIV plans to continue backing affected companies, including TakeMe2Space and OrbitAID, if short-term cash flow pressure emerges.
Majumdar stated that increasing the number of launch sites and operations is necessary to reduce dependence on ISRO. He highlighted the need for an accelerated launch schedule in the near future, given the large number of space startups and the VCs interested in this domain.”
Private players such as Agnikul Cosmos, Skyroot Aerospace and EtherealX will help, but the transition will take time.
Ruparel echoed a similar sentiment. “We are helping our companies with customer traction and retention through technology adoption, scale, risk & execution speed,” she said, adding that deep tech is a bet for the long run.
She viewed failures as part of industrialisation, not breakdown. “In spacetech, thousands of satellites will be built over the next decade,” Ruparel said. She argued that on this scale, failures are inputs to speed rather than bottlenecks.
Earlier, Indian space startups operated under a scarcity model, with rare launches and long waits after failures. Today, startups plan relaunches within months. They design satellites for quicker rebuilds, begin insurance talks earlier, and typically include contingency clauses in customer contracts.
Another fallout from the PSLV-C62 anomaly has been the spotlight on a gap that many Indian space startups now regret: none of their satellites on this mission were insured. Recent reports show that these Indian companies didn’t obtain launch or satellite insurance mainly because premiums are high, and affordable, tailored space policies aren’t available in India.
This gap contrasts with global practice, where launch insurance is standard for most commercial payloads. Analysts and insiders have pointed out that the lack of an accessible insurance market in India leaves startups exposed to total losses when missions fail, especially for first-of-a-kind or experimental satellites.
Will the Government Step in?
For regulators and institutions, the PSLV anomaly arrived at a sensitive moment, as India is pushing to open its space sector while preserving confidence in its national launch capabilities.
According to the year-end review for 2025 provided by the Department of Space in December, India’s space programme was already riding a wave of milestones before the PSLV anomaly.
Last year, ISRO celebrated its 100th launch from the Sriharikota spaceport, marking a milestone that represents nearly fifty years of operational growth. It also revealed plans to expand its launch infrastructure with a third launch pad at Sriharikota to support next-generation rockets and increased launch frequency.
IN-SPACe, the government body tasked with enabling private space activity, responded by emphasising support rather than caution. Dhananjay Khot, director of strategy and planning at IN-SPACe, described an organisation-wide effort to support non-government entities working through recovery.
“I have no doubt that this setback will be turned into another triumph for the Indian space sector. This is merely a delay, and not a denial of their dreams and plans,” he said.
In the interim, ISRO’s schedule is critical as more startups prepare for flight, lengthening launch queues. This tension is common in mature space economies. Last year, NASA’s Lunar Trailblazer, a small lunar orbiter, lost contact and power shortly after its February 2025 launch due to spinning that prevented solar panel orientation.
The organisation ended its lunar water-mapping mission in July 2025. In April 2025, a Firefly Aerospace Alpha rocket launch failed, losing its payload, and in May 2025, a SpaceX Starship test flight experienced an onboard leak and loss of control.
For now, Indian space startups aren’t waiting for perfect conditions, but building resilient systems that can endure setbacks. Despite PSLV C-62’s failure to complete its mission, the ecosystem surrounding it continues unabated.
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