Drone Maker Stark Defence Targets $500M Valuation in Sequoia-Led Funding Round

Europe’s drone race just went up a gear: Sequoia is leading a fresh round that could push German loitering‑munition maker Stark near a $500M valuation—right as Germany targets €162B in annual defense spend by 2029.

German attack drone startup Stark Defence is in advanced talks to raise about $60 million in new funding led by Sequoia Capital, a deal that would boost its valuation to roughly $500 million just 18 months after its launch, Bloomberg reports. The defense tech company, focused on loitering munitions and AI-powered battlefield systems, has drawn strong investor interest amid a global surge in military spending.

Rapid Growth Fueled by Investor Demand

Sequoia first invested $15 million in Stark in late 2023, valuing the company at around €90 million ($97 million). Since then, the Munich-based startup has attracted nearly $100 million in capital, according to sources cited by Bloomberg. The new round, while not finalized, has reportedly drawn interest from 8VC, Thiel Capital, the NATO Innovation Fund, In-Q-Tel (the CIA’s venture arm), Project A, and Döpfner Capital.

If completed, the investment would underscore how venture capital is moving aggressively into defense startups, lured by the prospect of major contracts with European militaries.

Europe’s Defense Spending Push

Investor enthusiasm for Stark is closely tied to Europe’s broader defense rearmament. Following Russia’s 2022 invasion of Ukraine and shifting U.S. military commitments, Berlin is preparing to boost its annual defense budget to €162 billion ($189 billion) within four years. Analysts expect a wave of procurement as countries race to close capability gaps, creating fertile ground for European drone makers.

Germany’s Bundeswehr is already testing drones from Stark and domestic competitor Helsing, Bloomberg reported earlier this year.

Stark’s Technology and Expansion Plans

Stark has publicly committed to building warheads and loitering munitions, a category of drones that loiter in the air before striking targets with precision. The company is also developing AI command-and-control software for centralized coordination of battlefield operations. Sources told Bloomberg that Stark is considering expanding into additional land, air, and sea platforms for military use.

The startup recently opened a production facility in Swindon, UK, to accelerate manufacturing. This marks its first major expansion outside Germany, strengthening ties with NATO-aligned markets.

Founder’s Background in Drones

Stark was founded by entrepreneur Florian Seibel, who also leads Quantum Systems, a separate drone company valued at more than $1 billion that produces reconnaissance UAVs for both civilian and military use. Seibel split off Stark because some Quantum Systems investors opposed developing weaponized drones, limiting the company’s access to the fast-growing attack drone segment.

DroneXL’s Take

Stark Defence’s rapid rise highlights a new phase in Europe’s defense industrial landscape, where venture-backed startups are now competing for roles traditionally held by legacy contractors. The influx of top-tier investors—from Silicon Valley powerhouses like Sequoia and Thiel Capital to strategic entities like NATO’s fund and In-Q-Tel—signals growing confidence that drone warfare will remain central to modern military strategy.

Key questions remain. How will Germany regulate private-sector development of offensive drone systems? Could this funding spree disrupt traditional procurement channels in Europe? And what role will AI automation in battlefield command systems play in shaping accountability and oversight?

As European drone startups attract unprecedented investment, the dividing line between Silicon Valley venture capital and state defense priorities is blurring. This convergence could accelerate innovation—but it also poses major ethical and regulatory challenges.

What do you think? Should venture capital play a larger role in shaping the future of military drones? Share your thoughts in the comments below.

Photos courtesy of Stark.