Defense Tech Venture Capital – Q1 2025

Introduction

Q1 2025 marked a pivotal period for defense tech investing, driven by shifting U.S. administrations, renewed tariff debates, and an intensifying geopolitical backdrop. Against this backdrop, VCs deployed $1.78 billion into 24 deals, a +82.2% jump in capital and +4.35% more transactions versus Q4 2024 – underscoring strong investor conviction in the industry.

Key Takeaways

• Money is back: VCs poured $1.78 B into defense tech, the second‑largest quarter by funding we’ve ever tracked — and that’s without a $1 B+ mega‑round.

• Concentration is still happening: While there were no billion dollar rounds, Saronic’s $600 million round still represented 33% of all dollars invested.

• Late Stage Dominance: Late Stage deals (Series C+) soaked up 71 % of capital (up from just 39% in Q4 2024), powered by Saronic, Shield AI, and Epirus. Seed + Series A/B share fell to 28%.​​

• Broadening deal pipeline: With 24 closings in Q1 2025, deal count is at its highest since tracking began in Q1 2024, highlighting robust activity across stages.

• Emerging niches: Pilgrim’s $3.25 million Seed round marks the first Health & Biotech deal in our dataset – and could signal a new frontier for defense applications.

• Platform Rule: Platform Systems snagged ~$700 M. Weapon Systems followed with ~$410 M.