European defense startups have raised a record $7.4 bln year-to-date, with U.S.
investors providing more capital than local backers for the first time, Dealroom
and Resilience Media said on Monday. The YTD total is nearly three times the
full-year 2025 total. Rising perceived threats from Russia and higher European
defense budgets are driving rapid growth in the sector and spawning companies
focused on drones, spy satellites and other battlefield technologies,
intensifying competition for traditional defense contractors. Some European
officials have expressed concern about foreign capital entering the sector;
founders say weak domestic capital markets and restrictions on weapons
investment have forced them to seek funding abroad.
