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Welcome back! MY FIVE PREDICTIONS FOR 2026 Russian grey zone warfare will intensify. Putin’s calculation is that Europeans will divert resources from Ukraine if they perceive a threat to their homeland. Meanwhile Western Europe is struggling to grasp that it is living “in a space between peace and war”, as Blaise Metreweli put it in December. Let’s see if Putin can change that perception. Space X will become the most valuable company on the planet. It already appears to be on track for the largest IPO in history. Space technology is foundational to everyday life, and SpaceX has a monopoly on access to orbit. Meanwhile Starlink is set to provide internet to hundreds of millions of users worldwide. And NVIDIA may have hit its peak valuation. Anduril will IPO at a valuation of $50bn. Since 2025 was the year of defence tech, there is no better time than 2026 for Palmer Luckey to finally take his company public. Retail investors will be keen to get their hands on the equity. Ukrainian defence technology will begin to dominate global defence tech. Export restrictions have hitherto stopped Ukrainians from disseminating their novel technology. But that changed in 2025. Expect to see more coming out of the country. A leading quantum computing company will demonstrate 200+ logical qubits. So far the 48 qubit system of Microsoft & Quantinuum from 2024 remains the highest count of error-corrected logical qubits. But 2025 advancements in error correction will make it possible to beat that in 2026.
NEWS Ukraine claims underwater drone strike on Russian sub Ukraine’s MoD claimed that an uncrewed underwater vehicle (UUV) disabled a Russian Kilo-class submarine in Novorossiyk. If true, the use of a UUV against a submarine would represent another first in naval warfare. What’s striking here is the operational reach of the SubSea Baby UUV. The port in Novorossiysk is 500km from Odessa and at the centre of heavy Russian electronic warfare effects. The combination of extended range and mission execution in an electromagnetically denied zone is something that no other UUV company has achieved. Ukrainian defence tech companies in the maritime domain have the advantage of a heavily contested testing environment on their doorstep. It will take time for Western competitors to catch up (see my prediction above). Finnish authorities seize Russian ship suspected of sabotage Finnish authorities seized a ship sailing from Russia on suspicion of damaging an undersea telecoms cable between Finland and Estonia. Police have arrested the vessel’s crew members. Historically, the Baltic was a Cold War chessboard of quiet submarine patrols and intelligence gathering. Now it is a grey zone theatre where undersea infrastructure itself is a target. Companies have long sought to develop technology to map the sea floor. I believe an understanding of the water column itself will be increasingly important as Russia dials up the grey zone activity (see my prediction above). Quantum Systems acquires autonomous trucking startup Fernride Quantum Systems, a German developer of surveillance drones, acquired Munich-based driverless truck startup Fernride for an undisclosed amount. Fernride was founded in 2019 and had raised €75m in total. On the face of it, this is not an obvious acquisition target for Quantum Systems. Fernride shifted from commercial applications to ground-based defence logistics and still has ambitions to develop commercial trucking technology. But as competitors like Helsing and Anduril continue to add verticals in defence autonomy, Quantum Systems must navigate a similar path to scale while developing a distinct suite of non-lethal capabilities (since it is restricted by its investors to non-lethal technologies). FUNDRAISING Nu Quantum, an a British developer of distributed quantum computing technology, raised a $60m Series A led by National Grid Partners. Nu Quantum is an Expeditions portfolio company. Photonic, a Canadian developer of distributed quantum computing, has raised $180m CAD in the first close of its latest round, led by Planet First Partners. K2 Space, an American builder of satellites designed to operate across low, medium, and geostationary orbits, raised a $250m Series C at a $3bn valuation. Redpoint led the investment. Cambium, an American developer of advanced materials for defence and aerospace markets, raised a $100m Series B led by 8VC. Exein, an Italian developer of embedded runtime security software for internet-connected device firmware, raised a €100m round led by Blue Cloud Ventures. Quantum Art, an Israeli developer of trapped-ion quantum computers, raised a $100m Series A led by Bedford Ridge Capital. Vatn Systems, an American developer of autonomous underwater vehicles for military and commercial customers, raised a $60m Series A led by BVVC. Digantara, an Indian developer of space-based missile detection technology, raised a $50m Series B. AnySignal, an American developer of radios for space and defence communications, raised a $24m Series A led by Upfront Ventures. EtherealX, an Indian developer of a reusable medium-lift launch vehicle, raised a $21m Series A round co-led by TDK Ventures and BIG Capital. Array Labs, an American developer of radar satellites for three-dimensional Earth mapping, raised a $20m Series A round led by Catapult Ventures. Fortastra, an American developer of defence satellites, raised an $8m seed round led by Upfront Ventures. ZeroPhase, a German developer of communications software for unmanned defence systems, raised a €5.8 seed round led by BlueYard Capital. Gambit Cyber, a Dutch developer of threat exposure management software for identifying and prioritising cyber risks, raised a $3.4m seed round led by Expeditions. Gambit Cyber is an Expeditions portfolio company. Odin Space, a British developer of orbital debris detection technology, raised a $3m seed round led by Steel Atlas. Accenture has agree to acquire Faculty, a British AI company which provides products and services to government and commercial customers, for $1bn. It is the largest ever acquisition of a British AI startup. SURVEY The results are in for the 2025 Working with Defence & Security Survey. Check them out here. Welcome to 2026. It’s good to be back.
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