Anduril’s Round-F, Arctic Military Connectivity and Ukraine’s Asymmetrical Warfare
Anduril Industries closed its series F round at $1.5 billion, valuing the company at $14 billion. Anduril is part of one of the largest changes in the defence sector since World War II: the flow of venture capital funding into defence tech start-ups.
SpaceX successfully launched two satellites for Space Norway that included two US military payloads that will enable connectivity in the Arctic region.
But first, on the night of August 8th, Ukraine launched a drone attack on an airbase in the Lipetsk region simultaneously with a ground invasion, the first major one on Russian territory. Mykhailo Fedorov, Minister of Digital Transformation, who piloted the “Army of Drones” and encouraged Ukrainians to make drones at home said in an interview with Le Monde that:
The Big Story
Anduril — Venture Capital’s Defence Darling
Anduril Industries has closed a $1.5 billion series F round, valuing the company at $14 billion, doubling the valuation from its last round in 2022. In total, Anduril has raised more than $3.7 billion to date.
Peter Thiel’s venture capital firm Founders Fund and investor Sands Capital co-led the round, with backing from Fidelity Management, Baillie Gifford, and Franklin Venture Partners.
Anduril is part of one of the largest changes in the defence sector since World War II - the flow of venture capital funding into defence tech companies. For decades, funding to defence companies like Lockheed Martin came solely from the US government.
In FT, Silicon Valley was said to be “re-embracing its roots in military innovation,” calling Anduril one of the clearest signals, continuing with that “venture capitalists […] are gambling that the US will open up its mammoth defence budget to smaller and edgier providers, meaning there could be a ton of money to be made.” The US spends more on defence than any other country in the world — its budget being $842bn this year.
Components of Anduril’s sentry towers, about 300 of which have been installed along the U.S.-Mexico border to automatically detect incursions. Source: Wall Street Journal
I have earlier covered what Anduril’s founder, Palmer Luckey, thinks about his work: it’s a race against China. This is a common belief, Luckey and others say that there needs to be a large number of cheaper and more intelligent systems that can be effective over long stretches of ocean against a manufacturing and technological power like China. At Anduril, many teams are building only weapons that can be completed by 2027 — the year the Chinese President Xi Jinping has said his county should be prepared to invade Taiwan.
The amount of private capital flowing into the venture-backed defence-tech industry has ballooned, with investors spending at least 70% more on the sector each of the past three years than any prior year. From 2021 through mid- June 2024, venture capitalists invested a total of $130 billion in defense-tech startups, according to data firm PitchBook. The Pentagon spends about $90 billion on R&D annually. There are now more than a dozen defense “unicorns”—privately held companies valued at $1 billion or more— including Anduril, Shield AI, Relativity Space, and Epirus.
Anduril is planning to use the round to increase hiring, expand infrastructure, and bolster its supply chain and processes. It also saidit will invest in a manufacturing platform that will power a new 500,000-square-foot factory capable of producing tens of thousands of autonomous weapons systems a year.
SpaceX Launches Satellites for Arctic Connectivity
On Monday, SpaceX successfully launched two satellites for Space Norway, including two US military payloads that should enable connectivity in the Arctic region. Space Norway is a state-owned firm that manages and develops space-based infrastructure and services for governmental and commercial uses.
The Arctic Satellite Broadband Mission (ASBM) constellation includes two satellites built by Northrop Grumman and carry payloads from the Norwegian Armed Forces and the US Space Force. This is the first time a non-American satellite has hosted an American military payload.
The Arctic Strategy from July this year calls on the Pentagon to leverage space-based communications infrastructure to bolster its ability to operate in environments above 65 degrees North latitude.
In parallel to the mission, Space Norway and KSAT also jointly established a satellite control centre in Tromsø, Norway for the operation of the satellites when they become operational.
An illustration of the two Arctic Satellite Broadband Mission (ASBM) program satellites on orbit. Illustration: Northrop Grumman
In the News
South Korean Nuclear Weapons Would Fracture US Ties, Defence Chief Says
South Korea’s Defence Minister, Shin Won-sik, warned that developing nuclear weapons could severely damage the country’s alliance with the United States and cause financial market instability. Amidst rising nuclear and missile threats from North Korea, there have been increasing calls within South Korea for a domestic nuclear arsenal. However, Shin emphasised that pursuing nuclear weapons could lead to “a huge crack” in US-South Korea relations and bring about international penalties, including a financial shock. The minister also highlighted the geopolitical shifts, particularly the strategic partnership between North Korea and Russia, which complicates South Korea’s security landscape.
Read more at Reuters.
Killer Robots Are Becoming A Real Threat In Africa
The deployment of autonomous weapon systems, often referred to as ‘killer robots’, is becoming a growing concern in Africa. These technologies, which operate without human intervention, pose significant risks to civilian populations and challenge existing legal and ethical frameworks. The article highlights the urgent need for international regulations to address the proliferation of these systems in conflict zones across the continent.
Read more at The Guardian.
DOD Official Lauds New Program to Streamline Acquisition Process
William A. LaPlante, the undersecretary of defence for acquisition and sustainment, has praised the new Defence Department pilot program, Competitive Advantage Pathfinders (CAP), designed to streamline the military’s technology procurement process. CAP aims to make the traditionally sequential acquisition process more simultaneous, fostering collaboration and removing barriers. This initiative is part of a broader effort to accelerate the delivery of essential military capabilities and ensure the resilience of the industrial base in protracted conflicts.
Read more at DoD.
Global Quantum Technologies in Military Market Projected to Hold Significant Share by 2033
The global market for quantum technologies in the military is expected to grow significantly, with a projected compound annual growth rate (CAGR) of 19.2% from 2023 to 2033. Key areas of application include quantum computing, quantum communication, and quantum sensing, with quantum computing anticipated to hold the largest market share. North America is expected to lead the market due to substantial investments in quantum research, particularly by the US Department of Defense. Asia-Pacific is projected to see the highest growth rate, driven by increasing defence expenditures in countries like China, India, Japan, and South Korea.
Read more at Yahoo Finance.
How The U.S. Could Transform Its Drone Industry For The Price Of One F-35
The U.S. drone industry could be revolutionised with a fraction of the investment typically allocated to traditional military assets like the F-35 fighter jet. By redirecting resources towards innovative drone technology, the U.S. could enhance its military capabilities and maintain a strategic edge in modern warfare. This article advocates for a shift in defence spending priorities to embrace the evolving landscape of military technology.
Read more at Forbes.
Palantir Sends AI-Fueled TITAN Prototype to Army
Palantir Technologies has delivered a prototype of its AI-fueled TITAN system to the U.S. Army, marking a significant advancement in the military’s adoption of artificial intelligence. TITAN is designed to process vast amounts of battlefield data in real-time, providing actionable intelligence to commanders. This development is part of the Army’s broader strategy to integrate AI into its operations, enhancing decision-making and battlefield effectiveness in complex, multi-domain environments.
Read more at DoD.
