PitchBook data captured through mid-2026 shows defense technology startups have already secured more capital this year than the full prior year, with $12.3 billion flowing into 175 deals centered on drones, battlefield AI, and related hardware.
Five years ago no one in Silicon Valley would have believed this.
PitchBook: defense tech companies making drones, battlefield AI, and more have raised $12.3B across 175 deals YTD, up from a $9.95B total from 158 deals in 2025 (Financial Times)
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The rise from 158 deals last year to 175 so far points to broader investor appetite for lower-cost, rapidly produced systems over legacy platforms.
While some investors flag risks of overheating in segments like drones, others see durable structural demand driven by evolving government needs rather than short-term conflicts.
Many users expressed excitement over defense tech firms raising $12.3B for drones and battlefield AI, praising founders and the sector's acceleration, while negative users objected to the term defense as a euphemism for war.
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@KTmBoyle Everyone at YC would have believed it. YC was deeply into hard tech by 2014.
Five years ago no one in Silicon Valley would have believed this.
Respectfully disagree. Hard tech and defense tech were separate categories before Ukraine. Many venture firms were still reluctant to do follow on rounds in companies that sold to the Department of War or allied governments as their primary focus. Many top firms still weren’t allowed to invest due to their LPAs. Most early drone companies targeted consumer or hobbyist use cases. The biggest question for any company was follow on capital, including companies that wanted to sell to the Department of War but knew that story wouldn’t play with investors. Early stage investors (YC included) definitely saw the emerging talent pool before the broader market, but the scale to which the narrative shifted and downstream capital came into companies unapologetically building for defense— I think that’s a surprise to everyone.
@KTmBoyle Everyone at YC would have believed it. YC was deeply into hard tech by 2014.
@KTmBoyle Truth & u all deserve a ton of credit! 🇺🇸🚀
Five years ago no one in Silicon Valley would have believed this.
@KTmBoyle @paulg Defense? You mean war.
@KTmBoyle @paulg Agree with you here Katherine
@paulg @KTmBoyle Boom!
@KTmBoyle @paulg Job isn't done until working for defense tech firms isn't considered "selling your soul for money" but something people take a pay cut to do out of civic duty.
@paulg @KTmBoyle Hard-killing tech
@KTmBoyle contrarian + right
@KTmBoyle @paulg 🎯
@KTmBoyle @paulg The software sector is done for; we must go all out in the hardware sector!
I think that's an unfair comp. YC partners tend to be advertise every trend, so definitionally they'll have predicted everything. But many seem to not work out -- you can look through the Request for Startups for many failed ideas. This is not a criticism of failed ideas. After all, that is the point of YC and venture capital in general.
@paulg @KTmBoyle The software sector is done for; we must go all out in the hardware sector!
@RussellVarriale @KTmBoyle Among others.
Five years ago nobody in Silicon Valley would have believed that the US would be, easily, the largest exporter of primary energy in the world; in investing over $750B/yr in data refineries; in reindustrializing at an impressive pace; in Starlink as a global internet service; in Starship; in Robotaxi; in Optimus; in Nvidia being more valuable than the German stock market; in the rise of Palantir and Anduril; in California becoming anti success.........
@KTmBoyle Yeah it’s wild! When I sold my 2 companies and then joined the Marine Corps, tech dude going into military was a strange concept and I definitely felt like a fish out of water. But now it’s totally normal and that’s a good thing. Closest SV and DC have been since the mid 80s
@KTmBoyle I started pitching Starship Ventures as a defense tech VC in mid 2020.
@KTmBoyle I should've posted more on X
@KTmBoyle Still is. The hard tech that works needs a founder willing to wait 5+ years.
@KTmBoyle amazing founders that took advantage of several geopolitical shocks that shook up the market