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“Once an arena just for contrarian VCs, miltech [or defense tech] is booming and there is an appetite for the government sector to outsource R&D to the VC crowd,” my former boss Matthew Panzarino wrote not too long ago. I noticed that at TechCrunch Disrupt and in recent news, too. — Anna
Defense tech is no longer a hard no
Defense company Anduril was once described as “tech’s most controversial startup.” But that hasn’t stopped it from raising a massive $1.48 billion Series E round of funding last December, which is presumably fueling its recent acquisition spree. Its latest deal is the takeover of Blue Force Technologies, the design and engineering firm behind the “Fury” unmanned fighter jet.
Anduril is more than a counterpoint, though. It is symbolic of a trend in which defense tech and venture capital dollars are no longer antithetic. As my TechCrunch colleague Aria Alamalhodaei noted:
“Anduril’s success has flown in opposition to the long-dominant perspective that defense tech is ill-suited for venture dollars. Such success stories, combined with rising geopolitical tensions and a sea change inside the Pentagon itself, has meant that more startups than ever before are actively seeking to work on tech at the intersection of national security and commercial — and more investors are willing to fund them.”
European defense tech startup Helsing hasn’t yet raised as much funding as Anduril; as a pure software play, it might never need to. But even as an AI company, it is breaking fundraising records, with a recent €209 million Series B funding round ($223 million) that was reportedly raised at a €1.5 billion pre-money valuation, or $1.6 billion.
In November 2021, Helsing had already raised €100 million in funding from Prima Materia, the moonshot-focused investment vehicle of Spotify co-founder Daniel Ek, who joined the company’s board. But its Series B lead, General Catalyst, is a mainstream VC firm, indicating that more investors are willing to at least look at this space.
It is not just the fundraising environment that is improving for defense tech startups; they are also more likely (or less unlikely) to attract top talent.
In a recent interview (in French), Helsing’s VP of AI and former head of AI research at Meta Antoine Bordes said that bringing up his new role typically elicited two types of reactions among his peers, which I am summing up here: “Not my thing, but good for you,” and “Great, let’s talk about job opportunities.”
Working for Helsing means working on pressing issues. “In parallel to building commercial traction, Helsing has been active in Ukraine since 2022, providing capabilities and technology for frontline operations, with personnel deployed on an ongoing basis,” the startup wrote in its round announcement.
Like U.S. fears about China, the war in Ukraine likely played a role in making defense tech less of a taboo in Europe. Both of these make NATO members and industry giants more willing to leverage innovative tech for defense — and that includes AI, which Helsing co-founder Gundbert Scherf believes “will be essential so that democracies can continue to defend their values.”
The increasing number of top talent working on these issues in democratic societies can help counter some of China’s structural advantages when it comes to applying AI to warfare, Helsing’s co-founder Torsten Reil said onstage at TechCrunch Disrupt.
While they didn’t call it that in the interviews I watched, Reil and Bordes seem to be tenets of the once-ubiquitous belief in the “10x engineer” — but now in the AI-enabled defense tech space.
“China may have tens of thousands of ML engineers, but the reality is, it’s actually just a few hundred that will really move the needle; and you need to get those together to form critical mass to really create those big capability advantages,” Reil said.
Of course, there are still plenty of open questions on how AI in particular can be applied effectively and ethically in the defense field. But there’s a far better chance that these will be asked and answered in democracies, so it makes sense for VCs to question why they would sit this one out.
Too many Jobs?
When I was done musing whether an AI should ever be allowed to pull the trigger, I opted for another kind of meditation: on the work and life of Steve Jobs. The Apple founder is the central character of an opera, “The (R)evolution of Steve Jobs,” which had its belated San Francisco premiere the same week at TechCrunch Disrupt.
I am no art critic, let alone an opera critic, and plenty have already shared their impressions on the libretto and music since it premiered in Santa Fe in 2017. But as a spectator, I found the one-act play mostly enjoyable, although often cheesy and melodramatic.
On the positive side, besides fine performances and scenography, it had a lot more humor than I expected; for instance, with Jobs’ wife, Laurene, singing to him, “The kids miss you / And sometimes I do, too.” It also wasn’t hagiographic, and it didn’t shy away from showing the less agreeable aspects of Jobs’ personality and behavior, both at work and outside of it. A special mention also goes to the character representing (as well as the actor playing!) Kōbun Chino Otogawa, the late Zen priest who officiated at Jobs’ wedding.
When the opera became less convincing, though, is when it tried to persuade the audience that later in life, Jobs had morphed into a refined version of himself, “Steve 2.0,” in no small part thanks to his wife. While a disclaimer states that the work “has not been authorized or endorsed by Apple Inc., the Estate or Family of Steve Jobs, or by any persons depicted” in it, I found that the way it idealized Laurene Powell and her relationship with Jobs verged on cringy.
I suppose it’s not that easy to find enough of a dramatic arc in a real person’s life to be able to tell a story that people will care about. All in all, the opera did an okay job at it. If you want to see it for yourself, there are still a few upcoming performances at SF’s War Memorial Opera House. Feel free to let me know what you thought, too!