Defence is more important today than it’s been in some decades. A spate of conflicts and rising tensions between global powers have encouraged European nations in particular to boost their defence spending, and become more self-sufficient. Every problem is an opportunity for someone, though, and the people that stand to benefit here are Europe’s defence startups.

Companies such as BAE Systems, Thales Group and Rheinmetall mean there’s already ample talent in the European sector, but there’s also plenty of room for innovative startups providing newer and most cost-effective solutions. The five startups below are just the tip of this iceberg, and are already proving their worth to governments and investors alike.

Cambridge Aerospace

The money invested in many of the companies on this list may not make them feel like startups, but Cambridge Aerospace really fits the bill. Formed just two years ago, the UK-based defence firm has raised $500 million in just its last two funding rounds, putting it at a valuation of $3.4 billion.

Unlike some startups, this isn’t just speculative. Cambridge Aerospace has plenty to back up its valuation, having already sealed multiple deals with the UK Ministry of Defence. Its Skyhammer intercept missile and launcher system has already been developed and delivered, with its next product, Starhammer, expected to hit the market in 2027.

The company has been able to deliver on such a short schedule thanks to a raft of veteran talent. CEO Steven Barrett is a Regius Professor of Engineering at the nearby University of Cambridge, while CCO Chris Sylvan served in the US Marine Corps, and held the role of Director for Europe at innovative defence firm Anduril Industries.

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The UK defence sector in particular looks set to flourish. The government has laid out plans to increase defence spending as a proportion of GDP from the current 2.3% to 3.5% by 2035. While part of this will be allocated to renewing the UK’s nuclear armaments, a significant proportion is also slated for technology such as missiles and drones.

The UK has also shown willingness to invest in emerging technologies already, with examples including its eyecatching (and snappily named) DragonFire laser defence system. The ship-mounted energy weapon is due to enter service in 2027, and is designed to fire at both air and sea targets, including mortar shells and drones.

Helsing

Headquartered in Munich, Helsing has rapidly established itself as one of Europe’s most valuable defence technology startups. Rather than manufacturing heavy hardware from scratch, Helsing is tapping into Europe’s growing tech expertise, and building artificial intelligence and real-time sensors for weapons systems.

Its platform processes vast amounts of live data from sensors mounted on fighter jets, land vehicles, and drones, providing operators with a real-time overview of the battlefield around them. The company has already secured major government contracts across Europe, including partnering with Airbus to develop AI capabilities for fighter aircraft.

Helsing has achieved multi-billion-pound ‘unicorn’ status through consecutive massive funding rounds, including the most recent injection of $1.8 billion. Formed in 2021, the German company represents a new breed of what’s becoming known as ‘neo-prime’ defence companies, prioritising software alongside traditional military hardware.

Stark Defence

Another high-flying Munich-based startup, Stark Defence is addressing the growing need for unmanned strike systems by making them quicker and easier to produce. With modern conflicts clearly demonstrating that affordable and autonomous drones have fundamentally changed battlefield tactics, being able to produce drones quickly could give armies a huge edge.

Stark Defence designs and manufactures both loitering munition (‘kamikaze’) drones and autonomous strike drones engineered to resist electronic warfare. The firm is pioneering rapid, scalable drone production by making modular drone parts, and employing AI to automate manufacturing processes as much as possible.

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Stark Defence is not only aiming to deliver mass-producible, highly cost-effective weapons platforms, but to do it domestically within Europe, making the continent more self-sufficient. With European militaries eager to replenish and modernise their inventories with local tech, Stark has quickly attracted major investment and government contracts, including the German armed forces.

Frankenburg Technologies

Hailing from Estonia (a country we’ve spotlit before for its vibrant tech ecosystem), Frankenburg Technologies is another firm founded to tackle the issue of drone warfare. Instead of building drones, however, Frankenburg is focussing on the other side of the equation: shooting down hostile drones as cheaply and effectively as possible.

Hostile forces frequently use mass-produced, low-cost drones to target high-value assets, making it unsustainable to shoot them down using multi-million-pound air defence missiles. Frankenburg’s solution is a series of low-cost, AI-guided interceptor missiles designed specifically to eliminate hostile unmanned aerial vehicles (UAVs).

Founded by a leadership team combining seasoned tech entrepreneurs and former senior military commanders, the company aims to pair genuine military insight with talented software developers. Frankenburg is already expanding manufacturing capabilities across Eastern Europe to help safeguard critical national infrastructure and military supply lines, and has most recently partnered with UK giant BAE Systems.

ARX Robotics

While airborne drones dominate much of the public discussion around defence, modern battlefield logistics and ground operations haven’t finished evolving. German startup ARX Robotics was founded by former army officers to bring robots to the battlefield, both with its autonomous unmanned ground vehicles (UGVs) and dual-use battlefield robotics.

ARX produces modular, tracked ground platforms such as its 'Gereon' series, powered by its own proprietary AI operating system. These autonomous vehicles handle high-risk tasks that traditionally endanger human soldiers, including jobs like resupplying frontline troops, evacuating casualties, clearing safe routes, and performing recon.

ARX’s platforms are already seeing operational deployment in Ukraine and along NATO’s eastern flank, with the company establishing a growing footprint in the UK to collaborate directly with British armed forces. Having been formed in 2022, the company has already raised €42 million, including money from the NATO Innovation Fund. 

The landscape of European defence is undergoing its most radical transformation in decades. As governments try to outsource less and spend more on defence (and pivot to newer technologies), nimble startups like these are proving that military innovation can happen at speed.

These five companies are commercial success stories, but they’re also becoming foundational to the continent's future security. With geopolitics evolving as quickly as it has in recent years, startups need to evolve just as fast—something these businesses are achieving with explosive effect.