Letara, a Japanese space tech startup founded in 2020 and based in Sapporo, is expanding its focus beyond hybrid thrusters for small satellites into larger rocket propulsion systems targeting space, defense, and security markets. This strategic shift is supported by a recent funding round that raised ¥2.6 billion (approximately $16 million), co-led by Headline Asia, JIC Venture Growth Investment, and Incubate Fund. The round also attracted strategic investors such as NES Corporation, Toyoda Gosei, and Frontier Innovations, the latter being backed by Japan’s space agency JAXA. Co-CEO Shota Hirai emphasized plans to develop versatile hybrid rocket systems that address a broad range of applications beyond just satellite thrusters.

At the core of Letara’s technology is an innovative hybrid rocket design that separates solid fuel from a liquid oxidizer, using low-cost materials like plastic and rubber instead of traditional paraffin wax. The company’s proprietary manufacturing process improves ignition reliability and consistent combustion, aiming to overcome traditional hybrid rocket challenges related to thrust, performance stability, and combustion control. This approach could enable more efficient propulsion for larger spacecraft, particularly those needing to traverse from low Earth orbit to geostationary orbit and through radiation-heavy zones like the Van Allen belt, areas where higher thrust is essential.

Japan’s growing investment in space technology and relaxed defense export policies have fostered a conducive environment for startups like Letara to scale their innovations and capture emerging commercial and government contracts. The company has already secured orders from satellite and rocket manufacturers along with the Japanese government, though specific contract values were not disclosed. Letara’s near-term goal involves conducting an in-orbit firing test with an overseas partner to validate their system’s capabilities, while developing scalable manufacturing processes and supply chains to support expanded production and commercialization efforts.

Letara faces competition from several players advancing hybrid rocket technology globally, including companies in Japan, China, South Korea, Singapore, Germany, Australia, and the U.S. The startup aims to leverage its academic origins at Hokkaido University and the market’s growth trajectory—estimated to reach $2.6 billion globally by 2032—to position itself as a key participant beyond the small satellite thruster niche. The company also sees potential in sustainable fuel options, such as recycled plastic, although further development is necessary to realize that possibility.