Europe and Asia Forge New Alliances in Defence Tech
Join Capital’s Partners, Tobias Schirmer and Daniel Carew, recently returned from a productive roadshow in Asia, where we held multiple extensive meetings with defence primes, government representatives and a range of investors. The primary aim of these conversations, which involved strategic partners from South Korea, Japan and Singapore, was to validate our thesis around Europe’s rapidly growing focus on defence tech and resilience.
These are sectors we deeply believe will present unparalleled opportunities for venture capital, investors, and promising European startups.
For decades, Europe has depended on the US and its security umbrella. The continent has overwhelmingly chosen to purchase military and defence hardware from American suppliers rather than spur innovation and investment in homegrown technologies. Yet, the upending of the global order and its alliances has starkly exposed Europe’s vulnerabilities to its reliance on external help.
Now, more than ever, European countries, especially Germany, France, and the UK, are making a significant shift towards developing autonomous defence capabilities. During our roadshow, we shared our thesis, which, in summary, outlined Europe’s shift from being a defence tech customer to achieving genuine sovereignty and control over the future of defence tech.
We detailed where we expect to see the biggest advances in innovation and subsequent investment growth. These include, to name a few, drones, cybersecurity, logistics, and maritime security. There are also advanced dual-use technologies such as radar systems, fiber-optic sensing, autonomous navigation, and artificial intelligence.
In presenting our thesis, we learned something. Asian defence primes, investors and policymakers were nodding in agreement. We discovered they view themselves in the same precarious situation as their European counterparts. They too have historically underinvested in defence and are playing catch-up in the midst of increasingly assertive regional neighbors. They too feel uncertain about security assurances from traditional allies like the US and this is only amplified by the economic pressures of trade conflicts and tariffs.
Our discussions became a meeting of minds, confirming that our Asian partners are also keenly aware of the necessity to embrace greater independence within their defence tech industry. It was immediately apparent that Europe’s very public but strategic pivot towards technologies that deliver security and economic benefits resonated with our audiences.
Every stakeholder we spoke to expressed strong interest in collaborating closely with European counterparts, recognizing such partnerships as essential to enhancing security through advanced technology.
What was clear was the enthusiasm to work more closely with trusted partners in Europe. Our stakeholders in Asia view an alliance with Europe as a mutually beneficial, but fundamentally crucial, step towards greater security.
We shared a few examples of impressive startups that we’ve backed, but one resonated most. We recently invested in a compelling fiber-optics scale-up from the Netherlands. They have built tech that’s able to detect submarines and vessels underwater. The tech is so sophisticated that it can sense when critical underwater infrastructure is being sabotaged.
As always, good timing helps. As we arrived in Asia, European governments were dialing up the rhetoric and adding billions of euros to their defence budgets, with Germany tearing up its fiscal rule book to do so. These are producing frameworks that bear the hallmarks of the US’s DARPA programme. They integrate the world’s best academics and universities, nimble and ambitious startups, well-supported venture capitalists and shifting government policies into an ecoystem that’s focused on innovation.
It’s a transformative approach.
We have drawn a line under history. Reliance on traditional, large-scale defence contracts overseas towards agile and aggressive startups. This struck a chord with our colleagues in Asia and they are now actively exploring how to do something similar but with their own unique flavour.
Consequently, we returned from our trip to Asia with an enhanced commitment to further developing the Europe-Asia defence technology nexus. The priority now is to forge these promising connections into a bridge that will stand the test of time. Together we will explore opportunities that bring Europe’s technological flare to Asia’s dynamic markets.
This collaboration is not only strategically imperative but aligns perfectly with venture capital objectives — ensuring strong commercial outcomes alongside critical advancements in defence capabilities.
Ultimately, our Asia roadshow underscored that Europe’s renewed focus on defence tech isn’t a regional phenomenon, it’s a global trend. By decisively investing in and controlling foundational technologies, Europe positions itself — and its international partners — as critical anchors of global stability in an increasingly unpredictable geopolitical environment.
The focus now is to nuture these inter-continental relationships and ensure they yield benefits for all by setting new standards for global collaboration in defence technology innovation.
