The U.S. defense sector stands at a pivotal moment, with an intensifying tech race against China and escalating threats from Russia. As President-Elect Trump prepares to reassume office, defense tech is set for significant growth, with AI and Silicon Valley at the forefront of national security innovation.
The narrative in Silicon Valley has shifted, with the DoD increasingly relying on these startups for AI, autonomy, and intelligence enhancements, signaling a new era in defense technology. Startups like Anduril, Scale AI, and Shield AI are disrupting traditional defense giants by introducing advanced, software-centric solutions.
Here’s a look at the top U.S. defense tech startups for 2025:
Anduril Industries
In under a decade, Anduril Industries has established itself as a key player in the US defense sector, which traditionally favors juggernauts like Lockheed Martin, Raytheon, and Northrop Grumman.
When Palmer Luckey founded Costa Mesa-based Anduril in 2017, he was known as the 20-something tech prodigy who created the Oculus Rift VR headset. Facebook, now Meta, acquired Oculus in 2014. Anduril may not exist today if Facebook didn’t fire Luckey in 2017 amid controversy about his support for then-President Trump and shifting leadership dynamics.
Anduril builds autonomous systems like drones, jet fighters, surveillance towers, underwater vehicles, and counter-drone tech. The startup’s focus on artificial intelligence aligns with the Pentagon’s desire for smarter, faster systems that can be deployed at scale.
Anduril describes itself as software-driven, with its Lattice OS as the backbone for its offerings. Its solutions are used across branches by military commanders, border security teams, and other decision makers in critical operations. Anduril’s Sentry Tower is equipped for sensors and AI for perimeter security and border surveillance, which is expected to be a top priority in Trump’s White House.
Luckey says hyperscaling the deployment of weapons systems is key to national security and the future of warfare. In September 2024, Anduril introduced its new Barracuda cruise missiles that can be mass produced twice as fast for 30 percent less than traditional missiles. The designs feature 50 percent fewer parts, and their assembly is highly automated, requiring 95 percent fewer tools to build.
Anduril is headed into 2025 with a full plate, with plans to develop a hypersonic propulsion system called Denali, deploy its new Bolt drones for defense missions, expand its production of Ghost drones with a new factory in Australia, deliver a $200 million counter drone system for the Marine Corps., and partner with FlackTek to create high-quality solid rocket motors. They’re also expanding their footprint in space, recently securing a nearly $100 million contract to modernize the US Space Surveillance network with their Lattice mesh networking system.
Anduril plans to pursue an initial public offering (IPO) as early as 2026.
Scale AI
Scale AI is helping the military supercharge defense systems with advanced AI and machine learning. Founded by the world’s youngest self-made billionaire Alexandr Wang in 2016, the San Francisco-based startup’s expertise spans intelligence, surveillance, reconnaissance, hardware modernization, and autonomous vehicle tech.
Scale works with the government directly, building mission-specific solutions for ground, air, surface, and subsurface autonomy. Scale offers a generative AI platform specifically for defense applications.
Its Defense Llama is an advanced large language model (LLM) built on Meta’s Llama 3 and tailored for US national security missions. Scale says the LLM helps military planners simulate adversary actions, plan operations, and prepare contingencies while remaining in compliance of Pentagon guidelines.
Scale, whose enterprise clients include Microsoft, Toyota, and Open AI, is currently valued at nearly $14 billion.
Saronic
Austin-based Saronic Technologies, which makes autonomous surface vessels for naval missions, hit unicorn status in 2024 with $175 million Series B funding led by Andreessen Horowitz.
Launched in 2022, Saronic now has three vessels designed to work autonomously alongside humans:
- Spyglass is a 6′ vessel for tactical missions and collaborative swarms
- Cutlass is a 14 footer designed for longer range operations and heavier payloads.
- Corsair is a powerful 24′ foot vessel with a modular architecture, intended for large-scale, critical naval missions
Saronic boasts its ability to build and deploy the vessels quickly to respond to evolving threats.
Shield AI
Shield AI, founded in 2015, develops AI-powered autonomous drones and systems that operate without GPS or direct human control.
Based in San Diego, Shield’s flagship product is the V-BAT, a drone that takes off and lands vertically. It’s powered by the startup’s proprietary platform called Hivemind AI that uses advanced algorithms to navigate challenging and dynamic environments like dense urban areas and electronic warfare zones.
