This Week in Dual-Use

NEWS

US confirms weapons in space

The US revealed publicly for the first time that it has deployed weapons to space, provoking an angry response from China.

It’s unclear why the US chose to declassify this capability, but it might indicate a desire to deter an imminent threat.

It’s no secret that China and Russia have weapons in space. Russia has been developing them since the 1970s. It has the Nudol direct-ascent missile and the Kosmos-2542 "nesting doll" inspector satellites, in addition to ground lasers and jamming systems. It is also (credibly) reported to be developing a nuclear anti-satellite weapon.

But Russia’s effort is less well resourced than China’s. China has the SC-19 and DN-3 direct-ascent anti-satellite missiles and the Shijian-17 and Shijian-21 co-orbital satellites with robotic arms, in addition to ground-based lasers, and jammers targeting GPS and satellite communications. Notably, it conducted 92 orbital launches last year (compared to 17 for Russia).

There are a number of venture-backed companies (largely in the US) developing this kind of defensive space-based capability, most notably True Anomaly. It will be interesting to see whether there is a European market (or indeed political will) big enough to support the same over here.

The world’s first uncrewed naval battle

The Ukrainian military released footage of the first known naval battle between two uncrewed surface vessels (USVs). A Ukrainian Sargan 3000 USV apparently tracked a Russian USV in the Black Sea and destroyed it using an onboard gun.

We have seen this in the skies above the battlefield in Ukraine, with UAVs shooting down UAVs. And more recently on the battlefield itself, with UGVs taking on UGVs. So it was only a matter of time until its inception in the maritime domain.

As readers of this newsletter will know, the war in Ukraine is increasingly robotic in nature. In some areas of the front line there are relatively few soldiers holding ground. Instead they operate UAVs and UGVs from underground bunkers. This YouTube video by Perun gives a good overview of what the front line is now like.

This USV-on-USV battle is validation for the UK’s Royal Navy and for the First Sea Lord, General Gwyn Jenkins, who has made a big bet on the concept of a Hybrid Navy. The Royal Navy has canceled the planned production of two large ships, replacing them with a hybrid fleet of uncrewed boats + a crewed mothership which controls them.

Many other navies are making similar bets, though perhaps not quite as bold as that of the UK. It will be a similar shift in global naval platform to that of the early twentieth century, when the world moved from battleships and cruisers to aircraft carriers and submarines.

Ukraine’s Operation Vivaldi

Ukraine recently undertook a successful operation to re-take a Russian salient of ~75km² in Northern Donbas. It apparently deployed UGVs more than 10km behind enemy lines using heavy lift drones to deliver them.

The operation has been a closely guarded secret so relatively little is known so far. But it points to the development of new anti-drone tactics that could bring back (limited) manoeuvre on the battlefield. It seems that Ukraine developed tactics to clear enemy drones before launching offensive operations.

Operation Vivaldi is not yet over (it refers to the multiple seasons of Vivaldi’s famous piece). It will be interesting to see what comes next.

Japan’s drone-based quantum sensors to detect submarines

Japan plans to deploy quantum magnetometers onboard drones in order to detect submarines. They’re designed to detect the faint magnetic disturbance a submerged submarine leaves in the water.

Quantum magnetometry has been a laboratory promise for a decade. The interesting part is perhaps the deployment concept rather than the physics. Magnetic detection range is short (a few thousand metres at best).

But Chinese submarines leaving port for the Pacific must pass through a handful of narrow (and shallow) straits. If Japan can crowd those straits with enough cheap drones it may still generate an advantage.

Meanwhile China has already tested drone-mounted quantum magnetometers at sea. So Tokyo is playing catch-up on a technology it needs more than Beijing does.

FUNDRAISING

DEFENCE

Mach Industries, an American developer of uncrewed systems and advanced propulsion technology, raiseda $600M Series C extension at a $3.7B valuation.

Tekever, a Portuguese developer of large UAVs, raised a $580M Series D at a $6.4B valuation led by UC Investments.

Covenant, an American precision strike company, emerged from stealth with $250M in funding (across three rounds) at a $1B+ valuation. Investors include a16z, Founders Fund, Lux Capital, 8VC, Aleph and Lightspeed.

Poseidon Aerospace, an American developer of cargo UAVs for defence logistics air freight, raised a $60MSeries A led by TQ Ventures.

Impossible Objects, an American additive manufacturing company focused on aerospace and defence, raised a $40M Series B led by Inflection Equity

Bulwark Dynamics, an American developer of USVs for contested logistics, raised a $6.8M seed round.

HydroSight, an Israeli developer of AI that detects seabed changes and anomalies from marine survey data, raised a $5M seed led by StageOne Ventures.

SYOS Aerospace, a New Zealand developer of uncrewed systems, raised an undisclosed amount co-led by NZVC and Outset Ventures. 

SPACE

Stoke Space, an American developer of reusable rockets, raised a $1B Series E co-led by Point72 Venturesand Spark Capital.

The Exploration Co., a French-German builder of reusable space capsules, raised a $450M Series C round co-led by Bessemer, Atomico, and EQT’s Scaleup Europe Fund.

Impulse Space, an American developer of spacecraft and propulsion systems for moving payloads in orbit, raised a $308M Series D extension.

Open Cosmos, a British satellite builder, raised a €300M round.

EnduroSat, a Bulgarian provider of standardised satellites and constellation services, raised a $205M round co-led by Riot Ventures and Atreides.

Pixxel, an Indian developer of hyperspectral Earth observation technology, raised a $100M Series C co-led by SWF Temasek and Seraphim.

Besxar, an American developer of orbital semiconductor manufacturing, raised a $14M round led by Dauntless Ventures and Overture VC.

Galaxia, a Canadian developer of Earth observation technology, raised $4.5M CAD co-led by Amiral Ventures and Invest Nova Scotia.

Project-S, a German developer of space-based radar for detecting and tracking orbital threats, emergedfrom stealth with an undisclosed amount.

QUANTUM, CYBER & AI

Exein, an Italian developer of embedded cybersecurity for physical AI systems, raised a $270M round at a $1.7B valuation, led by Headline.

Cylake, an American company enabling organizations to use AI security tools while keeping sensitive data on-premises, raised a $245M round.

Fortaegis, a Dutch developer of chip-based security, raised a $50M Series A led by Serendipity Capital.

EigenQ, an American developer of quantum-safe security and trusted-infrastructure products, raised ~$45Mahead of its proposed IPO.

Arlequin, a French developer of AI models for analysing patterns across large datasets, raised a a €28MSeries A co-led by redalpine and OTB Ventures.

AI Score, a British developer of technology to track AI use and set controls for oversight and security, raiseda $5.4M seed led by Fuel Ventures.