Our friends at defence tech accelerator Vimy Forge are recruiting for their second cohort: more info here.

🎯 Three-Shot Burst

The money is approved. The buying isn't. CADSI grew its membership 70 per cent in a year to 254 companies in Ottawa-Gatineau, 182 of them SMEs, riding $80 billion in budget defence spending, a goal of 70% of military contracts to Canadian firms, a $241 million NRC program and a $4 billion BDC program. Dominion Dynamics raised $139 million over the summer and builds out of a 30,000-square-foot Kanata North factory. Eliot Pence still can't see it: "I'm waiting for the boom. I'm hopeful for the boom." ONE9’s Michael Smith names the condition: "The build only happens when you actually start buying your Canadian products." CADSI's Christyn Cianfarani names the choke point: "I need a security clearance and I cannot get it in the time frame that's required for me to execute on my contract." ROB Magazine's John Lorinc walks through the 400-page Project Approval Directive that governs every major buy: four stages, multiple sub-stages and a 64-question complexity rubric, against more than $63 billion allocated for 2025-26. Carleton's Elinor Sloan counts 26 reports and 10 stages for a large procurement, with 13 marked for removal. The Defence Investment Agency has not yet received all live files and is not yet a single point of accountability, says CGAI's David Perry: "The way our system works right now, it just can't handle an expanded volume like we've been trying to deal with for the last 20 years."

Reality check: Auditor General Karen Hogan found National Defence did not manage its ammunition to meet regular-use or strategic stockpile needs. Fifteen regular-use contracts averaged almost 19 months from signature to delivery, and CAF readiness for NATO commitments was "well below target" as of March 2026. Defence Watch has the report's harder numbers, straight from the audit: $695 million committed to the stockpile in 2025-26, zero rounds received by March 31, 56% of assigned ammunition actually used, and $656 million in inventory overdue for counting.

• DIA head: Canada is buying military gear for a world where ‘pretty much everything’ changed

We combine funding, sector expertise and strategic connections to help Canadian businesses scale, compete globally and seize the opportunities ahead. Connect with our experts today.

Paris is crowded. London is where companies survive. Ben FitzGerald’s Dickensian frame in War on the Rocks splits defence tech into two markets: Paris for prototypes, pilots and discretionary money, London for production contracts and recurring revenue.

“Long-standing defense specialist investors are nearing the end of fund lifecycles and their own patience, while generalist venture capital firms that entered defense as part of a trend are now discovering that defense procurement does not scale like consumer software and does not offer clear exit paths.”

About $49 billion in venture money went to defence tech in 2025, and the Silicon Valley Defense Group’s top 100 startups have raised more than $118 billion, but they won just $4.3 billion in awards in 2025 out of more than $450 billion the Pentagon obligates each year. Of 450 DIU prototype OTAs from 2016 to 2023, only 14% converted to production, 51% among completed prototypes. Palantir is worth more than Lockheed, Northrop and General Dynamics combined.

RealClearDefense calls this uncharted territory for private capital while Congress struggles to move the 2027 bills that fund autonomy, AI, counter-UAS and the industrial base: “Now is also the time to anticipate potential fracture points and mitigate them through intelligent design.” Nicholas Nelson in Foresight by Tawazun tallies the mega-rounds, Anduril at $5 billion on a $61 billion valuation, Helsing at $1.8 billion on $18 billion, Quantum Systems at $1.2 billion, then deflates them: “Funding rounds do not generate military capability.” Capital, he writes, “is an input, not an outcome.” The drone market is the live test. Drone Dominance promises $1 billion over two years in repeated small awards, with Neros taking 4,960 drones in Gauntlet 1, and the Army admits it is trying to “artificially induce” demand. AV’s Chad Chasteen: “There is no supply without demand. Continuous competition doesn’t mean you make industry fill out continuous requests for white papers.”

a16z

AD 50 2026: Production is Deterrence

We’re excited to present a16z American Dynamism’s annual list of 50 companies that are rebuilding and protecting America. To learn more, watch our companion podcasts here…

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5 days ago · 170 likes · 2 comments · a16z American Dynamism

Strategy arrives. Sovereignty still needs a definition. The Plan for a Stronger Canada names defence one of eight strategic capabilities, confirms 2% of GDP in 2025-26 on a path to 5% by 2035, calls protecting the Arctic “the defining task” for the CAF, and promises a defence plan to “give the CAF one clear, central mission: the defence of Canada and Canadian interests.” It is Canada’s first national security framework in 22 years. Canadian Shield Institute’s Matthew da Mota flags the hole in the middle: cloud, AI compute, quantum and telecom are listed as strategic capabilities with no definition of what sovereignty means for them. His line: “autonomy built on digital systems Canada doesn’t own or control isn’t autonomy at all.” His test for a Canadian partner is one “not majority owned by a foreign parent company.” CIGI’s Carvin, Juneau, Neiman and Wark want an IQT-style rapid prototype and investment model, technological sovereignty in major procurements and a sovereign space stack from launch to domain awareness, and they warn: “A national security strategy is not cost-free.” The same week tested the principle: John Ivison reports that Israel’s Elbit closed its purchase of International Submarine Engineering, the Port Coquitlam AUV maker with a 50-year history and an IDEaS-funded docking project, without a national security review. Up north, The Wire China examines how the Grays Bay Road and Port could make a Chinese-owned mine viable: state-backed MMG has held the Izok zinc deposit since 2009, and a 230-kilometre all-weather road to a deep-water port on the Coronation Gulf is the missing piece. Then the space agency put up $4 million across three priority technologies: $1 million for a CubeSat telescope, $1 million for CASTOR readout electronics and $2 million for snow-mass radar modules, with a full radar integration design left out “given the financial constraints of the RFP.”

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

🍁 Ottawa takes up to $1.6B of Cohere at a $35.7B valuation. The federal government will take an equity stake in a planned $7 billion round led by Germany’s Schwarz Group, the largest financing ever by a Canadian startup, up from roughly US$7 billion a year ago. Cohere has to spend $1.7 billion on Canadian compute by 2030, keep its headquarters here and double its workforce, with payments tied to milestones.

The Canadian Explorers

A Practical Guide for Financing a Canadian Defence Startup

By Matt McLeod, Partner, Toronto | Blake, Cassels & Graydon LLP…

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6 days ago · 2 likes · 1 comment · Ethan Marcoux

🍁 North Vector Dynamics raises $20M+ Series A. Czech fund Tech Horizons leads the round for the counter-UAS startup, with ONE9, Garage Capital, Ripple Ventures, Feld Ventures and Conconi Growth Partners, and Czechoslovak Group joining as a strategic investor after an MOU on European manufacturing. The CM-70 interceptor weighs about 3 kg, measures 90 cm, flies on a small rocket with laser guidance and works without GPS. First units ship in 2027, built for Geran-4 and Geran-5 jets in a war where Zelensky says “only 57% of jet-powered drones are being intercepted.”

🍁 Lockheed closes Ultra Maritime at US$3.45B. The Canadian Press reports Lockheed completed the acquisition of the Dartmouth undersea warfare company last week, after investing since 2022. Founded in 1947 as Cossar (Canada) Ltd., it builds sonobuoys, sonar and torpedo defence for more than 30 navies with about 2,000 staff. SaltWire has the Halifax business angle on the $3.45 billion deal for Dartmouth. Lockheed Martin Canada has separately pledged up to 320 skilled jobs in Nova Scotia within five years, worth up to $126 million in salaries and benefits. Canada’s premier sonar house now sits inside Lockheed’s Rotary and Mission Systems.

🍁 Solink raises US$100M in growth capital. Toronto’s Vertu Capital leads the round for the Ottawa AI video company, with GS Growth, Golub Growth and Comcast Ventures. Solink covers more than 35,000 locations in 65 countries, uploads 750 million hours of video a month, has 350 staff and is on track for US$100 million in annual revenue by April. It is the third Solink round led by a Canadian firm.

🍁 SAFE contract number two: Galvion’s $44M+ helmets for Latvia. The Canada-EU summit in Montréal announced the Montréal helmet maker’s contract to equip the country where Canada has its largest military presence abroad, following Marconi’s ORION radios for Poland’s Cyber Command. The same package brings up to $2.5 billion in financing for De Havilland waterbombers, cooperation on IRIS² and Galileo, and a path for Canada to become the EU’s first Associate Member.

• Ukraine’s battlefield lessons for Canada… Automated turrets shot down dozens of enemy drones over Kyiv in the past month alone

• BCI with October public comps in defence

The Defense Brief

When the Battlefield Became Transparent, War Went Underground

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5 days ago · 7 likes · Louise Boucher

🍁 Saab signs IMP, Magellan and CAE for a Gripen line, and Bombardier signs with BAE. Saab picked Halifax’s IMP to run a Canadian final-assembly line for the Gripen E, with Magellan on aerostructures and CAE on training, though the GE F414 engine stays the one purely American, export-controlled part. Canadian Defence Review has the full partner statements, including IMP’s David Gossen on building Gripens “for Gripen customers internationally.” Bombardier, which turned down building Gripens over factory capacity, signed an MOU with BAE Systems to explore future combat jets and hit its US$1 billion defence revenue target five years early. Breaking Defense lines up both bets and notes Italy says Canada’s GCAP observer status carries no industrial role yet.

🍁 Lockheed’s HIMARS offsets land at PV Labs. The Burlington optronics SME was approved for Lockheed ITB investment to develop a next-generation Pilot Night Vision Sensor for the AH-64E Apache, under the framework tied to Canada’s 26 HIMARS. No dollar figure was disclosed. Founder Mark Chamberlain calls PV Labs Lockheed’s “trusted R&D and delivery partner of choice in Canada.”

Industrial Base Alpha

⬟ Xona

On October 22nd, 2026, Xona Space Systems announced a $250 million Series D at a $2.45 billion valuation led by Future Ventures, staking their balance sheet on an audacious proposition: redefining and upgrading the Global Positioning System (GPS…

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5 days ago · 11 likes · 3 comments · Matthew Bernard

🍁 EarthDaily wins a $4.3M NASA task order. The Vancouver company will test whether its constellation meets Landsat standards, with eight of 10 satellites in orbit and 5-metre pixels against Landsat’s 30. It already has an NRO evaluation contract, an eight-figure US defence data deal and a DRDC-funded AI border platform for the RCMP.

🍁 Bloomsco raises a $1M pre-seed from BDC and Telegraph. The Montréal startup uses AI to turn technical manuals into military training plans, already holds a DND contract for an officer qualification standard and counts former RCN commander VAdm (Ret’d) Ron Lloyd as an adviser. Hugh McGuire: “The whole focus of a military is training people well to do the work they need to do.”

Energetics gets funded: Odin and Firehawk. The WSJ profiles Odin Energetics, a Solugen and Kraken Kinetics venture with $115 million committed, an explosive it says is 30% more powerful than what drones carry now, and modular plants it can build in six months. The US industrial base it is up against is one 84-year-old plant running at 3% of its 1944 peak, Holston, the only domestic source of HMX and RDX. Brian Davis: “We are not suddenly in an energetics crisis. We have actually been in an energetics crisis for 20 years.” Dallas-based Firehawk raised more than $150 million in a Series D at a valuation above $1.4 billion, led by Advent and Rochefort, to take Hydra-70 output from 40,000 to more than 125,000 a year and cut propellant production from 45 to 60 days down to about six hours. Canada’s $1.4 billion munitions framework includes a domestic nitrocellulose plant. It has no Odin yet.

Salesforce buys Rune. The $190 billion CRM giant is acquiring the military logistics AI startup about two years after its founding, with $30 million raised, a five-year $99 million Army enterprise agreement for TyrOS and seats on both the Lockheed and Anduril NGC2 teams. Salesforce’s defence business is growing 80% a year. A source close to the deal: “Defense companies buying other defense companies is part of the market, but it doesn’t bring in anyone new.”

“I initially expected defense tech startups to get acquired by other defense tech startups, primes, industrial companies, etc. Or to exit public, of course. But with the Pentagon pushing acquisition reform and *real* software modernization, there’s growing incentive for enterprise software companies and hyperscalers to buy their way into the market.” - Ali Javaheri, PitchBook Data

Industrial Base Alpha

⬟ Rune

Twenty-eight months after its founding, and on about $30 million raised, Rune Technologies has agreed to sell to Salesforce…

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a day ago · 2 likes · Matthew Bernard

Related: KAS Canada and MIGS map the legal and security debate over AI-enabled drones for transatlantic allies, a 2025 paper worth rereading as Canada writes its own drone rules.

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⚔️ Combat Readiness

🍁 Fighter file. The RCAF took its first two F-35s at Luke Air Force Base, and Defence Minister David McGuinty says the 88-jet buy is still under review, weighing industrial benefits and autonomous systems that fly alongside fighters. Canada has 16 jets under contract, long-lead costs paid on 14 more and 72 in limbo. The leverage problem hasn’t moved since CBC laid out the US hold over Link 16 for any Canadian Gripen in March. Swedish Lt.-Col. Johan Legardt: “If Canada is the first country where the U.S. draws the red card then we have a problem.”

Gray Matters

Physical AI for National Security: The Startups Fine-Tuning Robotics Foundation Models

You’ve heard of ChatGPT wrappers…but what about robotics foundation model (RFM) wrappers? In 2026, in the wake of several impressive new model releases, it seems like everyone is building RFM wrapper companies on top of models like Physical Intelligence (Pi)’s…

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14 days ago · 19 likes · Maggie Gray

🍁 Kit for Canada. The River-class destroyer is pivoting to a full Aegis combat system and military off-the-shelf kit to cut cost, schedule and technical risk. Sea Ceptor gives way to RAM, Leonardo’s Vulcano to BAE’s MK 45, the developmental TLFAS sonar to Thales Sonar 2087 at no extra cost, and onboard jamming to offboard decoys. Fifteen ships, HMCS Fraser’s keel laid in June, Final Design Review in early 2028. DND: the baseline “is expected to remain stable.”

• Calgary health tech company’s gel helps heal Ukrainian soldiers

🍁 Sustainment tax. Canada is paying Lockheed $9.8 million in a non-competed FMS contract to patch the CH-148 Cyclone’s radar warning software, and 97% of the work happens in Owego, New York, with the rest split three ways between Ottawa, Halifax and Patuxent River. The fleet cost C$3.75 billion to buy and C$11.17 billion in major in-service support.

🍁 Home front. Documents put before Gen. Jennie Carignan show the CAF was warned about safety gaps for more than 20 years before the October 17 fire at CFB Wainwright that killed four soldiers. The Forces run at least 27 overlapping safety regimes, and the new Defence Safety Programme won’t reach initial capability until spring 2027.

ChinaTalk

WarTalk: Kofman on Why Russia's Doing Badly

The ChinaTalk team is going to CoRL (the Conference on Robot Learning) in Austin! Reply to this email if you’d like to hang out between November 9th and 12th. We’re also doing karaoke on the 11th — RSVP here if you’d like to join…

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19 hours ago · 26 likes · 1 comment · Jordan Schneider and Phoebe Chow

🍁 Axis watch. CSIS says Iranian threats to Canada involved potentially lethal plots against individuals and will likely continue, as Toronto police tie gun-for-hire networks to shootings including the attack on the US Consulate. The procurement side is just as busy. Reuters uncovered more than 5,000 numbered MODAFL agencies that have imported at least $2 billion in hardware, explosives and trucks since January 2025, with 97% of reviewed transactions settled “without currency transfer.” 240 Analytics’ Noam Binstok: “The amount of money going through these agencies is staggering, and no one has noticed them before.”

🍁 Defence bank watch. Eight German industry groups, including BDSV and the savings banks association, urged Berlin to become a founding DSRB member before the November 30 charter signing in Luxembourg, warning German firms could lose preferential access to bank-financed procurement. Berlin’s ambassador isn’t sold: “So we don’t necessarily need to have another bank, which is always costly in the beginning.” Britain won’t join and will build its own Multilateral Defence Mechanism with the Netherlands, Finland and Poland, after an offer that would have moved the DSRB’s headquarters to Europe.

Counter-drone. Helsing unveiled its Contra air defence system and two interceptors: the jet-powered AD-1 Inferno at 700 km/h with loiter and re-engagement, and the rocket-powered AD-2 Ambush at Mach 2.5 and 20-plus km, both container-launched and priced in the “tens of thousands of euros.” They were shown as models, with orders no earlier than the second half of 2027. Russia is building Geran-4s and Geran-5s at 4,000 a month.

• Hypersonica raises €100M more to speed up and build out its hypersonic ambitions

Eye on Cyber (by Denis Laskov)

Attacking and defending drone navigation: How it works, how to attack & defend against jamming & spoofing.🛰️၊၊||၊🛩️🪓😈

An international group of academic security researchers published a major study on threats to UAV navigation systems, both civilian and military. The focus of the paper - practical attacks on drone navigation, like spoofing and jamming, and countermeasures…

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5 days ago · 8 likes · Denis Laskov

Cheap at scale. Destinus now builds nearly 300 Ruta cruise missiles a month, more than Europe produced in a year before the full-scale invasion, with 1,750 built and a 250 kg, 700-plus km Block 2 in production, all with no Chinese components. Mikhail Kokorich: “To have sufficient deterrence, you need to have tens of thousands of missiles.” His real worry is that Europe still lacks the units and logistics to operate them.

Maritime autonomy. Retired VAdm Michael Connor and Yoni Tobin chronicle the first naval battle between unmanned boats, a Ukrainian Sargan 300 sinking a Russian USV in September, alongside three US one-way attack USVs striking an Iranian submarine in July. Taiwan wants more than 200,000 one-way attack drones and 1,200 USVs. Their diagnosis: expendable boats are held to the same testing standards as manned warships. Their prescription: “This is a marathon, not a sprint.”

• The U.S. Once Dominated the World’s Oceans. China’s Xi is Changing That.

Autonomous air. The Air Force is rethinking cheap uncrewed fighters after its Iran losses, and that leaves Anduril’s FQ-44 Fury and General Atomics’ FQ-42 Vengeance chasing a higher-end, multi-role requirement. Maj. Gen. Ty Neuman: “We recognize that the cost of entry [into contested airspace] is all-aspect stealth, period.”

• Adapting Information Collection for Tempo, Survivability, and Integration

Insider threat. A Foreign Affairs essay traces how allied industrial partnerships leak: F-35 parts including a cockpit canopy misrouted through Hong Kong into China, North Korean IT workers inside a US contractor, and MirrorFace’s 200-plus attacks on Japanese defence targets. The National Technology and Industrial Base started in 1993 as a US-Canada arrangement. The authors want an allied industrial-security grading system.

Space. The DIA warns China may field space-based directed-energy weapons by the late 2020s, with its ISR fleet past 510 satellites, triple the 2018 count, while Russia’s Kosmos 2612 passed within about 26 metres of an ICEYE satellite imaging for Ukraine. The full DIA space threat report also carries the sharpest public image yet of China’s reusable spaceplane, which TWZ confirms has flown four orbital missions since 2020, the latest launched in February and still up. ICEYE and Nokia, meanwhile, signed a letter of intent with Ukraine’s defence ministry on sovereign LEO satcom.

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View the agenda and apply now.

🔫 Hot Shots

🍁 DND is hiring policy officers. The Policy Officer Recruitment Programme opens its 2026-27 competition in early November for master’s and JD grads: permanent jobs from day one, three one-year rotations from EC-03 to EC-05, up to $5,000 for relocation.

🍁 Arctic fiction, real prize money. IDEaS announced the Polar Paradigms 2045 winners, hard science fiction set around an adversary’s floating base between Ellesmere and Devon Islands.

