By Akash Sriram

(Reuters) - Impulse Space, a startup building spacecraft that can ferry satellites and other ‌payloads around in orbit after launch, said on Tuesday it has raised $500 million in a Series D funding round.

The funding round values the company at $4.26 billion, according to a person familiar with the matter.

The company was founded by Tom ​Mueller, SpaceX's first employee and the propulsion engineer who led development of rocket engines that ​helped turn Elon Musk's company into the world's dominant launch provider.

The round was co-led ⁠by venture firms 137 Ventures and Banner VC and brings the total capital raised by the Redondo ​Beach, California-based company to more than $1 billion, Impulse said.

BEYOND LAUNCH ROCKETS

The fundraising highlights strong investor appetite for ​companies building infrastructure for the next phase of the commercial space economy, beyond launch rockets.

As launch costs fall and satellite deployments accelerate, demand is rising for vehicles that can reposition spacecraft between orbits, deliver payloads deeper into space and ​service satellites already in orbit.

"Launch has pretty much been solved. The challenge now is getting everywhere else ​beyond low Earth orbit," Mueller, who is also CEO of Impulse Space, told Reuters.

Impulse develops orbital transfer vehicles and ‌propulsion ⁠systems designed to move satellites more quickly once they are already in space.

Impulse said it has flown three missions so far and secured hundreds of millions of dollars in customer contracts. Its products include Mira, a maneuvering spacecraft already operating in orbit, and Helios, a larger transfer vehicle slated for its first ​flight in 2027.

"For Helios, ​commercial customers can launch ⁠on a Falcon 9 and take six, eight or 10 months to reach their final orbit. Our pitch is: 'launch with Helios and we'll get you there ​the same day,'" said President and Chief Operating Officer Eric Romo.

SPACEX IPO ​EFFECT

Investor enthusiasm around ⁠the space sector has surged following SpaceX's filing last month for what could become the largest IPO in history. The filing outlined ambitious expansion plans spanning Starlink satellite internet services, artificial intelligence infrastructure and reusable Starship rockets.

SpaceX's expected IPO ⁠has intensified ​investor interest in a new wave of startups founded by ​former SpaceX executives and engineers building satellite, spacecraft and orbital logistics businesses.

Additional investors in the Impulse round included Founders Fund, Lux Capital ​and Linse Capital, the company said.

Reporting by Akash Sriram in New York City; Editing by Matthew Lewis

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