Emerging Tech Investment Opportunities

Executive Summary: Mapping the Defense Tech Investor Landscape 1/ At Context VC we are preseed investors that invest across industries/sectors. More than 80% of our capital to date has gone into investing in military veteran founders (cc US Army, US Navy, United States Air Force, United States Marine Corps, United States Space Force). 2/ The data is in, and the message is clear: Defense Tech is no longer a "niche" vertical. It is a powerhouse of innovation driven by "Dual-Use" technology: software and hardware that thrive in both commercial markets and critical national security applications. In our latest analysis of the investment landscape, we’ve broken down where the firms are located and which stages they are investing in. 3/ 📈 💸Investment by the Numbers The distribution of investment stages shows a healthy pipeline, though it remains heavily weighted toward the early builders: Early Stage (Pre-Seed/Seed): 42% of firms. Growth/Mid-Stage (Series A/B): 33% of firms. Late Stage / Private Equity: 14% of firms. Multi-Stage / Incubation: 11% of firms. While there are many early-stage firms by number, it’s much more heavily weighted by dollars towards late-stage and multi-stage firms. 4/ 📍Geography of Innovation While Silicon Valley remains a titan, the "Coast-to-Coast" defense corridor is real. Here is the count of firms by major hub: Washington DC or Northern VA: 21 New York: 17 San Francisco: 15 Boston: 6 Austin: 4 5/ 🚀 🪖Why This Matters Over 80% of these firms invest in "Dual-Use". This means the next generation of flight software, autonomous systems, and encrypted communications isn't just being built for the battlefield, it’s being built for the global economy. From TFX Capital, The Veteran Fund, Veteran Ventures Capital, to Outlander VC, and more, the bridge between private capital and national defense has never been stronger. At VetraFi, we see this same spirit in our service members: the desire for tools that are field-tested, validated, and mission-critical. Whether it's physical fitness, financial fitness, or defense hardware, the standard is excellence. Are you building or investing in the Dual-Use or investing in the next generation of defense? Please let us know what we missed (we will knock out pushups and pullups), or please let us know what we should include in our next update of the Defense Tech Investor Landscape Map. Let’s chat/connect in the comments! 6/ 🙏 Thank you Casey Cowan and Joseph Stella for your help with this investor market map. We are also working on an European and Asian defense tech investor market map, cc Nicolas L.! cc J2 Ventures, First In, Scout Ventures, Champion Hill Ventures, AIN Ventures, Shield Capital, Harpoon, New North Ventures, Differential Ventures, AE Industrial Partners, LP, Cerberus Capital Management, Cerberus Ventures, General Catalyst, Insight Partners, Founders Fund, Andreessen Horowitz, 8VC, Thrive Capital, Lux Capital, Accel, and so many other firms.

Over 100 Companies Are Building Killer Robots for the Pentagon. I Found the 20 That Will Actually Survive. Last week, a defense startup CEO told me something that made me think. "We're not competing with Lockheed anymore. We're competing with 100 other startups who think they're the next Anduril." He's right. And 80 of them will be dead by 2027. I spent three months mapping autonomous defense companies chasing DoD contracts. From Silicon Valley AI labs to Boston robotics shops to D.C. consultancies pivoting to hardware. etc. The carnage has already started. Twelve companies that raised Series A rounds in 2024 are out of money. Three that won SBIR grants can't scale production. One with $50M in funding just lost their entire engineering team. But 20 companies are making headway. And they all share the same DNA. The Pattern Winners don't build for the Pentagon. They built for the 19-year-old Marine who has to use their tech while getting shot at. One company embedded engineers with combat units for 6 months. No contract. No promise of payment. Just learning how operators fight. Result? Their drone requires two people to operate. Competitors need 12. Skydio delivered drones with 70% capability