The return of European talent from the US, more government support and changes in how universities back innovation are driving a blossoming of European defence tech, say founders and VCs in the field.
“We are seeing a lot of promising dynamics,” says Kelly Chen, a member of the senior management team of the new €1bn NATO Innovation Fund, talking on a panel at the Sifted Summit in London.
“The ecosystem is definitely young but deeptech rests very much on university research,” an area in which European academics and universities are strong, she says.
Eric Slesinger, founder of 201 Ventures, says an influx of engineers and researchers who spent years working for big tech firms in the US are now returning to Europe with heaps of expertise, and want to found their own startups. But investors still need support to understand the regulatory differences between European countries, on issues including export controls, he adds.
And although more young defence startups are emerging, Europe still has few at scale, says Torsten Reil, cofounder and CEO of Helsing, a Munich-based company developing AI software for the armed forces, which is running several programmes in Ukraine. He laments that many founders still aim to sell very early and says Europe needs more role models with the know-how and determination to grow.
The Ukraine war has triggered an “explosion” of drone companies, Reil says, with the technology being used on the battlefield in novel ways, but he predicts the sector will cool down over time and only a handful of startups will achieve scale.