Stark Defence Skyrockets To 35 Billion As 500 Million Funding Deal Sends Shockwaves Through European Defence Tech

The Rise of Stark Defence: A €500 Million Fundraise that Pushes its Valuation Past €3.5 Billion

Berlin-based strike drone startup Stark Defence has raised €500 million in a round led by Sequoia Capital and Peter Thiel’s Founders Fund, valuing the company at more than three and a half billion euros. This latest injection of capital further solidifies Stark’s position as one of the best-funded defence tech startups in Europe.

Founded in 2024, Stark Defence has been making waves in the defence technology landscape with its loitering munitions, also known as drones that hover over a target area, identify threats autonomously, and destroy them by self-detonating on impact. Its flagship product, the Virtus, has been deployed in Ukraine and can be assembled in just ten minutes. The company operates in Germany, Ukraine, Sweden, and Greece, with a 40,000-square-foot production facility now open in Swindon, England.

The new funding round is significant not only for Stark Defence but also for the European defence tech sector as a whole. According to Bloomberg, this latest injection brings the company’s total funding to more than €660 million, up from approximately €160 million before this latest round. More than 80 percent of the new capital will go toward manufacturing and research expansion, indicating that Stark is planning to scale its operations significantly.

Stark Defence’s CEO, Uwe Horstmann, who was appointed in October 2025, is also a founding partner at Berlin venture capital firm Project A, one of the investors in this round. Horstmann brings extensive experience in defence technology, having previously invested in startups such as ARX Robotics and serving as a reserve officer in the German Armed Forces. Stark was co-founded by Florian Seibel, who previously built rival German drone company Quantum Systems, and Johannes Schaback.

The fundraise comes after Germany awarded Stark and Munich-based rival Helsing initial contracts worth roughly €269 million each in February for kamikaze drones to equip the Bundeswehr’s 45th Armoured Brigade in Lithuania. Framework agreements could push the total value to €1 billion per company, making these deals potentially worth billions of euros to the companies involved.

The European defence tech funding landscape has been heating up in recent months, with other startups also raising significant amounts of capital. Helsing is raising one and a half billion dollars at an $18 billion valuation, while Quantum Systems raised €340 million in 2025. In the US, Anduril raised $5 billion at a $61 billion valuation in May, doubling its mark in under a year.

Global defence tech venture capital reached $49 billion in 2025, nearly double the prior year, according to data from the European Defence Industry Programme. Government spending is driving much of this demand, with the EU’s ReArm Europe plan aiming to mobilise up to €800 billion in defence spending over four years, and Germany’s special defence fund, created after Russia’s invasion of Ukraine, accelerating procurement of autonomous systems.

However, the competition for these contracts, engineering talent, and investor capital is intensifying. Quantum Systems, Seibel’s earlier company, has more years of operational maturity and deeper AI integration across its platform. The challenge now lies with Stark Defence in scaling production to meet military procurement requirements.

One of the biggest hurdles that Stark will need to overcome is maintaining production at the volumes required by defence ministries. While the company has contracts and a deployed product, it still needs to demonstrate manufacturing at the scale that these companies require. Helsing, on the other hand, has already shown its ability to integrate AI across its platform.

The valuation trajectory of Stark Defence is extraordinary even by defence tech standards. The company went from a $500 million valuation in August 2025, when Sequoia led its Series B, to more than three and a half billion euros less than a year later. Whether Stark can convert this fundraising momentum into production-scale delivery will determine if it becomes a lasting European defence champion or a cautionary example of how fast capital can flow into a sector reshaped by war.

The involvement of Peter Thiel in Stark Defence has also been politically sensitive in Germany. Ahead of the Bundestag vote on the drone contracts, the defence ministry told lawmakers in a confidential briefing that Thiel Capital held less than 10 percent of the company. After this latest round, Bloomberg reported that Thiel’s overall shareholding has decreased further, with the majority stake belonging to the founding team and employees and the remaining shares spread across roughly 50 different investors.

As the European defence tech sector continues to evolve, Stark Defence’s recent fundraise is a significant development in the industry. With its focus on loitering munitions and deep AI integration, the company is well-positioned to capitalize on the growing demand for autonomous systems in the defence sector. However, the competition will be fierce, and Stark will need to scale production quickly to meet military procurement requirements if it hopes to remain a leading player in this rapidly evolving market.

The biggest threat to Stark Defence’s success lies not just with its competitors but also with the complexities of scaling production in a highly regulated industry. The company must navigate complex supply chains, ensure compliance with international regulations, and maintain its focus on innovation while expanding its operations.

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