in 3 months. By month 12, they'd pushed 47 software updates based on combat feedback. Traditional contractors were still writing requirements documents. Winners treat manufacturing like a weapon system. Anduril built factories before winning major contracts. Saronic designs boats for mass production, not perfection. Firestorm 3D-prints drones in the field. The traditional primes? Still treating production as an afterthought. The Math Current reality: • 100+ companies chasing autonomous defense contracts • Combined VC investment: $8.7B since 2020 • Total addressable market by 2027: $12B • Winners needed to capture 80% of the market: 20 That's 80 companies fighting over table scraps. The Survivors Based on my analysis, here are the 20 that are leading the charge: The Platforms (One brain, infinite applications): Anduril, Shield AI, Applied Intuition The Swarmers (Quantity as quality): Skydio, Saronic, Blue Water Autonomy The Specialists (Owning one domain): Hermeus (hypersonics), Epirus (directed energy), True Anomaly (space) The Builders (Manufacturing as moat): Firestorm, Forterra, Terminal Autonomy The Enablers (Making others deadly): Scale AI, Vannevar Labs, Rebellion Defense The Wild Cards (Different playbook): Joby (VTOL), Reliable Robotics, Mach Industries The rest? They're building impressive tech, but many will never see combat. Your Move If you're supplying these 20, you'll ride the wave. If you're competing with them, you have roughly 18 months to pivot or perish. Find your unique slot. The autonomous defense revolution isn't winner-take-all. It's winner-take-most. And the winners are already emerging from the pack.

For the first time in venture history, three distinct channels share the liquidity burden roughly equally. A decade ago, secondaries barely registered. They accounted for roughly 3% of exit value in 2015. Today they claim 31% : nearly $95b in the trailing twelve months. The shift accelerated after 2021’s IPO bonanza. When public markets closed their doors in 2022, investors found alternative routes. Secondaries absorbed demand that would have flowed to traditional exits. When Goldman Sachs acquired Industry Ventures, the transaction signaled secondaries have arrived. Morgan Stanley followed with EquityZen, then Charles Schwab announced its acquisition of Forge Global. Wall Street recognized the structural change before most of venture did. This matters for founders & investors. When IPOs dominated exits, fund models assumed a small number of public offerings would generate the bulk of returns. Now liquidity arrives through multiple doors. A founder might sell secondary shares to patient capital while the company remains private. A GP might move positions through continuation vehicles. An LP might trade fund stakes on an increasingly liquid secondary market. The 830 unicorns holding $3.9t in aggregate post-money valuation cannot all exit through IPOs. The math doesn’t work. At 2025’s pace of 48 VC-backed IPOs, clearing the unicorn backlog would take seventeen years. Secondaries provide a release valve that traditional exits cannot. Companies like OpenAI have embraced this reality, running employee tender offers while voiding unauthorized secondary transfers. The largest private companies now manage their own liquidity programs rather than waiting for public markets. Today, secondary liquidity concentrates in the top 20 names. SpaceX, Stripe, OpenAI. For the founder of company #50, the secondary market remains largely theoretical. For secondaries to succeed as a broad asset class, buyers must underwrite positions in companies without household recognition. As the market grows, this coverage gap becomes opportunity. For LPs starved of distributions since 2022, the expansion of secondary channels offers hope. The $169b in cumulative negative net cash flows needs somewhere to go. More exit paths mean more opportunities to return capital. When a Series B employee asks about liquidity today, the answer isn’t “wait for the IPO.” It’s “we’re planning a tender offer next year.” A decade ago, secondaries were a footnote. Now they’re infrastructure. Liquidity flows where it can, not where tradition suggests it should.

