We sat down with Matt Kuppers, founding partner of Defence Invest and Commissioned Operations Officer in the Reserves of the German Army. Before becoming a Defense Tech VC, he founded his own consulting firm in London and later served in a German Army unit testing innovative systems.
We spoke about his past experiences, what it took to start a defense tech VC fund, what he looks for in the defense tech space, and how he envisions a potential European war.
Editor’s note: This interview has been edited for length and clarity.
Who Are You and What Are You Working on Now?
I got into startups in London in 2009, while still a PhD student, and spent over two years in venture capital. Academia wasn’t for me, so in 2013, I founded a consulting firm: think “McKinsey for early-stage startups.” We helped accelerators, built programs, and expanded from London across Europe and into India, Singapore, Kuala Lumpur, and even Qatar.
COVID crushed the conferences side of our business, and I’d already become interested in defense innovation. In 2018, I joined the German Armed Forces, completed basic and officer training, and worked in a new unit testing innovations for combat vehicles with primes such as Rheinmetall and KMW.
After three years, my commanding officer and I started building Defence Invest. I’m now in the reserves, ~8 weeks a year, and full-time on the fund with a five-person team, collectively bringing around 60 years of defense experience.
What Makes Defense Tech a Compelling Place to Build and Invest Today?
Two things: urgency and responsibility.
Ukraine has shown how quickly a major war can escalate and how asymmetric it can be. Europe spent decades in “peacetime mode” — shrinking forces, aging equipment, under-invested innovation. Scaling back up takes time: training recruits, reopening barracks, refitting vehicle fleets, rebuilding supply chains.
Security is not just the military’s job; civilians contribute to it as well. Founders, investors, media, everyone. Most tech waves come with a moral story—social networks “connecting the world,” crypto “democratizing finance,” AI “advancing science.”
Defense is different. It’s not optional lifestyle tech; it’s about protecting our societies.
Why Should an LP or Fund Manager Invest in Your Fund?
A commander would never send civilians to battle; they deploy soldiers. So why would any LP or Fund Manager commit capital to a team lacking operational fluency?
Founders lacking a defence background must seek out specialist VCs, as this partnership is the only way to bridge the gap between civilian innovation and mission-critical deployment.
Our conviction is that survival is based on skills, not wishes. War doesn’t distinguish between civilians and men trained as soldiers. In the defence technology asset class, domain expertise is a prerequisite for survival, just as it is on the battlefield.
You Framed Defense as a Civic Duty. What Did You Mean?
If you missed out on social media or crypto, nothing fundamental has changed. In terms of defense, opting out leaves a hole in our collective security. Contribute where you can: build, invest, publish, serve.
It’s a long-term effort, not a hype cycle.
Where Are the Real Bottlenecks and Challenges in Defense Tech?
We identified five big ones:
- Energy & battery management — Range is limited, and performance drops in cold, hot, and moist conditions. Better performances, packaging, and smarter battery management software matter.
- Communications — Robust, encrypted, low-latency links that survive jamming; mesh networking for swarms.
- Autonomy — Especially on the ground, where terrain changes and GPS is unreliable. Systems must complete missions when links drop.
- Sensors — Seeing through weather and EW, lowering signatures, fusing multi-sensor inputs reliably.
- Counter UAS integration — Orchestrating detect-track-identify-defeat across mobile, cyber-secure, AI-assisted systems.
That’s where capability, defensibility, and scale line up.
There are Many “Garage-Built” Systems. Will Everything Become More “Deep-Tech” in the Future?
Both matter. In wartime, simplicity is powerful—you can field it quickly. At the other extreme are highly advanced, high-altitude autonomous systems.
The venture sweet spot is: effective, reliable, affordable, and scalable.
If a drone costs €1k instead of €50k, procurement can buy more, faster. You’ll see more AI/ML on board, but over-engineering can slow down go-to-market and scaling efforts.
How Does Your Background Help Portfolio Companies Get to First Revenues?
We worked closely with primes such as Rheinmetall and KMW, as well as the German Federal Office of Procurement. We have seen procurement mechanics from both inside the forces and from the primes’ side.
We can help founders translate a demo into a fielded capability, thanks to our expertise with security requirements, trials, test ranges, safety cases, pricing, and contracting pathways.
It’s not just “build and sell”; it’s build, test, certify, integrate, train, support.
Where Is the Best Entry Point for a Defense-Focused VC Right Now?
Series A. By then, a team usually has a validated product—often with live feedback from Ukraine—and is ready to industrialize. The VC can still get a good deal and add real value.
There’s a lot of capital at the seed stage: there’s meaningful public money (NATO DIANA, ESA, EU defense programs), but there’s a gap between A and B. There are too many €200–300K checks, and not enough €2–3M+ to scale production, harden systems, and hire the right operators.
U.S. Funds Often Lead the Bigger Rounds. Is There Room for European Late-Stage Capital?
Yes. Europe’s defense-tech VC scene is young; most startups are only 2–3 years old, so true Series B/C opportunities are rare today. Over the next 2–5 years, both companies and investors will mature. We’ll see more specialisation, more European A-to-B funds, and eventually more late-stage capital.
Governments are committing to long-term budgets; this isn’t a short-term wave.
Will Future Conflicts Resemble the War in Ukraine, with Swarms of Cheap Drones?
Expect a mix. Tanks and heavy armor aren’t going away—if the adversary has them, you need them. You’ll see pervasive UxVs and electronic warfare, plus more sophisticated cyber operations targeting grids and critical infrastructure.
Geography decides tactics: the Northern European Plain favors armored maneuvers; the Suwalki Gap and the Kaliningrad enclave shape Baltic planning; the Baltics are building layered fortifications and drone defenses.
So: combined arms on land and in the air, dense UxV presence, and cyber. Very similar to Ukraine in some ways, but with more integrated cyber and EW.
Do You Have Advice for Civilian Founders or Investors Entering Defense for the First Time?
Join the reserves if you can. You’ll understand the users, culture, and constraints to which you’re directly contributing. If that’s not feasible, immerse yourself:
- Talk to operators and veterans; visit units and test ranges.
- Go to field demos, hackathons, and exercises.
- Partner with advisors who’ve worked with procurement and primes.
- Build for reliability, survivability, and cost—not just fragile prototypes.
Trust matters here. This isn’t pure software. The bar is higher, but the impact is bigger.
Quick Questions
One Misconception You’d Retire?
“Tanks are obsolete.” They’re not. Drones changed the calculus, but combined arms still win.
One Capability Europe Underestimates?
Communication resilience. If the link dies, your system dies—unless you’ve designed for it.
Where Do First-Time Founders Most Often Underestimate Effort?
Certification, safety, integration, and unit training. Getting something to fly once is easy. Getting it fielded across brigades takes a lot of work.
Any Last Note on Your Job as a Defense Tech VC Before We Leave?
Ultimately, our job is to help founders build real capability and industrialize it. If we do that, we’ll keep our societies safe and create enduring companies. That’s what this work is about.