For decades, spy agencies have had access to a magic-seeming technology known as SAR, or synthetic aperture radar. A satellite with SAR onboard can send radar beams from space that bounce off Earth and then return to a sensor, which assembles the information to produce an immaculate image. The key to the technology—what separates it from high-powered optical telescopes—is that the beams can pass through clouds and work at night. They make the invisible visible.

A young company in Palo Alto called Capella Space, which announced $12 million in new funding on May 9, has figured out a way to create much smaller, cheaper versions of SAR satellites. If the technology lives up to its billing, it would make this type of imaging available to businesses, not just governments. The idea is that hedge funds, farmers, city planners, and others would buy the pictures to track changes in the world around them. "We're going after hourly images of anywhere on Earth that people care about," says Payam Banazadeh, Capella's co-founder and chief executive officer.

Researchers in the U.S. began developing SAR after World War II with military applications in mind. Lockheed Martin Corp. claims to have built the first operational version in the '50s. Since then, SAR has largely remained in the realm of espionage and military strategy. A typical satellite can be the size of a bus, weigh 2,500 pounds, and cost as much as $500 million.