Quantum Computing and Defense: The Next Strategic Frontier Quantum computing presents major implications for future military and defense technology. Based on available public and government data, five nations are leading global investment in quantum research with dual-use (civil and defense) potential: 🇨🇳 China ↳ Estimated $15 billion in national quantum R&D funding ↳ PLA-linked institutes developing quantum communication and sensing ↳ Quantum satellite demonstrations for secure communication ↳ Leads globally in quantum patents and publications 🇺🇸 United States ↳ Multi-billion-dollar investment through the National Quantum Initiative ↳ Coordination across DOE, NSF, DOD, and NIST ↳ Defense projects via DARPA and Air Force Research Lab ↳ Focus on quantum cryptography, simulation, and sensing systems 🇪🇺 European Union ↳ Over €10 billion committed by EU and member states collectively ↳ Quantum Flagship (€1 billion) drives collaborative R&D ↳ Focus on dual-use sensors, communications, and aircraft systems ↳ Partnerships across Germany, France, and the Netherlands 🇬🇧 United Kingdom ↳ £2.5 billion (≈ $3 billion) through the National Quantum Strategy ↳ MOD projects in quantum radar, navigation, and timing ↳ Strong collaboration between government, academia, and industry ↳ Clear pathway toward operational defense applications 🇨🇦 Canada ↳ CAD 360 million through the National Quantum Strategy ↳ Partnerships between universities and the Department of National Defence ↳ Research focused on secure communications and quantum simulation ↳ Active contributor within NATO’s emerging tech discussions These investments reflect each nation's strategic priorities in next-generation defense capabilities. The data shows substantial government commitment across all five countries, with varying approaches to implementation. What trends do you see in your country's technology investments? Share your thoughts on defense technology development ♻️ Repost to help people in your network Follow me for more defense technology analysis

In an era of peak ambiguity, shifting geopolitical tensions, and asymmetrical warfare, our defense posture won’t just rely on the quality of software we can build; it will rely on the speed in which we can adapt, iterate, and deploy new innovation. As my partners Paul and Alexa recently wrote in their piece on the rise of applied software for hardware-intensive industries, we're entering a new era where software is no longer layered on top of the physical world—it’s integral to development from the start. We believe deeply in software-defined hardware as a driver of future resilience. That belief underpins our investments in defense companies like Helsing, Anduril Industries, Applied Intuition, and Saronic Technologies. But software-defined hardware is just one piece of the equation. There’s a broader ecosystem that is needed to scale innovative hardware. A key part of this is software for testing and deployment. One of the most persistent bottlenecks in innovation is proving real-world viability. In many sectors, a few hacker-engineers can scrape together an MVP, ship a small batch of prototypes, and iterate from there. But for the defense companies, the high standard for validation in the real world is costly and complex. As an example, autonomous aircraft can be built in months, but take years to certify. Companies like PhysicsX and Nominal are tackling testing and simulation to reduce waste and shorten development timelines, while enabling superior product design. PhysicsX delivers deep learning–based simulation software, embedding intelligence across the entire product lifecycle, from concepting