Aiming for a €500 million valuation, the arms company embarks on its venture
Investment in German Defense Tech Startups Surges Amid Geopolitical Tensions
Private investments in defense and security technology startups in Germany have seen a significant increase, particularly in response to the ongoing conflict in Ukraine. One of the most prominent examples is Berlin-based startup Stark, specializing in weaponized drone systems, which recently raised $62 million from leading investors including Sequoia Capital and Peter Thiel [1][2][5].
Stark's operations are strategically aligned with current geopolitical tensions. The company is actively developing unmanned aerial vehicles (UAVs), including strike drones with AI-powered targeting, which have been tested and deployed in Ukraine, supporting NATO allies and partner militaries [2]. Stark is also planning to expand, with a new drone production facility in the UK and potential local production in Ukraine if demand grows [1][2].
Another significant player is ARX Robotics, a German startup focusing on autonomous unmanned ground systems and AI software for defense modernization. ARX Robotics has raised an additional €11 million, bringing its total funding to €42 million by mid-2025 [3]. The company emphasizes modular, scalable platforms intended for NATO and EU defense applications, aiming to enhance autonomy and digital transformation of existing military vehicles.
The surge in investment in German defense tech startups is backed by major US and European venture capital firms and prominent individual investors. Notably, Stark Defence's funding round is reportedly led by Sequoia, a well-known Silicon Valley venture capital firm [6].
The growth in the German defense industry is not limited to startups. The German government plans to double its defense budget to €162 billion by 2029 [7]. This increase in state military spending, coupled with private investment, is driving growth in the sector.
Quantum Systems, based in Gilching, Bavaria, is another key player in the German defense industry. The company produces surveillance drones and has a valuation of over $1 billion [8]. Quantum Systems supplied 800 drones to Ukraine last year, most of which were surveillance drones [9].
Stark Defence was founded by Florian Seibel, a former helicopter pilot who studied at the University of the German Armed Forces. Seibel also founded Quantum Systems in 2015 [10]. If successful, the funding round would value Stark Defence at around $500 million, marking it as one of Europe's fastest-scaling defense tech startups [1].
Investment in European and German defense tech startups is not limited to Germany. European and German venture capital funds have been active or launched fresh funds in 2025, including those targeting dual-use technologies and defense [4]. There are also new initiatives outside Germany, such as the Amsterdam-based NUNC Capital's €20 million initiative to support Ukrainian defense startups [4].
In summary, the war in Ukraine has catalyzed increased private investment in German defense tech startups, particularly in UAVs and autonomous systems. This investment is backed by major US and European venture capital firms and prominent individual investors, signaling strong market confidence and strategic significance of the sector in the current geopolitical climate [1][2][3][5].
- The Information
- Reuters
- TechCrunch
- Tech.eu
- Business Insider
- Business Insider
- Spiegel Online
- Bloomberg
- Deutsche Welle
- Handelsblatt
