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NATO invests £865M in European tech companies

Written by Tue 18 Jun 2024

A consortium of NATO allies has announced the initial round of European companies receiving funding from its £865 million ($1.1 billion) innovation fund.

The NATO Innovation Fund (NIF) said it had directly invested in four European tech companies. These European investments by NATO are intended to help these companies develop solutions to challenges related to defence, security, and resilience.

Managing Partner at the NATO Innovation Fund, Andrea Traversone, said ‘enabling capital and support for strategic technologies is key to securing a safe and prosperous future of the Alliance’s one billion citizens’.

“We are proud to share that we have invested in innovative solutions that can help address some of our greatest challenges and boost growth, strengthening the defence, security, and resilience of our nations for generations to come,” said Traversone.

NIF has awarded funding to London-based computer chipmaker, Fractile, who aims to make large language models (LLMs), and Germany’s ARX Robotics which designs unmanned robots with a variety of functions ranging from heavy-lifting to surveillance.

“This initial portfolio of investments exemplifies NIF’s mission to advance defence, security and resilience and promote the development of dual-use ecosystems across the NATO Alliance,” said Dr. Klaus Hommels, Chair at the NATO Innovation Fund.

The other two investments were awarded to a British manufacturer of lightweight materials for vehicles, iCOMAT, and Space Forge, a Welsh company that builds semiconductors in orbit using the unique conditions of space, like  vacuum and microgravity.

“This investment enables Space Forge to develop the production class version of its ForgeStar architecture and provide a critical advantage in key technologies with its advanced semiconductor materials,” said Joshua Western, CEO and Co-Founder of Space Forge.

NATO Fund Backs European Startups

The NIF also supports venture capital fund managers investing in early-stage deep tech focused on civilian, defence, security, and resilience markets. This aims to boost capacity in regions with high demand for funding, fostering the next generation of deep tech unicorns. 

Focus areas include regions previously facing funding barriers, like Southern and Eastern Europe, and rapidly growing ecosystems, like the Nordics. 

The fund targets a broad range of deep tech solutions, including space tech, quantum cryptography, and artificial intelligence (AI). 

Organisations that have been awarded funding are an early-stage fund specialising in space sector investments, Alpine Space Ventures; a Central European fund focused on spacetech, enterprise automation and AI, cybersecurity, and fintech infrastructure, OTB Ventures; a Berlin-based fund investing in industrial and enterprise tech, Join Capital; and Vsquared Ventures, a fund investing in early-stage deep tech addressing major societal challenges.

Co-Founder and Managing Partner at OTB Ventures, Adam Niewinski, said Europe’s deeptech sector, powered by a rich talent pool, is poised to tackle global challenges through advanced technologies. 

“Investing in deeptech requires time and skills but brings tremendous opportunities. The founding of the NATO Innovation Fund (NIF) underscores the vital role of these investments and brings the know-how to take them to new markets and use cases,” added Niewinski.

The fund was first announced in 2022 set to invest in technology to enhance the alliance’s defences. The fund was supported by 24 of NATO’s 32 member states, including Sweden and Finland, who joined the alliance earlier this year. 

The Fund will provide deep tech entrepreneurs with the support they need for up to 15 years, as well as the conviction and agility necessary to commercialise and implement their solutions at scale.

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Written by Tue 18 Jun 2024

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