🍁 CSA call closes November 26. SMEs with CubeSat optics, focal-plane electronics or Ku-band T/R modules have until November 26 to bid on the space agency’s $4 million STDP call, one contract per technology.

🍁 A Senator for the War Museum. Brampton’s Roshel donated a Senator MRAP to the Canadian War Museum, the same type it has shipped to Ukraine more than 2,700 times since 2022. The museum wanted a combat veteran, but Ukraine’s no-scrap policy meant it got one fresh off the line.

🍁 Read: Lagassé on decoupling. Carleton’s Philippe Lagassé argues in The Atlantic that pulling away from the US is awkward: core spending goes from about $64 billion in 2025 to $160 billion by 2035, with no financing plan explained, while the CAF still relies on Washington for communications, command and control and intelligence.

Debating Canadian Defence

Defence in the National Security Plan

Canada’s new national security plan is out. After a few years of Zeno’s Paradox of Motion style publication timelines, the Carney government has released The Plan for a Stronger Canada: National Security for Canadians. The Plan acts as a chapeau document for five sub-policies that will be published soon-ish: economic security, foreign policy, defence po…

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5 days ago · 35 likes · 3 comments · Philippe Lagassé

🍁 Read: Defence is nation building. Syntax Strategic’s Jennifer Stewart tells Ottawa Life that thousands of SMEs are entering the defence supply chain with no experience of federal procurement or committee scrutiny. Her warning: “If Canadians only hear about defence when there’s a cost overrun or a delayed ship, we will lose the argument we just won.”

• Keeping Critical Data in Canada: How ThinkOn and AVSS Are Building a Sovereign Platform for Public Safety and Defence

• These Are The U.S. Weapons Most At Risk In The Looming Rare Earths Supply Crisis

From a Hacking for Defense class to the field in 10 months. The Army tested Groundpath’s Auto-Router at Hohenfels, an ATAK plugin that plans covered routes without pinging satellites or cell towers, built by a Carnegie Mellon team that started in January and picked up by DIU. It rolls out to the 2nd Cavalry Regiment and 173rd Airborne next month. Spc. Corwin Pedersen: “It’s insanely easy.”

Points for kills. Orbis dissects the gamification of the battlefield: Ukraine’s Army of Drones Bonus pays 40 ePoints for a tank and 120 for a captured soldier, redeemable on Brave1, while Russia’s GRU-run Rubicon has grown past 5,000 personnel. The authors: “Wars will become presumably easier to start and harder to end because the feedback mechanisms governing their costs are no longer present.”

Stop the innovation theatre. Eva Sula says we have reached an interesting point in defence innovation where an entire ecosystem can be commercially successful without necessarily solving a single military capability problem.

Unfrozen. Supermarkets Across Europe Report New Suspected Freezer Hack.

5G. NATO’s Latvia 5G demo stumbles, and commanders say that’s the point.

Shoutout for Ethan Marcoux’s defence tech event in Montreal on Nov 26.

The AI agent that logged into the Pentagon. Wired reports an Accenture contractor connected a DOD production environment to a personal Claude Code account, and the agent ran on the network for two months, appearing to send credentials and a map of NIPRNet to a high-risk third-party site. Accenture says the allegations are “without merit.”

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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Special guest post by Matt Clancey, VP Maritime Programs at Dominion Dynamics & CAF veteran

We don’t need to be bad at procurement, and this RFP proves it.

Bottom Line Up Front: Canada (DRDC/BOREALIS working with the RCN) has issued and closed a first-of-its-kind developmental RFP for a net new operational capability. If DND keeps contracting in this way, we’ll see an order of magnitude increase in Canadian technology in the hands of CAF members.

The problem: The RCN does not currently have a mine hunting capability. The Fleet Diving Units are responsible for disposing of sea mines once located, but do not have a vessel, crewed or otherwise, equipped with the sonar to find them (notwithstanding the REMUS vehicles that are limited as a standalone platform). Mine Countermeasures has come to obvious relevance from lessons in the black sea, and especially in the Straight of Hormuz.

The status quo: Normally in the Options Analysis phase of a procurement like this, the RCN would have noted that there were no Canadian companies making 12m class USVs, then scanned what our allies were doing, seen that France, Netherlands, and the UK had all procured platforms that fit the need. They then likely would have pursued a Foreign Military Sale as the fastest and easiest procurement. Alternatively, they may have issued an RFI followed by an RFP that stipulated multiple years of experience building USVs for MCM that functionally locked any Canadian solutions out. But that’s not what they did in this case.

Enter W8472-275993: 258 pages of procurement bliss intended to be “…an iterative and incremental approach to meet Canada’s unique operational requirements.” Here’s why it’s remarkable:

1. The procurement is developmental, but it isn’t innovation theatre, this is a real capability: Minimum Viable Prototype due in 9 months, full solution in 21, requirement to codevelop with DRDC / RCN and implement feedback during the development process, and initial contract for 1 unit with options for 3 additional.

2. Scoring hugely favours Canadian content (out of 100 pts): 25 for Canadian Value-Added (cost based), 12 for Canadian Sovereign Capability Considerations, 21 for Team Assessment (most of which requires experience in Canada). Plus, only 10 points are price which makes the math prefer a more expensive more Canadian option than a cheaper foreign equivalent.

3. Incentivized early delivery (12 / 100 scoring points).

4. Zero requirement to have built a USV of this type before, but rather in the Team Assessment the bidder must show that their team has the requisite skill to make it happen.

5. The tender originally ran from 10 September to 1 October, and then was extended to 8 October. A 4-week RFP response period favours leaner, faster moving, AI enabled organizations (i.e. startups and SMEs).

There’s even more to it but those 5 points make the case. Could it still be better? Of course. The RFP is very heavily defined, leaving little room for novel capabilities, the fixed firm price bid is challenging to estimate with such a short turn around, there’s no requirement for the IP to be Canadian, etc. Those weaknesses are real, but they do not outweigh what this procurement gets right.

Industry has been asking DND to give us a chance to show that we can build great things, and in W8472-275993 DND has delivered. Now each party has a role to play: DND needs to keep using this as a template, and industry has to follow through and deliver (on time and without litigation).

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

🍁 North Vector Dynamics raises $29M to build interceptors by the thousand. The Calgary counter-drone missile maker closed a Series A of more than $29 million led by Prague’s Tech Horizons, with ONE9, Garage Capital, CSG, Ripple Ventures, Feld Ventures and Conconi Growth Partners. The CM-70 is under a metre long, weighs about three kilograms and flies at 900 kilometres an hour. Paul Ziadé says the plan is a 25,000-square-foot plant and missile production in the thousands per year by 2027, with fuzes brought in-house.

🍁 Ottawa puts $15M into a sovereign GPS built by a California startup. The Strategic Response Fund cheque backs Xona’s $64.8 million mission operations and satellite manufacturing centre in Montréal, about 126 jobs, to run Pulsar, a low Earth orbit navigation service built to sit alongside GPS and Galileo. Xona is headquartered in Burlingame, California. Mélanie Joly told SpaceQ the point is to put the entire command-and-control system in Canada for sovereignty reasons, with a sovereign GPS as the end goal: “The $15 million project is to really anchor Xona in Canada for the long run.” The same week, Xona raised a $250 million Series D at a $2.45 billion valuation led by Steve Jurvetson’s Future Ventures, seven months after a $170 million Series C, and claims signals up to 100 times stronger than GPS. So define sovereign. The new PNT Resilience Framework, which the Resilient Navigation and Timing Foundation says the U.S. could learn a thing or two from, ties the word to strategic autonomy and fewer supply-chain vulnerabilities, and sets up a National PNT Office inside ISED. Ownership is not in the definition. In Ottawa’s working usage, sovereign means the control room sits on Canadian soil.

Overmatch

The Sovereign Stack

When we were kids, nothing beat ripping open a present and seeing a new toy. It lights up! It makes noise! The kid on the box is having the time of his life…

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5 days ago · 11 likes · Morgan Hitzig, Evan Loomis, and Jordan Blashek

Robert Asselin

The Missing Innovation Foundation of Canada’s Defence Industrial Strategy

Canada’s new Defence Industrial Strategy (DIS) marks an important shift in how we think about national security and economic sovereignty. Its premise is compelling: in an era of technological competition, sovereignty depends not simply on the military equipment a country buys, but on what it can design, develop, produce, and sustain. Ultimately, these a…

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6 days ago · 2 likes · 1 comment · Robert Asselin

🍁 Meanwhile, $80,000 hands the tax office’s guards to an ICE contractor. The CRA moved a $12 million multi-year security contract from the Commissionaires, the not-for-profit founded in 1925 to employ veterans, to the Canadian subsidiary of Allied Universal. Brian Lilley broke it: a firm making tens of millions off ICE and other U.S. agencies beat a Canadian veterans’ institution by just $80,000, less than 1% of the contract, months after the Commissionaires lost their right of first refusal on most federal work. Wayne Long’s defence in the House: “The process resulted in the selection of a qualified Canadian supplier.” Xona counts as sovereign because its control room is in Montréal. Allied Universal counts as Canadian because its subsidiary is registered here. Both pass the test as written.

🍁 NordSpace signs DND’s first launch-pad deal: $20M over 10 years. The facility access agreement gives DND priority access to a dedicated pad at the Atlantic Spaceport Complex in St. Lawrence, N.L., and covers upkeep and standby readiness only, with missions contracted separately. The target: put a DND payload on an Aquila bus, launch it on Tundra and operate it in orbit within 24 to 72 hours of call-up, against 27 hours for the U.S. Space Force’s VICTUS NOX in 2023. Its Terra Nova satellite is already in orbit. BetaKit notes the suborbital Taiga has hit technical setbacks and is waiting on regulators, while SpaceX signals Falcon 9 rides may get scarcer or stop. Rahul Goel’s definition of sovereign: “That capability is only possible if a Canadian company owns the full stack from launch vehicle to launch pad.”

The Hard Part

Alex Kolicich: The Quiet Force

I am scootering down the Embarcadero on a sunny Tuesday in late August. My San Francisco friends tell me this is unusual after a summer of cloud and fog. I pass under the Bay Bridge, cruise by the Ferry Building and follow the water toward one of the old piers…

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5 days ago · 11 likes · Evan McCann

🍁 Reaction Dynamics wants $350M to reach orbit twice. The Longueuil rocket maker plans Borealis, a six-tonne-to-orbit medium lifter, by 2031, after the light-lift Aurora flies from Canso in 2028. The plan: a $70 million to $100 million CAD Series B, then $200 million to $250 million, headcount from 68 to 350 and floor space from 60,000 to 375,000 square feet, on $50 million raised so far plus $8.3 million from IDEaS Launch the North. It claims 10 customer agreements and LOIs and says SpaceX is turning away launch customers past 2028. Bachar Elzein: “Canada should be able to reach orbit on its own terms.”

🍁 Telesat’s lenders offer $3.2B and a deadline. Silver Point, GoldenTree and Sound Point put a $3.2 billion rescue on the table, $1.7 billion in new equity and $1.5 billion in debt, with shares offered at $31.50, about half Monday’s close. The stock fell almost 10%. Telesat GEO owes about $2.4 billion with the first payment due December 6 and held $160.8 million in cash at the end of June. The lenders are also suing over the transfer of 62% of Lightspeed outside their collateral. The 1991 Telesat Act says no insolvency law applies and the company cannot be wound up without an Act of Parliament. This is the same company holding Ottawa’s $2.3 billion Arctic military connectivity contract.

🍁 The banks want in. BMO is leaning into defence with a new enterprise chair, Michael Bonner, on top of up to $70 billion over 10 years announced in September, and its economists put the 5% of GDP pledge at about $150 billion a year in economic impact by 2035. Darryl White on deal flow: “I don’t think we’re there yet.” JPMorgan put $5 billion into startups in year one of its security initiative, halfway to $10 billion, including the Hadrian ($1.4 billion) and Castelion ($1 billion) rounds, and has expanded the program to Canada. Marc Andersen argues that a $1.5 trillion budget still needs a national security capital strategy to pull in private money before the window closes.

The Air Force buys a $333M hacker-hunting kit off a video-pitch marketplace. HII’s Enlighten IT Consulting won a $332.8 million firm-fixed-price contract to tie the Integrated Defensive Cyber System into the Common Runtime Stack for Data, part of Cyber Command’s Joint Cyber Warfighting Architecture, so defenders process network data at the edge instead of shipping every byte to a central data centre. Seven offers, work through 2032, Space Force money in the mix. The buy went through a Commercial Solutions Opening on Tradewinds, where companies often pitch with short videos. A third of a billion dollars, bought the fast way.

Anduril at $90B is priced as one-third software company. Kyle Briggs breaks down the October 13 tender that let employees in 16 countries sell up to $1.3 billion of stock at $94.80 a share: about 20 times sales, against 1.9 times for Northrop, on a projected $4.3 billion in 2026 revenue and a $1.2 billion operating loss. Only about a quarter of that projection traces to named contracts, and identifiable Lattice work totals about $50 million, roughly 1%. To triple late money in five years, Anduril needs about $31 billion in revenue by 2031, growing 49% a year. Its factory stack keeps raising too: Arda, founded by ex-OpenAI research chief Bob McGrew, emerged from stealth with $232 million, including a $160 million Series A at $1.5 billion from Altimeter, Accel and Khosla, with Anduril as first customer. Work instructions that took 10 hours now take 15 minutes. Anduril COO Matt Grimm: “We would be behind on our production goals without it.”

Helsing buys into its rival. Germany’s Helsing agreed to fund and partner with Destinus, the Dutch cruise missile and drone maker, taking a minority stake in a round valuing it at around €6 billion ($6.7 billion). Europe’s champions are consolidating before most of Canada’s have raised a Series B.

Interceptors and rocket motors scale up. Long Wall, the former ABL Space Systems, won a $75 million Missile Defense Agency contract to finish flight testing Cyclops, its low-cost interceptor, and will match it with $75 million of its own. CSIS counts U.S. Patriot inventories below 1,000, THAAD near 250 and SM-3 near 410, with legacy interceptors costing up to about $30 million each. L3Harris opened a Camden, Arkansas plant to double GMLRS motor output, one motor every nine minutes, after a record $250 million Lockheed follow-on, while the Army has floated 133,014 GMLRS rockets by 2034. The stockpile problem is now a factory problem.

Laowai -- Tyler Johnson

#103 -- The Pentagon Is Going Direct. The Middlemen Should Worry

Michael Dell coined the direct business model in the 90s and shattered the tech industry. By going direct to the end user, Dell vacuumed up the competition and changed the distribution and channel models for the tech industry. The direct business model drove market share and made many retailers and middlemen obsolete. (Ironically, the majority of Del…

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3 days ago · 1 like · Laowai -- Tyler Johnson

Related: POLITICO Europe finds Britain’s defence industry has a private investment problem, with 42 U.S. defence VC funds against “three, arguably four” credible early-stage investors in Europe, $19.6 billion raised by U.S. firms against $932 million by British ones in nine months, and Revolut closing a drone maker’s account, while Vestbee maps the deeptech and generalist VCs backing Europe’s defence startups, from Kima’s €150,000 cheques to Lightspeed co-leading Helsing’s $1.8 billion Series E, which doubles as a target list for Canadian founders raising abroad.

First Breakfast

The Arms Race is Measured in Gigawatts

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5 days ago · 18 likes · Katherine Lambert

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⚔️ Combat Readiness

Pentagon reform watch. NewsNation obtained the letter that lays out a four-star Autonomous Warfare Command under Project Agincourt, run by DIU’s Owen West as CEO and Navy SEAL Senior Chief Max Strasiser as COO, with an October 1, 2027 target and products judged on competitions, exercises and real combat performance. Their thesis: “Low-cost drones have transformed the nature, pace, and economics of warfare.” Pete Newell, former head of the Army’s Rapid Equipping Force, warns that a four-star headquarters will not, by itself, make anyone faster: the Pentagon asked for $54.6 billion for autonomous warfare in FY2027 and the committees had written down about $1 billion. His metric is days from field problem to fix. DCMA’s Col. Dustin Thomas wants the Pentagon to plan to crash and replace a share of the drones it is already buying, turning training into a standing industrial exercise: “The objective shouldn’t be to enter the next war with the world’s largest warehouse of drones.” The Economist’s War Room flags the new command alongside a warning on Ukraine’s Starlink starvation, the two halves of the same lesson.

• “The U.S. has 16,876 machine shops. A staggering 83% of them operate with fewer than 20 employees, and the average machine across these facilities runs about a quarter of the time. The capacity certainly exists, but it remains heavily fragmented”:

Defense Tech and Acquisition

The Arsenal’s Missing Layer

Dan runs a machine shop in Sterling Heights, MI, equipped with ITAR-registered four- and five-axis mills; exactly the kind of shop every report on the defense industrial base says our country is shor…

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6 days ago · 17 likes · 6 comments · Stephen Rodriguez and Adar Hay

The war goes underground. The Atlantic goes into the pipes: a map shows at least 57 steel gas pipelines, most one to two metres wide, running under the front, and Ukraine’s Khartiia Corps has spent six months fighting through them on coal-mining wagons powered by electric-scooter motors, retaking about nine miles of pipeline in Operation Veles. Ukraine has retaken two pipelines. Dozens remain in Russian hands. Brig. Gen. Ihor Obolensky on why: “Day by day, the kill zone is expanding, getting wider and deadlier. So what’s the answer? You go underground.”

A JINSA report co-written by the IDF officer who ran Israel’s counter-tunnel fight after October 7 lays out what Israel’s underground war can teach other militaries, starting with treating the surface and subsurface fight as one, and a 2025 U.S. Army report already concluded American forces “may not be able to avoid a subterranean fight.” The drone kill zone pushed the infantry below ground. Sensors that cannot see there are now a capability gap.

Missile Matters — with Fabian Hoffmann

European Deep Strike? Taking Shape.

Picture: Destinus…

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2 days ago · 33 likes · 2 comments · Fabian Hoffmann, PhD

• Ukraine carried out world’s first medical evacuation of a human via drone from the battlefield the 30th mechanised brigade of Ukraine managed to save their injured comrade from a minefield.

🍁 Kit for Canada. DND plans 47 passive sensor stations from the Yukon to Alert under Project Crossbow, shipping-container units on metal legs, airlifted by Hercules and Chinook, solar and wind powered and unstaffed year round, with installs starting as early as next summer, initial capability in 2029, completion in 2032 and a 20-year life. Filings show two sites in Quttinirpaaq National Park and four in a Banks Island bird sanctuary. Sensors need people. Forbes profiles the 5,000-plus Canadian Rangers who cover roughly 70% of Canada’s territory, including a 5,200-kilometre snowmobile run across the Northwest Passage on Dominion Dynamics’ AuraNet mesh, feeding one picture to troops on the ice and to Ottawa. Col. Benoit Mainville: “Technology does not substitute for us; it serves as an additional tool in our toolkit.” Crossbow is the sensor layer. The Rangers are the network that already works.

Kate McKenna

The Bill Has Come Due On Our Chinese Drone Component Dependency

On 18 November, China hosts the leaders of the Asia-Pacific in Shenzhen for APEC (APEC). Shenzhen makes 70% of the world’s consumer drones (CGTN). The Kremlin says a Trump–Xi–Putin meeting on the sidelines has been agreed “in principle”. Ukraine is not invited …

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a day ago · 3 likes · Kate McKenna

The kill zone. Ukraine’s 3rd Army Corps twice drove armour behind Russian lines in Operation Vivaldi: four vehicles broke through, one was hit and drove out, and a second push went about 4.5 kilometres deep and dropped infantry onto Russian drone teams, who then fought nearly surrounded for days. Andrii Biletskyi: “Today, the use of armored vehicles is effectively a special operation.” The same lesson hit the U.S. Army at Hohenfels, where a detachment of Ukraine’s 412th “Nemesis” regiment caused about 70% of a U.S. armoured brigade’s casualties in three days, with more than 750 drone contacts in roughly 10 days, before Greywolf adapted, fielded 700-plus drones of its own and got drone casualties below 30%. The officers’ estimate: 60% of brigade counter-drone is fieldcraft and drills. Armour is not dead. It now moves only as a planned raid under a drone umbrella.

Ukraine's Arms Monitor

The Rise of Amphibious Drones in Ukraine

Ukraine recently saw its first amphibious drone logistics mission. Rather than an isolated case, it marks the emergence of a growing sector: amphibious drones that can cross both land and water. For now, they are designed for logistics and evacuation missions, with strike…

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6 days ago · 44 likes · 1 comment · Olena Kryzhanivska

Counter-drone. Reuters, via Defense News, finds Europe weighing powers for utilities and infrastructure firms to bring down drones: France passed an August law letting approved operators like EDF and SNCF detect, jam and shoot, has catalogued 17 counter-drone systems and three integrators, and wants vital sites equipped by 2027. Austria is following, Poland already lets operator security units take down drones, and Germany still treats it as policing. Eurelectric’s Kristian Ruby: “there could be heating outages this winter due to hybrid attacks.” Fingrid’s CEO calls handing operators those powers “a very, very big change,” and Rheinmetall calls the segment “very fast-growing.” Liability is the blocker: nobody wants to be the utility whose interceptor drops a drone on a house.

• Counter-UAS has a signature problem: Repeated flights can reveal a pattern of response

• What if drones could operate longer without needing to recharge?

• The Canadian Armed Forces is asking industry how to protect its bases across Canada from drones

The off switch. For a week from October 14, Ukrainian drones flying faster than 100 mph lost their Starshield link, and Dmitri Alperovitch said “They are losing drones.” The WSJ reports Trump called Musk and asked him to lift the restrictions. By Saturday, Kyiv said both services were back above 400 kph. Reuters reported the throttle order came from inside the White House, and Musk said Ukraine “violated Starlink terms of service” with offensive strikes. It has happened before. Reuters reconstructed how Musk ordered at least 100 terminals switched off around Kherson in 2022. Kyiv has now signed a letter of intent with Nokia and ICEYE for its own satellite communications. Zelenskyy: “We must all rely on capabilities that we can control.”

🍁 Space. David McGuinty says Ottawa signed more than $3 billion in space contracts and agreements over the past year, including $2.3 billion to Telesat for Arctic military connectivity, $688 million to MDA for a radar satellite and the $105 million Launch the North program. New this week: $17.9 million in IDEaS satcom money, $4.7 million of it to Kepler for laser crosslinks, and a new Space Mission Operator trade with a first cohort of 25. McGuinty: “Canada cannot afford to depend on capabilities that we can’t access, that we can’t protect, or that we can’t replace when we need them most.”

🍁 NORAD’s quiet crack. The Atlantic reports that Canada now struggles to find senior officers willing to take U.S. postings at NORAD and other integrated commands, over career risk, shrinking access and families who do not want to cross the border. One officer: “will you use one of them to take up a position in the States, where you might be underemployed, with little access and little meaningful work to show for it?” David Perry: “The day-to-day relationship has deteriorated.” Almost half of Canadians now call the U.S. an enemy or potential threat. Former CDS Wayne Eyre calls it U.S. “self-harm.”

Industrial Base Alpha

⬟ Aevex

One news article erased $591 million in Aevex’s enterprise value overnight…

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a day ago · 5 likes · Matthew Bernard

🍁 Casualty math. The fire at Wainwright that killed four and wounded 39 soldiers filled a 100-bed hospital with burn patients and exposed what two years of civil-military war games already showed: the CAF has no burn surgeons, relies on a civilian system running at capacity, and imports most of its tissue from the U.S. Canada has 15 tissue organizations to America’s 100-plus. Surgeon General Maj.-Gen. Scott Malcolm: “We simply don’t produce enough tissue in Canada, right now, in peacetime, to meet our demands.” He wants every tissue bank to hold about 1.5 million square centimetres of skin, roughly 11 parking spaces, which Héma-Québec says treats 75 to 150 severely burned patients at once.

Mind of Things

Everything Looks Like a Nail When You Have a Railgun

Technology fills our lives to the point of ubiquity. If you read certain corners of the internet, Substack included, you will hear calls for us to move away from technology and toward a more analog life. This is understandable, given the issues that the adoption of transformative technologies has caused in society. We have…

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2 days ago · 21 likes · 2 comments · Justin Mc

Sensor to shooter. Brig. Gen. Steven Carpenter of Multi-Domain Command Europe tells War on the Rocks that his soldiers ran the full high-altitude balloon kill chain themselves in Arcane Thunder, more than 20 balloons, and that the hard part is filtering 99% of the noise so the right shooter gets the target. His pitch advice: if an adversary fires a $2 million interceptor at your $50,000 drone, “we win that exchange,” and the gap is attritable, reliable Group III drones. The data plumbing is the real fight. Anduril’s first NGC2 integration with the 25th Infantry Division in Hawaii ran into growing pains with legacy radios, with Lockheed’s Chandra Marshall admitting “some people are surprised at how much of a challenge it has been.” Brig. Gen. Shane Taylor: “It wasn’t seamless, and we learned a lot.” Every army fields onto legacy kit. Integration is the product.

Data centres are targets. Klaudia Klonowska and Michael Schmitt lay out the defender’s legal duty to protect civilians around military data centres: Russian strikes damaged at least six Ukrainian data centres in late September, one Kyiv attack killed four, Ukraine hit three Yandex sites and a Sberbank build, and Iranian strikes set AWS facilities in Bahrain and the UAE on fire. France now runs its Arcadia command platform from an underground data centre at Mont-Valérien, and the Dutch are building a sovereign military cloud. Every commercial cloud hosting military workloads is now a dual-use target.

Europe rearms, the Nordics first. UnHerd’s Lily Lynch documents how neutrality became a distant memory: U.S. forces now have “unimpeded access” to 47 Nordic bases, Finland finished a 200-kilometre border fence and lifted its blanket ban on nuclear weapons, and Imatra lost its Russian tourists and sits at 16.4% unemployment. Finland plans to build about a million anti-personnel mines for around $110 million, domestic production from 2028, every conscript trained to use them, after leaving the Ottawa Convention in January. Poland, Lithuania, Latvia and Estonia are leaving too. The treaty carries this city’s name. NATO’s front line is walking away from it.

• Billions in Backlog, Three Chokepoints: Where Defence Production Is Stuck

🍁 Counter-drone, Suffield edition. Canadian Defence Review’s Richard Nghiem reports that IDEaS’ 2026 counter-drone sandbox at CFB Suffield shifted from detection to defeat. It brought 22 innovators from six countries and up to C$1.75 million in prizes. The scenarios: a 2.5-kilometre airbase perimeter, a five-vehicle convoy and an infantry squad on foot. Ukrainian air defence officer Sergiy Kuzyara: “Even small drones that can be assembled by a teenager can harm infrastructure that is critical for Canada.” The Canadian Press, reporting from Latvia, finds that countermeasures now arrive in about six weeks, and Riga’s Janis Kazocins warns against buying Ukraine’s best drones and warehousing them. Helsing’s answer is Contra, an AI air-defence system with two container-launched interceptors: the jet-powered AD-1 Inferno and the Mach 2.5 AD-2 Ambush. Niklas Köhler on the dilemma it replaces: “slow fair-weather drones, or million-euro missiles fired at cheap, mass-produced targets.”

🍁 The navy moves ashore. Capt(N) Chris Taitt says the RCN will move command of maritime operations to operations centres on land. It can no longer assume control of the spectrum it uses to command ships in the Pacific or Atlantic. He calls it “the most fundamental rethink since at least CF transformation in 2005” and the data problem “absolutely immense.” The secure digital backbone this needs is the industry opportunity. ReadyAyeReady maps where autonomy fits in guarding Canada’s approaches:

• Kraken mine countermeasures kits for each coast

• MDA drones on Halifax-class frigates by 2028

• The two big underwater surveillance programs not due until the mid-2030s, with sailors still running one vehicle each

Middle powers hedge. Carney announced a strategic trade and defence partnership with Turkey and toured Baykar, maker of the TB2. He held up an industry that builds about 80% of its own kit: “This is not the case in Canada.” The baggage: Wescam cameras were diverted to Azerbaijan in 2020, and export permits stay case by case. Finland is doing the same with Ukraine. Sine Engineering, which supplies GPS-free navigation software to about 200 Ukrainian drone makers, launched a joint R&D initiative to build in Finland, as Kyiv and Helsinki signed seven deals worth €330 million. Ukraine is trading its combat know-how for factories and engineers abroad.

Shadow war. POLITICO reports the Pentagon is quietly building an elite technology sabotage agency, the Technology Support Office, set up by Steve Feinberg’s April 14 memo, merging two classified programs, building hacking tools and planning deception operations to get adversaries to install faulty components, with classified contracts likely “north of $1.5 billion.” Cyber Command and SOCOM both objected. The other side runs its own playbook. A joint alert co-signed by Global Affairs Canada and the RCMP warns that North Korean IT workers pose as foreign nationals to fund weapons programs, using AI, proxies and U.S. “laptop farms,” with red flags including refusing video calls, below-market rates and asking for crypto.

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🔫 Hot Shots

🍁 Getting defence ready takes a year. Plant’s Mari-Len De Guzman walks SMEs through the certifications, clearances and capital it takes to compete under the 70% Canadian content target: CPCSC level 1 takes about three months, level 2 about a year, and 123 Defence’s Jonathan Clow describes the prime’s call: “Are you certified? No. See ya.” BDC’s defence platform is now $6 billion, with RBC at $1.4 billion and CIBC at $2 billion over five years.

🍁 Watch: Eliot Pence on building Ukrainian robots in Canada. CBC Morning Live’s David Common talks with the Dominion Dynamics founder about the Tencore partnership and what it means for Canada’s drone industry.

The Pentagon wants armed drone boats in 120 days, with $300M behind it. DIU and the Pentagon’s unmanned systems office launched a sprint for production-ready counter-air USVs. The boats must carry Hellfire, JAGM, APKWS or Stinger, cover 200 nautical miles and engage targets beyond three nautical miles. Bidders get 30 days to demo, with up to $100 million in prizes and $200 million set aside for follow-on production. DIU’s framing: the cost-exchange ratio “is heavily skewed in favor of the adversary.”

🍁 Floating chargers from Vancouver Island. Langford’s Mostar Labs builds Lilypads, modular floating battery banks with sensors, the largest about 5.5 metres long with 200 kWh, already pitched to Singapore’s port and to a Coast Guard that wants lighthouses off diesel. Output goes from two a month to 30.

SOCOM wants a common software sandbox. The command is seeking an integrated contracting vehicle for a PaaS environment near MacDill so traditional and non-traditional vendors can integrate, test and get to authority to operate together. RFI responses are due November 5.

The Army will test 15 counter-drone systems in Morocco. Tan-Tan hosts up to 15 drone-defence technologies in February and March 2027, with more trials at African Lion 2027 and winners in soldiers’ hands within 180 days. The ask: spot radio-silent small drones from nearly a mile, day or night.

European founders want AGILE made permanent. A coalition of defence founders and investors, from Project A and Expeditions to KEEN and Nordic Air Defence, wrote to Kubilius, Costa and Metsola on October 23 asking for continuous AGILE funding across the 2028 to 2034 budget after its 2027 pilot. Their line: “A programme renewed in stops-and-starts loses the agility it was created to deliver.”

Quantum needs a warfighter’s scorecard. After the Pentagon’s October 8 package of about $350 million, including $200 million for DARPA and a conditional loan of up to $150 million for PsiQuantum, Burak Oktenli shows how two dashboards can both read 83.3% post-quantum migration while one mission still fails on a single shared dependency. His fix: “’Not demonstrated’ needs its own status.”

The Canadian Explorers

Building Canada’s Quantum Future | Christian Weedbrook, Xanadu — Explorer Spotlight #20

Welcome to the 600 Canadian Explorers who have joined! If you aren’t subscribed, follow the Canadian founders who are building in Canada’s most critical industries by subscribing here…

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5 days ago · 1 like · Ethan Marcoux

Count ships, then weigh them. Visual Capitalist ranks the world’s militaries four ways: China fields 841 vessels to America’s 465, but the U.S. carries about 2.6 times the tonnage and flies 13,032 aircraft, more than the next four countries combined.

Warm hands, no gloves. The U.S. Army’s forearm heater boosted manual dexterity by up to 50% in Alaska field trials by pushing finger skin toward a 15°C breakpoint, since gloves cost 50% to 80% of dexterity.

🍁 CVCA and COVE build the on-ramp for defence capital. The two launched Canada's first Defence & Security Capital Markets Program. It puts angels, venture funds, private equity and pensions in a room with founders, military leaders and procurement officials, pegged to a defence budget expected to top $150 billion by 2035.

🍁 Kanata wants to build 10,000 drones a month. Robotics Centre tripled its footprint into a 70,000-square-foot Kanata plant. It is patenting flatpack drones that go together in 10 minutes with a multi-tool and zip ties, though it has no Canadian contract for its own drones yet. Carp’s AVSS grew from 20 to over 50 staff after a Defence Drone Initiative contract awarded in weeks. Josh Ogden on companies assembling licensed foreign designs: “If you assemble Ikea furniture, are you suddenly a furniture manufacturer?”

And the closer: cloned war dogs. Ben Lamm’s Warhound emerged from stealth with $200 million at a $1.2 billion valuation from Sequoia, 8VC, Corner Ventures and In-Q-Tel to gene-edit and clone Belgian Malinois and German Shepherds, suited up in Anduril vests and goggles, because more than 80% of U.S. military working dogs come from Europe and less than half are fit for service. First litters arrive early next year. Lamm on where the hardware goes: “on top of the dog, not in the dog.”

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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🎯 Three-Shot Burst

The Shahed runs on American chips. Engineers from Ukraine’s 1230th Athena Engineering and Technical Regiment pulled a Geran-4 (part of the Shahed drone family) flight controller out of wreckage in Poltava region and counted 105 identifiable components, at least 80 of them made in the United States, or 76.2%. Texas Instruments and National Semiconductor alone account for 61 parts. Not one Russian-made chip turned up.

Ukraine’s Defence Intelligence puts output at about 3,000 Geran-4/5s and 2,800 Geran-2s a month, which means 183,000 TI and National Semiconductor parts a month for this one controller and roughly €1.4 million a month in TI revenue at distributor prices.

Michael Horowitz and Lauren Kahn’s new taxonomy for CFR files Iran’s Shahed-136 as semi-autonomous without human supervision, the same bucket as radar-guided missiles that have flown since the 1960s, and puts Russia’s Geran-4 Seeker in the supervised column. Their five-type chart is the cleanest visual of the week, and their line cuts through a decade of Geneva talks: “The question isn’t, ‘Is it autonomous?’ but rather, ‘How autonomous is it?’” The recipe is spreading. Yasir Zaidan shows in War on the Rocks how Sudan became a laboratory for drone warfare thanks to Abu Dhabi: Chinese CH-95 or FH-95 drones at Nyala with 250 km of range, more than 1,100 civilians killed by drones between January and June 2026, about 80% of recorded civilian deaths, and $14 billion in electricity losses. Zaidan: “The threat here is about knowledge transfer.”

In Yemen, the knowledge now comes from a chatbot. Anthropic disclosed that a northern Yemen cell used Claude in place of human weapons engineers to write guidance, navigation and control code for a guided rocket on a phone-class flight computer, a ballistic missile with a 2,000 km range goal and an “R2000” set with a hypersonic glide variant. A UK investigative group’s mapping of Houthi procurement traces custom missile components, tools and test equipment to a Chinese supplier, which the Critical Threats Project ties to a domestic Kheybar Shekan variant. Iran’s own lines are flattened but not finished: FPRI’s satellite survey finds Parchin, Khojir and Shahroud strewn with rubble after Epic Fury, yet tunnelling at Shahroud continues and any site could be producing again within a year if Tehran sources new planetary mixers.

• An Iranian navigation system, Western electronics, and a Russian-made Shahed. Here’s what I found inside.

Industrial Base Alpha

⬟ Affordable Mass

The runner-up for most interesting headline this week for me goes to the Army’s selection of four companies, including Furientis, to compete in the 2027 IFPC Inc 2 interceptor fly-off. Furientis is fresh off a $25 million seed round and is one of several new companies getting into the interceptor business…

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12 days ago · 3 likes · 4 comments · Matthew Bernard

A $5 million interceptor against a drone that costs tens of thousands. At DND’s fourth Counter-Uncrewed Aircraft Sandbox at Suffield, two dozen companies competed for a $1 million prize while Ukrainian Maj. Sergiy Kuzyara laid out the problem: Shaheds fly more than 2,000 km, and the new jet versions cruise with older models at about 180 km/h before more than doubling their speed. “But they switched to jet-powered and so we need to use something new: jet-powered interceptors or missiles.”

Calgary’s North Vector Dynamics answered with a metre-long, laser-guided missile built for jet Shaheds that brushed its target in a CBC-witnessed test, St. John’s StrobelTEK brought an optically guided anti-swarm missile, Colt Canada showed a proximity-fused 12-gauge round, and 2024 winner AIM Defence used its $1 million to open a 10-person Canadian division.

Reality check: A Patriot PAC-3 costs $5 million Cdn, and that is what the US and Gulf states fired at cheap Iranian drones at the start of the Iran war. Washington’s cheaper answer moved at wartime speed. The Army made Merops a program of record in 142 days, bought 13,000 interceptors within about eight days of the Iran war starting at roughly $15,000 each, with $3,000 to $5,000 possible at volume, and landed them with two NATO partners in 21 or 22 days against a 14-day ask.

The gap is widening. NATO's transformation commander, French Adm. Pierre Vandier, told CBC in Ottawa that interception rates against some Russian drones have fallen from about 90% earlier this year to roughly 50% as faster jet-powered models arrive, and that the West must now "produce what we can produce in mass and rapidly."

One rung up, Anduril’s Steelfin is a two-stage interceptor family built to come off one line by the several thousand a year, compatible with M903A2, Mk 41 and Typhon launchers, with flight tests next year. Axios’s AUSA roundup adds Chaos Industries’ Vespid interceptors with initial production of 12,000 and Raytheon’s Coyote Block 2C+RM.

The cheapest layer is a shotgun: The Economist watched about 100 British soldiers in Wiltshire turn clay-pigeon shooting into drone-defence training, 100 targets each. The quietest layer is the spectrum: The WSJ reports Ukraine’s Night Watch unit spoofed two Russian ballistic missiles into the Dnipro with its Lima system, while Russian drones answered with Chinese anti-jam antenna arrays that went from four elements to 32. US Col. Josh Koslov: “If you are not winning in the spectrum, you are going to lose the war.”

The threat is already over allied soil. CBC counts more than 1,000 suspicious drone incidents in Germany since January 2025, 261 airport disruptions there in eight months, up 80%, and more than 300 in Norway. KNDS’s Marcel Grisnigt wants Europe to let arms makers take down drones over their own plants, weeks after Estonia blamed Russian intelligence for an arson attack on Milrem Robotics: “if defence capacity is interrupted by hybrid warfare, then we won’t be ready in 2030.”

