US investors have stepped up funding in European defence technology start-ups, accounting for the largest chunk of private capital flowing to the burgeoning sector this year amid a rise in global conflicts.
The US provided more than 65 per cent of venture capital defence tech investment in Europe so far this year, according to Dealroom data, up from 18 per cent in 2023. The increase marks a sharp reversal from the previous year, when more than half of VC funding for defence tech in Europe came from domestic investors.
US venture capital firms have provided $458mn to European defence start-ups in the year to date, more than three times higher than the sum invested any other year, according to Dealroom. Overall, VC investments into Europe have grown nearly fivefold since 2018 and are set to hit $1bn this year.