Defense startups

Strategic Driver

Asymmetric Warfare (notably in Ukraine)

Sector Terminology

Neoprimes (startups) vs. Primes (legacy contractors)

Key Geographic Hubs

Silicon Valley, California; El Segundo, California

Primary Technologies

Autonomous Drones, Computer Vision, AI, Electronic Warfare, EMP, Sonar

Total Venture Funding (H1 2025)

$38 billion

2014-01-01

2016-01-01

2025-06-30

2025-10-03

5. Procurement breakthroughs for startups: Emerging defense startups like SpaceX and Palantir have challenged traditional Defense Department contracting, leading to greater competition and innovation. SpaceX sued the U.S. Air Force in 2014 over exclusive contracts awarded to ULA for national security launches, resulting in policy changes that ended ULA's monopoly. Palantir also sued the U.S. Army in 2016 for excluding commercial solutions in its procurement process, winning the case and forcing [...] The recent headway Silicon Valley upstarts have with the DOD does not change the fact that building an enduring defense tech business does not come without significant challenges and pitfalls. Indeed, as the Pentagon and even other investors have recently noted, the influx of capital into defense tech startups must come with realistic expectations. We remain intellectually honest that building an enduring defense tech startup is very hard. R&D obstacles, commercialization challenges, friction [...] Given our long track record of partnering with companies at the intersection of defense and deep technology, including Skybox Imaging, Rocket Lab, Endgame, Spire Global, Claroty, and Virtru, we have various sales playbooks as well as metrics benchmarking reports specific to defense tech to help go-to-market teams navigate the federal sales landscape. In addition, we can offer a unique talent network for startups to leverage when building out their teams.

A wave of defense tech startups in Silicon Valley is drawing billions in funding and reshaping America's national security. Anduril Industries, recently valued at $30.5 billion following its latest funding round, is among the so-called "neoprimes" — companies challenging the dominance of legacy contractors, dubbed "primes.)," such as Lockheed Martin, Northrop Grumman, Boeing, General Dynamics, and RTX (formerly Raytheon). [...] Venture funding for U.S.-based defense tech startups totaled about $38 billion through the first half of 2025, and could exceed its 2021 peak if the pace remains constant for the rest of the year, according to JPMorgan. ## 'The battlefield is changing' [...] Why private investors are pouring billions into Europe's defense tech sector CNBC Explains

The enthusiasm has spurred something of an arms race on the opposite coast. In El Segundo, Calif., where a handful of traditional defense contractors are headquartered, startups are setting up shop in warehouses adorned with American flags and squat racks and racing to build battlefield-ready tech. They've constructed FPV drones, used AI to automate factory floors, and sent capsules to space. Last week, an El Segundo-based nuclear startup said it split the atom. [...] Jake Adler poured his actual blood into his startup. Adler, the founder of Pilgrim, a biotech and defense startup building medical devices for the battlefield, filmed himself testing his flagship product — a hemostatic dressing he calls Kingsfoil — by cutting open both of his thighs. Following the video, the Redwood, Calif.-based startup raised $4.3 million in seed funding. Defense VC ## Read next ### Business Insider tells the innovative stories you want to know [...] AndrenaM's rapid fundraise signals just how eager investors are about the new wave of defense tech. The startup, cofounded by Matej Cernosek and Alex Chu, uses AI to analyze sonar data and deliver real-time insights, aiming to give this legacy defense tool a high-tech upgrade. A 21-year-old founder who cut open his leg to demo his biotech raises $4.3 million

We compile and update a weekly list of recently funded Defense and Defense Tech startups in USA, and share it with our subscribers via email. Each week, our research team compiles information and data on recently funded Defense and Defense Tech startups in USA, including details about the type of funding round (such as Pre-Seed, Seed, Series A, etc), employee count, contact details of their c-suite, technologies used, top investors in that round and many more data points. [...] Defense startups that raise capital are under pressure to deliver mission ready solutions quickly. They are often working on high security and high impact projects and need trusted partners for development, compliance, testing, and deployment. Early funding rounds open the door for new vendor relationships as they prepare for government or commercial contracts. ### 2. What types of companies fall under the defense technology category? Defense tech startups include companies that build: [...] Meeting security compliance and government procurement requirements Rapidly scaling research and product development Prototyping and testing in simulated or field environments Securing Department of Defense or federal agency contracts Hiring cleared engineers and subject matter experts ### 6. What kinds of vendors do defense startups work with after funding? Frequently engaged vendors include: