Estonia, a Baltic nation of 1.4 million known for its tech prowess, spearheads funding defense projects in central and eastern Europe following Russia's actions in Ukraine. The region's history under Soviet rule makes the threat from Russia keenly felt.
Sten Tamkivi, a tech entrepreneur, noted that Estonians consider defending their country a daily priority. Tamkivi, along with partners, has redirected investments, including in defense projects, emphasizing European sovereignty amid growing NATO concerns in the region.
Investments in European defense tech have surged, with a rising focus on central and eastern Europe since the Ukraine conflict. Estonia, home to tech giants like Skype and TransferWise, plays a significant role in this trend due to its innovative tech industry and close proximity to Ukraine.
Venture capital funds in the region support defense-focused startups; for instance, Presto Ventures in Prague has launched a fund in partnership with a Czech arms maker. The fund targets startups specializing in cyber security, quantum computing, and AI for defense applications.
The founder of Tallinn-based Darkstar highlighted the importance of quick-deployment technology for the battlefield in Ukraine, such as drone thermal cameras. Their investment in Farsight showcases the growing interest in defense startups, which have multiplied in recent years.
The uptick in venture capital interest in eastern Europe bridges the funding gap faced by defense startups due to traditional lending constraints. Governments in the region, like the Czech Republic and Estonia, are stepping in to support the emerging defense tech sector, aiming to attract global investors and boost the local industry's revenue substantially by 2030.