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Germany is taking a leap toward modernising its defence system by heavily investing in advanced military technologies like artificial intelligence, autonomous robots, and even cyborg cockroaches. This could be a gamechanger amid security threats in Europe after Russia’s invasion of Ukraine.
Russia has exposed Europe’s military weaknesses and reliance on American security. For people like Gundbert Scherf, co-founder of defence tech startup Helsing, the war changed everything.
Scherf, whose Munich-based company creates AI-based military tools and drones, struggled to get investors when he first started. But today, things have flipped. Speaking to Reuters, “Europe this year, for the first time in decades, is spending more on defence technology acquisition than the US.”
According to news agency Reuters, last month, Helsing’s value more than doubled to $12 billion.
The German government under Chancellor Friedrich Merz is now opening the doors of its military to collaborate directly with start-ups. The goal is to fast-track innovation and reduce dependence on traditional defence giants.
“We want to help give Europe its spine back,” Scherf added.
STARTUPS POWER GERMANY’S HIGH-TECH DEFENCE PUSH
Germany is not just big firms like Rheinmetall and Hensoldt but also smaller companies working on futuristic ideas. These include ARX Robotics, which makes autonomous tank-like machines, and Swarm Biotactics, which is building insect-based spy tools.
“Our bio-robots — based on living insects — are equipped with neural stimulation, sensors, and secure communication modules,” said Stefan Wilhelm, CEO of Swarm Biotactics. “They can be steered individually or operate autonomously in swarms.”
The German military’s innovation hub is also seeing a sharp rise in interest. “Germany has developed a whole new openness towards the issue of security since the invasion,” said Sven Weizenegger, who leads the Cyber Innovation Hub. He added that he now receives 20 to 30 LinkedIn messages a day with defence tech ideas, compared to just a few per week back in 2020.
The transformation isn’t just about gadgets. Germany plans to nearly triple its annual defence budget to $175 billion by 2029 and meet NATO’s 3.5% GDP defense spending goal. A new draft law will even make it easier for startups to get advance payments and win government contracts.
Marc Wietfeld, founder of ARX Robotics, described a turning point after meeting Defence Minister Boris Pistorius. “He told me: ‘Money is no longer an excuse—it’s there now’,” Wietfeld said.
GERMANY AIMS TO LEAD EUROPE’S DEFENSE FUTURE
In fact, Europe’s 19 largest defence spenders are set to outspend the US in military procurement this year: $180 billion versus America’s $175 billion. Overall US military spending remains higher, but the gap in technology investment is narrowing fast.
“Society has recognised that we have to defend our democracies,” said Christian Saller, an investor in defence startups like ARX and Quantum Systems.
Venture capital funding in German defence tech has jumped from $373 million in 2022 to $1 billion in 2024. German companies have received $1.4 billion in the last five years—more than any other country in Europe.
“The startups just need the brains to do the engineering and prototyping,” said Stefan Thumann, CEO of Donaustahl. “And the German Mittelstand will be their muscles.”
– Ends
With inputs from Reuters
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