and design to manufacturing and operations. And in the field, Nominal collects, structures, and activates raw field signals to give operators and engineers real-time visibility into how complex systems are performing. These systems aren’t just for tech-native startups. They can support mechanical, electrical, and aerospace engineers at legacy firms, streamlining processes and unlocking innovation across incumbents and emerging players alike. We’ve embraced “build, test, learn, repeat” in the software world. Now we need to bring this to the hardware world with purpose-built platforms that understand the nuance of development in critical industries. We need tools that make fast, continuous iteration possible. Resilience begins with rethinking how we build, test, and deploy in the physical world. Read more from Paul and Alexa here: https://lnkd.in/gih37kyY

The Gulf crisis just created the biggest startup opportunity in a decade. Five things Silicon Valley leaders need to understand right now: 𝗗𝗮𝘁𝗮 𝗰𝗲𝗻𝘁𝗲𝗿𝘀 𝗮𝗿𝗲 𝗻𝗼𝘄 𝗺𝗶𝗹𝗶𝘁𝗮𝗿𝘆 𝘁𝗮𝗿𝗴𝗲𝘁𝘀. Iranian drones hit three AWS facilities. The Strait of Hormuz and Red Sea both data chokepoints are closed. The security frameworks behind the Gulf’s AI partnerships were built for chip export control, not for protecting buildings during a war. 𝗧𝗵𝗲 𝗱𝗲𝗳𝗲𝗻𝘀𝗲-𝘁𝗲𝗰𝗵 𝘁𝗵𝗲𝘀𝗶𝘀 𝗶𝘀 𝗮𝗰𝗰𝗲𝗹𝗲𝗿𝗮𝘁𝗶𝗻𝗴. The Pentagon set a $13.4B AI budget for FY2026 which is the largest in U.S. defense history. $130B+ in VC has flowed into defense-tech startups since 2021. → Palantir’s Maven system ran intelligence across five combatant commands → Anduril ($30.5B valuation) — Lattice OS selected as the Army’s fire control platform, Arsenal-1 factory producing autonomous systems at scale, OpenAI partnership for counter-drone AI → Shield AI ($5.3B) — Hivemind autonomous piloting completed AI vs. manned F-16 combat maneuvers → Epirus ($1.5B) — directed-energy counter-drone systems integrated with Anduril’s Lattice, directly relevant to Gulf drone defense → Saronic ($1.5B) — autonomous naval vessels applicable to Strait of Hormuz patrol → Hermeus ($1B+) — hypersonic aircraft for ISR and rapid strike → Ares Industries — Y Combinator’s first weapons company, building low-cost anti-ship missiles → Ursa Major ($2.5B) — rocket propulsion for supply chain independence Early-stage investors in this space are looking at generational returns. 𝗧𝗵𝗲 𝗿𝗲𝘀𝗶𝗹𝗶𝗲𝗻𝗰𝗲 𝘀𝘁𝗮𝗿𝘁𝘂𝗽 𝘄𝗮𝘃𝗲 𝗶𝘀 𝗵𝗲𝗿𝗲. Every hyperscaler is now rethinking geographic risk. That creates massive demand for: → Sovereign cloud infrastructure (hardened, government-grade, physically defensible) → Multi-region failover and edge computing platforms → Satellite backup connectivity (Aetherflux, Astranis) → Underground and modular data center designs → Cybersecurity for critical infrastructure against nation-state actors → Alternative compute capacity for displaced AI workloads (CoreWeave, Vultr) Startups solving resilience at the infrastructure layer will command premium pricing from both governments and hyperscalers. This is the next $100B+ category. 𝗚𝘂𝗹𝗳 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗶𝘀 𝗽𝗮𝘂𝘀𝗶𝗻𝗴 𝗯𝘂𝘁 𝗻𝗼𝘁 𝗱𝗶𝘀𝗮𝗽𝗽𝗲𝗮𝗿𝗶𝗻𝗴. Sovereign wealth funds holding $2T+ in U.S. assets are reviewing commitments. The Stargate UAE mega-campus, Amazon’s $5.3B Saudi cloud all in limbo. But post-conflict, these governments will double down on tech diversification away from oil. Startups that maintain Gulf relationships now while diversifying their own risk will be first in line when capital flows resume. The Gulf’s structural advantages with sovereign capital, energy, ambition haven’t disappeared. But the risk has permanently shifted. Rapid de-risking without full retreat.

