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NEWS In drone news, Ukraine launched an attack on Russian strategic bombers using drones hidden in the roofs of mobile wooden cabins and placed on a truck - a true trojan horse. The operation was entirely remote, relying on Russian mobile network for communications. A lot has already been written about this. What caught my attention was how this changes the calculus for security of assets. The coverage so far has focused on the concentration of NATO’s strategic bombers at fewer and fewer air bases, to save costs. That is one vulnerability. But what about critical infrastructure more broadly? Surely any power station, airport or even parliament building would be vulnerable to this tactic. How do you defend against that? I recently came across a company developing a capability to launch drone swarms from a mothership in low earth orbit. A week ago that seemed like a far-fetched concept. In defence spending news, the UK government released its long-awaited Strategic Defence Review (SDR), which has been 18 months in the making. The delay, I understand, is because defence technology and strategic considerations evolved so quickly during that time period. At some point they had to rip it up and start again. As an investor in early-stage companies selling to government, it was a relief to see recognition that defence procurement doesn’t work. I’ve written before that the UK’s procurement system was built for the cold war, when the priority was tanks and submarines, and no one was really at war. Today’s battlefield is being transformed by young companies that often aren’t even profitable yet. A multi-year procurement process means that many die before they get a contract. And the technology is out of date by the time it arrives. The SDR proposes that rapidly evolving technologies, such as drones and software systems, should be procured within a three-month timeframe. That is a huge shift. It also emphasizes improving access for small and medium-sized enterprises (SMEs), and suggests a ‘Defence Investment Plan’ to ensure that procurement decisions are responsive to current and future defence requirements. Those are good recommendations. The ball is now in the MOD’s court. In VR news, Anduril, a new American defence prime, has partnered with Meta (Facebook) to develop VR products for soldiers. The mixed reality systems promise to deliver enhanced battle information to users. This story has a nice circularity to it. Palmer Luckey sold his first company, Oculus, to Facebook for $2bn. He was then fired for donating to right-wing political parties. That was a blessing in disguise for Luckey, who went on to found Anduril. Now he’s going to link Anduril’s products to the VR that Meta bought from him, closing the loop. FUNDRAISING Labrys, a UK-based developer of a secure workforce management platform for organisations operating in defense, humanitarian aid, and disaster response, raised a $20m Series A round led by Plural. Labrys is an Expeditions portfolio company. Firefly Aerospace, a US-based developer of space launch technology, received $75m from Northrop Grumman in an extension to its $175m Seried D round which it announced in November 2024. Infleqtion, US-based developer of quantum computing systems for use in defence, secure communications, and advanced sensing, raised a $35m Series C round. Investors included Glynn Capital, Counterpoint Global, S32, and SAIC.
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