Europe is paying, and America is collecting. Publicus counts European counter-drone awards rising from 2 in 2021 to 16 in 2025, with US firms taking about €1.1 billion in disclosed awards. Canada has a homegrown entry. Sentinel AMS’s StarForge consortium, backed by a $10 million Lockheed Martin ITB tied to Canada’s 26 HIMARS and the University of Alberta, packs radar and a drone factory into a 20-foot container. Its first drones will be unarmed interceptors that kill by collision, with 65-plus Skunk Works engineers in Calgary behind the software, US Marines already training on it and Baltic trials next spring. CTO Ed Zimmermann: “designs and tactics are changing monthly, even weekly.” Canada’s own forces are still not listed as a customer.

• Russia calls its Geran-4 attack drone a product of domestic manufacturing. Its electronics tell a very different story

• Blackstone is building an interceptor platform

Mass is a factory problem. Hadrian signed a seven-year deal to run a “factory within a factory” inside Lockheed Martin’s missile plant in Grand Prairie, Texas: 24 machines making components for PAC-3 MSE, THAAD, PrSM and GMLRS, live by January, with 24 more in Arizona running lights-out for overflow. It lands as Lockheed works through more than $60 billion in Pentagon deals to triple PAC-3 output from 600 to 2,000 a year. Hadrian has raised $2.34 billion, the last round at a $7.87 billion valuation.

“This is the first time a defense prime has really partnered with a new, innovative manufacturing technology company like Hadrian in a service agreement.” - CEO Chris Power

Lockheed CEO Jim Taiclet and acquisition chief Michael Duffey sat down with CNBC’s Morgan Brennan to walk through stockpiles and the Pentagon’s missile contract spree, the same week L3Harris won $250 million from Lockheed for GMLRS rocket motors in Camden, Arkansas. Then the US did the obvious thing and copied the Shahed. CNAS’s Philip Sheers and Stacie Pettyjohn price the LUCAS one-way attack drone at about $35,000 against $2 million for a JASSM-ER, and model a selective strike on China’s Huian Air Base at 235 LUCAS-ERs and 8 JASSM-ERs for $39.5 million. Their summary: “The world’s foremost defense innovator and top weapons provider has now copied an adversary’s relatively simple kamikaze drone built from commercial components.”

The Pentagon wants more than 10,000 low-cost munitions in three years. Ukraine shows what Shahed-style mass does on offence. The Washington Post mapped 54 strikes between April and August that took half of Russia’s refining capacity offline by aiming at distillation units that sanctions make hard to repair. The target list is widening. After Russian drones knocked out Ukrainian data centres serving up to 100,000 Kyiv households, Ukraine hit three Yandex data centres in four days, including the site housing two of the supercomputers that train YandexGPT.

RealClearMarkets tallies a new class of defence investor: JPMorgan’s $1.5 trillion Security and Resiliency Initiative, Lockheed in $4.1 billion of venture rounds this year, the US Navy’s $900 million into Hadrian and BDC’s $500 million Defence Fund.

CIBC Innovation Banking’s Paul McKinlay and Corporate Finance’s Evan Bennitt take the question home in a new video on what Canada’s Defence Industrial Strategy holds for investors, the right primer for anyone underwriting a Canadian line. The missing Canadian piece finally has a meeting. CGAI’s Prairie Shield series will hold a December 10 workshop at KPMG Ottawa on building Canada’s sovereign missile capability, under Chatham House rules. Canada has promised millions of drones. It has not promised an interceptor line.

Bottom Line: The Shahed is not a drone. It is a supply chain, a price point and a production rate. It runs on 80 American chips, its offensive copies run Ukraine’s refinery campaign, and the US now builds its own at $35,000. Killing one costs $15,000 with Merops or $5 million with a Patriot, and the winner is whoever owns the factory behind the cheaper shot.

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🤝 Deal Corner

💭 When does a neoprime become a prime? Investor Sam Burrell flagged that Anduril cannot start FQ-44 Fury production under its CCA contract until Congress passes a 2027 budget, four months after it beat Boeing, Lockheed and Northrop to become the first new entrant to win a fighter program since the 1970s:

“The situation raises a few questions. When does a neoprime become, just, a prime? Does the product-first model actually transfer to exquisite platforms, or only to attritable ones? And is there a version of this where the neoprime changes the customer rather than the customer changing the neoprime?”

This week offers partial answers: Steelfin is product-first at attritable scale, Hadrian is a neoprime working inside a prime’s factory, and Merops shows the customer can change when it wants to, 142 days to a program of record.

• Jackson Moses: Sellers need buyer dollars to operate

🍁 Dominion Dynamics will build Ukraine’s TerMIT robots in Canada. The Ottawa firm signed an MOU at AUSA with Tencore to produce the tracked TerMIT ground drone in Canada as early as 2027, running Dominion’s AuraNet command-and-control software, for resupply and mine-laying on Ukraine’s front. BetaKit adds that Tencore claims more than 5,000 UGVs delivered since 2024, Dominion has raised $169 million CAD including a $139 million Series A, and an Arctic-hardened variant is planned for Canada and NATO export.

🍁 CSG becomes MDA Space’s largest shareholder with a $434M stake. The Czech arms group bought 9.5% of MDA Space through a dedicated subsidiary as its entry into space.

🍁 Rozvelt raises $3.1M to take a hunting mask to war. The Montreal startup's Vektr headgear hides a hunter's exhaled scent. After SHOT Show, defence firms asked for a version that also filters inhaled lead and other particles, so Rozvelt closed a $3.1 million seed round led by Evovest's Benoit Robert to build military, police and first-responder lines and to start Canadian production this fall.

🍁 RBC sizes a US$10B launch market Canada could chase. RBC's Mission Critical report finds at least US$10 billion in launch demand open to Canadian rockets between 2027 and 2035, out of a global market worth up to US$265 billion. It argues defence should anchor the spending, because military satellites cost five times as much to build and launch and will make up nearly half the value of the decade's satellites.

🍁 Tenstorrent raises US$1.5B at a US$6.2B valuation. The Toronto-founded AI chipmaker closed a US$1.5 billion round led by Trace Capital and Innovation X, with ARK Invest, Fidelity, Morgan Stanley and T. Rowe Price in the syndicate. That comes months after Intel and Qualcomm reportedly each offered more than US$5 billion to buy it. The catch is that Tenstorrent moved its headquarters to Austin in 2023, Toronto now holds 200 of its 1,000 employees, and co-founder Ljubisa Bajic's Toronto spinout Taalas went to AMD in August. Export Development Canada backed it early, and Canada still lost the head office.

🍁 NRC IRAP has put $135M into defence and dual-use SMEs since January. Defence Industry Assist, launched with $241 million, has backed 860 SMEs and more than 540 projects and supported 2,300 jobs across all 10 sovereign capability areas. Canadian Defence Review notes 79% of recipients have fewer than 50 employees and half are under ten years old. Small cheques, wide net, and the first program this year to show real volume.

🍁 49North hands TerraSense a slice of the RPAS program. A TerraSense-led consortium with UBC’s STAR initiative and KF Aerospace will fly EO/IR collection over the Strait of Georgia to train automated target classification for the RCAF’s 11 CQ-9B Guardians, due by 2028, under 49North’s $78.2 million GA-ASI contract. Build-Partner-Buy, with the Canadian part doing the data work.

🍁 CSA’s tech fund hits its smallest round since 2014. STDP AO 10 split $11 million across 15 companies and 16 projects, with $1 million cheques to Kepler, MDA, MPB, NordSpace and Obruta and $860,000 left unawarded.

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🍁 Canadian space and defence names head for Bay Street. NorthStar Earth & Space won conditional TSX approval to list as NSTR after a SPAC merger where 96% of Viking’s public holders redeemed, leaving about C$32.5 million, most of it PIPE money, against roughly C$17 million owed to Spire after a July arbitration loss. Maritime Launch also won conditional approval to move MAXQ to the TSX with Isar’s Spectrum complex under construction and a 2028 first launch targeted. Harjit Sajjan and Hunter Scharfe’s Juno Industries is taking over capital pool company Trail Blazer to list on the TSXV as JUNO, last traded at C$0.075. NordSpace, meanwhile, broke ground on Phase 2 of its Newfoundland spaceport using $10 million split between the company, ACOA and a provincial loan that is three-quarters forgivable at 100 jobs. Public money is going to be the test for these balance sheets.

Missile Matters — with Fabian Hoffmann

U.S. Space-Based Ballistic Missile Early Warning and Ukraine

Picture: Northrop Grumman…

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13 days ago · 89 likes · 9 comments · Fabian Hoffmann, PhD

🍁 Flavio Volpe wants $1B to turn auto plants into vehicle lines. APMA’s president is pitching Project Arrow Defence Industries to build military vehicles with Hanwha tech and partners like Linamar and Martinrea, one of 167 ventures in the Canada Investment Summit deal book.

Dominion Dynamics CEO makes the historical case that Canada retooled its factories for war in 1938 and Trump’s tariffs give it reason to do it again.

The Canadian Explorers

Build in Canada: October’s Startup Opportunities.

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18 days ago · 2 likes · 2 comments · Ethan Marcoux

Sensors and space radar raise $39M. Austin Sensing Company emerged from stealth with $15 million, led by Bow Capital’s $11 million seed, for an RF detector covering 28 square miles per unit that already sits with more than 40 US police and fire departments. Seattle’s Kapta Space took a $24 million Series A led by Washington Harbour Partners for metamaterial radar payloads that track moving targets from orbit. Gallatin AI’s $50 million Series A for logistics software rounds out the week, and PitchBook puts global defence-tech VC at $67.4 billion so far this year.

Britain’s sovereign AI fund backs Augur. The £500 million fund, which writes £5 million to £10 million cheques, invested an undisclosed amount in the ex-Palantir founders’ security startup and gave it time on the Isambard-AI supercomputer.

NATO’s fund goes east, and so does a Ukraine-first seed fund. The NATO Innovation Fund opened a Warsaw branch under Jan Duthel to chase procurement and deal flow in a region where it has yet to back a single startup directly. WildField Ventures is raising a $10M to $15M dual-use fund with $250,000 first cheques, three-quarters for Ukraine and an explicit ban on weapons, munitions and finished drones. Components, sensing and compute are where the next round of Ukrainian value sits.

Washington wires small-business capital into the arsenal. The Pentagon and SBA signed a deal to route Economic Defense Unit referrals into SBA-backed funds under the new Smaller War Plants Commission, aimed at munitions and critical minerals. SBA’s Kelly Loeffler says small manufacturers make up 70% of the defence industrial base. Congress already raised SBIC leverage limits this year and wants more private-market managers in the program.

The Free Press

America’s Munitions Mess Is Even Worse Than You Think

The war with Iran is stalemated, in part due to a shortage of munitions available to the U.S. military. If this situation is not a full-blown crisis, it is certainly a scandal, and many observers have drawn the conclusion that these shortages would make deterring a potential Chinese effort to take control of Taiwan more difficult…

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3 months ago · 88 likes · 170 comments · Aaron MacLean

Related: Resilience Media asks whether there is a defence tech bubble and gets a “hard no” from JPMorgan’s Daniel Rudnicki Schlumberger, who puts European military-tech spending at 0.02% of GDP, while Sifted reports VCs catching founders misrepresenting or blurring their defence revenue, Kyle Briggs shows the $1 trillion US budget has only a $91 billion front door for new entrants, and cyber is on pace for a record year of M&A with 219 deals in the first half.

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⚔️ Combat Readiness

The golden hour is gone. In-Q-Tel’s medical team writes that in Ukraine, moving a wounded soldier to advanced care can take days, sometimes more than a week, against about an hour in Iraq and Afghanistan, so field kit has to run for days on end, survive mud and drops, and hide its heat, light and radio signature. Their fix is to put early-stage med-tech in front of operators before the design freezes, because lab validation “tells you almost nothing about whether it’ll survive a rucksack, a firefight, or 48 straight hours of use.” The New York Times shows why. Two soldiers of the 128th Heavy Mechanized Brigade spent more than 200 days in a 200-square-foot ruin inside the kill zone, walked six miles over four days to get out, and each lost 40 pounds while Russian drones flew 678 resupply sorties in a single day nearby. Strike range grew from a few miles in 2024 to 20 miles for most drones and 40 for fixed-wing by 2026. Mykhailo: “The modern concept of war did not foresee this.”

Salt Typhoon is still inside. The joint advisory from the NSA, Canada’s Cyber Centre, CSIS and Five Eyes partners remains the playbook for China’s campaign against telecom backbone, provider-edge and customer-edge routers in Canada and worldwide since at least 2021, naming three Chinese contractors that work for the PLA and the MSS and five exploited Cisco, Ivanti and Palo Alto CVEs. Its warning: “Partial response actions may alert the actors.”

The front door is your living room: The WSJ estimates 20 million residential-proxy backdoors in cheap US home devices, and Citizen Lab and Confiant found Israeli ad firm Discover-Tech using online ads to track users and deliver Candiru spyware across 120,000 websites, with hits on networks at NATO and the Pentagon. The FBI took down more than 40 North Korean laptop farms in Texas that took 70 companies for more than $3 million, and arrested Richmond Hill’s Edward Dubrovsky, a former CYPFER executive, in the ShinyHunters extortion case, the same group that claims a petabyte from Telus Digital. Former CSIS director David Vigneault adds the next attack surface: in a Chinese EV, “everything you do around your car, will be acquired by China” as Ottawa courts Chinese joint ventures for 50,000 cars a year. Canada’s cyber exposure runs through routers, ads, payroll and parked cars.

🍁 Kit for Canada. The Army’s Minerva program is racing to buy cheap drones through prototype challenges rather than requirements lists, with Arctic surveillance drones for the Rangers capped at $500,000 per award, a wish-list due in three to four months and a separate counter-drone tender for bases. Lt.-Gen. Darcy Molstad: “We have to treat it almost like an expendable commodity.” The big-ticket file is moving the other way. Ottawa paused 16 UH-60M Black Hawks for special forces after State had already approved them, leaving 427 Squadron on 30-year-old Griffons, while Google cloud, a Raytheon trainer and HIMARS all slipped. Justin Massie: “What is changing is not so much the strategy as the political discomfort.” Retired Lt.-Gen. Alain Pelletier warns a split F-35 and Gripen fleet would stretch an RCAF that is already short of pilots and technicians: “You cannot duplicate people. You cannot clone people.”

🍁 Money is not readiness. Even as defence climbs from $75 billion toward $95.6 billion by 2030, Treasury Board is weighing 10% cuts to DND operating spending, the 2023 cuts of $810 million then $908 million a year still apply, readiness sits at 61.3%, and only one of four Victoria-class subs works. Retired Lt.-Gen. Andrew Leslie: “do not cut operations, training and maintenance because that is the lifeblood of the military.” Benchmark Canada puts Canada 28th of 31 allies on equipment share and 29th of 30 on troops per capita, and retired Vice-Adm. Mark Norman calls it a defence-spending quagmire where “time literally is money”. Scotiabank’s Rebekah Young adds that hitting 5% means about $30 billion a year in new security infrastructure, with a blunt verdict: “Canada has simply never built at this pace.” The Globe’s Ottawa forum framed the same 5% as up to $150 billion in annual investment. The money is arriving faster than the military can absorb it.

🍁 Procurement plumbing. Blakes reads Bill C-40 as sweeping changes to Canada’s defence procurement regime: a Crown corporation for the Defence Investment Agency, an associate minister for procurement, non-competitive authority, lending without Finance’s sign-off and DNSPPA records carved out of access to information. Procurement Ombud Alexander Jeglic flags the catch, since C-40 does not extend his mandate to the new Crown, and “there’s a danger in removing transparency” when the money moves. His annual report, themed Time for Results, logged a record 851 cases, up 27%, with complexity cited 150 times and e-procurement complaints up 127%, and the government-wide chief procurement officer he calls the most critical fix still does not exist. Jeglic: "the success of procurement reform will be measured not by new initiatives launched, but by outcomes delivered."

The Canadian Explorers

The Data Between the Machines | Michael Nelson, TACTIQL — Explorer Spotlight #19

Welcome to the 559 Canadian Explorers who have joined! If you aren’t subscribed, follow the Canadian founders who are building in Canada’s most critical industries by subscribing here…

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16 days ago · 2 likes · Ethan Marcoux

🍁 Software sovereignty. Dominion’s Eliot Pence and Matt Clancey argue in the Financial Post that there is no sovereignty without software, noting the RCN’s first operational autonomous surface vessel tender weights Canadian content at 58% while the River-class destroyers will run American Aegis code Canada cannot modify. Key line: “Canada does not need to build every ship. But we must control the systems that tell our ships what to do.”

The Theodore Roosevelt strike group deployed with a large drone ship for the first time, DIU opened the second $40 million sprint of its SWAP-USV prize for drone boats that carry drones, and NAWCAD landed a drone on a pitching deck with GPS jammed using commercial cameras and software. NAWCAD’s Peter Arslanian: “GPS is the first operational link an adversary attempts to sever.”

Single point of failure. SpaceX capped military-grade Starlink above 160 km/h in Ukraine without warning, and adviser Serhiy Beskrestnov says several missions were disrupted. The FT reports Kyiv was blindsided by the Starlink restrictions and by intelligence gaps as Russia fired 39 ballistic missiles and more than 120 drones at energy sites covered by Trump’s “energy ceasefire.”

• Starlink vs Starshield

Space. CSIS tracks Russia’s Cosmos 2612 manoeuvring into the orbital plane of an ICEYE radar satellite that supports Ukraine, after five sister satellites burned fuel to chase it in May and one came within 2.5 km. Axios says America is not ready for space war, with China past 1,400 satellites and the supply base “running hot at peak demand, yet structurally fragile.”

Washington wants 1,000 launches and reentries a year by 2030, and the US, Russia and China are racing to put nuclear reactors on the Moon, NASA’s by December 2030. Zero Point Cryogenics’ Chris Cassin points out the US is paying Interlune $6.9 million to go to the Moon for a resource Canada has at scale: helium-3 from CANDU reactors at Darlington.

Counter-drone. Daniel Weiss's Small Wars Journal essay argues counter-drone weapons have arrived, and so has the bill: firearms are the most widely used physical defence in Ukraine with the best cost per kill, Army laser production systems run an estimated $21 million to $25 million each, and the one on the southern border targeted a Border Patrol drone two weeks after firing on balloons forced a 10-day FAA closure of El Paso airspace. His verdict on lasers and microwaves: "Pennies to shoot, millions to field."

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🍁 Europe is the hedge. Matija Renčelj of the European Space Policy Institute argues space is Canada’s gateway to European collaboration: a record €407.7 million ESA pledge, von der Leyen floating EU associate membership, Kongsberg signing with MDA and Telesat, and France’s Aldoria selling space-surveillance data to the CAF’s Space Division. The Economist’s leader argues Carney shows middle powers how to handle a dangerous world, with Davos’s warning that middle powers who stand alone will “be on the menu.” Diversification is now policy.

The Atlantic asks how Canada's military buildup is actually going and finds Ottawa promising 70% of defence contracts to Canadian firms within a decade, after years of sending more than 70% of capital spending to American kit, with core spending projected to climb from about $64 billion in 2025 to $160 billion by 2035 and no financing plan.

• Bain on European defence investment

True North Strategic Review

Over $135 million invested through NRC IRAP Defence Industry Assist to help Canadian businesses develop defence and dual-use technologies

Supporting Canadian innovators to scale technologies, strengthen supply chains and compete globally…

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17 days ago · 9 likes · Noah

🍁 Home front. John Ivison reports intelligence warnings that Moscow is preparing to target executives of firms supplying drones to Ukraine, and that Canada’s Sentinel R&D was threatened with having its address made public after its Airlogix deal, “a form of intimidation that sits squarely in the information-operations tool kit.”

