![\"\"](\"https:\/\/i0.wp.com\/spacenews.com\/wp-content\/uploads\/2026\/08\/Rep._Kevin_Mullin_signing_a_solar_panel._Credit_Xona-1.jpeg?ssl=1\")
<\/a>U.S. Rep. Kevin Mullin (D-Calif.) signs a solar panel at a Xona Space Systems manufacturing facility in California. Credit: Xona Space Systems<\/p>\nIn Southern California, aerospace companies have established ties with community colleges to support education and training for welders, electricians and other trades that support advanced manufacturing.<\/p>\n
\u201cWhat makes California unique is not only the engineering talent, but also the technician talent,\u201d Karan Kunjur, K2 Space co-founder and chief executive, said by email. \u201cThe greater LA area has a deep pool of talented technicians who are foundational to building any major aerospace company.\u201d<\/p>\n
Access to capital<\/p>\n
Another draw is funding. More than 2,000 venture capital firms including prominent space investors call California home.<\/p>\n
And while those firms bankroll businesses around the world, it\u2019s helpful when entrepreneurs and investors can build relationships over coffee or dinner, said Mark Matossian, Whipsmart Ventures founder and managing partner and former Iceye U.S. chief executive.<\/p>\n
One-third of U.S. space-technology companies are in California. In the last five years, more than half of U.S. venture capital funding for space technology went to California companies, according to a report prepared for GO-Biz by Lightcast, an economic modeling firm.<\/p>\n
In contrast to other states, California does not attract companies with financing packages. \u201cWe don\u2019t write blank checks,\u201d Desai said. Instead, the state awards tax incentives for hiring and investment.<\/p>\n
In June, Gov. Gavin Newsom awarded a $32.75 million California Competes Tax Credit to Vast for creating 657 new jobs and spending $87 million to expand its Southern California research, development and manufacturing facilities. Similarly, Apex collected a $24 million tax credit in April and True Anomaly obtained a $12.7 million credit in 2025 for investing in satellite manufacturing and expanding their workforces.<\/p>\n
State strategy<\/p>\n
Companies also remain in California to be close to partners and customers.<\/p>\n
\u201cLos Angeles is one of the centers of the global space industry,\u201d Ian Cinnamon, Apex chief executive and co-founder, said by email. \u201cThe engineers, technicians, suppliers, customers and experienced operators we need are already here, and that concentration of talent matters when you are trying to build and scale a new kind of aerospace manufacturing company.\u201d<\/p>\n
Potential customers include the Space Systems Command, the U.S. Space Force acquisition arm based in Los Angeles that managed a $15 billion budget in 2025.<\/p>\n
California houses three of NASA\u2019s 10 centers: the NASA Jet Propulsion Laboratory, NASA Ames Research Center and NASA Armstrong Flight Research Center.<\/p>\n
Access to Vandenberg Space Force Base on California\u2019s Central Coast is another benefit. To meet increasing demand for launch capabilities, California awarded
$9.5 million to REACH, a Central Coast economic-action coalition to augment Vandenberg infrastructure and support workforce development.<\/p>\n
Tax credits and Vandenberg funding stem from the California Jobs First Economic Blueprint, published in 2025, which identified aerospace as a \u201cstrategic sector to focus on and prioritize,\u201d Desai said. \u201cWhen we created this statewide strategy, we identified pilot sectors to put a whole-of-government approach into supporting and maintaining. Space, defense and satellites was one because we know the legacy of this sector, but also where it\u2019s going. We want to do everything we can to keep it here, to keep it growing.\u201d<\/p>\n
A real estate solution<\/p>\n
Years ago, space companies complained about the high cost of California real estate, which was more of a problem when firms required facilities spacious enough for satellites the size of a school bus.<\/p>\n
Since smaller satellites now dominate the market, \u201cpeople are building whole constellations in classic Silicon Valley one-story office parks,\u201d said Matossian, former head of program management and satellite production for Terra Bella, an Earth observation satellite startup acquired by Planet Labs in 2017. \u201cFor Terra Bella satellites, we set up a mobile clean room. At Iceye, we built satellites in a converted conference room.\u201d<\/p>\n
In the wake of the pandemic, roughly 16% of Silicon Valley offices remain vacant.<\/p>\n
\u201cAll you have to do is drive down [Highway] 101 and look at all this delicious Class A office space that has been empty since the beginning of the pandemic,\u201d Matossian said. \u201cIt\u2019s practically free.\u201d<\/p>\n
Surrounding ecosystem<\/p>\n
In April, Xona invited guests to a new facility in Burlingame, south of San Francisco, where it manufactures satellites and payloads for the Pulsar global navigation satellite system constellation. Xona\u2019s Silicon Valley neighbors include companies developing autonomous vehicles, robotics, AI logistics, device trackers and cell phones that could adopt Xona technology.<\/p>\n
\u201cA lot of the best tech in the world is located in the Bay Area,\u201d Manning said. \u201cIt\u2019s good for us to be located in the same place as our customers.\u201d<\/p>\n
The founders of Xona, like the founders of Terra Bella predecessor Skybox Imaging, met at Stanford University. Stanford, California Institute of Technology, University of Southern California, California Polytechnic State University and University of California campuses supply a constant stream of engineers and entrepreneurs.<\/p>\n
Initially, aerospace engineers may find jobs with SpaceX, Northrop Grumman, Boeing, Lockheed Martin, Raytheon or one of the new satellite manufacturers. Once they gain experience, they often gravitate to startups or establish their own.<\/p>\n
\u201cHere in LA, there is no question that the amount of talent that\u2019s coming out of the universities is part of the equation\u201d fueling the rise in manufacturing, David Barnhart, director of the USC Space Engineering Research Center, said in an interview. \u201cPeople complain about the high cost of living and the high cost of doing business in the state, but in general those negatives are outweighed by the positives. California has become an aggregator of the key suppliers, the key vendors and spacecraft integrators. That allows companies to move very fast.\u201d <\/p>\n
This article first appeared in the August 2026 issue of SpaceNews Magazine.<\/p>\n
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