A mission control centre will be set up in Adelaide to monitor a global constellation of satellites.
Fleet Space Technologies will establish the centre and launch its first two nanosatellites in the coming months.
"They're going to cover the entire globe with an internet connectivity for an internet of things that has never existed," chief executive Flavia Tata Nardini told reporters at the site on Wednesday.
"Everything we have done so far was to connect people, now we are connecting things.
"There are 75 billion devices coming online to help agriculture, mining, oil and gas, logistics, maritime to finally connect, to improve efficiency."
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The government has provided $500,000 through its Future Jobs Fund and the company will also invest $500,000 in the project.
The centre will create 17 ongoing jobs and five during its construction.
Wednesday's announcement is the latest in a string of pledges from the government, including $750,000 to Robern Menz to secure the Violet Crumble brand and $1.75 million to Entech Electronics to double production.
Treasurer Tom Koutsantonis shirked criticism the state had invested large amounts of money into projects delivering relatively few jobs to the state.
"We are a smaller state and we need to have government investment to help grow the economy," he said.
"We're not building a mission control ourselves. We're investing in a young entrepreneur."
