The Greatest Victory Requires No War as Shield AI Raises $240M for Military Autonomy

The intersection of artificial intelligence and defense technology is attracting substantial investment, as geopolitical tensions and military modernization efforts drive demand for autonomous systems. Recent funding rounds for U.S. defense startups underscore Silicon Valley’s deepening involvement in national security technology, particularly in autonomy and AI-driven military applications. Shield AI, Epirus, and Anduril Industries are among the latest beneficiaries, securing hundreds of millions in fresh capital to accelerate the development and deployment of AI-powered military solutions.

Shield AI, a San Diego-based defense tech company developing AI pilots for military aircraft, has raised $240 million in a new funding round, boosting its valuation to $5.3 billion. This makes it the second-largest U.S. defense tech startup by valuation, trailing only Anduril Industries. Shield AI’s investors include major defense and aerospace firms, with L3Harris and Hanwha Aerospace leading the round, alongside Andreessen Horowitz, U.S. Innovative Technology, and Washington Harbour. This latest influx of capital brings the company’s total funding to $1.3 billion.

Shield AI plans to use the funds to expand Hivemind Enterprise, its AI-powered autonomy software designed for defense contractors, governments, and robotics firms. Hivemind enables unmanned systems to operate without GPS or communication signals an increasingly critical capability as military operations grow more reliant on autonomous technology in contested environments.

Founded in 2015 by Andrew Reiter, Brandon Tseng, and Ryan Tseng, Shield AI has seen a rapid rise in valuation. In 2023, it raised $300 million at a $2.8 billion valuation and $200 million at $2.7 billion. The company has collaborated with L3Harris on AI-powered mission autonomy and continues to expand its portfolio, which includes:

• Hivemind Pilot, Commander, and Forge – AI-powered tools for autonomous flight and mission execution.
• V-BAT – An autonomous vertical takeoff and landing (VTOL) drone designed for military applications.
• Sentient Vision Systems – Wide-area motion imaging software for battlefield intelligence.

Anduril Industries Targets a $28 Billion Valuation

Shield AI’s fundraising success comes amid reports that Anduril Industries is in talks to raise $2.5 billion at a valuation of $28 billion. Anduril, a leader in autonomous defense systems, previously raised $1.5 billion last year at a $14 billion valuation. The company has positioned itself as a key player in AI-driven military solutions, with backing from high-profile investors, including Peter Thiel’s Founders Fund.

Anduril’s expansion reflects broader industry trends, as defense firms look to integrate AI and automation into military operations. The company’s focus on autonomous surveillance systems, unmanned aircraft, and AI-driven defense platforms has made it a preferred partner for the U.S. government and allied nations.

Brandon Tseng, Shield AI’s co-founder and president, emphasized the demand for autonomy in defense technology: “Defense tech customers are all looking for autonomy, seeing massive demand for their aircraft business and AI pilots.”

The surge in defense tech investments isn’t limited to AI-powered autonomy. Epirus, a company specializing in directed-energy weapons, recently raised $250 million in Series D funding, bringing its valuation to $1.35 billion. Directed-energy weapons, which use electromagnetic pulses to disable enemy electronics and drones, are gaining traction as militaries seek non-kinetic options to neutralize threats.

The timing of Epirus’ funding is notable, as the U.S. and its allies emphasize advanced weapons systems capable of countering drone swarms and electronic warfare. The company’s investors see promise in its ability to develop scalable, cost-effective solutions for modern battlefield challenges.

“Developing autonomy is both complex and costly. Hivemind Enterprise solves this widely known problem and enables the rapid and efficient proliferation of resilient, high-performance autonomy for intelligent machines across industries,” said Nathan Michael, Shield AI’s Chief Technology Officer. “Hivemind Enterprise is about supercharging the industrial base to build and monetize autonomy, enabling a world of millions of autonomous systems in the next ten years.”

European Defense Tech

While U.S. defense startups dominate in terms of investment and valuation, European counterparts are making significant strides. Helsing GmbH, a German AI defense company, recently secured €450 million in funding, reaching a valuation of approximately €4.95 billion. General Catalyst led the round, with Accel and Lightspeed Venture Partners also participating.

Helsing develops AI-driven software for military systems and has secured government contracts across Europe. As European nations increase defense spending, startups like Helsing are well-positioned to benefit. France plans to double its defense budget by 2030, while Germany has committed to meeting NATO’s 2% GDP defense spending target—a threshold it previously struggled to meet.

Other European defense startups making progress include:

• ARX (Germany) – Specializing in advanced surveillance and defense systems.
• QinetiQ (UK) – Focused on military technology, robotics, and cybersecurity.

Although Europe’s defense tech sector remains smaller than that of the U.S., rising security concerns and increased government funding are creating new opportunities for startups.

Autonomy is increasingly viewed as a cornerstone of modern defense strategy. Shield AI co-founder and President Brandon Tseng notes that defense customers are prioritizing autonomous solutions, particularly for aircraft.

Saronic, a U.S. startup specializing in autonomous warships, recently quadrupled its valuation to $4 billion after raising $600 million. The trend is clear—militaries worldwide are investing in AI and autonomy to enhance mission effectiveness and reduce reliance on human operators in contested environments.

Shield AI’s recent demonstration of its Hivemind software piloting a General Atomics MQ-20 Avenger highlights the progress being made. The February Orange Flag exercise showcased how the AI system can fly autonomous missions, marking a step toward operational deployment.

“Hivemind flying the MQ-20 is a major step forward in demonstrating operational autonomy at scale and a proof point for the power of industry-led innovation,” said Christian Gutierrez, Shield AI’s VP of Hivemind Solutions. “We’re investing our own resources into this to accelerate our larger goal: flying autonomy on as many platforms as possible. When the government calls for autonomous solutions that enhance mission effectiveness, we’ll be ready.”

GA-ASI Vice President Mike Atwood emphasized the significance of the demonstration, stating that open-architecture platforms will be critical in ensuring interoperability and avoiding vendor lock-in. The integration of Hivemind into various aircraft, including F-16s and MQ-20s, suggests that autonomous flight is becoming a reality rather than a theoretical concept.

The influx of investment into defense technology, particularly in AI-driven autonomy, signals a shift in military strategy. Companies like Shield AI, Anduril, and Epirus are attracting billions as investors recognize the growing demand for autonomous systems and advanced weaponry. Meanwhile, European startups are gradually gaining traction, backed by rising defense budgets and government support.

As they said in their post “Autonomy for the world. The greatest victory requires no war.’