While Team Indus had backing from Nandan Nilekani, Ratan Tata and Flipkart founders Sachin and Binny Bansal, it could not even muster half of the Rs 4.5 billion it required for the mission to the moon.
The aborted plan of Team Indus to land a spacecraft and rover on the moon by March after it failed to mobilise funds to hire a rocket from Indian Space Research Organisation (Isro) shows that investors are still wary of funding space start-ups in the country.
While Team Indus had backing from Infosys co-founder Nandan Nilekani, Tata Group doyen Ratan Tata and Flipkart founders Sachin and Binny Bansal, the Bengaluru-start-up could not even muster half of the Rs 4.5 billion it required for the mission to the moon.
Team Indus - a finalist for the Google XPrize Lunar Prize - had to complete the mission of landing a rover and driving it for 500 m on the moon surface by March.
The rover had to send high-definition videos and images back to earth to win the $20-million prize.
The XPrize had also mandated the private team could only seek 10 per cent of its effort from any government agency.
Team Indus had hired retired Isro scientists to guide its team to build a spacecraft and rover, but could not mobilise the Rs 2.2 billion to Rs 2.25 billion needed to hire a dedicated Polar Satellite Launch Vehicle (PSLV), Isro's workhorse rocket for what could have been the first private mission to the moon, people familiar with the development said.
With its inability to complete the mission by March, Team Indus will be out of the race for the GXLP prize.
Rahul Narayan, founder and chief executive of Team Indus did not respond to calls or messages from Business Standard.
Start-ups in the space sector say mobilising funds is the biggest barrier in India as investors are hesitant to support such high-risk ventures and would prefer to focus on the tried and tested model of backing software start-ups.
Srinath Ravichandran, one of the promoters of AgniKul Cosmos - which is focused on building an orbital class nano satellite launch vehicle - says there are three fundamental obstacles to raise funds.
"An aerospace hardware start-up is not even in the mandate of most of the venture capital funds; getting foreign money from outside the country directly is complicated because of security issues and fear of sharing sensitive information outside the country and high networth individuals (HNIs) in India find it hard to comprehend that the start-ups have enough credibility to build a rocket," says Ravichandran.
This despite Isro's efforts to outsource satellite and rocket manufacturing to private firms.
India's first private commercial Moon rover mission, which the Bengaluru start-up, called off since the latter could not mobilise funds for the project.
This comes at a time, the Isro is planning to outsource the satellite and rocket-building completely to private sector.