There aren’t enough rockets for space data centers. Cowboy Space raised $275 million to build them.

The seemingly insatiable demand for AI computing has data center entrepreneurs looking to the stars. There’s one key problem: there aren’t enough rockets to put data centers into orbit around Earth, and they’re too expensive.

Most of the players are hoping that SpaceX’s Starship – which is expected to make its twelfth test flight as soon as this weekend – will solve the problem. But once the vehicle is operational, it could be years before it’s commercially available, given SpaceX’s internal satellite operations. The same is true of Blue Origin’s New Glenn rocket, which failed to deliver a satellite on its third launch in April.

That leaves space data center systems either aiming for the mid-2030s, like Google Suncatcher, or preparing to start doing edge processing work for space sensors, like Starcloud.

In theory, there is a third way: “We support our own rocket program,” Baiju Bhatt, CEO and founder of Cowboy Space Corporation, told TechCrunch. It expects the first launch before the end of 2028.

Today, the company announced the closing of a $275 million Series B round at a $2 billion post-money valuation, led by Index Ventures, as an advance on this project. Breakthrough Energy Ventures, Construct Capital, IVP and SAIC also participated.

Bhatt, co-founder of online stock platform Robinhood, launched this startup in 2024 as Aetherflux, with plans to collect abundant solar energy in space and bring it to Earth. The idea of ​​space data centers led the company to turn to using its electricity while in orbit. The practical realities of that endeavour, in turn, led him to a rocket development program and the company’s new name.

Bhatt said he talked to several launch providers to try to find a path where his company would only build satellites, but he couldn’t find enough launch capacity to really scale an orbital data center business or do it in a way that the economic unit could compete with ground-based alternatives.

“There are a lot of new rockets coming online, but as we look out three, four years, they’re still very, very rare, and I think you’re going to see a lot of the early rocket providers really specialize in their own payloads,” Bhatt said.

Of course, while it makes sense to bring the rocket indoors, it’s also crazy. Only a few private companies in the West, notably SpaceX, Rocket Lab and Arianespace, consistently launch commercial rockets. Two others, Blue Origin and United Launch Alliance, have been struggling to pull their vehicles out of development hell for years. Some startups, including Stoke Space, Firefly Aerospace and Relativity Space, have been working for years and are still waiting to deliver working systems.

This company development will also bring Cowboy Space Corporation into direct competition with SpaceX and Blue Origin, the most advanced and well-funded players in the market.

“The prize here and the size of this market is big enough that there is room for many players to succeed,” Bhatt said “I see the demand for AI getting stronger and stronger and I see the options on Earth getting more and more limited.”

One advantage, Bhatt argues, is the company’s focus on that single market (data centers) and its unique design. Orbital rockets typically have a booster stage that launches the vehicle to the edge of space and a second stage that carries the payload and delivers it into orbit. Cowboy Space plans to build its data centers directly on the second stage of its rocket. It’s actually a bit of a twist: The first US satellite, Explorer 1, was built as the final stage of a rocket, complete with radio equipment and a few scientific instruments.

Building the rocket solely to launch its data center satellites will simplify the design process. The company expects each satellite to have a mass of 20,000 to 25,000 kilograms and generate 1 MW of power for just under 800 onboard GPUs. That means its rocket would be slightly more powerful than SpaceX’s Falcon 9, though it would still be smaller than its under-development Starship. Ultimately, Bhatt says, he expects the booster to be reusable.

Cowboy Space has hired space industry veterans, including former Blue Origin propulsion engineer Warren Lamont and former SpaceX launch manager Tyler Grinne. The company also plans to build its own rocket engine, the most complex and expensive part of any launch vehicle. Cowboy Space is still working on basic development needs, such as facilities to test, build and launch its rockets.

The new vision comes with a new name for the startup, to emphasize its mission to “rule humanity from the high frontier,” though Bhatt admits “it gives me a reason to wear a cowboy hat and also grow that sick moustache.”