The State of Defence Tech 2025 shows that while Europe is the global leader in VC investment in sectors such as quantum, it lags in spacetech, as well as in AI chips and processors, two sectors identified as leading the global investment growth in security and resilience tech in recent years. AI-specialised semiconductors are vital to maintaining supply chain resilience and sovereign compute. 

In addition, it highlights how the UK’s military heritage is shaping Europe’s defence tech boom. According to the report, one in seven defence tech founders bring experience from the armed forces or Ministry of Defence, with the UK leading the field at 30 founders. That influence carries through to the boardroom, with over 12% of C-level executives in European defence startups having military or MoD backgrounds, most often as CSIOs and CSOs. Once again, the UK dominates, with 41 such leaders, more than twice as many as France, the next most represented nation. 

The report is launched at the Resilience Conference in London, which brings together key figures from the defence tech sector to focus on the future of the battlefield, autonomy, VC investment in kinetic weapons, post-quantum cryptography, supply chains and manufacturing. The conference is a unique gathering, from across NATO and Ukraine, of leaders from the military, venture capital, and startups working in the defence tech sector. 

Record-breaking investments 

According to The State of Defence Tech 2025, venture capital investment in European defence tech has already reached $1.5 billion this year, making it the most active year ever for the sector, with mega rounds, including the €600 million ($698.5 million) funding raised by German defence startup Helsing in June, playing a large part in the rise. 

The number of investors drawn to the sector has also increased rapidly in recent years, with the number of unique investors in European defence projected to have risen 4x since 2019 by the end of this year. In addition, the level of VC investment coming from the 27 countries of the EU has risen steadily since 2022, when Russia’s full-scale invasion of Ukraine brought intense investor focus to European and global security. 

Defence tech now accounts for 6.2% of total European VC funding, up from less than 1% before 2020. For context, overall defence expenditure is expected to reach 2.1% of GDP in the EU in 2025, according to the European Defence Agency. This means it will cross the historical 2% NATO target for the first time, but still fall short of the new revised 3.5% target.

However, the US continues to dominate defence VC funding across NATO allies. In 2025, the US contributed 85% of the total VC invested in defence tech. More broadly, funding raised by NATO allies has reached $9.1 billion in 2025, already surpassing the amount raised in the whole of 2024 by more than two billion dollars.

Funding blindspots

The report highlights AI in defence, robotics and autonomous systems as the main areas fuelling growth in defence tech since 2019. Despite this strong performance by the sector as a whole, critical gaps in Europe’s VC investment are identified. 

Just 12% of the total VC investment into space launch vehicles globally between 2022 and 2025 came from Europe, while only 6% of the VC funding into AI chips and processors was from the region over this period. This has been identified by governments, including the UK and France, as a potential vulnerability and both have worked with US semiconductor giants to scale up AI infrastructure. 

Furthermore, Europe provides only 25% of the funding for drones, in comparison to the 53% coming from the United States. In contrast, Europe provides 88% of VC funding in quantum cryptography.

Europe’s hotspots

While the data shows growing VC investment in Europe, the figures reflect a handful of outsized raises, most notably Helsing’s $600 million round in Germany, as well as major raises for Multiverse Computing, Quantum Systems, Cambridge Aerospace, STARK and ARX Robotics.

Germany leads Europe both in absolute terms and relative to total VC activity, thanks largely to Helsing, which helps propel Munich to the top spot among European cities. London and Paris follow behind, with four of the top ten hubs located in the UK - showing the country’s breadth of activity without a single dominant city. But there are also growing defence tech clusters across the rest of the continent, such as Lisbon and Madrid, which are also attracting increasing investment.

Khaled Helioui, partner at Plural, said: “Europe needs to address the critical areas in its defence tech sector where it has serious vulnerabilities. Space and applications of AI are new frontiers for defence technology that will define our sovereignty, resilience and ability to compete. The window to act is narrow, and if we do not invest with the ambition and decisiveness that the challenges we are facing require, Europe will remain dependent on others for the technologies that will shape the future of security and pursue its predicted obsolescence.”

Jan-Hendrik Boelens, founder and CEO, Alpine Eagle, said: “Europe has the talent, research depth and industrial heritage to lead in the technologies that matter most for security and resilience. However, leadership does not happen by accident; it requires a long-term commitment to both capital and execution. Space, AI chips and advanced systems are not just future markets; they are the backbone of sovereignty. If we want Europe to be secure and competitive, we must turn today’s momentum in defence tech into sustained leadership across the entire innovation chain.”

Tobias Stone, co-founder of Resilience Media, said: “We are glad to see more investors embracing defence and security. This is necessary to ensure our democracies are properly defended. Ukraine has shown how important startups are in a fast-moving conflict because they can innovate far more quickly than the public sector or the primes. For that to work, we need private capital to flow into the sector. Investing in defence is unique because it is both a commercial opportunity and a moral imperative in an era where our democracies are directly under threat. Resilience Media was established to be a platform to showcase best practices and support a narrative around how the tech sector supports defence.”

Resilience Conference 2025: Shaping the Future of Defence

Following its successful inaugural London conference in September 2024, Resilience Conference 2025 will again feature the leading founders, investors, military, and national security leaders from NATO, EU, and Ukraine. They will cover defence tech themes, including the future battlefield, autonomy, kinetics, maritime warfare, manufacturing, resilient supply chains, and much more. 

Speakers include Lorenz Meier (Auterion), Ragnar Sass (Darkstar), Kusti Salm (Frankenburg Technologies), Robin Dechant (General Catalyst), Klaus Hommels (Lakestar, NIF, MSC), John Ridge (NIF), Cameron McCord (Nominal), Sten Tamkivi (Plural), Uwe Horstmann (Project A), Ophelia Brown (Blossom Capital), Oluseun Taiwo (Solideon), along with senior speakers from NATO militaries and national security agencies.

This year, Resilience Media is launching London Defence Tech Week, a curated week of back-to-back events around the Resilience Conference. The week will feature the European Defence Tech hackathon, Resilience Conference, and Future Forces Demo Day, along with a range of other fringe events from partners and supporters.