Innovation governance after the state: Capital concentration in the U.S. commercial space industry

How is private financing distributed as commercial activity expands in sectors that have historically been supported by the state? This paper examines the relationship between innovation accumulation and investor concentration in the U.S. commercial space industry. We propose that differences in investors' technical evaluation costs can narrow participation in firms with large patent portfolios, even as investment expands across the sector. A panel of 2317 firms covering the 1990–2024 period shows that cumulative patent stocks are associated with fewer unique investors and a higher within-firm investor concentration. Recent patent flows are positively associated with investment volume. These patterns are consistent with the proposed mechanism, but the data do not directly identify investor specialization or evaluation costs. The concentration estimates are sensitive to the construction of investor shares, and interactions around a data-detected 2015 break are not statistically significant. An exploratory extension documents changes in foreign investor participation without treating nationality as a measure of ownership or control. The findings suggest that assessments of public-to-private technology transitions should examine the distribution of financing alongside its aggregate volume. They motivate further investigations of participation, resilience, and governance influence in strategic technology sectors.