- Helsing, a 5-year-old Munich-based defense AI company, is reportedly raising $1.2 billion at an $18 billion valuation, led by Dragoneer and Lightspeed
- The round comes with an active €1.46 billion drone contract from the German military, plus a €268 million initial order for HX-2 loitering munitions approved by parliament in February
- Germany passed over legacy defense giant Rheinmetall in favor of Helsing and Stark Defence, signaling a procurement shift toward AI-native startups
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7| 7|Five-year-old European defense AI company Helsing is reportedly close to raising a $1.2 billion round at roughly an $18 billion valuation, according to the TechCrunch. The round is expected to be led by Dragoneer Investment Group and co-led by existing investor Lightspeed Venture Partners.
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9| 9|The valuation jumps from an estimated €12 billion ($14 billion) in June 2025 to $18 billion now—a 29% increase in under a year. That kind of step-up usually requires more than VC enthusiasm. In Helsing’s case, it comes with an active €1.46 billion drone contract from the German military, according to Tech Funding News. The round was oversubscribed multiple times.
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11| 11|Helsing, Dragoneer, and Lightspeed could not be immediately reached for comment.
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The Contract Behind the Valuation
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15| 15|In February 2026, the German parliamentary budget committee approved contracts worth €268 million ($316 million) each for Helsing and fellow startup Stark Defence to supply loitering munitions—what the press calls kamikaze drones. The Defense News report details that contractual options could add €1 billion to each deal, provided the systems prove technologically mature and lawmakers agree to additional purchases.
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17| 17|That’s where the €1.46 billion figure comes from: the base contract plus the maximum option value. For Helsing, the system in question is the HX-2, an AI-guided loitering munition designed to fly to a target area, stay airborne, and automatically propose strike targets to a human operator at a safe distance. The on-board AI processes sensor data and identifies targets—a human still authorizes the strike.
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19| 19|The weapons are destined for Germany’s armored brigade in Lithuania, with deployment planned for 2027. Speed is the priority: the German defense ministry structured testing and training to run in parallel rather than sequentially, according to the same report. Lawmakers attached reporting requirements and cancellation clauses in case manufacturers fail qualification tests.
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21| 21|This matters because Germany has historically been reluctant to put weapons on drones. As Defense News notes, the parliamentary approval represents a turnaround in the country’s military posture since Russia’s full-scale invasion of Ukraine four years ago. Previously, lawmakers in the Social Democratic Party were wary of allowing the military to install weapons of any kind on unmanned systems.
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From Software to Kamikaze Drones
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25| 25|Helsing started as a software company. Co-CEO Gundbert Scherf, a former special representative in the German Ministry of Defense and McKinsey partner, has argued that the defense industry traditionally built hardware first and added software as an afterthought. Helsing reverses that: AI comes first, then the platform.
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27| 27|The company’s core technology includes software for electronic warfare, intelligence analysis, and mission planning. But over the past two years it has expanded aggressively into hardware. The HX-2 drone is the most visible example. Helsing has also introduced Lura, a submarine detection and surveillance platform built on a large acoustic model trained on underwater sensor data, as NZZ reported from the company’s first media day.
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29| 29|The founders—Scherf, biologist and former game developer Torsten Reil, and AI researcher Niklas Köhler—started in 2021, when most venture capitalists would not touch defense. Their first €8.5 million came from wealthy families and individuals. Reil has said the three believed then, and still do, that Europe and democracy are under attack. Their stated mission: use AI to protect democracy.
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31| 31|That framing resonated with Spotify founder Daniel Ek, who led Helsing’s Series D round of €600 million in June 2025 through his investment vehicle Prima Materia. Ek also serves as Helsing’s chairman. The company has raised a total of €1.3 billion in venture capital across all rounds. Despite US firms leading the new round, Helsing remains roughly 80% European-owned, per Reil.
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Europe’s Procurement Disruption Runs Through Munich
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35| 35|The most telling detail in the Helsing story is not the valuation. It’s who got passed over.
