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Helsing just closed the largest funding round in European defense-startup history — $1.8 billion at an $18 billion valuation — cementing AI-powered defense as one of the hottest categories in venture right now.
With JPMorgan and ICONIQ joining a roster of European backers, is defense tech becoming the next category where U.S. and European capital compete head-on for AI-native founders?
In today’s Startup News AI:
Helsing raises $1.8B at $18B valuation
DeepSeek eyes new round ahead of 2027 IPO
Chai Discovery lands $400M for AI drug design
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What’s new? Helsing closed a $1.8 billion Series E led by JPMorgan Chase, Lightspeed Venture Partners, and ICONIQ, valuing the Munich-based AI defense company at $18 billion — the largest funding round in European defense-startup history.
What matters?
The round follows a $694 million raise in 2025 led by Spotify founder Daniel Ek, which was itself the largest European defense investment at the time — Helsing has more than doubled that record within a year.
Helsing’s product line spans AI-powered sensor-fusion software, the HX-2 strike drone, and underwater surveillance systems, with platforms already supplied to Ukraine and NATO partner nations.
The company says it remains predominantly European-owned even as U.S. investors like JPMorgan and ICONIQ join the cap table, a detail it’s emphasizing amid growing scrutiny of foreign ownership in defense tech.
Why it matters?
An $18 billion valuation makes Helsing one of Europe’s most valuable startups of any kind, signaling that defense AI has become investable at a scale once reserved for consumer and enterprise software. For founders building dual-use or defense-adjacent AI, the round is proof that institutional capital — not just government contracts — is now chasing this category.
What’s new? DeepSeek is reportedly in talks to raise $1.5 billion at roughly a $71 billion valuation, just weeks after closing a $7 billion round at a $50 billion valuation — a pace that would make it one of the fastest-compounding valuations in AI history.
What matters?
Potential backers include Tencent and Beijing’s National Artificial Intelligence Industry Investment Fund, following a $7 billion round closed just a month earlier with an unusual deal structure.
The company is reportedly preparing for an IPO as early as late 2026, with 2027 as the primary target — a milestone that would make it one of the first major Chinese LLM developers to go public.
DeepSeek’s open-source models now account for nearly 23% of tokens processed through Vercel’s enterprise AI gateway, evidence its efficiency-first approach is winning real developer adoption, not just headlines.
Why it matters?
A $71 billion valuation for a company built on cheaper, more efficient models is a direct challenge to the capital-intensive strategies of U.S. labs. Investors weighing AI infrastructure bets should note that efficiency, not just scale, is now commanding premium valuations.
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What’s new? Chai Discovery closed a $400 million Series C led by Index Ventures, with Kleiner Perkins, Sequoia Capital, and Dimension co-leading, valuing the AI drug-design startup at $3.8 billion as it ships Chai-3, its latest molecular design model.
What matters?
The round drew new backing from Bain Capital Ventures, Battery Ventures, and Baillie Gifford, alongside existing investors that include OpenAI itself — a notable bet from a foundation-model lab into applied biotech AI.
Chai’s software helps researchers forecast and redesign molecular interactions to pursue “undruggable” targets, with commercial partnerships already in place with Eli Lilly and Pfizer.
CEO Joshua Meier says the company wants tomorrow’s medicines “designed with the precision, speed and scale of modern engineering,” a pitch that’s drawn co-investment from Sequoia’s Pat Grady and Kleiner Perkins’ Ilya Fushman.
Why it matters?
A $3.8 billion valuation for a two-year-old company signals investors now see AI-driven drug discovery as a near-term commercial category, not a research bet. OpenAI’s participation also hints at how frontier labs are starting to diversify their own capital into vertical AI applications they don’t want to build in-house.
The Shortlist
Nous Research is raising at least $75 million at a $1.5 billion valuation, led by Robot Ventures, to grow its open-source Hermes agent platform past 214,000 GitHub stars.
Flex raised $70 million at a $1.2 billion valuation and launched Flex Global, a stablecoin-powered payments product moving money across 100+ countries in minutes.
Hadrius raised $27 million led by CRV to build AI compliance software that’s already cut manual review work 70% for over 500 financial firms.
InstaLILY closed a $60 million Series B led by Energize Capital, with Home Depot Ventures and United Rentals joining to back its AI “forward deployed engineer” for industrial clients.
Feathery raised $30 million in a round backed by Index Ventures and Bain Capital Ventures to expand its AI decisioning platform, now used by over 300 financial services firms.