Physical AI models will map and navigate the physical world. So… we mapped the physical AI model market to help you navigate the evolving space. Robotics is no longer bottlenecked by hardware. The real determinants of robotic performance and impact are now intelligence and the data and models that allow machines to operate autonomously in messy, unpredictable environments. In 2025, robotics companies raised a record $40.7B, and a growing share of that capital is flowing into physical AI, especially the models that let robots perceive, reason, predict outcomes, and act in the real world. We used our predictive intelligence to map the space and identify 70+ companies building this intelligence layer across the stack: • Data & simulation • Model architectures including VLMs, VLAs, and world models • Foundation models • Observability platforms What stands out about where this market is headed: 1️⃣ Proprietary training data is the choke point Physical AI models live or die by access to real-world robot data, which is scarce, expensive, and hard to replicate. Companies that control data through simulation, teleoperation, and deployed fleets gain a durable advantage and can dictate who gets access to capable models. 2️⃣ World models unlock true autonomy Vision and action are no longer enough. World models give robots the ability to predict, plan, and adapt over time, moving robotics from reactive systems to autonomous ones. That shift is why investment is accelerating and why this layer may decide the long-term winners. 3️⃣ Multi-robot coordination is still wide open Single-robot intelligence is advancing quickly, but coordinating fleets remains unsolved. The company that builds the orchestration layer for heterogeneous robots will define how physical AI scales across real-world environments. These companies are the foundation for intelligence that will power the physical economy. Explore the full market map and analysis below 👇

Super Bowl LIX wasn’t just a showcase of top-tier football—it was also a test of how well the networks could handle one of the most demanding connectivity environments in sports. As the Philadelphia Eagles celebrated their victory, New Orleans’ telecommunications infrastructure quietly played a crucial role in keeping fans, media, and businesses connected across the Caesars Superdome, tailgate zones, hotels, the airport, and the French Quarter. While much of the spotlight is on game day, T-Mobile, Verizon, and AT&T took a long-term approach, ensuring that their investments would benefit the city far beyond the Super Bowl. T-Mobile took a broad approach, focusing on both in-stadium upgrades and wider city improvements to keep fans connected wherever they were. -Upgraded its Distributed Antenna System (DAS) inside the Superdome, enabling peak speeds of 1.2 Gbps for fans in the stadium. -Enhanced macro cell sites in high-traffic areas like Champions Square, boosting speeds up to 920 Mbps. -Expanded its 5G network across New Orleans, adding permanent improvements to the French Quarter, key hotels (Hyatt Regency, JW Marriott, Roosevelt), the airport, and the Smoothie King Arena. Verizon focused on delivering high-speed connectivity in dense environments, making key enhancements to its 5G Ultra Wideband network: -Installed 509 Ultra Wideband radios and 155 C-Band radios inside the Superdome to provide consistent coverage across seating areas, suites, and concourses. -Mounted 42 MatSing Ball Antennas on the stadium’s catwalks, improving capacity in crowded sections. -Laid down 560+ miles of new fiber across New Orleans, permanently improving connectivity in areas like Bourbon Street, the airport, and other key venues. AT&T: A Critical Role as the Neutral Host Key Investments: -A significant DAS upgrade featuring 91 zones of 5G+ C-Band, 3.45 GHz, and mmWave, improving capacity across the stadium. -Outdoor antenna system enhancements, ensuring strong connectivity in tailgate areas, parking garages, and fan zones. -City-wide 5G+ expansions, with 69 small cell upgrades and C-Band overlays, particularly in high-density areas like the New Orleans Convention Center. The infrastructure investments made for Super Bowl LIX are a blueprint for how connectivity should be approached at large-scale events. Planning ahead is crucial. The carriers spent years preparing for this one-day event. At LA28, we are planning for a global audience across multiple venues for weeks at a time. Adaptability is essential. The ability to optimize networks in real time using cloud-based vRAN, C-Band, and mmWave proved valuable in managing massive data surges. Lasting impact matters. The networks deployed for the Super Bowl aren’t just for the game—they now serve as part of New Orleans’ long-term telecom infrastructure. The next step? Taking these learnings and applying them to the world’s largest sporting event. #SuperBowlLIX #topvoices

🎉 New Investment: Icarus 🎉 As someone who's watched countless hardware startups burn through capital on impossible physics, I'm usually skeptical of "flying for weeks" promises. But Icarus isn't another drone company - they're solving a massive gap in our defense infrastructure that I didn't fully appreciate until now. The problem hit me during a conversation with a DoD contact: satellites are predictable (enemies know exactly when they pass overhead), balloons drift wherever wind takes them, and traditional aircraft burn fuel every minute they're airborne. Meanwhile, threats require persistent, controllable eyes in the sky that can stay exactly where you need them, for weeks, without breaking the budget. That's the strategic insight behind Icarus - autonomous, solar-powered aircraft operating at 60,000 feet in the stratosphere. Think of them as "cell towers in the sky" that deliver real-time intelligence, communications, and surveillance at around $100K per aircraft versus millions for traditional platforms. Unlike satellites constrained by orbital mechanics, these systems stay fixed over target areas, leverage stable stratospheric conditions, and can be deployed in large numbers. What convinced me to invest? Three things: the tech fundamentals finally work (component costs dropped, solar/battery tech improved, autonomy enables scalable ops), the timing is perfect (geopolitical events have highlighted the stratosphere as contested space), and the execution is real (successful DoD demos, ongoing flights at altitude, strong government traction). Behind this is Henry Kwan, an aerospace engineer from Georgia Tech who built drones for NASA and satellites at Orbital. His team brings experience from SpaceX, Tesla, Honda, and the Army - exactly the credibility needed to execute in defense. Previous attempts like Google Loon or Facebook Aquila couldn't crack the reliability equation. Icarus is built specifically for defense mission requirements: controllable, persistent, cost-effective, and manufacturable at scale. Super excited to back Henry Kwan and the team as they secure the strategic high ground along side with Y Combinator and Pioneer Fund! Let's gooo!