Shadow war. The WSJ tells how Lt. Lev Stupnikov, a 26-year-old Russian signals officer, fed Ukraine coordinates that killed more than 300 Russian soldiers, starting with a strike near Vuhledar that killed 68, including a brigade commander, before he crossed the line using the password “Peanut shop.”

Minerals and money. Lawfare’s Kirsten Asdal, Tom Koch and Tao Tan argue America did not lose its rare earth industry, it sold it, from GM’s 1995 sale of Magnequench to a Chinese-backed group to China’s current 90% grip on refining, and propose a contingent convertible bond that converts to equity if Beijing chokes supply. “Markets price for cost. China prices for control.”

The American Prospect profiles Deputy Secretary Stephen Feinberg, the Pentagon’s buyout king, whose investment units are staffed by former Cerberus executives, whose old firm backs Canada’s Torngat Metals, and whose ethics framework the Pentagon will not describe.

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🔫 Hot Shots

🍁 ONE9 teaches dual-use from problem to market. The ONE9 team is running a one-hour hybrid workshop series at Area X.O in Ottawa on investor expectations, validating capability gaps and dual-use as a deliberate go-to-market strategy, with one-on-one time with the team afterward.

🍁 DND’s MINDS grants close October 26. Targeted Engagement Grants pay up to $100,000 for defence and security research, events and publications, and the Young MINDS stream pays up to $10,000 for students. Think tanks and industry can both apply.

🍁 Six Canadian dual-use firms can go to Seoul. The Trade Commissioner Service’s Korea defence CTA special edition takes up to six companies through virtual mentoring and three days of B2B and B2G meetings in Seoul in February, with applications due November 5. Uncrewed systems and sensors get priority.

The US Army wants allied spectrum kit. G-TEAD and USAREUR-AF’s ACE 27-02 challenge is open to firms incorporated in allied countries, with $1.5 million in prizes, $6 million in OTAs and white papers due October 30. Winners in the first three areas can go straight to a Phase II SBIR through the DoD SBIR/STTR submissions portal.

🍁 The biggest Coast Guard ship ever got its keel. Seaspan laid the first hull module of CCGS Imnaryuaq, a 158-metre Polar Class 2 icebreaker due in 2032, with an Inuit Nunangat coin set into the hull for luck. Davie’s Arpatuuq is being built in Helsinki.

🍁 Zeal Motor’s Fat Trucks found a defence market. The Bromont firm’s Arctic trial vehicles came home with no major breakdowns and no spare parts, which turned an ISC prototype into CAF and US Air Force contracts and a 500-vehicle-a-year plant in Cowansville. Defence is 20% of revenue today and could reach 50%.

Norway has a playbook for newcomers. Defender Media published a guide to entering the Norwegian defence market, timely after Kongsberg’s MoU with MDA Space and the new Canada-Norway Arctic space agreement.

The plumber who pulled the yoke. When a FlyDubai first officer attacked his captain with an axe and put Flight 1073 into a dive of 14,000 feet in 29 seconds, Israeli passenger Yaniv Hayun grabbed the controls, and he credits the Toronto-made series Mayday for teaching him what to do, now in its 27th season across 150 countries. Two off-duty pilots landed the plane in Saudi Arabia. His instruction, learned from Canadian television: “you have to pull the yokes when the plane’s nose is down.”

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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Special guest post by Philippe Letarte, Canadian Venture Capital & Private Equity Association (CVCA)

Amending a single regulatory provision could unlock millions in private capital for Canada’s innovation ecosystem.

The gap: Canada’s chronic shortage of growth capital is one of the most pressing problems facing its innovation agenda, as the CVCA has stressed in recent months. The Defence Investment Agency (DIA) now holds the pen on the next iteration of the Defence Industrial Strategy (DIS), and part of the solution may already sit in the Industrial and Technological Benefits (ITB) Model Terms and Conditions. The Venture Capital Fund (VCF) Transaction provision under section 7.9 lets defence primes meet part of their ITB obligations by investing in Canadian venture capital.

The CVCA’s ask: The government is about to launch the Venture and Growth Capital Catalyst Initiative (Growth VCCI), a $1B fund-of-funds program announced in Budget 2025 and managed by BDC. That launch is an opportunity to put currently unallocated ITB capital to work for Canada’s innovation ecosystem.

Reality check: Innovation, Science and Economic Development Canada’s Fall 2025 ITB annual report counted ~$84B in live ITB obligations across 117 contracts. Of that, $23.4B has yet to be assigned to any industrial activity. The VCF category carries a 5x multiplier, yet in the decade since it was created, not one dollar of VCF credit has been publicly reported. The Parliamentary Budget Officer found that multipliers of every kind (R&D, VCF and technology transfer combined) made up just 0.8% of ITB transaction value from 2015 to 2019. It is a mechanism on paper only.

The fix: CVCA’s submission asks that limited partner (LP) commitments to Growth VCCI-approved funds-of-funds count as eligible VCF Transactions under section 7.9. The rest of the ask:

• Treat the LP’s cash commitment as the eligible investment.

• Accept Growth VCCI’s existing Canadian-content compliance reporting submitted to BDC as ITB evidence, subject to DIA audit rights. The program already requires at least 60% of allocations to go to Canadian VC funds and at least 90% of direct investments to go to Canadian companies.

• Use look-through attribution against paid-in LP commitments.

• Keep the existing 50/50 staged-credit structure.

• Raise the multiplier from 5x to 9x, still subject to the aggregate VCF cap.

Bottom Line: This needs no new appropriation, no new bureaucracy and no new program. The DIS’s ITB modernization pillar already promises enhanced multipliers and new Strategic Investment Transactions, and the CVCA is handing the DIA a ready-made way to deliver on that commitment. Capital will decide whether Canada’s rebuilt defence industrial base is Canadian-owned when it matters most

Debating Canadian Defence

Defence Investment Incorporated

The Carney government has tabled new legislation for the Defence Investment Agency. The previous legislation to put the DIA on a statutory footing was included in the ways and means motion in the spring. This new bill, C-40, sorts out a bunch of issues associated with the previous one and provides a better path forward overall…

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25 days ago · 52 likes · 8 comments · Philippe Lagassé

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

🍁 ATCO spins out a defence company inside a $72B utility merger. Emera is buying Canadian Utilities and ATCO in what the companies call the largest merger ever between two Canadian firms, and ATCO’s housing, defence and investment arms become New ATCO, a separate Calgary-listed company built around contractor ATCO Frontec, with Nancy Southern as chair and CEO. Frontec turned a Resolute Bay site into a base for 350 CAF personnel in three weeks for Operation NANOOK-NUNAKPUT, holds a two-year, $48.4 million Polar Over-the-Horizon Radar contract with Inuvialuit Development Corporation, and owns 49% of Nasittuq, which runs the North Warning System and supports CFS Alert. Closing is expected in Q3 or Q4 2027, after CFIUS review. Canada’s biggest Arctic defence services shop is about to become a pure play.

The Canadian Explorers

Power Beyond the Dock | Meiz Majdoub Jr., Mostar Labs — Explorer Spotlight #18

Welcome to the 495 Canadian Explorers who have joined! If you aren’t subscribed, follow the Canadian founders who are building in Canada’s most critical industries by subscribing here…

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24 days ago · 2 likes · Ethan Marcoux

• To SPAC, or not to SPAC?

• Canadian defence procurement system is “genuinely broken”

🍁 AirMatrix lands its largest IRAP project (amount undisclosed). The Ottawa company is getting NRC IRAP funding through the Defence Industry Assist initiative to fuse multi-sensor data into one low-altitude airspace picture on Libra, its hardware-agnostic C2 platform, covering automated sensor cueing and AI-assisted visual confirmation with a human in the loop. CEO Bashir Khan: “The next generation of airspace security will not be defined by whoever deploys the most sensors.”

🍁 Q3 A&D M&A: fewer deals, bigger cheques, and a Montreal deSPAC. B. Riley counts 59 announced A&D deals in Q3, 40% below Q2 and well under the 87 quarterly average, but nine $1B-plus deals, the most since 2020. They include GE Aerospace for CPP ($11.8B), Thales for Exail ($4.4B), Lockheed Martin for Ultra Maritime ($3.5B) and Wildcat for Austal ($1.4B) with Hanwha bidding $1.2B. Sponsors now own a record 277 A&D companies, and Big 6 prime dry powder hit $16.4B, the highest since 2Q19. Montreal’s NorthStar Earth & Space closed its deSPAC with Viking Acquisition Corp I on October 1 at a $300 million pre-money EV. The exit window is narrow, but it is open.

Anduril bets $6.6B on submarines and wins $1.8B for Army C2. The company is putting $3.7 billion of private capital into Arsenal-2, a 187-acre, two-million-square-foot yard in Baltimore County backed by a Navy incentive contract worth up to $2.9 billion that ties payments to production, building Virginia-class modules for Electric Boat and Newport News from 2030. The same week the Army gave it a five-year deal of up to $1.8 billion to field Lattice across I Corps as the NGC2 backbone. Bloomberg reports the Sparrows Point site will employ about 3,100 people at full operation, with full production the year after it opens.

Pentagon puts $350M into quantum computing. PsiQuantum gets a $150 million capital loan commitment for US manufacturing and prototyping, and $200 million moves Atom Computing, Diraq, IBM and IonQ into Stage C of DARPA’s Quantum Benchmarking Initiative, which tests whether each machine can reach utility scale by 2033. PsiQuantum is valued at $7 billion on $1.66 billion raised. OSC’s Peter Zuckerman: fault-tolerant quantum is “a national security imperative.” Capital loans now sit next to grants in the Pentagon toolkit.

• The Pentagon Is Moving Onto the Cap Table

Benchmark makes its first pure defence bet: $25M into Furientis. The one-year-old Los Angeles interceptor maker raised a $25 million seed at a $125 million post-money, on top of a $5 million pre-seed in May, and holds a funded Pentagon contract for mid-range interceptors after 12 successful launches. The goal is 1,000 interceptors a year per facility. Industrial Base Alpha frames the gap: the US Navy receives 300 to 500 interceptors a year, while China can build an estimated 3,000 anti-ship cruise missiles a month. Interceptors are the new drones.

Tiberius signs $500M to license its ramjet shell to the UK. The California company will manufacture, license and distribute Sceptre with unnamed UK partners under an ITAR Technical Assistance Agreement. The 155 mm round claims 150 km, Mach 3.5 and 65,000 feet from unmodified NATO howitzers, after first in-flight ramjet ignition in New Mexico in April.

Balerion closes an oversubscribed $200M Fund II. The Dallas firm has backed 15 companies from Fund II, including Valar Atomics, Vast, Commonwealth Fusion, Relativity and Erebor, on top of earlier bets on SpaceX, Anduril, Impulse and Armada, and hired former NASA Chief Technologist A.C. Charania as managing director.

Missile Matters — with Fabian Hoffmann

Powering Scalable Mass: Western Turbojet Production in 2026

Picture: PBS…

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21 days ago · 44 likes · 6 comments · Fabian Hoffmann, PhD

Voyager wins $22.4M to put more satellites on each launch. The Strategic Capabilities Office signed an Other Transaction Agreement for Voyager to build flight-ready prototype satellite dispensers that let the Space Force fly extra smallsats on spare payload capacity without touching the primary mission.

Related: PitchBook’s new Q3 robotics note goes deep on actuators and motion systems, the component layer under every ground robot, interceptor and drone array in this issue, and the layer most exposed to Chinese supply.

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⚔️ Combat Readiness

Spectrum war. The WSJ went inside Ukraine’s electronic warfare fight. Night Watch says its Lima system, with a stated 120-mile reach, diverted two Russian ballistic missiles into the Dnipro River before they hit a government site in Kyiv, and spoofed a hypersonic Kinzhal last November until it broke up. An Unmanned Systems Forces officer says EW suppresses 70% to 95% of radio-controlled drones in his sector. Phantom Defense counts more than 11,500 Russian drones detected and about 7,500 neutralized in a year, and December1 now ships thousands of units a month, up from dozens in 2024. The cycle is brutal: when Russian drones started using Chinese Controlled Reception Pattern Antennas to dodge jammers, Night Watch and Cascade built Lima Quant in three months, and Russia went from four antennas to eight, then 16, then 32. US Air Force Col. Josh Koslov: “If you are not winning in the spectrum, you are going to lose the war.” Canada has a home for this. CAFCYBERCOM leads all CAF cyber, joint EW and SIGINT, with the Canadian Forces Electronic Warfare Centre producing intelligence mission data.

🍁 Kit for Canada. NATO’s Innovation Continuum, run by Allied Command Transformation, held its final in-person working period in Dartmouth, its first time in Canada, with 100 companies and 30% of them Canadian. Finland’s Kelluu flew a surveillance airship over Dartmouth Cove alongside Canadian and Icelandic underwater kit, a war game ran on a map of the GIUK gap, and Kelluu has opened an Ottawa office to chase the Canadian Arctic.

The procurement side is trying to keep up. At Edmonton Startup Week, CFB Edmonton contracts officer Sean Naugle told founders “We want to partner with you: we need suppliers, diversity, more options” to make buying faster, while Grengine’s Connie Stacey compared federal procurement to “telephone tag” and pointed at DIANA’s Rapid Adoption Service, which lets any of 32 allies contract a vetted product directly. Calian’s Chris Pogue, speaking at DEFSEC Atlantic, says 1,700 new companies and 166 venture firms entered Canadian defence in the past year, and warns the foreign platforms bought in the last six to eight months will lock in decades of support contracts unless Ottawa builds vehicles for Canadian firms to add capability: otherwise “we will have purchased obsolescence.”

First Breakfast

Unmanned Forces as a Service

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24 days ago · 32 likes · Dan Madden and Dominic Ventimiglia

🍁 Procurement, rewired. Bill C-40, tabled October 6, would turn the Defence Investment Agency into an agent Crown corporation, the Canadian Corporation for Defence Investment, led by a new associate minister of national defence and freed from parts of Treasury Board policy. Eugene Lang calls it “unprecedented and a leap of faith,” and Philippe Lagassé warns “a Crown corporation model comes with big risks.” Siobhan Harty and Jeffrey Collins call it the biggest change to defence procurement in 75 years and point to the last precedent: C.D. Howe’s Department of Defence Production, which ran from 1951 to 1969 while Canada spent about 5% of GDP on defence, the level Canada is targeting now. Their worry is the split: the Defence Production Act stays with the public works minister. The PBO’s new primer supplies the stakes. Core spending reaches $163.6 billion in 2035-36 on a gradual path, DND’s capital spending fell $18.5 billion short of plan from 2017-18 to 2023-24, and a standalone DIA costs $103.8 million over five years plus $22.3 million a year after that.

mustafa@terrakinesis.com

Swarming in DDIL Environments Is an Illusion

Every defense tech show floor has the same video. A hundred drones lift off together, hold a formation, and paint a shape in the night sky. The crowd films it. The briefer says “swarm.” Nobody asks what happens when the mission, environment, or spectrum changes…

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22 days ago · 2 likes · mustafa@terrakinesis.com

Ukraine, Inc. Tectonic’s second dispatch from Kyiv tracks an industry whose capacity went from $1 billion in 2022 to about $35 billion in 2025, with roughly $55 billion expected this year. Foreign money into Ukrainian production hit $6.1 billion in 2025, up from $600 million. Brave1 counts 2,500 companies and 5,000-plus products, and brigades with their own budgets have ordered UAH 33 billion and 500,000-plus drones through its marketplace. Consolidation has started: Swarmer bought Ratel for $224 million, Vyriy rolled up five firms, and Ukraine opened controlled exports in July with 20% to 30% of proceeds sent to a state defence fund.

Theseus CEO Ian Laffey, a Université de Montréal alumnus, explains the pull on the Ukraine Military History Podcast. His GPS-free navigation startup came out of a February 2024 hackathon, landed in Kyiv in November 2024, and failed on day one because nobody had told the team drones launch from catapults, so he moved there. His case for the market: brigades buy at unit level and drop what fails, so “you just can’t prove that scale anywhere but here and that efficacy.” The private capital is still small next to the state money. Defense Valley’s open tracker counts €126 million across 65 capital events and 46 companies since 2024, with €87 million in 2026 alone and Uforce’s $50 million the largest round. Saskatoon’s Draganfly shows up once on the investor list.

• Dan Herman on partnering with Ukrainian defence tech

🍁 Export math. SIPRI’s 2021-2025 data puts Canada 16th among arms exporters at 0.7% of the global market, with Ukraine taking 34% of Canadian exports, Saudi Arabia 27% and the US 17%. The US holds 42% and France 9.8%. The Defence Industrial Strategy wants exports up 50%. The opening is in Brussels and Washington at once. France’s new ambassador, Hélène Farnaud-Defromont, says France already gets 65% European content in what it buys and the ideal is “100 per cent European content,” yet only one SAFE contract has gone to Canada since it became the first non-European partner in February.

US Ambassador to NATO Matthew Whitaker told Europe that with $1 trillion to $1.5 trillion in US defence spending this year, American industrial capacity “is largely going to be used to provide those requirements for the US military,” and that “the United States needs friends with manufacturing capacity.” The EDA expects missile defence capacity to grow more than 800% by 2030, mostly at the short-range end. Washington can’t fill Europe’s orders and Europe wants European content.

Big think: breaking robotic mass. Retired Air Force Col. George Dougherty argues mass drone fires alone won’t restore manoeuvre. His answer is to treat the low “air littoral” as terrain for ground vehicles that don’t touch the ground: arrays of up to tens of armed drones under one operator acting as the forward striking element, with crewed forces following. A 50 kg payload carries a light machine gun with fire control plus four light anti-tank missiles. Twenty drones replacing a $5 million to $10 million Stryker implies $250,000 to $500,000 each, under the Army’s $650,000 target for a new robotic combat vehicle. He wants a prototype unit modelled on the 11th Air Assault Division (Test). Beijing is studying the same problem without paying for it. CSIS reviewed 90-plus Chinese sources and found PLA analysis lands about four months after a technique appears in Ukraine, with fielding a year or more later. Within four and a half months of Spider’s Web, a Chinese brigade drilled against 20-plus drone operators with detection kit cataloguing 800-plus commercial models.

Spend more, build more. Harpoon Ventures founder Larsen Jensen, a former SEAL and two-time Olympic medallist, makes the money case. China installed 295,000 industrial robots in 2024 against 34,200 in the US, or 54% of the world total, the DIA estimates real Chinese military spending at $325 billion to $400 billion, and GAO says major programs average more than 12 years to deliver initial capability, which he blames on budgets that refuse to fund both today’s force and tomorrow’s. His two lines: “Calling the refusal to pay ‘discipline’ does not make it so,” and “We cannot assume American ingenuity will make up for factories that do not exist.” CNAS puts numbers on the cheap end. Operation Epic Fury drained US high-end missile stocks, and the $35,000 LUCAS made its combat debut there. Against a Renhai-class cruiser, 47 HERONs cost $9.4 million versus $19.2 million for six LRASMs, but a lower unit cost “does not translate into a cheaper salvo” when far more rounds are needed, roughly half of 2,000-plus Chinese targets sit deep inland, and hardened targets still need exquisite weapons. The Pentagon wants more than 10,000 low-cost munitions in three years.

