Defence primes as early-stage investors: corporate venture money moves into dual-use tech in 2026

Corporate venture capital is familiar in software and retail. In 2026 its fastest-growing corner is defence and dual-use technology. Crunchbase data shows defence-tech startups raised nearly $15.8 billion globally in H1 2026, already past the full-year 2025 record of $9.6 billion, against annual totals of roughly $2.8–3.8 billion from 2022 to 2024.

The primes move upstream

Dealroom data shows primes including BAE Systems, Lockheed Martin and Airbus took part in rounds worth $4.1 billion so far in 2026, the highest on record. Lockheed Martin raised its in-house venture fund from $400 million to $1 billion in April — its largest increase since the fund began in 2007 — then opened a London office in July with a commitment of at least $100 million to UK and European startups. BAE Systems committed €50 million to two European venture funds.

This sits inside a broader shift. Global Corporate Venturing reports corporate investors joined 5,221 funding rounds in 2025, up 30% on 2024, worth $233.8 billion, up 75%; more than 3,000 corporations made at least one early-stage investment, above the 2021 peak. More relevant for fund managers: GCV's analysis found over half of the venture funds closing in Q2 2026 included corporate LP commitments, much of it going to first-, second- and third-time managers.

Money grows faster than deal count, and the exit is a trade sale

The shape of the money repeats the AI pattern: capital concentrates. Crunchbase counted 107 defence rounds in the first five months of 2026 against 206 deals in all of 2025 — a modestly faster pace, while value multiplied, driven largely by outsized rounds. Startup Genome's GSER 2026 records roughly 60% growth in Series A value for defence tech globally and about 15% growth in deal counts over the past year, the fastest-growing sector outside AI.

Europe is the centre of the shift. A Dealroom and NATO Innovation Fund report puts European defence, security and resilience startup funding at a record $8.7 billion in 2025, up 55% year on year and nearly four times the level five years earlier. What matters for early investors is that the exit door is open: research from White & Case, as cited in press coverage, counted 42 completed defence M&A deals globally in H1 2026, up 56%.

• Export-control and shareholder-nationality constraints: a dual-use product can lose markets the moment a foreign prime joins.
• Single-customer dependence: defence budget contracts run on long, politically driven cycles.
• Share of civilian revenue: commercial customers keep the company alive between budget cycles.
• Manufacturing capital needs: hardware demands large follow-on rounds, and the pool of investors able to follow in Southeast Asia is finite.
• Acquisition scenarios: who the plausible buyers are, and whether they are permitted to acquire a Vietnam-registered company at all.