Starcloud Files for 88,000 Satellites — But This Startup Already Has Hardware in Orbit
The orbital data center race is heating up, and a 12-person startup in Redmond, Washington just made its move. Starcloud (formerly Lumen Orbit) filed an application with the Federal Communications Commission on March 13 seeking authorization for up to 88,000 satellites — a constellation designed...
The orbital data center race is heating up, and a 12-person startup in Redmond, Washington just made its move.
Starcloud (formerly Lumen Orbit) filed an application with the Federal Communications Commission on March 13 seeking authorization for up to 88,000 satellites — a constellation designed to operate as orbital data centers serving artificial intelligence workloads. The satellites would operate in sun-synchronous orbits at altitudes between 600 and 850 kilometers.
It's a modest proposal compared to SpaceX's audacious plan, filed in late January, for up to one million orbital data center satellites. But Starcloud has something SpaceX doesn't yet: hardware actually in space.
First in Orbit
In November 2025, Starcloud launched Starcloud-1, a 60-kilogram satellite carrying an Nvidia H100 GPU — the first state-of-the-art data center-class processor to operate in orbit. The company trained NanoGPT, a language model created by OpenAI founding member Andrej Karpathy, using the complete works of Shakespeare. The model responded in Shakespearean English: "Greetings, Earthlings!"
The satellite is now running Google's Gemma model, marking the first time a high-powered AI model has been queried from space.
"This very powerful, very parameter dense model is living on our satellite," CEO Philip Johnston told CNBC. "We can query it, and it will respond in the same way that when you query a chat from a database on Earth."
The Founder
Philip Johnston is a second-time founder. Before launching Starcloud in early 2024, he spent time at McKinsey working on satellite projects for national space agencies. He previously founded Opontia, a digital brands aggregation company that raised over $50 million and scaled to 100 employees.
He's also a Harvard graduate.
The company has raised $21 million in seed funding — one of the largest seed rounds for a Y Combinator graduate — and is part of Nvidia's Inception program and Google for Startups Cloud AI Accelerator.
The Pitch
Starcloud argues that orbital data centers offer 10 times lower energy costs than terrestrial facilities. Satellites in sun-synchronous dusk-dawn orbits can generate near-continuous power from solar panels, avoiding the day-night cycles that ground-based facilities face. The company claims space-based compute could address AI's escalating energy demands, which the International Energy Agency projects will more than double by 2030.
The company's white paper envisions a future 5-gigawatt orbital data center with solar panels spanning four kilometers — larger than most terrestrial solar farms, but the company says it would be substantially cheaper and smaller than an equivalent ground installation.
The Skeptics
The concept faces significant technical hurdles. Latency makes orbital data centers unsuitable for real-time workloads, though batch processing and archival storage remain viable. Heat dissipation in the vacuum of space is notoriously difficult — radiation shielding adds mass and cost. Each 90-minute orbit also means periodic "cool-off" periods without sunlight, creating power fluctuations.
Reddit threads and industry analysts have questioned whether the economics ever work. "Orbital Data Centers is a stupid idea with the current technology," read one widely-shared Reddit post. "Radiation shielding plus heat dissipation in space are the most challenging."
What's Next
Starcloud-2 is scheduled for launch in 2027 into sun-synchronous orbit, featuring a cluster of processors and proprietary thermal and power systems in a smallsat form factor. The company plans Starcloud-3 and Starcloud-4, the latter involving massive satellites designed for deployment on SpaceX Starship vehicles.
The FCC filing seeks authorization for Ka-band spectrum for telemetry, tracking, and control communications. Starcloud says it will follow best practices for debris mitigation, including deploying satellites in lower orbits for initial checkout before raising them to operational altitudes — ensuring malfunctioning satellites reenter quickly and burn up entirely.
The Angle
Starcloud's 88,000-satellite application is modest compared to SpaceX's million-sat vision. But with actual hardware operating in orbit — running AI models that respond to queries from space — the Redmond startup has demonstrated something the aerospace giant has yet to prove: that orbital data centers can work, at least at small scale.
Whether they can scale profitably is the question.
Starcloud was founded in 2024 by Ezra Feilden, Philip Johnston, and Adi Oltean. The company has 12 employees. Its $21 million seed round is one of the largest for a Y Combinator startup.
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