Managing partner at Balderton Capital, Bernard Liautaud delivered a stark warning at a recent tech event: Europe is becoming dangerously dependent on Elon Musk’s SpaceX for satellite launches and communications—a strategic liability as space becomes the next frontier of defence and infrastructure. He argued that to safeguard sovereignty, the EU must accelerate its own capability in launchers, spacecraft and satellite networks.
Liautaud’s remarks come amid surging investment into European “sovereign tech”, as defence budgets rise across NATO states in the wake of the war in Ukraine. Balderton, a veteran European VC, has already backed The Exploration Company (a Franco-German venture developing rockets, cargo capsules and lunar landers) to build a home-grown space stack. But even with those bets, European players remain dwarfed by American incumbents in scale, experience and capital.
SpaceX dominates both launch services and satellite broadband, especially via its Starlink constellation, leaving Europe few viable alternatives. For example, Eutelsat is now scrambling to close a funding gap and gain scale to compete, as the French government recently committed €750 million toward a 29.65 % stake and the UK added €163 million to bolster a local counterweight to Starlink. Meanwhile, European aerospace giants Airbus, Thales, and Leonardo are negotiating a sweeping satellite manufacturing merger worth about €10 billion, intended to pool resources and better challenge US and Chinese rivals.
The competitive gap is not just industrial: it is technological and economic. Europe’s flagship launcher, the Ariane 6, lacks reusability and carries higher per-launch costs compared to American benchmarks. At the same time, regulation is emerging as a tool of contest: the European Commission’s new proposed “EU Space Act” would force non-European satellite operators to meet local cybersecurity and hardware standards if they want access to the EU market. That raises the stakes: a dual strategy of industrial buildout plus regulatory leverage.
Still, there are obstacles. Europe continues to lack deep capital markets tailored to space, with investment often fragmented across nations. The European Space Agency (ESA) has warned that the proposed mega-merger of satellite businesses could create monopolistic concerns, reducing competitive tensions needed for innovation. And even as European nations pledge billions to new initiatives, such as the €10 billion Iris2 constellation to rival Starlink, technical execution and international coordination bring challenges.
For Europe to credibly contest SpaceX’s dominance, it must knit together policy, capital, and engineering at scale. Liautaud’s insistence that “a growing part of military supremacy will be fought in space” signals that the space race is no longer sci-fi territory, but it is central to 21st-century security. The question now is not whether Europe can catch up, but how fast (and whether the political will and investor resolve exist to make it happen).
