"Defense and aerospace startups have already raised more than $19 billion in 2025, according to data firm PitchBook. This comes as the Pentagon, under Defense Secretary Pete Hegseth, calls for a total overhaul of the military's acquisition system to "focus on speed and volume," he said in a speech earlier this month. The military's push towards faster and cheaper innovation is resonating in Silicon Valley, with investors pouring record amounts of cash into AI-powered weapons, drones, and other defense-focused startups."
"Last year, global venture capital investments in defense and aerospace companies totaled over $10 billion. All signs point to this year nearly doubling last: As of late November, global defense and aerospace funding has surpassed $19 billion, per PitchBook. As if Silicon Valley needed any more reassurance from the military's top brass of its bet on defense tech, Army Secretary Dan Driscoll recently said the Army aims to work less with traditional defense businesses and procure more weapons from startups."
Defense and aerospace startups raised over $19 billion in 2025, nearly double the roughly $10 billion recorded in 2024. The Pentagon is calling for a total overhaul of the acquisition system to focus on speed and volume and to operate on a wartime footing. The Army plans to reduce reliance on traditional defense contractors and procure more weapons from startups. Investors are directing record capital into AI-powered weapons, drones, and factory automation. Startups are establishing production and development hubs in places like El Segundo, California, building FPV drones, automating factory floors, and racing to deploy battlefield-ready technologies.
Read at Business Insider
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