Welcome back to the #25 edition of The New Defense Post!
In this edition, we’ll cover:
Guest Article: The Malignant Seven: The Blind Spots That Destroy Value in the New Defense
Spotlights: Germany’s STARK Hit a €1B+ Valuation; Germany Is Placing Its First Big Loitering Munitions Bets (Up to €4.3B in Total Value) on Two Venture-Backed Startups: Helsing and STARK; Anduril Is Reportedly in Talks to Raise up to $8B at a $60B+ Valuation to Fund New Manufacturing Capacity and Autonomous Systems
Fundraising News of the Week: Defense-tech funding this week clustered around late-stage scale-ups, drone and ISR production, hypersonics, defense program software, electronic-warfare monitoring, and applied AI.
Bonus Section: Our second deep dive into interceptor drones, with our top picks for startups operating in this space
Guest Article: The Malignant Seven: The Blind Spots That Destroy Value in the New Defense
Photo Credit: RTX
Most investors entering defense believe they understand the risks.
They talk about long sales cycles, complex procurement, and political noise. But these are not the risks that destroy value. They are the ones everyone already knows.
The real risks sit underneath. They are structural and slow-moving until the moment they are not. They are the reason so many promising companies never become Anduril, never reach a Ghost Shark moment, and never escape the prototype stage.
Most of the value destruction in defense comes from misreading these blind spots. They are predictable, but only if you look at the system in the right way.
Pierre-Marie Derouin joined us again to break down what is fundamentally different in defense tech.
Spotlights
1. Germany’s STARK Hit a €1B+ Valuation
Photo Credit: STARK
STARK has reportedly crossed the unicorn threshold: Manager Magazin says the German loitering-munitions startup raised a new round “a few weeks ago,” valuing it at more than €1B.
The report adds that Founders Fund, backed by Peter Thiel, contributed a double-digit million euro amount, alongside European investors. Reuters also notes it saw documents indicating the German government plans to order €536M worth of strike drones from STARK and Helsing. (Reuters).
📰 Our Take: Habemus Unicorn! Europe can add another fast-growing defense tech startup to its roster of unicorns.
Investment in Europe’s defense tech has grown at an astonishing pace over the last few months, and STARK (together with its cousin Quantum Systems) has been among the biggest winners in this space. What remains to be seen is whether this growth is backed by actual results in the field.
2. Germany Is Placing Its First Big Loitering Munitions Bets (€4.3B in Total Value) on Two Venture-Backed Startups: Helsing and STARK
Photo Credit: Helsing
Germany is making its first major procurement push into unmanned “kamikaze” drones, selecting two venture-backed startups: Helsing (backed by Daniel Ek) and STARK (backed by Peter Thiel). Together, the contracts can reach up to €4.3B in total value, pending parliamentary approval.
Helsing’s initial deal is €269M, with an option to scale to €1.46B for its HX-2 drones. STARK’s deal is also €269M initially, with a larger option value of up to €2.86B for its Virtus drone (the rationale for the higher ceiling is unclear in the documents). The number of drones is redacted. (Financial Times)
📰 Our Take: This is Germany signalling that speed matters: rapid procurement to equip its new brigade in Lithuania, plus contract structures that explicitly anticipate fast tech change. It’s also a blow to Rheinmetall, which was left out after delays to its FV-014 (“Raider”) armed drone.
Neo-primes are used to move at a much faster pace than traditional primes, still slower than many frontline applications require, but still quite fast for such large organisations. Primes, on the other hand, have to adapt to this faster iteration cycle and potentially change their internal processes. So far, even imperfect delivery has been good enough, which is a big change in the way procurement works.
3. Anduril Is Reportedly in Talks to Raise up to $8B at a $60B+ Valuation to Fund New Manufacturing Capacity and Autonomous Systems
Photo Credit: Anduril
The funding would give Anduril more leeway to finance its first major weapons-manufacturing facility and to develop an autonomous fighter jet, as The Information previously reported.
For context, Anduril was valued at $30.5B in a $2.5B funding round in June last year. The new valuation would be roughly double that figure.
Anduril (which develops defense tech, including a wide range of sensors and drones) has gained prominence amid calls for low-cost autonomous defense products and is seen as one of Silicon Valley’s hottest defense bets as drones reshape warfare in Ukraine and Donald Trump pushes the Pentagon to adopt cutting-edge technologies to counter China. (Reuters)
📰 Our Take: This valuation would make Anduril the largest defense tech startup by valuation and the sixth-largest defense company in the world by market capitalization.
The valuation is driven by increased U.S. spending on drone solutions and alternative weapons systems. However, Anduril’s traction in Europe is still lagging, and its combat performance in Ukraine remains limited so far.
The U.S. policy stance, combined with Europe’s push for strategic autonomy, is a significant barrier for American startups trying to access the European market. This is especially true where credible European alternatives already exist, as in drone technology, whereas that is not the case for capabilities such as stealth fighter jets (think the F-35).
Other News
Shield AI is reportedly seeking up to $1B in new funding, targeting an ~$11B valuation to scale autonomous military systems. (PYMNTS)
Hanwha Aerospace signed an MoU with Frankenburg Technologies to jointly develop counter-UAS systems for land platforms. (Yonhap News)
Fundraising News
Amount | Name | Round | Category |
|---|---|---|---|
$8B (In Talks) | Neo-Prime | ||
€150M | ISR Drones | ||
€23.3M | Hypersonic Missiles | ||
$17M | Integrate | Collaboration Software for Defense Programs | |
$13.5M | EW Monitoring | ||
€7.2M | AI for Defense | ||
Undisclosed | Drone Autonomy | ||
€3M | AI for Defense |
Bonus Section — Drone Interceptor Startups Part 2
Photo Credit: Cambridge Aerospace
The global counter-UAS market is projected to grow from $4.5–6.6 billion in 2025 to $14.5–20.3 billion by 2030.
Shooting down a $30,000 Shahed with a $3.8 million Patriot missile is not a sustainable long-term strategy. With Russia launching over 170 Shahed-type drones per day, the need for a cheap, mass-produced kinetic layer has become difficult to ignore. And a new wave of European startups is building exactly that. (Morningstar)
Cambridge Aerospace in the UK is building something closer to a disposable cruise missile. Their Skyhammer is a tube-launched, turbojet-powered interceptor that reaches Mach 0.7 and has a 30 km range. Founded in late 2024, the company has raised over $130 million. A faster variant, Starhammer, could target cruise missiles at Mach 2.
France's Harmattan AI became Europe's first interceptor unicorn when Dassault Aviation led a €200 million round in January 2026 at a €1.4 billion valuation. Their Gobi interceptor has been ordered by the French and British armies. Production target: 10,000 units per month.
Alta Ares, also French, achieved NATO certification in October 2025 and downed its first Shahed in Ukraine ten days later, moving from certification to combat kill faster than any competitor.
The technology works. Ukraine has scaled interceptor drone production to 1,500 per day, for context. (UNITED24 Media)
The real challenge, though, is in manufacturing thousands of interceptors per month, integrating with sensor networks, and iterating faster than the threat evolves, which is what will define the winners.
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