After years of shunning investments in military and security-related technology startups, VCs are raising their profile in the sector as part of the US effort to gain a technological upper hand against new threats from adversaries like China and Russia.
More investors have also flocked to portfolio companies whose satellite, robotics and software tools can do double duty as military and commercial “dual-use” technologies.
This year has seen $7 billion invested in VC-backed US aerospace and defense companies through Oct. 13, according to PitchBook data. That puts the sector on track to surpass last year’s record deal value of $7.6 billion.
VCs’ growing appetite for those deals stands in contrast to their slowing pace of investment in most other sectors as the market slogs through a broad-based downturn.