Shield’s valuation is at nearly $3 billion. In 2024, Shield won a $198 million contract to deliver autonomous drones to the U S Coast Guard. The drones have proven effective in Ukraine, which has requested hundreds more of the devices to use against Russia.
Skydio
Skydio, founded in 2014, originated as a consumer drone manufacturer but shifted focus to enterprise, public sector, and defense in 2023. Today, the San Mateo-based startup is the largest drone manufacturer in the United States.
Skydio’s drones navigate and avoid obstacles autonomously with advanced computer vision and artificial intelligence. Valued at over $2.2 billion, Skydio has contracts with every branch of the DoD, more than half of US state departments of transportation, and hundreds of public safety agencies.
In October 2024, China sanctioned Skydio after the company was approved to supply drones to Taiwan’s National Fire Agency. The sanctions have caused issues with Skydio’s supply chain, especially batteries, which the startup is working with government officials to help solve.
Skydio also recently raised $170 million in an extension of its Series E funding. According to TechCrunch, Skydio’s revenue continues growing since dropping consumer drones in 2023, with over half of $1.2 billion in bookings coming from defense customers.
Entering 2025, Skydio says it aims to expand globally and improve drone connectivity.
Rebellion Defense
Rebellion Defense develops AI software for the military to detect threats faster, make better decisions, and stay ahead of the enemy. Based in Washington D.C., the startup was founded in 2019 and achieved unicorn status just a few years later in 2021.
Rebellion has two main offerings: Iris for situational awareness and tracking physical threats, and Nova for testing systems for cybersecurity vulnerabilities.
Iris uses AI-driven computer vision to process data from multimodal inputs, including cameras, radars and sensors to detect and track potential threats in real time. Its predictive modeling forecasts movements so operators can proactively confront emerging threats.
Nova is a test automation platform that simulates how hackers might break into defense systems. It automates vulnerability assessments, penetration testing, and threat modeling.
Firestorm
Founded in 2022, Firestorm is a rapidly growing producer of modular and easy-to-produce drones for defense applications. Firestorm’s drones are 3D-printed in under 9 hours and are adaptable to different mission types.
San Diego-based Firestorm’s offerings include:
- Tempest, a line of modular drones that can be quickly customized
- XCell, a system for semi-automated drone and spare parts manufacturing in the field
- OCTRA, a flight controller and mission computer to manage drone operations
Firestorm raised $12.5 million in March 2024, led by Lockheed Martin Ventures. The startup raised another $20 million in Series A funding the following October.
Epirus
Epirus specializes in high-power microwave technology to disable drones and other electronic threats. Founded in 2018 and based near Los Angeles, the startup’s flagship product is Leonidas, which the Army has adopted to protect against drone swarms.
Leonidas sends out invisible pulses of energy that can target a single drone or disable a whole swarm at once. It essentially creates an invisible shield that protects an area by zapping anything that gets too close. Its software-defined design allows for quick updates.
Epirus has been awarded notable contracts, including $66 million from the Army in January 2023.
Vannevar Labs
Palo Alto-based Vannevar Labs turns foreign communications into real-time intelligence for the military. Launched in 2019, Vannevar says its Decrypto tool helps military analysts and operators quickly understand info critical to national security.
Decrypto uses advanced language processing AI to automatically translate communications, analyze content for key details, and highlight urgent insights. The Defense IUnit recently awarded a nearly 100 million dollar production contract to deploy the data analysis solution across the DoD.
CHAOS Industries
CHAOS Industries develops cutting-edge systems for detecting threats, securing communications, and defending critical military electronics.
The Los Angeles-based startup just raised $145 million, bringing its total funding to $215 million. Founded in 2022, the company says its Coherent Distributed Network (CDN) connects sensors, devices, and systems, using advanced synchronization to share info between devices in real-time.
The CDN powers HYDRA, which the startup calls a highly mobile, scalable, paradigm-shifting technology for the conduct of warfare. CHAOS Industries is backed by big investors like Accel, which is becoming an increasingly significant player in defense tech.
Defense Tech in 2025
With President-Elect Trump’s incoming administration showing a keen interest in bolstering defense capabilities, the stage is set for these startups to play pivotal roles in shaping national security and global military posture. The era of reliance on slow, conventional defense systems is waning, giving way to a future where the speed of innovation, the power of AI, and the adaptability of tech startups could very well dictate the balance of power.