Defense & Security

Defense Technology Is the Fastest-Growing Venture Category

Global defense spending has crossed $2.4 trillion annually and is accelerating. NATO's commitment to 2%+ GDP defense targets, combined with geopolitical instability across multiple theaters, has created unprecedented demand for next-generation military technology. Venture-backed defense startups raised over $15 billion in 2025, making defense tech one of the fastest-growing categories in the venture ecosystem.

The structural shift is clear: traditional defense primes are too slow to deliver the technologies that modern warfare demands. Software-defined systems, autonomous platforms, hypersonic capabilities, and AI-powered intelligence tools require startup-speed innovation cycles. Governments are increasingly sourcing critical capabilities from venture-backed companies through vehicles like STRATFI contracts and NATO innovation programs.

The dual-use thesis amplifies the opportunity. Many defense technologies - cybersecurity, autonomous systems, advanced materials, satellite communications - have direct commercial applications that expand addressable markets beyond government procurement. Companies that serve both defense and commercial customers build more diversified, resilient businesses.

Uhlig Capital has deep defense exposure across its portfolio: ARX Robotics (defense robotics), Delian Alliance (defense manufacturing), Hypersonica (hypersonic systems), P11 (quantum-threat cryptography), Portal Bio (DARPA-funded biotech), Ankar (defense-adjacent AI), and Cape (secure communications). Our fund managers - including SpaceVC, Nebular, and Pax VC - have built strong dealflow in this category.