Defense Tech

“I think an area where, despite it being amazing for America and important for the world, I think the venture returns of the March might be tough will be defense, not because we don't need all these products, but because I think there's an element of that busin…”

“They increase the size of the market because de facto, nobody wants to find an underrated market where there's only one person. So like, if you're the one person, the percentage of the defense budget you can get is much smaller. And two, they set up a comparat…”

“People say we're in a defense bubble. Well, turns out it's kind of like a good thing because we're at a point where we're looking for automakers and People to be making missiles, to be helping supply the military complex.”

“There's defense, the greatest VC boom in defense tech, In a country's history.”

“And so you'll notice that like we are now extremely enthusiastic investors in defense tech and in you know, things involving law enforcement, national security, public safety and, you know, say a hundred percent, we would not make that same mistake again.”

“Founding teams, one of the most important things in, in defense is some of them can be outsiders and, you know, brilliant technologists and thinkers. It does take a lot of inside knowledge and I think that one of the things we got right and keep getting right …”

“I mean, I like defense tech to it because I like guns and explosions. So yeah, I always like say how much I love and roll”

“Look at this Defense tech wave. And now it's like the hottest area outside of AI. And that was more or less created by Andrew. And I'll give a lot of credit to Palmer, one of the four founders of that company for, like, completely reversing this trend.”

“I do think defense will accelerate in terms of startups and defense tech and the shift to autonomous or not autonomous, but to drone based systems in general.”

“Thinking back to when we started Anvil in 2017 as kind of the pariah of Silicon Valley. It was like not something people were doing, it was incredibly unpopular, and now all of a sudden there's like almost nothing as popular. Maybe AI slop enterprise SaaS comp…”

“Even though you have a catalyst, there's probably only a six to 12 month window where defense tech is non-obvious.”

“Now I think defense tech is becoming consensus. It's too obvious. And so it's like valuations are incredibly high”

“We invested in defense a lot three, four years ago, and then we kept looking, we're basically paused for a year and a half or two, because after the Ukraine and Israel thing, you know, prices just went up like two, three, four times, but the company fundamenta…”

“A lot of people had defense tech El pack clauses. Right. That were very real. We had them. We don't have them anymore, not because we wanted to make a change, but because there was this one LP we had had very serious treaty.”

“But I haven't seen that particular bubble sort of like wind down yet. We're still seeing some pretty active, heavy, heavy investing there.”

“I don't think you need to have a military background to do this. I think there's amazing American patriots that just want to get involved and they have really core technical skills elsewhere. I think it's helpful that, you know, folks came from the visceral op…”

“So, yeah, I think there's gonna be some tough reconciliation that happens, you know, over the course of the next year or two, where it's, like, there's gonna be, like, you know, 50 to 60% of this field that's just gonna have to die off or get acquired for penn…”

“What I lead a lot of is all our national security, all of our defense stuff. And it comes out of the same core funds. So it's not a separate thing where, We have to deploy five hundred million dollars a year in this.”

“More importantly, like, you know, the crazy thing about defense tech that I think not a lot of people realize is there's really not the concept of product-led growth. Like, you can't just dog food something with a customer, and then all of a sudden the colonel…”

“I think how this entire ecosystem, both from an entrepreneurial and a VC perspective, like defense tech, how this goes wrong is we actually cannot deliver on the systems that we are selling the government. I actually think the snowball of, like, accepting new …”

“When you're a defense that company, you need two things. You need to build great technology. But you also need to be able to sell it, and you need to understand, like, government sales, government procurement, and Alon is a genius at building great technology,…”

“We have a nice exposure to Enduro, and we have a couple of others that we're really excited about, and Enduro's not going to be the only winner in that space.”

“What's, what's overrated? And I would say it was overrated actually is defense tech.”

“It's not like enterprise software where there's going to be hundreds of great companies that go after a multi-trillion dollar TAM in defense tech, multi-trillion dollar TAM, but I think it's gonna be a much smaller number of companies where all the value accru…”

“I mean, I think that you could make a pretty compelling argument that Austin is a way better place to build a health company, a defense tech company, like any number of these sort of hard tech or other companies that You know, the Bay doesn't necessarily have …”

“And then defense, I think is a little bit ahead of its skis. You know, we were just having a conversation earlier, Leah and I, about this, is, you know, selling into the government is really hard, and I think people don't understand that.”

“I would say Helsing is a company that you can only co-found. You need to have multiple founders.”

“And it was a big shift from like the defense tech boom, the gundo boom. A lot of those guys had had rough goes in like the Wi-Fi money era, realized it was not very durable, very zero sum, and moved over to something that was more tangible.”

“I think we could see the same thing play out in defense. I think we could see the same thing play out in AI.”

“I believe that the big venture firms, defense tech is great, right? Defense tech, those companies are going to be insanely capital inefficient. They're going to require insane amounts of money. My view is like American dynamism and defense tech as a theme. It'…”

“As you move into things that they've been moving into, crypto defense tech, like, you're getting into heavily regulated industries, so you're gonna bump up against this more, and you're gonna think about policy more”

“And so people will lose a lot of money chasing the new, new thing, which today happens to be defense in addition to AI.”

“Even if you abstract away from like the hype, you still feel like there is a moment in time where, you know, de-globalization is real. Increased global conflict is real. Like those things create market opportunities.”

“Is how startups and private sector companies are getting involved in this space today through vertical integration where they are building both the hardware and software. So I think about that with and a role for defense tech or Varda for space tech. And then …”

“Now there's a ton of capital and a ton of interest and a lot of people who really want to be part of this. So we've really reached a tipping point on that, but we still have a long way to go on taking some of what Brian was just talking about really to the nex…”

“I think the hard reality with this is it's just like venture. It's just like any sort of industry where there isn't going to be 500 success stories. That is unlikely to be the case, right?”

“We've had roughly a hundred billion dollars of venture investment enter defense tech recently, last couple of years.”

“Defense tech is an area that I'm bullish on, but there's nothing like Endural.”