KAPITAL PARTNER INSIGHT · JULY 2026
From the drone-dominated kill zone to AI-enabled autonomy
Defence-tech has moved from the periphery of the defence industry to become a distinct investment category. The change is being driven by rising defence expenditure, commercially available technology and, above all, the operational lessons from the war in Ukraine.
This Insight examines the transition from traditional high-value defence platforms to affordable, software-enabled and increasingly autonomous systems. It also explains the distinct markets, procurement structures, risks and value-creation factors investors need to understand.
Four key themes
From Defence 1.0 to Defence 2.0
Traditional platforms such as combat aircraft, armoured vehicles, ships and missiles remain strategically important. They increasingly depend, however, on drones, electronic warfare, sensors, software and counter-unmanned-system protection.
Ukraine as the catalyst
Ukraine has created a broad and decentralised ecosystem in which companies develop and update products through direct operational feedback and short development cycles.
AI, autonomy and swarms
AI and autonomy are becoming operational requirements because unmanned platforms can scale faster than operators, communications capacity and human data processing.
The investor perspective
Investors must assess more than whether a product works. Product maturity, manufacturing, supply chains, procurement access, governance, financing and continual adaptation are equally important.
Main conclusion
Defence-tech combines characteristics of software, industrial technology and deep tech.
The category benefits from structural demand and higher defence spending, but companies also face rapid obsolescence, demanding government customers, production constraints and geopolitical risk. Specialised technical, commercial and financial due diligence is therefore essential.
Read the full Kapital Partner Insight
The full publication examines the market, technologies, Ukraine’s role, investment opportunities, due-diligence considerations and principal risks.
A specialised corporate finance partner for defence-tech
Kapital Partner advises defence-tech companies and investors on capital raising, financing, strategic partnerships, public-market readiness and access to Nordic and international capital.
Jesper Ilsøe
Partner
ji@kapitalpartner.dk
+45 26 80 27 28