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37| 37|When the German parliament approved the €268 million drone contracts in February, legacy defense giant Rheinmetall did not get an order. Rheinmetall, a €10+ billion revenue company and one of Germany’s most established defense contractors, was expected to submit its own offer for the budget committee’s consideration within weeks. But the initial awards went to two startups that did not exist five years ago.
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39| 39|This is the European version of a pattern that has already played out in the United States. Companies like Anduril and Palantir spent years fighting their way into Pentagon procurement channels traditionally dominated by Lockheed Martin, Raytheon, and Northrop Grumman. The Pentagon’s recent AI contracts with OpenAI, Nvidia, and Alphabet showed the same dynamic: new entrants winning deals that legacy primes once took for granted.
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41| 41|Europe is now following suit, but with a structural difference. The continent’s defense spending has historically been fragmented across national budgets with limited cross-border procurement. Russia’s war in Ukraine changed the calculus. Germany’s €100 billion special defense fund, announced in 2022, created the budgetary space for parliament to approve startup drone contracts that would have been politically unthinkable a decade ago.
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43| 43|The battlefield AI race in Ukraine has also served as an unlikely proving ground. Autonomous drones, AI-powered targeting systems, and electronic warfare tools developed by startups have been tested under combat conditions. That real-world data validates technology in a way that no peacetime exercise can match—and investors know it.
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45| 45|Helsing is not alone in the European defense AI space. Quantum Systems, another German drone maker, raised €180 million in November at a €3 billion valuation. Lisbon-based Tekever raised £400 million at a £1 billion+ valuation a year ago. But Helsing’s $18 billion valuation puts it in a different category entirely—roughly 6x Quantum Systems and 14x Tekever.
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47| 47|The gap reflects more than hype. Helsing’s €1.46 billion contract potential gives investors a revenue floor that most defense startups cannot match. And the company’s software-first architecture means it can expand into new domains—air, land, sea, underwater—without building entirely new hardware stacks each time. The HENSOLDT partnership for the CA-1 Europa autonomous combat aircraft, announced in February, extends that logic to crewed-uncrewed teaming in the air.
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49| 49|Reil has dismissed rumors of an IPO. There are no such plans, he told NZZ. The founders’ priority is remaining independent—not selling to a larger defense conglomerate. That independence is part of the pitch: a European-controlled AI defense company that cannot be acquired by a US or Chinese entity is strategically valuable in a way that goes beyond its revenue multiples.
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51| 51|The round has not closed. Dragoneer and Lightspeed have not confirmed their participation, and the final valuation could shift before the deal is done. But the trajectory is clear: Europe’s defense procurement is moving toward AI-native companies at a pace that would have seemed impossible before 2022, and Helsing is the primary beneficiary.
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FAQ
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What does Helsing make?
Helsing develops AI-powered defense software, autonomous drones (including the HX-2 loitering munition), and surveillance platforms like Lura for submarine detection. The company operates across air, land, sea, and underwater domains.
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Who owns Helsing?
Despite US investors Dragoneer and Lightspeed leading the new round, the company remains roughly 80% European-owned, according to co-CEO Torsten Reil. Spotify founder Daniel Ek, through Prima Materia, is the company’s chairman and a major backer.
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How does Helsing’s valuation compare to other defense startups?
At $18 billion, Helsing is valued roughly 6x more than Quantum Systems (€3 billion) and 14x more than Tekever (£1 billion+). It is the most highly valued defense AI startup in Europe.
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What is the HX-2 drone?
The HX-2 is a loitering munition—a kamikaze drone that flies to a target area, uses AI to identify potential targets, and proposes strike options to a human operator who authorizes the action. Germany approved an initial €268 million order for the system in February 2026.
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Why did Germany pass over Rheinmetall?
German lawmakers approved contracts for Helsing and Stark Defence first, while Rheinmetall’s offer was still under review. The decision reflects a procurement shift toward AI-native startups that can deliver autonomous capabilities faster than legacy contractors.