Innovation is not just the technology we see. The biggest part sits in the underlying infrastructure behind it - and that’s exactly where the real competition is taking place. It is like an iceberg. The technology is just the tip, the visible part, while the larger mass sits below the surface: in the connectivity standards, compression algorithms, operating systems, and the IP that holds them together. • 𝗖𝗼𝗻𝗻𝗲𝗰𝘁𝗶𝘃𝗶𝘁𝘆 𝘀𝘁𝗮𝗻𝗱𝗮𝗿𝗱𝘀: They determine how devices and systems communicate. Standards such as 5G and Wi-Fi provide the reliability and interoperability needed across networks and services. • 𝗖𝗼𝗺𝗽𝗿𝗲𝘀𝘀𝗶𝗼𝗻 𝗮𝗹𝗴𝗼𝗿𝗶𝘁𝗵𝗺𝘀: As data volumes grow, compression makes storage and transmission practical, forming the backbone of video, imaging, and sensor-driven services. • 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝘀𝘆𝘀𝘁𝗲𝗺𝘀: They coordinate hardware and software, enabling applications to run securely and consistently across devices. • 𝗣𝗮𝘁𝗲𝗻𝘁𝘀 𝗮𝗻𝗱 𝗜𝗣 𝗳𝗿𝗮𝗺𝗲𝘄𝗼𝗿𝗸𝘀: They define how technologies are accessed and licensed, shaping collaboration, standards participation, and the broader commercial landscape.   Each of these layers is usually handled by different organisations - standards bodies, OS developers, network equipment makers, and open-source communities. Very few companies operate across all of them because the expertise and investment required are enormous. Huawei is one of the exceptions. Its work spans connectivity, , operating systems, and global standards development - and operating at that depth demands sustained, large-scale R&D. To provide some context of that scale, here are some figures announced at Huawei’s 6th Innovation and Intellectual Property (IP) Forum a few days ago: • CNY 1.249 trillion invested in R&D over the past decade • More than 20% of annual revenue allocated to research • Over 150,000 active patents worldwide across connectivity, software, and multimedia • Top 6 global R&D spender • 2.7+ billion 5G licensed devices A major part of this effort relies on open standards. Huawei has over 10,000 technical submissions in 2024 and more than 140,000 in total to standards bodies worldwide. It is impressive how some of the most impactful work driving innovation is done in the background and how little of it is visible to the outside world. Yet for the key players, this is actually the part that matters and the one that ultimately determines how competitive they are. Opinions and graphics: my own 𝐒𝐮𝐛𝐬𝐜𝐫𝐢𝐛𝐞 𝐭𝐨 𝐦𝐲 𝐧𝐞𝐰𝐬𝐥𝐞𝐭𝐭𝐞𝐫: https://lnkd.in/dkqhnxdg