Defense technology continues to receive a lot of attention from investors, and today, one of the larger startups in the field is announcing more funding. Shield AI — the company that develops platforms and planes for autonomous flight systems, targeting the U.S. military and its allies as customers — has raised $60 million funding, money that they will use to further develop their technology.
This amount will come as a supplement to Shield AI’s Series E, and it brings the total to $225 million. AI Shield previously announced 165 million USD batch in June, giving the startup a $2.3 billion valuation. We confirmed with Brandon Tseng, president of Shield AI, who co-founded the company with his brother Ryan (CEO), that the extension has the same valuation.
This latest $60 million comes from a single investor, Hollywood producer Thomas Tull. (The company’s previous investors include Snowpoint Ventures, Riot Ventures, Disruptive, Homebrew, Point72 Ventures, Andreessen Horowitz, Breyer Capital, and SVB Capital.) Interestingly, the company actually closed additional funding. this one week after the final round was announced.
We are in the midst of a difficult fundraising period: investors have tightened their wallets in response to the fact that tech companies, from top to bottom, have seen business slow. Then the startups that had a harder time raising capital had to cut costs to expand their runways and prove to backers that they had business ideas that would grow and thrive. profitable. And even if they do all that, they could still run out of money and have to close.
Among them, defense technology is one of the prominent categories, especially because of world events: tensions between nations, terrorism and war are all happening at the technological level today. , and that means equipping those in combat with better tools, but also the ability to use technology to take any action aimed at reducing casualties.
“Military and government spending is countercyclical,” Tseng said in an interview. “When you talk to a consumer or corporate business, spending falls during a recession. But the government is a stable Eddie. Military modernization requires a path and a plan and so it will continue to follow.”
All of that is driving the business of the best startups in the space, and that is also attracting investor interest.
“Automated defense capabilities will play an increasingly essential role in our defense programs and are critical to our ability to remain competitive,” Tull said in a statement. . “Shield AI is a leader in this space, developing some of the most cutting-edge and cutting-edge technologies for AI testing. We are proud to be able to support Shield AI and the work they are doing in defense.”
Shield AI is headquartered in San Diego, what we have previously described as the Silicon Valley of the defense industry: it is the home port of the US Pacific fleet, and according to Collected statistics by the city’s chamber of commerce, outside of Fairfax County, Virginia (where the Pentagon is based) larger San Diego receives more defense spending than anywhere else in the US Shield based in along with dozens of other large and small defense contractors.
The company already has several of its Hivemind drones and aircraft on the market and deployed with customers (for example, in the F16 aircraft pictured above) — Shield AI is part of the Recording Program copy of the US Department of Defense — and it is working on a number of other projects, including VTOL autonomous aircraft hardware and software, and the ability to “swarming” to jam signals or help their customers communicate when their signal is noisy.
Indeed, the large size of the Shield AI funding round, $225 million, is not only indicative of that demand but also of the high costs involved in growing the industry. It comes just 11 days after Anduril, another defense technology startup working on autonomous systems, confirmed that it has raised nearly 1.5 billion USD with a valuation of $7 billion.