This Week in Dual-Use
NEWS
In LLM news, Tencent became the latest tech company to unveil an AI model intended to eclipse DeepSeek. The Hunyuan Turbo S model is designed to respond as instantly as possible, distinguishing itself from the deep reasoning approach of DeepSeek’s chatbot.
This is another chapter in the story of the China’s civil-military fusion doctrine. Tencent was originally a video game developer but has spent the last decade or so making venture investments into Western deeptech companies. It has quietly built a portfolio of cutting-edge technology startups coming out of Europe and the US, including a number of quantum computing companies.
In January the US administration designated Tencent a ‘Chinese military company’, and venture investors across the world suddenly worried about their portfolio companies which had Tencent on the cap table. Rightly so. They will find it difficult to sell to US government with Tencent as an investor.
Tencents investments are straight out of the Chinese civil-military fusion playbook and mirror China’s systematic efforts to acquire advanced technology through corporate partnerships and outright cyber espionage. The question isn’t just how to stop this, it’s how much know-how has already been acquired.
In quantum computing news, Amazon announced its first quantum computing chip, Ocelot. The news brings it into line with its big cloud rivals Microsoft and Google, which have also unveiled their own quantum chips in recent months, respectively Majorana and Willow.
This came without the fanfare of Microsoft’s announcement last week. The question is whether Ocelot is a step towards modular, scalable quantum architecture, or just another demonstration chip to keep pace with Microsoft and Google.
Elsewhere, QuEra raised $230m (see below) and PsiQuantum announcedOmega, a photonic chipset which, apparently, contains all the components required to build million-qubit-scale quantum computers. Meanwhile Chinese scientists allegedly overcame a key barrier to scalable photonic quantum computing.
The race for fault-tolerant quantum computing continues to heat up.
In procurement news, the UK government announced major support for small and medium enterprises (SMEs) following its commitment to increase spending on defence to 2.5%.
New SME spending targets for defence will apparently boost access to UK defence spending for startups. Additionally, a new support hub will provide guidance to small businesses on accessing the defence supply chain.
This is welcome news. UK defence procurement processes are often complex and long. That is also true of the US and Europe. But the MOD has rightly recognised that now is the time to change.
FUNDRAISING
QuEra Computing, a US-based developer of a neutral atom quantum computer, raised a $230m debt round.
Peregrine Technologies, a US-based developer of data analytics software designed to assist law enforcement agencies in interpreting unstructured data, raised a $190m round.
Skylo, a US-based developer of direct-to-device satellite connectivity for smartphones, vehicles, and IoT devices, raised a $30m round.
QuantWare, a Netherlands-based developer of superconducting quantum processors, raised a €20m Series A round.
Magdrive, a UK-based developer of advanced electric propulsion systems for satellites and spacecraft, raised a £8m Seed round.
Rune, a US-based developer of military field logistics software, raiseda $6.2m Seed round.
SkyMirr, a US-based developer of antennas and modules for satellite communications, raised a $7.4m Series A round.
Deepnight, a US-based developer of AI-driven night vision technology, raised a $5.5m Seed round.
VRAI, an Ireland-based developer of mixed reality simulation training for defense and security sectors, raised a €5m Series A round.
Exia Labs, a US-based developer of military planning AI, raised a $2.5m Pre-seed round.