SpaceX looks into raising $500 million in a private equity round at a valuation of $30.5 billion to help launch its internet service project.

Called Starlink, this ambitious project of Elon Musk's company will launch 12,000 satellites to bring better internet access to rural areas and developing countries.

SpaceX Funding

According to a report published by the Wall Street Journal, the financing terms have already been agreed upon. The investors also include SpaceX shareholders such as the Scottish Baillie Gifford, who owns an investment firm. Gifford has a 7.6 percent stake in Tesla where Musk is also the CEO.

The funding will bring the total amount raised for SpaceX to about $2.5 billion of equity funding. SpaceX has also raised $250 million through a high-yield loan sale in November. In the same month, the Federal Communications Commission or FCC approved the Starlink project.

Ambitious Starlink Project

Earlier, SpaceX revealed in an FCC filing that the proposed communication satellite constellation aims at a lower orbit than its initial plan. The satellites will help reduce orbital debris and also provide better signal to the remote areas.

The aerospace company targets to launch 4,409 satellites where 1,584 of these will be placed in an orbit just about 550 kilometers above the surface of the Earth. At such distance, orbits have a shorter life, decaying just as fast. They fall into the atmosphere and burn up after several years. Many communication satellites, on the other hand, are usually in orbits more than twice as high and geosynchronous orbits are more than 20 times farther, Tech Crunch noted.

SpaceX shares a different view, however. It stated in its application that lower orbits offer "several attractive features both during nominal operation and in the unlikely event something goes wrong."

The company's decision is influenced by its experimental test satellites called "Tintin," which was launched earlier this year. SpaceX has found a way to ease the disadvantages of orbits that operate at a lower altitude. They expect to reap its benefits such as shortening the amount of time to send and receive a signal from the satellite.

SpaceX has already made a record-breaking 21 successful launches in 2018. It successfully launched a powerful GPS satellite nicknamed "Vespucci" last weekend.