Greece Targets a Role in Europe’s $8.7 Billion Defense-Tech Market

European funding reaches a record

European startups working in defense, security and resilience raised a record $8.7 billion from venture capital investors in 2025, an increase of 55% from 2024, according to Dealroom and NATO Innovation Fund data cited by CNN Greece. Funding stood at $5.2 billion in 2024, nearly five times its level six years earlier.

The composition of investment also changed. Late-stage funding tripled to $4.7 billion in 2025, indicating that capital is moving beyond company formation toward financing larger defense-technology businesses. Artificial intelligence-related technologies accounted for 44% of total sector funding.

The market now extends beyond conventional weapons manufacturers. Artificial intelligence, autonomous systems, cybersecurity, space technology, sensors, robotics and advanced communications networks are becoming integral to defense systems. A 28DIGITAL study cited by CNN Greece argues that innovation increasingly moves from commercial technology into military and dual-use applications, reversing much of the pattern seen during the 20th century.

Greece builds partnerships and production

Greece is seeking a place in this expanding ecosystem through partnerships linking domestic technology with international platforms. At the end of July, Greek company ALTUS-LSA and US-based Shield AI announced a strategic partnership. The plan combines the Greek KMB Hunter and M3NTOR Unmanned Command-and-Control System with Shield AI’s V-BAT aircraft and Hivemind autonomy platform.

Another initiative was announced on August 20, when US company AeroVironment formed AV Eagle, a joint venture with Greece’s Eyeonix. The venture aims to establish local production capacity in Greece. Operations are scheduled to begin in fiscal year 2027, with production capabilities expected in 2028.

Skaramangas Shipyards, Qualco Group and Olympic Marine have also agreed to research, develop, produce and demonstrate a Greek-designed multipurpose Unmanned Autonomous Surface Vessel. CNN Greece reports that the shipyard will contribute naval construction expertise, Qualco will supply software and artificial intelligence, and Olympic Marine will bring experience in advanced composite hulls.

A broad base, but scaling remains difficult

The Hellenic Centre for Defence Innovation is upgrading its digital map of the domestic defense-innovation ecosystem. The platform contains 776 registered entities, including 598 companies and 178 research laboratories, as well as 371 technical experts. These figures do not represent 598 specialist defense companies, but they indicate a broad pool of businesses and research teams whose technologies may have defense or dual-use applications.

That pool includes companies entering defense from other sectors. CNN Greece identifies nvisionist, whose artificial intelligence, computer vision and advanced analytics technologies have applications in energy, civil protection, critical infrastructure and defense. EFA Group, Theon, Metlen, OTE, Uni Systems, Profile, QnR, Cosmos Business Systems and Space Hellas are also active in the wider market.

Access to scale remains Europe’s central constraint. Different national priorities, fragmented procurement systems, lengthy purchasing procedures and limited specialist financing make it harder for European startups and mid-sized companies to convert technology into contracts. For Greece, the opportunity lies less in matching the size of the traditional French or German defense industry than in supplying software, autonomous systems, communications and specialized manufacturing to an increasingly cross-border European market.