🍁 Nuclear: learned, unlearned, outsourced. Works in Progress shows how Britain built 26 reactors from 1956 to 1971 in four to five years apiece, and by 1965 had more nuclear stations than the US, USSR and France combined. Now Hinkley Point C will take at least 13 years and run £17 billion over budget after 7,000 UK-specific design changes. The government’s taskforce found “a culture of resignation among dutyholders and regulators who simply accept that nuclear projects must be slow and expensive.” Canada is losing capability a different way. The Logic reports that Canadian Nuclear Laboratories, run by an all-American consortium of BWX Technologies, Amentum and Battelle, is helping Chicago’s Clean Core Thorium develop a fuel that a May briefing to Minister Tim Hodgson says India sees as a way to cut imports “from countries like Canada.” India runs 25 reactors, 21 of them Candu-style, and Cameco signed a nine-year, $2.6 billion supply deal there in March. Canada’s national lab, run by Americans, is helping its best uranium customer need less Canadian uranium.

Gray Matters

🎙️ Ep 31 - Techquisition: The Pentagon’s New Autonomous Warfare Command

🚨 EMERGENCY POD! The Pentagon is standing up a new Autonomous Warfare Command. On the latest Mission Matters Podcast episode, David and I sat down with defense acquisitions expert Bill Greenwalt to discuss what it will take to stand up a new functional combatant command focused on autonomous warfare…

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25 days ago · 9 likes · 1 comment · Maggie Gray and David Rothzeid

Counter-drone. The Pentagon picked four directed-energy systems for a homeland pilot run by JIATF-401: AeroVironment’s palletized laser, Kord’s Firefly, Boeing’s CLWS and Epirus’ Leonidas, which downed a 49-drone swarm in one burst in testing, across five bases for a year. JIATF-401 also awarded 10 Domestic Shield contracts worth up to $4.15 billion and plans a December shoot-off at Dugway. Brig. Gen. Matt Ross on cost per shot: “If I procure that system and it costs me $6 million and I take one shot a year, you can’t tell me that that shot only costs 8 cents.” Pete Newell, who ran the Army’s Rapid Equipping Force, warns the kit is aimed at the last war. Federal agencies seized more than 700 drones across 11 World Cup host cities, but the next drone navigates without GPS and flies with no radio link, and most counter-drone systems work by detecting and jamming that link ahead of LA 2028. His line: “Drones are IEDs that fly.” The Secret Service agrees. Deputy Director Matthew Quinn told 60 Minutes “I’d love to tell you the swarm problem is solved. It’s not,” even as the agency builds an AI- and radar-guided net-capture “drone hunter” and logs 10,000 threats against protectees this year.

The Defense Brief

When hybrid warfare gets personal

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20 days ago · 4 likes · 1 comment · Louise Boucher

Maritime autonomy. Ukraine’s navy calls September 14’s clash, when a Sargan 300 drone boat sank a Russian USV, the “first naval battle in history between unmanned boats.” In July three US one-way-attack USVs struck an Iranian submarine and naval facility, the first US combat use of USVs, and Taiwan wants 1,200-plus USVs and 200,000-plus one-way-attack drones. Retired Vice Adm. Michael Connor and Yoni Tobin argue destroyer budgets crowd out unmanned spending: “That is subtraction by addition.” China is building the carrier for the deep end. New imagery puts the Hudong-Zhonghua mothership we flagged last month at about 205 by 27 metres, with a bottom-opening well deck, a 12-arm cradle and a hangar for four 35 to 45 metre XXLUUVs with an estimated 10,000-nautical-mile range.

• ENVGO and Victoria’s Open Ocean Robotics will bring ENVGO’s 25-knot hydrofoiling XV2 into Open Ocean’s XplorerView C2, pairing a 68 kg sprinter with solar DataXplorers that have logged 13,000-plus hours and 30-day deployments in Sea State 7.

🍁 Cold reality. Internal DND evaluations of Exercise Global Response in Alaska found more than 400 soldiers of 3RCR lacked basic Arctic living and winter soldiering skills, with up to 30 frostbite cases, drones with 10 minutes of battery in the cold, and medics on personal phones.

The new Greenland-Denmark-US deal largely gives Washington rights it already held under the 1951 agreement, adds a ban on control by investors from outside NATO and the EU, and still cannot defend North America alone: “The Americans are going to need Canada.” Trump “has not changed the geography of the continent.” The geography is ours. The cold-weather skills have to be ours too.

• Canada’s Air Effects Team recently competed in a Five Eyes military modernization exercise

Industrial Base Alpha

⬟ Profit

AUSA It’s officially AUSA week in D.C. which is why we are rolling out a 20% promotion for IBA premium. New monthly subscribers get 20% off for their first 3 months ($8.80/month). Offer ends Sunday, Oct 18. Stay up to date on Industrial Base Alpha…

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20 days ago · 2 likes · Matthew Bernard

Mojave reality check. “Under a blistering desert sun, the U.S. Army strained to show it had become a modern, AI-powered fighting force.” That is the WSJ’s Heather Somerville on Project Convergence Capstone 6, ten days in July at Fort Irwin. There, 9,700 soldiers fought around the clock against an Army unit playing the PLA, in heat near 110 degrees. The drones from Anduril and Theiss UAV Solutions overheated and landed, or took as long as ten minutes to get airborne, against under a minute for Ukrainian crews with similar kit. Operators flew them for half their maximum time to save batteries, and lost the signal behind mountains. The augmented-reality headsets, on contracts worth more than $100 million each with three companies, struggled enough that the Army isn’t sure it will keep them. Much of the exercise went to clearing buildings. Starlink connectivity and the AI planning tools did improve. Anduril just won up to $1.8 billion to run the Army’s next command system, and the hard part is the gear at the edge of that network. Put this next to 3RCR’s drones getting 10 minutes of flight in the Alaskan cold. Heat or frost, the battery is the weak point.

🍁 Space. Canada remains the only G7 country without its own launch, and SpaceX launched all 12 Canadian satellites sent up in 2025, while SpaceX is reportedly turning away Falcon 9 bookings after 2028. SpaceQ’s Marc Boucher puts the cost of a light-lift rocket to orbit at $50 million or more, and Kepler’s Mina Mitry says rideshare’s “barrier to entry now has grown significantly.” Longueuil’s Reaction Dynamics is dropping its hybrid engine and cancelling the Aurora-1 test flight from Australia for storable liquid propulsion, after 21 hot-fires above 95% characteristic-velocity efficiency. It will start testing the RE-X orbital engine in November, still targets Q4 2028 from Spaceport Nova Scotia, and will follow with Borealis, a medium-lift rocket.

NordSpace got there another way: its Terra Nova pathfinder, nine months from concept to launch-ready, is operating in orbit and met every mission goal so far, which makes the Markham company the first Canadian launch hopeful flying its own hardware in space. Its Taiga suborbital rocket could fly from St. Lawrence, N.L. within weeks, pending approval. Terra Nova rode up on a Falcon 9 with about 130 other satellites.

🔫 Hot Shots

🍁 The Icebreaker x BDC report keeps showing up in the news. BetaKit’s story on Markham’s CyberWorks Robotics, which won an amended DND contract worth more than $1 million through Innovative Solutions Canada to supply autonomous vehicles to the CAF, with a path to up to $7 million more, cites the recent BDC x Icebreaker report finding that smaller Canadian businesses want to meet defence needs but many struggle to get in. CyberWorks is what getting in looks like.

🍁 Defence Drone Initiative Marketplace, Round 2 is open. The DIA is inviting Canadian suppliers to qualify for the DDI Marketplace, with a mandatory-registration industry day on October 15 and bids due November 6. There are six bid events, each capped at 100 bids, so submit once. The notice already lists 398 related contract awards.

🍁 NRC wants a field-deployable chemical imager. An Innovative Solutions Canada Phase 2 challenge offers up to $1.5 million over 18 months for a quantum cascade laser standoff imaging system that detects CBRNE threats at 0.3 to 10 metres, scaling up a capability NRC has only demonstrated as point spectroscopy in the lab. The window closed August 4.

🍁 Logistik Unicorp’s CEO is out after arrest. La Presse reports Hugues Dorban, 49, was arrested September 30 and faces three charges. The Saint-Jean-sur-Richelieu firm, which holds a 20-year, $3.7 billion DND contract for 1,220 uniform and kit items, says he no longer works there, says the company is not a target of the case, and has named Nicolas Robert interim CEO.

Palmer Luckey’s bank tops $7B. Erebor, the startup bank built to fill the gap Silicon Valley Bank left for tech, defence and manufacturing companies, has taken in more than $7 billion in deposits since launch in February. Defence founders now have a lender of their own in the US.

Resilience Media names 100-plus investors to watch. The list leans on Crunchbase data showing $14.6 billion invested in defence in the first half of 2026, up from $9.6 billion in all of 2025, and is built to help newcomers map the field.

War on the Rocks crowns ten wartime technologies for America’s 250th. The Cogs of War winners run from the blood bank to Rickover, Kevlar and the integrated circuit. The editors’ lesson is that government’s leverage “has historically come from committing early to things the market did not yet value,” such as the Army’s 1936 decision to design every Air Corps engine for 100-octane fuel. Buying early is industrial strategy.

Hackers knocked out French supermarket fridges. Cyberattacks on refrigeration systems hit hundreds of supermarkets across several major chains, including Intermarché and Coopérative U, which had to throw out fresh and frozen food. Prime Minister Sébastien Lecornu is “personally monitoring the situation” and has called in ANSSI.

The F-35 parts that shipped because of one missed email. A UPS employee missed a DSV email warning that the shipment must not route through Hong Kong, and China got an F-35 cockpit canopy and weapons-bay door, both coated in radar-absorbing material. ITAR held up on paper. The inbox did not.

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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🎯 Three-Shot Burst

Spending is no longer the constraint. Capture is. The Canadian Chamber of Commerce’s Business Data Lab put the decade on one page in its latest report. Core defence spending climbs from $64 billion in 2025 to $160 billion by 2035, a full 5% commitment means roughly $228 billion a year, and defence rises from about 11% of federal spending to nearly 30%.

Where the money leaks: Canada’s 538 core defence firms booked $17.3 billion in 2024 sales, the top 50 take roughly 80%, Canadian-controlled firms capture just 18% of sales, or $3.1 billion, and the industry imports 47% of what it buys. Of 802 innovative Canadian firms U15 identified, only 88, or one in nine, had won a related federal contract since 2015, and the new Defence Investment Agency only handles buys above $100 million with no public list of future needs.

Poland is the warning label: it doubled defence spending to about 4.5% of GDP between 2021 and 2025 and sourced an estimated 80% abroad. U15 Canada’s Robert Asselin told the Globe that about 75% of Canadian-linked patent families relevant to the industrial strategy had a foreign-controlled firm as the applicant, then summed up the file: “The intent is there, but the execution right now is not.”

The Toronto Star ran the numbers: Of $25 billion in federal contracts since Carney took office, an estimated $7.8 billion went to American-controlled corporations against $14.9 billion for Canadian-controlled ones, the share heading south rose from one-fifth to nearly a third, and the Buy Canadian Policy has steered 34 contracts worth $1.5 billion since December.

Washington has a different problem: AIA and Bain found the US gap is not “an overall shortage of capital, but a shortage of investable opportunities”, with defence venture capital up tenfold since 2019, the top 100 venture and PE-backed defence companies holding $118 billion against $16 billion in federal production commitments, and primes trading at utility multiples.

Reality check: St. John’s Avalon Holographics just banked $11.7 million from Lockheed Martin Canada, a $5.6 million contract on top of a $6.1 million Phase 1, for a 40-inch glasses-free holographic table now installed at Lockheed’s Lighthouse centre in Suffolk, Virginia. Founder Wally Haas: “even though it’s being developed in Canada, honestly, the primary beneficiary right now is probably the U.S. defense forces.” Hamilton’s Sentinel R&D is the same story pointed east. CEO Kath Intson says the company is now “selling directly to the Ukrainians,” in a deal separate from its Airlogix joint venture, while Ukraine’s digital procurement platform has already split $50 million among six Canadian companies. Dominion Dynamics’ Eliot Pence writes the fix: “Our grandparents built bombers faster than we award drone contracts today.” Victory Aircraft went from Lancaster blueprints to first flight in 16 months and built one bomber a day at peak in Malton, so give Canadian-owned autonomy firms 90 days from proposal to contract and 12 months to a field-testable prototype, then scale what works.

• Ottawa to turn defence procurement agency into Crown corporation, sources say

Canada wants its own rockets. The US still holds the keys to orbit. Toronto’s Canada Rocket Co. will put $30 million over three years into an engine test site on 50 acres beside London International Airport, fully operational by 2028, with a medium-lift orbital launch targeted for 2032. The company has 32 employees, $22 million raised, an $8.3 million DND grant, plans for a 500,000-square-foot factory, and is scouting lakefront land so it can ship 150-foot rockets to the pad by boat. CEO Hugh Kolias puts the cost of reaching orbit near $1 billion, half of it hoped from government, and sees “a once-in-a-lifetime opportunity to have this as Canadian as possible.” Ars Technica explains the bet. Tariffs and 51st-state talk pushed Ottawa to fund NordSpace, Reaction Dynamics and CRC through Launch the North, and CRC skipped the small-rocket phase entirely after interviewing about 150 engineers, up to the director of Starship engineering: “you’re not going to be able de-risk a rocket development program by building a smaller rocket.”

The window is real: Kolias says SpaceX plans to retire Falcon 9 within a few years, and FT Alphaville’s Sinead O’Sullivan argues SpaceX itself is pivoting away from space, almost a quarter century after it set out to make humanity multi-planetary. Canada has been here before. Alouette I made Canada the first nation after the two superpowers to design and build its own satellite in 1962, a 145-kg ionosphere probe that stretched a one-year design life into a ten-year mission, and it still rode an American Thor-Agena to orbit.

Now look at what Canada actually owns. Wes O’Donnell’s essay in The Walrus walks the chain: a $2.3 billion military satellite contract, potentially $2.7 billion, grows Telesat Lightspeed from 156 to 225 satellites, all built by MDA in Montreal, yet Telesat has booked more than a dozen launches on SpaceX Falcon 9, Canada has no missile-warning constellation, and he found no evidence of access to Galileo’s hardened PRS signal. His audit of military satcom: “Wideband: American. Protected: American. Tactical narrowband: American.” And the line that should headline the next space policy: “A satellite sitting in a clean room in Montreal isn’t a space capability yet.” Britain is already a step past that. The RAF just stood up No. III Space Effects Squadron to disrupt, degrade and deny hostile activity in orbit, using electronic warfare and backed by £880 million for space ISR and space control through 2029/30.

Surtur's Substack

Military Reusable Rocketry

Introduction…

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a month ago · 20 likes · 1 comment · Surtur

Beijing doesn’t need to steal it. It can buy the board. Italy’s Ferretti Group builds luxury yachts and has supplied patrol and fast-attack craft to the Italian Navy, Coast Guard and Carabinieri since 2016, and the FSD195 interceptor rides a Pershing yacht hull. State-owned Weichai, founded to arm the PLA and now a maker of engines for Chinese rocket launchers, holds 39.5% yet took eight of nine board seats at the May meeting, backed by a bloc of Chinese shareholders each sitting just under the 3% disclosure line. Weichai’s chairman named moving Ferretti production technology to a Qingdao hub for “public service vessels,” Beijing’s phrase for its coast guard fleet, a priority back in 2023. Former Italian defence chief Gen. Vincenzo Camporini: “There’s no need for espionage scenarios: the product’s standard digital architecture is sufficient.” Robbins: “Instead, they arrive with a shareholder vote, a below-threshold stake, and a factory turning out yachts for spying.”

The espionage track is running too: MI5 says more than 100 UK-linked academics unwittingly fed projects in AI, cyber, covert communications and steganography through CGTRI, a front with “very strong ties” to the Ministry of State Security, and security minister Dan Jarvis has written to every vice-chancellor to cut ties. Jamestown’s Sze-Fung Lee argues the approved embassy at Royal Mint Court, 5.5 acres and ten times the current footprint, could run as a hybrid-warfare hub beyond the reach of UK police, and notes former MP Paul Chiang’s 2025 suggestion that a Hong Kong activist carrying a HK$1 million bounty be handed to the PRC consulate in Toronto. The physical layer is exposed as well. FBI and Coast Guard investigators found hackers reached the propulsion system of a fully laden supertanker, the VL Prosperity, on approach to Galveston this summer, and US agencies were tracking cyber threats against nearly 20 vessels by September.

Washington is answering with export controls: Commerce has slowed licences for jet parts bound for COMAC and is weighing new rules on landing gear and aviation hydraulic fluid, while gallium, germanium and tungsten stay tight on the other side of the ledger.

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

🍁 Quantum eMotion buys Plurilock for nearly $34M. Montréal’s QeM will pay 30% cash and 70% stock for Victoria’s Plurilock, pairing quantum-secure cryptography with an existing government customer base and public-sector procurement channels, with a shareholder vote due in November.

a16z

The Case for the American Manufacturing Asset Class

Today, we launched Discourse, a curated forum on top of the Cosign network. 3,000 people have access to post directly, and everyone else can submit posts into a queue, kind of like old Product Hunt. Check it out: https://discourse.cosign.co…

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a month ago · 158 likes · 3 comments · Connor Love and Collen Larson

🍁 Draganfly takes US$10M from Trump Jr.-backed Unusual Machines. The Saskatoon drone maker sold 1,869,159 shares at US$5.35, with US$5 million each from Unusual Machines and an unnamed US fund, weeks after landing a Canadian Armed Forces drone contract for up to 5,000 drones, only 100 of them firm. The company says “no board seats or special rights” are attached.

European defence VC heads for $10.5B. Dealroom's State of Defence Tech 2026 says European defence startups have raised $7.4 billion so far this year, already a record, with defence now 11.1% of European VC. Resilience Media's write-up projects the total will quadruple 2025's $2.6 billion to $10.5 billion by year-end, while US startups took $19.6 billion, 75% of NATO and allied defence VC. Bessemer's Alex Ferrara names the catch: "in defense tech there are only a small number of strategic acquirers."

🍁 Hanwha keeps “Project Arrow” alive after losing the subs. The Korean group lost the submarine program to TKMS in July but is still exploring a military-vehicle joint venture with Canadian auto parts makers such as Linamar and Martinrea, potentially in Ontario plants idled by 25% US tariffs, building K9 Thunder howitzers, Redback IFVs and Chunmoo launchers.

Gray Matters

🎙️ Ep 30 - Techquisition: How DIU’s Bridge Is Accelerating Commercial Technology Into the Military

The Defense Innovation Unit has run over 600 prototypes. That gave them a front-row seat to a frustrating pattern: commercial technology that works, stalling out before it ever reaches the warfighter…

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a month ago · 5 likes · 5 comments · Maggie Gray and David Rothzeid

🍁 H2 Analytics lands $800K from FedDev Ontario. The repayable contribution backs a $4.2 million upgrade of the EASE military exercise-design platform with new AI features, plus expansion into Europe, the Middle East, Australia and New Zealand. The Ottawa firm is still bootstrapped, posted 552% three-year growth and added 22 staff in six months.

🍁 OSCP raises US$6M to navigate without GPS. Montréal's One Silicon Chip Photonics closed an all-equity Series A led by New Science Ventures to shrink a fibre-optic gyroscope onto a chip within two to three years, and plans to grow from 18 to 30 staff in a year. Founder Kazem Zandi is a Defence R&D Canada alumnus, and COO Alex Lintott says Canada's lighter export controls on the tech, compared with the US, help it sell into Europe. Lintott: "We're going to be the preeminent IMU provider out of Canada." GPS denial is now the default on every modern front.

US Navy orders 30 drone ships for $1.2B. Galliano (Edison Chouest), HII and Saronic each get 10 Medium Unmanned Surface Vessels at an average of $40 million per hull, with production starting immediately in Louisiana and deliveries as early as Q4 FY2027. The qualifying test ran roughly 26 hours and 360-plus nautical miles on a single command-and-control input, and Birdon did not finish testing.

