European climate tech funding plummeted 71% in 2025’s first half, but the story isn’t simple collapse. Companies are strategically rebranding toward “resilience” to tap defense budgets and navigate political headwinds, creating complex ethical challenges.
European defense technology investment is experiencing significant growth, with startups playing an increasingly vital role in addressing capability gaps. According to industry reports, defense tech now accounts for 6.2% of all European funding in 2025, driven by dual-use technologies and lessons from the conflict in Ukraine.
Investment in European defense technology is reportedly surging, with the sector accounting for 6.2% of all European funding so far in 2025, according to data published by market intelligence provider Dealroom and Resilience Media. The total sum is expected to reach $2.3 billion by year’s end, representing a significant shift in the continent’s security landscape. This growth comes as European governments have pledged to ramp up procurement spending, creating substantial opportunities for innovative companies entering the defense sector.
