Startup Satlyt has raised $8 million to build software that turns satellites already in orbit into distributed computing nodes, according to TechCrunch.

The seed round backs the company’s plan to run AI workloads on existing spacecraft. Instead of waiting for giant purpose-built orbital data centres, Satlyt wants to use satellites that are already flying.

Founder and CEO Rama Afullo previously worked at Google and SpaceX. The company has done technical work with Google DeepMind’s Gemma AI models.

The idea is simple. Bandwidth between orbit and Earth is costly and limited. If a satellite can classify or compress its own data first, it needs to send far less home.

TechCrunch reports that an earlier Gemma deployment cut the size of one transmission about onboard software errors by more than 60 per cent.

The funding comes as interest in space-based computing grows. Google’s Project Suncatcher is separately testing AI chips in orbit this month.

If Satlyt’s software works, old satellites could gain a second life as edge-computing platforms.