Army picks five shooters for PrSM Increment 4. Anduril, Castelion, Lockheed Martin, Mach Industries and RTX will prototype HIMARS-launched missiles that hit moving land and sea targets beyond 621 miles, with a fly-off and down-select in FY2027 and a final fly-off in FY2028. A week earlier Lockheed took $1.2 billion for Increment 2 production. Canada is buying HIMARS, so these are the rounds that will fill Canadian launchers.

Anduril buys underwater-comms specialist Popoto Modem. Terms are undisclosed, but the Massachusetts acoustics firm folds entirely into Anduril’s autonomous undersea fleet, which includes Copperhead and the Dive-based Ghost Shark, a $1.7 billion program of record. Maritime chief Andrew Nuss calls subsea communications “the wicked problem.”

Pentagon’s Critical Technologies office signs up In-Q-Tel. IQT will scout and diligence startups across all six Critical Technology Areas, from applied AI to scaled hypersonics, with joint pilots starting within weeks. Assistant Secretary Michael Dodd sets a 12-month benchmark of moving validated prototypes into field evaluations, because superiority goes to “who delivers it to the warfighter fastest.”

Japan builds a state defence investment fund and its own FMS. Tokyo plans a new agency run jointly by the Ministry of Defense and METI that would back defence startups through competitively selected domestic VCs, buy Japanese kit for resale abroad and manage government-owned, contractor-operated munitions plants, as early as fiscal 2027. Officials admit there are “almost no” Japanese startups living off Self-Defense Forces business.

Aventra raises $17.5M for balloon-dropped glide bombs. Konvoy Ventures led the round for the Virginia startup, whose Piranha rides a balloon to 60,000 feet and glides a 5 kg bomb about 100 miles to within three metres of a target, with a new factory taking output from 35 to about 500 a month. CEO Michael Weigand: "Short-range air defense systems really don't reach that high, so the mere act of the enemy shooting at you is mission accomplished." Cheap mass, courtesy of the stratosphere.

Airlogix and Auterion want a Canadian production line. The Ukrainian drone maker and the autonomy firm are taking their German joint venture model to Canada and the UK next, after a German JV building AI-guided strike drones under a contract Resilience Media pegs at $300 million. Auterion expects 100,000 drones to ship through partners this year.

Related: Resilience Media’s Jamie Burnham warns that a boom for European defence startups in 2025 brings a cap-table risk most funds cannot see, quoting an Estonian VC who knows one Russian LP would end his next raise… A Sanity Check on Defence Tech… From Innovation to Operational Capability: Canada’s Next Defence Challenge… Since July, European governments have taken two concrete steps toward buying defence capability together.

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⚔️ Combat Readiness

Middle strike. The Kyiv Independent rode with the 422nd Unmanned Systems Regiment, which works the band between the end of FPV range at about 35 km and deep strike at 300 km. Its $5,000 Starlink-equipped Hornets from Eric Schmidt’s Perennial Autonomy hunt fuel trucks on highway E58, and commander “Tyson” says they are now “the main weapon for controlling the highway from Russia to Crimea,” with “any serious movement” stopped. Warbirds’ Zozulia carries 50 kg over 300 km: four launched at a substation feeding radars and Starlink jammers, two got through, two direct hits. Russia answers with Rubicon interceptors and the Peresvet-M jammer, which can blank Starlink across about 20 square kilometres. Tectonic’s week in Kyiv shows why the middle matters. Small drones cause an estimated 60% to 70% of deaths in the 30 to 40 km kill zone, Vyriy’s Oleksii Babenko says “We cannot destroy 15,000 or 50,000 FPV drones on the front line” so you hit the vehicles that carry them forward, and Geran 4s and 5s at 500 kph are outrunning $1,000 to $2,000 propeller interceptors while turbojets run short.

The Kyiv Independent puts numbers on that gap: the Geran-5 flies 150 km/h faster than the Geran-4, costs about $115,000 against roughly $1.5 million for an Iskander-K, and Ukraine is downing only 57% of jet-powered drones while Russia builds about 3,000 Geran-4s and 5s a month. Drone adviser Serhiy Sternenko: “there is currently no mass produced effective product among interceptors.”

🍁 Kit for Canada. Justin Massie and Philippe Lagassé’s roadmap for the Strategic Analysis Network defines strategic autonomy as fighting with the US when possible and without it when necessary, framed as “risk mitigation rather than decoupling,” against a CAF where only 61.3% of force elements are operationally ready and 16,000 people are missing. The shopping list is specific: 88 F-35s by 2034, then about 50 non-US next-generation fighters from 2035, eight to ten GlobalEyes, AUVs alongside 12 Type 212CD submarines, and R&D at 3% of the defence budget. Their timeline is the sobering part: command autonomy within a decade, deep-strike autonomy beyond 2040. Meanwhile DND invited 22 companies from six countries to an October 6 drone sandbox at CFB Suffield and left Sentinel Advanced Military Solutions off the list, even though its containerized StarForge factory carries enough material for 300 to 400 drones, has flown with the US Marine Corps and is backed by $10 million in Lockheed HIMARS ITB money.

CTV Montreal toured the bigger Forge X unit in Châteauguay, which deploys from a shipping container in about 30 minutes with four 3D printers, and is going out for testing primarily with US groups while DND talks continue.

🍁 Choosin’ Texas. The Radiocommunication Act bars anyone outside the military, its existing suppliers, the RCMP and prisons from even possessing a jammer, so Hamilton's Sentinel R&D ran its electronic-warfare tests in Texas, and ISED's fix, a class-based exemption, is targeted for before the end of 2028. Remote Robotic Systems' Kevin Toderel on why that matters: of the first four US-backed drone models sent to Ukraine, "Zero. Zero platforms worked." Volatus' Glen Lynch: "The ideal scenario is that we put it in a lake." Latvia, smaller and denser, has an EW range. Meanwhile, documents tabled in Parliament show Ottawa flies at least 1,600 Chinese-made drones across more than a dozen departments, led by the RCMP's 1,027, with Environment Canada admitting no formal security assessment on its 76.

🍁 Home front. The BBC asks why Canada is preparing for “a (long shot) US invasion” after more than 30% of Canadians told Leger an invasion was likely following the Maduro capture.

• Former CDS Gen. Wayne Eyre: serviceability sat near 50% and Canada could burn through much of its ammunition in days while industry needed years to replace it.

🍁 Software sovereignty. Canadian Defence Review’s James Careless polls the builders behind the DND/CAF AI strategy, which targets AI-enabled defence by 2030, and the verdict from industry is consistent. Contextere’s Gabe Batstone says procurement traps firms in “pilot purgatory.” Sapper Labs’ Allen Dillon, who ran an $11.3 million IDEaS contract: “Cyber-power now doubles roughly every ten months… Yet Canada’s cyber procurement cycles often take decades.” Zighra’s Deepak Dutt: “The strongest signal the government can send to talent is confidence in adoption.”

The kill zone. The Telegraph reports Ukraine got its tanks back into the fight this summer by hunting drone crews, radars and EW first: strikes 10 miles back on drone supplies, 20 to 25 miles on artillery, 60 miles on fixed-wing scouts and more than 200 hits on logistics vehicles in May, some 100 miles deep, before the Oleksandrivka push retook 288 square miles. Units reportedly read Russian messenger apps to adjust fire. Dr Thomas Withington: “The minute you switch your cell phone on, you have to assume you’re lighting up like a Christmas tree.” A Military Review team led by Maj. Gen. Thomas Feltey puts the doctrine around it: a 15 to 25 km contested zone, breakthroughs that must run 25 to 75 km, and drone-enabled defences that “excel at denial, not decision,” which is why Ukraine’s 2024 Kursk surprise stalled for lack of armoured mass.

• Ukraine rolls out drone-stopping razor fence to thwart attacks

Ground robots. Mykhailo Fedorov, the 35-year-old who built the Army of Drones, launched an “Army of Robots” at IT Arena, promising a first confirmed battlefield result from a humanoid-like robot within six months and a robot-led assault with no infantry alongside within a year. His new company counts Palantir’s Alex Karp as first investor, and Ukrainian troops already ran more than 25,000 ground-robot logistics and evacuation missions in August, 3.3 times January. Fedorov: “We want to eventually substitute our infantry with these robots.” The US Army is moving at prize-money speed by comparison. Its xTechHumanoid challenge picked five winners from a $1.25 million pool, including IHMC’s hybrid robot “Alex” and Ras Labs’ fingertip force sensors, with breaching, resupply and casevac competitions to follow.

Pentagon reform watch. At Quantico, Pete Hegseth announced six initiatives, led by an Autonomous Warfare Command meant to stand up as a four-star functional combatant command by October 1, 2027, with DIU director Owen West and SEAL Senior Chief Max Strasiser running Project Agincourt as a CEO-COO pair, plus FORTRESS America, a new Corps of Cadets and an Office of Religious Affairs. TWZ fills in the fine print: the command still needs Congress to approve it, Project Meridian names Elon Musk, Palmer Luckey and Newt Gingrich to a future-war study due January 28, 2027.

Big think. Former Army Secretary Dan Driscoll argues in Foreign Affairs that Operation Spider’s Web made mass the new currency, and describes watching an allied air defender at Grafenwoehr swivel between screens, manually copying data from one proprietary system to another while Ukrainians ran the whole fight from one. His prescription is an allied, open-architecture industrial base, because “a smartphone that cannot exchange data, after all, is simply an expensive paperweight.” Matthew Ford of the Swedish Defence University pushes the other way, arguing that innovation has become a strategic dead end that substitutes for judgement, that “identifying 1000 targets a day is the easy part,” and that NATO’s 2025 purchase of Palantir’s Maven Smart System raises sovereignty questions no one has answered.

A RealClearDefense paper argues drones have gone from tactical tool to strategic weapon, citing a Russian Black Sea Fleet that “now has nowhere to hide,” Spider Web’s box-truck swarms and a jet-powered Geran-5 that blurs into cruise-missile territory, which together add up to the “democratization” of deep precision strike. Its sharpest warning is about home soil: it doubts stadium and venue owners “have grasped the true depth and breadth of this potential threat.”

Stockpile paradox. The Atlantic traces how the UAE became THAAD’s first foreign buyer and how the system has worked exactly as designed against Iran, just not as promised: the US held no more than 534 interceptors in 2024, burned a stockpile that took about nine years to build in ten months, and nearly 80% is gone by CNN’s estimate. Batteries have been pulled from South Korea, the production race finishes in 2030 at best, and CSIS says Tomahawk stocks need four more years.

At Lakestar’s Resilience Summit outside London, one military attendee priced the same problem on land: the UK spends £15 billion on 100-plus tanks for a division, while in Ukraine an identified tank lasts about an hour against five or six £4,000 fibre-optic drones with 35 km of reach. The room’s summary: “We have been throwing Ferraris at Frisbees.” A Lakestar partner added a rule every Canadian founder knows: “Your right to exist starts with the first contract of your home military.”

• European defence funds are raising quickly:

▪️DTCP reached a €455 million first close for its inaugural defence fund
▪️Lakestar closed its $300 million Resilience I fund for defence and dual-use technologies
▪️Expeditions closed a €197 million fund for defence and dual-use startups
▪️Final Frontier and Myriad are targeting €100 million for early-stage defence tech
▪️Resist.UA launched a new fund targeting up to €50 million
▪️Primo Capital is targeting €120 million for space and dual-use technologies

The Defense Brief

The German Case

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a month ago · 13 likes · Louise Boucher

• Nuclear microreactor companies in Europe

🍁 Arctic traffic. The Financial Times reports that Northern Sea Route transits quadrupled as the Gulf war and melting ice pushed ships north, and the same story is also reachable through this Google link for readers without a subscription. Lloyd’s List counted 133 voyages in September, four times 2022 and 46% above August, almost half under the Russian flag, and the Chinese box ship Dubai Tower ran Qingdao to Felixstowe in 24 days against 40-plus via Suez.

Europe rearms. The Atlantic spent a month in the Baltics and found societies ready to commit their whole populations to the fight: Lithuania’s Riflemen’s Union doubled after 2022 to about 20,000, Lithuania spends more of its GDP on defence than any other ally, and some officials fear the US munitions burn in Iran raises Moscow’s appetite for a fait accompli across the 40-mile Suwałki Gap.

Washington’s contribution is modest: about 50 Marines from Camp Lejeune are heading to the Baltic with small drones and coastal sensors for NATO’s Baltic Sentry mission, as Moscow threatens nuclear use over any Kaliningrad blockade.

Futura Doctrina

Project Agincourt and the New US Autonomous Warfare Command: An Initial Assessment

Technology is advancing so rapidly that new capabilities for drones may emerge even before the procurement cycle for previous-generation equipment is complete. Sometimes the procurement cycle for drones isn't even complete yet, and there's already new technology that surpasses the previous one…

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a month ago · 45 likes · 6 comments · Mick Ryan

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🔫 Hot Shots

🍁 The Army wants to see your breaching kit. The Canadian Army and IDEaS are running a MINERVA field demonstration on breaching at 2nd Canadian Division Support Base Valcartier on October 28, and Canadian industry must register by October 16.

🍁 Kingston Police lost 100,000 real documents to a hacker. An intruder on a compromised account copied and encrypted about 160 GB across 345,000 files starting January 1, 2025, touching records on tens of thousands of people back to 1998, then “agreed” to delete it all. The force now plans nearly $4 million over three years for cyber.

Is the AI Revolution Ready for War? No.

🍁 Calian opens Northstar, its first defence integration lab. With Invest Ottawa at Area X.O's Greenbelt site, Calian will run a vendor-neutral lab on its ATHORA platform for eight founding partners including Cohere, Anvil, TACTIQL and Tessellate Robotics, the first facility under a $100 million push for sovereign C5ISRT.

🍁 Spy capacity. CSIS is rewriting its hiring playbook after internal documents showed 85% of appointments were internal as of March and onboarding under enhanced top secret clearance takes 12 to 18 months. The service is adding an external recruitment team and weighing outsourced screening to clear "structural bottlenecks." Former CSIS analyst Stephanie Carvin: staff shortages mean people "burn out, they get tired and that is a risk for the organization." Meanwhile, former intelligence officials Alan Barnes and Geoff St. John warn that a Canadian foreign espionage service would yield perhaps several hundred reports a year and should start from a requirement only espionage can meet, because "Bond films are not documentaries."

🍁 Juno Industries shows its first two products. Harjit Sajjan and Hunter Scharfe’s Vancouver company unveiled Guardian, a sensor-and-compute kit that runs without external connectivity or GPS, and Logan, a common operating picture built to plug into existing C2, after a $12 million raise in May and entry into the Defence Drone Initiative.

🍁 Volatus opens 53,000 square feet in Mirabel. The plant already builds drone docking stations and V-Series aircraft, and CEO Glen Lynch says sovereignty requires the ability “to manufacture, integrate, test and support that technology here in Canada” and not just design it.

Drone Dominance is recruiting FPV pilots. The Pentagon program wants service members with FPV experience to fly future Gauntlets, with follow-up surveys going only to valid .mil addresses.

Ukraine’s Mavic replacement still needs China. Vyriy’s new Slavic recon drone doubles the Mavic’s range to 30 km, plugs into Delta and Kropyva, and retrains Mavic pilots in under a day after testing with seven units, but ships with no price, no production target and some Chinese components.

DARPA wants a hypersonic cruise missile that’s cheap to build. The new RFI covers four classes, from fighter-carried to ground-launched, demands a “revolutionary leap” in range, speed or altitude plus high-rate manufacturability, and explicitly invites non-traditional firms, with responses now due November 6.

Traysar wants to put sovereign AI underground. The Austin startup’s truck-mounted Terminus borer, paired with Armada’s modular data centres, aims to bury air-gapped compute next to the mission so it survives attacks like those on Middle East data centres. CEO Yadin Soffer: “The future of infrastructure is not only distributed, it is underground.”

USNI wants the Navy to draw maps again. Proceedings traces US sea power’s high points from Mahan to the 1980s Maritime Strategy to map-driven strategic thinking and calls for a Naval War College “Geography Center,” with the Arctic among the candidate priorities.

The US Fed economist, the dating site and the spy. CNBC’s Eamon Javers reconstructs how a Chinese handler cultivated Fed official John Rogers for years, brokering his travel, his marriage and even his prenup, until FBI agents arrested him.

Rinse and Repeat: Canada Has the Talent to Build for Its Own Military. It Needs the Nerve to Use It.

Britain brings back the horse. Household Cavalry troopers patrolled in pairs on horseback at Sandhurst’s Barossa training area on September 23, tracking simulated enemy positions through SA80 sights. The MOD calls it a niche capability for ground vehicles can’t handle, not a return to the charge. The last British cavalry charge was in 1917. In a kill zone full of drones, a horse is hard to jam.

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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🎯 Three-Shot Burst

The arsenal of democracy is waiting on a screw. The New York Times went to Saginaw, Michigan, and found the part that decides how fast America can rearm: the precision ball screw, a spiral cut into metal that sits inside Patriot missiles, aircraft and humanoid robots, where demand has jumped as much as 50 percent since 2020 and a shortage now adds “months or even years” to building a missile. Only a handful of American firms can make them to military spec, and most are already at capacity.

The Wall Street Journal shows what sits downstream of that choke point: RTX’s Tucson plant runs around the clock and Lockheed Martin is hiring hundreds in Arkansas to triple Patriot output, but the US fired more than 1,000 Tomahawks in two months against Iran and burned roughly half its high-end Patriots, so most of the new missiles will arrive too late for any fight in the next couple of years, even with a $23 billion Tomahawk order on the books. Munitions averaged just 7.5% of Pentagon procurement and research spending from 1999 to 2025, against 23% for aircraft. The chokepoints go deeper than screws. China controls 68.6% of global germanium, the price is 9 to 10 times 2023 levels, and every thermal sight and missile seeker needs it, which is why the Pentagon’s CLEAR program just funded LightPath’s germanium-free BlackDiamond glass.

Batteries are next: the Pentagon handed Amprius up to $75 million to convert a US electric vehicle line into a drone cell plant, targeting 12 million NDAA-compliant cells a year by early 2028. Arena Physica’s teardown explains why this matters: DJI holds about 70% of the global drone market and grew hardware margins from 72% to 79% on a roughly $139 bill of materials, beating Apple’s 53% on the iPhone 15 Pro Max, because it designs its own silicon inside a Shenzhen supply belt that makes over 80% of the world’s lithium batteries. Missile primes are now reaching beyond the traditional rocket-motor base to spacecraft and hypersonic-jet companies for propulsion. The strategic stakes are spelled out in Foreign Affairs. Michael Horowitz argues the Iran war proved that the age of precise mass is here: 1,000 targets hit in 24 hours and 12,000 more in 37 days, and the regime is still standing, because “militaries cannot endlessly block salvos of $35,000 Shahed-136 attack drones with $4 million Patriot missiles.” Nadia Schadlow names the result, warning that the US is caught in an attrition trap built on capacity, adaptation and political gaps, where paper power fails to become sustained combat power. The Canadian version comes from CGAI. Jahara Matisek notes that Canada sends 69 cents of every defence procurement dollar to its Five Eyes allies, that 54% of the navy’s fleet was unserviceable in a 2024 DND report, and that Canada ranks top five in 14 of 31 critical minerals yet exports its nickel and cobalt to be refined elsewhere. His line should be taped to every DIA desk: “production is power; dependence is a strategic liability.”

