This Week in Dual-Use
NEWS
NATO launches Drone Edge
There were a few headlines from last week’s NATO summit in Ankara - Trump promising Patriot missile production in Ukraines (without apparently consulting Lockheed Martin), lifting CAATSA sanctions on Turkey and a pledge from Allies of €70B for Ukraine in 2026.
But I want to focus on Drone Edge, a new $40B drone and counter-drone initiative. It is a dedicated counter-drone marketplace intended to help member states procure counter-drone systems at scale. A bloc-wide procurement platform, rather than 32 separate national efforts.
A perennial concern for the defence tech investor is around the international scalability of startups. Domestic markets are important but international sales are what really drive venture returns (outside of the US). The counter-drone marketplace goes some way to solving that problem as it seeks to establish a common procurement platform for NATO members. Good news if you can get on to the platform.
The agreement is much thinner on the offensive side. In fact, conspicuously absent is any NATO mechanism for buying strike drones, FPVs or loitering munitions (the categories which dominate the battlefield in Ukraine today). Those remain national decisions, for now at least.
Helsing, a Germany-headquartered neoprime, has just increased its valuation to $18B. That is a both a tailwind and a liability for the European defence tech market. Europe needs it to succeed. For that to come true, Europe must buy from Helsing.
SpaceX targets 100,000 satellite constellation
SpaceX has filed with the FCC to operate a new constellation of 100,000 satellites, each one 2,000-2,500kg, for “for consumers, enterprises, and government users and billions of AI-powered devices around the world”.
For context, the current model (Gen2 mini) is 800kg: Starlink operates about 11,000 of them with approval for 4,000 more, and launches them in its Falcon 9 in batches of 26.
So, this is an ambitious expansion of the Starlink vision. And the whole thing is contingent on Starship: this number of satellites could only be deployed at scale by a heavy-lift, fully reusable vehicle. The filing is, in effect, a bet on Starship reaching operational cadence. That is certainly non-trivial.
If successful, it would make for a congested low-Earth orbit. But it would also transform the internet connectivity of the planet.
Meanwhile, Jeff Bezos’s Blue Origin is raising outside capital for the first time, targeting $10B at a $130B valuation.
Europe’s ballistic missile defence
Post-Ankara, at a meeting of the “coalition of the willing” in Paris, Ukraine and nine other European countries agreed to build a shared ballistic-missile defence capability for Europe.
The countries, including Germany, France and Britain, hope to learn from Ukraine’s experience in defending itself against Russia.
Todays’ ballistic missile defence is, for NATO countries, largely reliant on American Patriot missiles. Those are now in short supply. And Europeans are increasingly reluctant to depend on the US for such a critical capability.
China’s DeepSeek develops its own AI chip
Was it a good idea to allow NVIDIA to sell H200s to China? The logic was that China wouldn't need to develop its own chips, ensuring some kind of dependency on America. On the other side of the trade, China seemed happy to use them as it built the foundations of its AI industry.
DeepSeek is now designing its own AI chip, a move which could shake up NVIDIA, Huawei and open-source AI. The new chip is admittedly designed for inference, not training new foundation models (which is more compute-heavy).
That would decrease token costs for DeepSeek, which would in turn drive greater adoption. Western users are increasingly turning to Chinese open-source models as costs for Western AI snowball. This new chip could give DeepSeek an additional advantage.
Additionally, the company is apparently preparing for an IPO later this year, while also seeking to raise $1.5B at a $71B valuation.
FUNDRAISING
DEFENCE
Helsing, a European neoprime headquartered in Germany, raised a $1.8B Series E at an $18B valuation.
Kraken, a British developer of uncrewed surface vessels, raised a $175M Series B at a $1B valuation, led by DTCP.
Brinc, an American developer of drones for police, fire, and other emergency-response agencies, raised a $125M round led by Motorola Solutions.
Singularity, an American developer of drone interceptors, emerged from stealth with an $80M Series A led by Khosla Ventures.
Valarian, a British company building the infrastructure layer for ‘high-consequence operations’, raised a $50M Series A led by New Enterprise Associates (NEA).
Skapion, an Israeli-American developer of counter-drone systems, emerged from stealth with $36M in funding led by Khosla Ventures and UP.Partners.
Project Q, a German company developing a platform to reduce the integration burden that has long complicated multi-domain operations, raised a €15M Series A led by Expeditions.
Dropla Tech, a Danish-Ukrainian developer of uncrewed ground vehicles (UGVs) and edge-AI explosive-threat detection systems, received an undisclosed amount of investment from MITS Capital.
SPACE
Hongqing Technology, a Chinese satellite maker, raised a $191M round led by Jinpu Capital.
Venus Aerospace, an American developer of rotating detonation rocket engines for hypersonic weapons, raised a $90M Series B led by Mercury Fund.
Flexell Space, a South Korean developer of lightweight, flexible solar cells for satellites, raised a $20M Series A.
Sybilla Technologies, a Polish developer of space observation technology, raised €8M from BGK and 3TS Capital Partners.
Ravee Optics, an American developer of compact laser communication terminals, raised a $6M seed led by BIG Global Investment JSC.
QUANTUM & AI
QuantumDiamonds, a German developer of quantum sensing technology to inspect chips for defects, raised a €15M round led by World Fund.
Shanghai Quantum Sensing Intelligence Technology Co, a Chinese developer of quantum sensing technology, raised a $1.5M round led by Futeng Capital.