Defence Technologies Trending in Europe’s Venture-Capital Markets

Europe is currently experiencing a fundamental shift in its understanding of security, technology and investment. In 2024, more than one billion US dollars flowed into European defence tech start-ups, which is more than five times the amount invested four years earlier. At XPONENTIAL Europe, the continent’s leading trade fair for autonomous technologies and robotics, start-ups and established companies will present innovations that are driving defence and dual-use technologies forward.

“For XPONENTIAL 2026, we have integrated defence technology into our portfolio. This is highly attractive for many start-ups, for whom we are creating a dedicated start-up area at the event. We are also observing the strong trend towards investment in defence and dual-use technologies,” explains Malte Seifert, Director of XPONENTIAL Europe.

According to Dealroom, venture-capital investors had once again invested almost one billion US dollars in defence and dual-use technologies by mid-2025 – with Germany accounting for the largest share. Among the largest financing rounds were Helsing, Quantum Systems and Arx Robotics. These deals demonstrate that defence technologies are experiencing a boom in the European VC market.

Europe’s Security “Wake-up Call”

This view is shared by Martin Buhl, one of the Managing Directors of the venture capital firm Helantic. With 100 million euros in venture capital dedicated to defence start-ups, the company aims to unlock untapped innovation potential for Europe’s defence industry by investing in dual-use technologies. “Europe is at a turning point in both security policy and technology,” says Buhl. “The threat level has intensified, procurement cycles are becoming shorter and demand for deployable, scalable technologies is rising
significantly. Germany is currently in a ‘wake-up phase,’ realising that independence and sovereignty in defence – and particularly in supply chains – are not guaranteed.”

This wake-up call affects not only military procurement but also the entire value chain. “These dependencies – on critical pre-products, technologies or geopolitically sensitive suppliers – show that technological sovereignty has become a key prerequisite for resilience,” Buhl emphasises. Accordingly, investments are focusing on dual-use technologies, sensor systems, edge AI, space infrastructure and unmanned systems. With the First Closing, Helantic has invested in three companies: Spinncloud, Fernride and HyImpulse. Together, they cover computing infrastructure for AI workloads, autonomous logistics, as well as aerospace technologies. “Deals are in the pipeline in Poland, the Czech Republic and the Baltic states, as well as opportunities in Israel – each with clear European value creation,” Buhl reveals.

Across Europe, numerous specialised funds are being set up to specifically support defence and dual-use technologies. In addition to former military personnel and security strategists, corporate VCs from major defence companies are increasingly becoming involved – as well as generalist investors entering the sector as “tourists”, driven by market momentum and the need for resilience.

Defence Reassessed in the Context of ESG Criteria

Another noteworthy development is the reassessment of defence activities in the context of ESG criteria. Here too, there are signs of a paradigm shift. Defence technologies are no longer a taboo topic; security is increasingly viewed as a fundamental prerequisite for sustainability. This new perspective enables earlier investment. Dual-use companies, in particular, benefit: civilian applications generate early revenues and market maturity, while defence-related use cases enable scale and resilience. Buhl summarises this effect: “In a nutshell, the sustainability compatibility of defence reduces stigma, accelerates talent recruitment and shortens the
time from prototype to operational readiness.”

Malte Seifert also observes the interplay of geopolitical uncertainty, social awareness changes and technological progress. For exhibitors and start-ups at XPONENTIAL Europe, the trade fair represents the place where “defence-tech and dual-use start-ups meet at an unprecedented level, forming an interface between security, technology, sustainability, and capital.”

XPONENTIAL Europe will take place from 24 to 26 March 2026 at the Düsseldorf Exhibition Centre.

All information on the event’s focal themes and programme highlights is available via the industry portal: www.xponential-europe.com

(Author: Simone Seidensticker)

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