Canada is spending $180 billion on kit. Can we take delivery? The sharpest Canadian defence essay of the season comes from Stewart Leckie, L-SPARK’s director of defence and dual-use technologies, reprinted in The Walrus. His question is whether Canada is “structurally capable of taking delivery” of dual-use technology, now that spin-in from commercial markets has replaced spin-off from government labs. His answer on procurement is brutal: “It is not broken. It is working exactly as designed.” In 2018 Ottawa counted 92 business innovation program streams across 20 departments and promised to cut them by up to two-thirds, and the Defence Industrial Strategy then added more: “Instead of more access, they built a maze with excellent intentions.”

Canada built DATAR, a networked radar and sonar battle picture that worked on Lake Ontario in 1953, a decade before anyone else, then could not afford to field it. The pattern is repeating in real time. Hamilton’s Sentinel R&D designed its drone around Ukrainian requirements, builds small autonomous aircraft for Ukraine’s Airlogix, and CEO Kath Intson told the Nrth conference she is now selling “directly to the Ukrainians” with no trouble finding buyers abroad. A different Sentinel, Châteauguay’s Sentinel Advanced Military Solutions, spent two weeks in the California desert in August printing drone chassis and flying missions from a deployable field factory, with a second-generation StarForge due around mid-October and a $10 million Lockheed Martin ITB contribution tied to HIMARS behind it. CTO Ed Zimmermann: “Every NATO country is struggling to some extent to keep legacy equipment in the field, because supply chains have atrophied and lead times are long.”

Reality check: TerraSense points out that the RCAF’s first MQ-9s land in 2028, 19 years after the JUSTAS RFP was supposed to drop, and the Army owns fewer drones than Ukraine loses in a week. Spreading the Defence Drone Initiative across 400 companies selling 100 drones each is a start, but: “If we try to build a domestic industry by churning out $5,000 hardware-focused drones a hundred at a time, we will lose.”

Space money doubled in six months. Canada’s biggest pensions had more in China than in Canadian equities. PitchBook’s space tech snapshot shows startups raised $11.3 billion across 244 deals in H1 2026, already past all of 2025’s $10.1 billion, with the median deal more than doubling to $14.5 million, late-stage rounds taking 87.4% and Europe hitting a record 21.1% share. Rocket Lab’s roughly $8 billion bid for Iridium put spectrum and customer access at the centre of the market. Demand is outrunning supply: a rocket shortage has operators weighing whether to build their own launchers or buy a rocket maker as mission costs climb. Public markets are sending a mixed signal. Bernstein says US defence stocks have slid from a premium to a discount despite record backlogs, because the problem “is not demand. It’s dysfunction.” in Congress, with the November 3 midterms as the likely clearing event.

Canada’s institutional money is the harder problem. The Canadian Shield Institute’s “Worth It” report finds pension holdings of Canadian public companies fell from 28% of assets in 2000 to under 4% by 2023, with the eight largest funds holding roughly $88 billion in China against $81 billion in Canadian equities. Ontario Teachers’ new $10 billion Canada pledge is 3.3% of its $303.2 billion, CPPIB keeps 12% at home, and OSFI confirmed the promised disclosure framework was quietly abandoned. CPPIB’s Michel Leduc told MPs: “By design, we are not a sovereign wealth fund, a development bank, a social-cause vehicle or an innovation venture.” The banks are moving faster than the pensions. CIBC’s capital markets podcast sat down with COVE CEO Melanie Nadeau on how Canadian entrepreneurs can scale breakthrough defence ideas and why this is a pivotal moment for the defence and resiliency sector.

The Venturist

How to Build a Defence Tech Company

This is a premium edition of The Venturist, available in full to subscribers. Subscribe for €9.99 a month or €89.99 a year to read our field guide to building a company in Europe’s hottest sector: defence technology…

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a month ago · 8 likes · Roko Karanusic

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

Canadians backing Canadians, in America:

🍁 Ottawa signs a preliminary deal for six Saab GlobalEye aircraft. The airborne early warning jets would be built in Canada with Bombardier, but the agreement is not a contract and carries no cost or timeline, and sources say the platform has met only a handful of RCAF requirements. Full NORAD integration needs US stealth communications technology Washington has never shared.

🍁 Canada and Norway open a government-to-government procurement lane. The Canadian Commercial Corporation and the Norwegian Defence Materiel Agency signed an LOI that lets Norway buy Canadian ammunition, missiles, UAVs, air defence and electronic warfare kit through CCC’s G2G model, with Ukraine deliveries the first target. CCC has run G2G contracting since 1946.

• The Ontario Ministry of Economic Development, Job Creation and Trade is undertaking a capacity mapping exercise to identify companies in the province that are capable of producing munition parts.

• Eva Sula, who will speak at GCXPO in Ottawa today, on the barriers SMEs face in defence

• The Real Arms Race Is Over Who Gets to Test First

🍁 Scotiabank prices Canada’s first defence bond at C$750M. The 5NC4 Canadian Defence Notes priced September 21 as the first offering under a framework published September 8, and the proceeds finance general-purpose loans to defence and security entities, public or private. A labelled defence bond is a new asset class in Canada.

🍁 Ontario Shipyards bids to build a 16 to 20 ship corvette fleet. The federally owned Port Weller dry docks once employed 2,000, and CEO Shaun Padulo now runs 175 workers and a $135.6 million CCGS Terry Fox refit that slid from summer 2025 to December 2027, while pitching up to 800 direct jobs on a program first pegged at $5 billion and now expected to cost substantially more. Vard’s Derek Buxton: “The procurement system has always been afraid. It’s lacked courage, and that’s why processes take forever.”

Rocko Carafano

Jevons Paradox Comes to US Shipbuilding

Jevons Paradox Comes to US Shipbuilding…

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a month ago · 6 likes · Rocko Carafano

🍁 MaRS and Vimy Forge launch a “capital matchmaking engine.” Toronto’s MaRS joins the Fredericton accelerator to pair unproven defence startups with investors who understand the risk profile, after a first cohort including Cellula Robotics and Wuxly and with a second due in January.

• DND’s MAIple Stack pulls in Cohere, Anvil Intelligence, H2 Analytics, Larus and Tactiql behind a $33.5 million seed line in the departmental plan.

Quartermaster raises $140M for ocean awareness. Insight Partners preempted the Series B four months after a $43 million A, with about $100 million in equity from Insight, Overmatch Ventures and First Round and a $40 million debt facility from Stifel. SmartMast sensors now sit on more than 650 vessels in 25 countries, with 800-plus systems shipped.

🍁 Halifax-based space technology company Galaxia has raised 4.5 million to continue developing advanced sovereign satellite systems built in Atlantic Canada.

Industrial Base Alpha

⬟ Saronic

Saronic made shipbuilding history this week earning the prototype Other Transaction Authority award alongside two other shipyards to produce the Landing Craft, Utility (LCU) 1700-class craft. This news was less widespread than their June 2026 rescue of two downed…

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a month ago · 8 likes · Matthew Bernard

DTCP closes €455M for a dedicated defence fund. Deutsche Telekom, Porsche SE, Denmark’s EIFO, Danica and Estonia’s SmartCap anchor a “Europe-led, NATO-aligned” vehicle that targets mostly Series B and later, with Kraken’s $175 million and Six Robotics’ €12 million rounds already in the book. Other NATO members’ startups are in scope.

Flagship Pioneering wins up to $47M to build biodefence platforms. The five-year ONTARGET award from the Chemical and Biological Defense Program buys a portfolio of platform technologies instead of one product, starting with Apriori Bio and Prologue Medicines.

• Toronto’s Biossil raises $153-million in OpenAI-led funding to bring resuscitated drugs to market.

Related: Tectonic got inside Brave Capital and DIU’s private Brave Frontier retreat outside Austin, where DIU deputy director Maj. Gen. Joe Kunkel told founders that only a select few in the department actually control the money and Shield AI recounted a V-BAT that lost GPS two feet off the ground in Ukraine before finding an S-400 two days later, a useful reminder that demand signals, not pitch decks, decide who survives.

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⚔️ Combat Readiness

🍁 Kit for Canada. The first CF-35A, AR-1, flew for 90 minutes at Fort Worth on September 23 in full RCAF markings, but Canada remains contractually obligated to only 16 of the 88 jets, with the first aircraft on Canadian soil in 2028 and full operating capability in 2032 to 2034. The drone problem cannot wait that long. MINERVA’s Phase 2 challenge wants a Windows-based airspace picture that plans, deconflicts and controls UAS traffic and spectrum in 4D at TRL 5 to 9, with bonus points for NATO-sourced components and bids due October 21. The notice admits the Army “has purchased foreign robotics and autonomous systems of varying quality.” Canadian software shops, this one is written for you.

🍁 The kill zone. In Latvia, the Wall Street Journal watched a Danish company playing the enemy use a night drone raid to break the Canadian-led brigade’s lines and overrun a Spanish position. Canadian Leopards rolled without anti-drone nets or detection, one crewman expected a shotgun for counter-UAS, and M777s were spread 12 kilometres apart in pits up to three metres deep. Col. David Brassard concedes the brigade is not at its desired readiness. Gen. Jennie Carignan wants the UK-led Joint Expeditionary Force as a “menu of options” for testing new drones and counter-drone kit.

Mind of Things

Anduril and the Limits of Build First, Buy Later

This week, Anduril announced that they were no longer able to work at risk on the FQ-44. A while back I wrote There is a Defense Tech Bubble, and this is one of the clearest examples those inside the bubble are starting to realize the limits of private capital. Private capital can finance prototypes, facilities, and even some low level production at ris…

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a month ago · 41 likes · 3 comments · Justin Mc

• Jackson Moses on Anduril:

Western capital markets are solving America's many defense deficiencies, investing $10Bs in its industrial base, and, as always, negligent U.S. politicians, bureaucrats, and antiquated processes are blocking legitimate progress. D.C. is demanding venture capitalist, allocators, and operators shoulder all the risk, to the tune of $170B+ of investment since 2017 (when Anduril was founded), without any semblance of buyer guarantees.

🍁 Arctic endurance. Joint Task Force North’s new commander, BGen J.N.M. Parent, runs 4 million square kilometres across three territories and names the gap in one word: “Sustainment.” In his words, “Reaching the North is not the challenge; sustaining operations once there is,” which is why airfield assessments and Northern Operational Support Hubs come before new platforms. Foreign Affairs makes the same point from the US side, opening on a 2016 crack in the ice that ended the US Navy’s flagship Arctic exercise early north of Prudhoe Bay and an early freeze that trapped roughly two dozen vessels in the East Siberian Sea five years later. The Arctic punishes anyone who confuses presence with endurance.

The Canadian Explorers

Materials of Attrition | Explorer Essay #2

Explorer Essays are ambitious ideas written by startup founders operating in Canada’s critical industries. If you are a founder building frontier technology for Canada and would like to publish an essay or opinion in The Canadian Explorers, contact me at contact@ethanmarcoux.com…

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a month ago · 2 likes · Ethan Marcoux and Stuart Lodge

• The Arctic Readiness Gap: Why Canada’s Defence Industrial Strategy Must Be Built on Northern Reality.

🍁 Home front. Carney told the New York Times he had prepared for the “extreme tail risk” of US military action against Canada, and CBC’s Murray Brewster explains that DND keeps a “vault full” of contingency plans that retired Lt.-Gen. Andrew Leslie says would have been pulled out after the Greenland threats. INDOPACOM’s Adm. Samuel Paparo called the scenario “absolutely and utterly preposterous” and asked about his “attack plans for the Martians.” Meanwhile the money is real: Canada hit $63 billion in 2025-26 and its real per-capita defence spending rose from 22% to 46% of the US level between 2014 and 2026, from US$598 to US$1,146 a head. Slovenia is now the only NATO member under 2%.

Autonomous air. Sweden’s Scaleout Systems flew a BAE Bofors loitering munition that found, ranked and bombed an armoured engineering vehicle with no comms in under 320 seconds, running YOLOv8 Nano on an Nvidia Jetson Orin Nano, after a -18°C Arctic strike demo and €100,000 from NATO DIANA. Notre Dame’s Amy McAuliffe documents where this is heading: Russia fielded a fully autonomous V2U in early 2025, and an AI-enabled drone whose software chose its own aim point killed three civilians at a Zaporizhzhia gas station. Eric Schmidt tells The Economist that the phase when Ukraine was the faster side is over, and that a human can oversee ten drones but not 1,000, which moves the operator from “in the loop” to “on the loop.”

Data is ammunition. Britain now gets secure access to Ukraine’s Avengers AI Labs, more than 5 million annotated battlefield frames drawn largely from the DELTA battle-management system, with up to a dozen UK companies invited to train comms-denied and GPS-denied autonomy inside a no-download perimeter. It is the first time Kyiv has opened that machine-learning infrastructure to a foreign government.

Ground robots. Forterra, the old Robotic Research that fired the first Javelin from an autonomous vehicle in 2004 and now employs more than 500, argues that warfare has automated everything “except one: the distribution of risk to the warfighter on the ground.” Ukraine agrees and is recruiting for what it calls a “Manhattan Project for Physical AI”, with an open call for robotics engineers, a CTO and co-investors under a blunt banner: “The enemy has learned to scale. We must be faster.”

The Canadian Explorers

The Software Defending Airspace | Bashir Khan, AirMatrix — Explorer Spotlight #17

Welcome to the 461 Canadian Explorers who have joined! If you aren’t subscribed, follow the Canadian founders who are building in Canada’s most critical industries by subscribing here…

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a month ago · 2 likes · Ethan Marcoux

Maritime autonomy. STARK’s new 12-metre Vanta 12 carries jammers, loitering munitions and MBDA’s Sea Venom anti-ship missile, sprints past 40 knots and patrols 1,200 miles for weeks, and was tested at REPMUS in Portugal for GIUK gap and Baltic shadow-fleet missions. The company was founded in 2024 and raised €500 million at €3.5 billion in June.

Axis watch. A canopy and weapons-bay door from an Australian F-35, shipped by UPS to the US for inspection in late May, were diverted to Hong Kong and are now held by Beijing. The same week, ShinyHunters leaked a roughly 5,000-line spreadsheet from what it claims is a two to three terabyte haul that maps FBI staff onto counterintelligence, China and Russia units, complete with addresses and Social Security numbers.

Wounded at scale. Drones caused an estimated 70% to 80% of casualties in Ukraine’s third year, and US wounded from the Iran war grew from about 200 in March to nearly 700 by August, most with traumatic brain injuries. Clinicians now describe “dronophobia” and sound-linked hypervigilance, and the authors warn that “the drone is a sustained condition, not a discrete traumatic event.”

• Ukraine captured Russia’s new Geran 4 and took it apart, revealing a Russian weapon whose lethal anatomy remains strikingly international, packed with components originating in China, the U.S., Europe and beyond.

• Video of Ukrainian drones set up and waiting to launch against Russian forces.

• Sounds crazy: Ukrainian drones are now protecting artillery.

• Ranked: Countries Importing the Most Military Drones.

• Perry Boyle: The Challenges of Defense Tech Investing in Ukraine.

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🔫 Hot Shots

🍁 Changing perceptions. ONE9 founder Glenn Cowan, a 19-year CAF officer with 14 years in a special operations unit, explains how Kensington anchored ONE9’s first fund when other Canadian institutions would not touch defence, and why dual-use is the thesis: “Other than a kinetically offensive weapon, almost every piece of technology has applicability outside of the military.”

Cyber security roundup: More than 60 government IT tenders last week asked for a specific product by name… Flights delayed at major US airports after cable cut by construction workers… The DIU Bridge Program is announcing the Classified Access to Address Critical Technology “CLASS ACT” solicitation, a new pathway to increase the number of cleared nontraditional companies working with the DoW.

🍁 Canadians who deliberate want more defence. Global Canada and Stanford’s deliberative poll of 7,491 Canadians and 408 deliberators found support for 3.5% of GDP on defence rose from 6.5 to 6.8 out of 10 after a weekend of debate, while knowledge that Canada has no foreign human intelligence service jumped from 49% to 73%.

🍁 Former CSIS director David Vigneault on hybrid war. Now chief intelligence officer at Strider Technologies, he tells the BBC that Russia is working “to create dissensions” inside democracies because “the more fragile we are, the less we’re able to counter their aggressive actions.”

🍁 Deloitte and CADSI put a price on procurement reform. Canada’s 538 defence firms produced $11.1 billion of GDP and 81,800 jobs in 2024, but only 53% of procurement stays home, and hitting 5% by 2033 with 70% Canadian content adds $56 billion of GDP and 14,000 jobs a year over the decade. Germany cut timelines 37% with similar reforms.

Germany has Europe’s biggest defence budget, and startups barely see it. Keen Venture Partners’ guide shows €108.2 billion in 2026 flowing mostly to primes, partly because BAAINBw officials carry personal liability for procurement decisions, which pushes them toward proven suppliers. Sophia Hommels: “Little funding ends up going to startups versus the primes, because no one wants to take the risk.”

Africom stands up a Defense Economics Office. Gen. Dagvin Anderson calls economics an “acceleration lever” and wants the office to disrupt adversary revenue and de-risk critical-mineral value chains into the industrial base, building on Steve Feinberg’s new Pentagon economic defence unit.

SOCOM is rewiring the A-Team. After a roughly 14% cut in buying power and about 5,000 fewer personnel against 35% more demand, the debate is whether to bolt cyber, EW and drone operators onto 12-man ODAs or replace core roles.

Amprius’s CEO makes the battery pitch on CNBC. Tom Stepien walks through the $75 million grant, China exposure and military demand under a simple headline: “We are bringing drone battery production to the U.S.”

The alliance map just got more crowded. Visual Capitalist maps five mutual defence pacts, with the new Saudi, Türkiye and Pakistan Mecca Defence Alliance creating fresh overlap with NATO through Türkiye. A NATO member now shares a collective defence clause with a nuclear-armed non-member.

A primer on how seekers find targets. everything RF’s explainer on what a radar seeker is and how it guides a missile is a useful refresher for anyone reading this week’s germanium and ball screw stories.

And the closer: the chickens that nearly guarded West Germany. BBC Science Focus revisits Britain’s 1957 Blue Peacock plan for ten 10-kiloton nuclear mines whose circuits froze when buried, and the fix someone actually proposed: a live chicken inside each bomb to keep the wires warm for a week. It was cancelled as unethical and bizarre.

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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The allied arsenal is empty, and the machine filling the targeting gap is hallucinating. Washington told allies to expect delays of as much as five years on missiles and air defence after the Iran war drained its own stocks.

Industry is sprinting: General Motors shipped PAC-3 MSE housings 22 days after contract signature on work that normally takes months or years, inside a Lockheed Martin munitions expansion worth $8 billion to $9 billion across more than 20 sites. It is not enough. Retired Gen. David Petraeus came back from six days in Ukraine reporting Patriot interceptors running low, jet-powered drone interceptors urgently needed and a $27 billion Ukrainian defence financing shortfall, with Ukraine’s General Staff counting more than 1.5 million Russian casualties since February 2022: “The war is thus becoming a race between two theories of victory.”

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Magazine Depth Affordability Is a Choice

America | Tech | Opinion | Culture | Charts…

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a month ago · 105 likes · 3 comments · Alex Oliver

Reality check: Meanwhile the speed everyone wants is producing its own casualties. CNN reports a SOCOM analyst used AI to write an intelligence report claiming a Chinese ship carried nuclear weapons components, aircraft were airborne and boarding teams were ready before someone caught that a chatbot had invented the cargo, with one source saying it “almost started a war” and another offering the line of the week: “AI allows you to get to a bad idea faster.”

The US’ Artificial Intelligence Acceleration Strategy aims to put models in the hands of three million personnel. Bloomberg’s reconstruction of the Minab strike shows what can happen downstream, when two Tomahawks hit an elementary school and killed more than 150 people including at least 123 children, with Palantir’s Maven Smart System fusing 150-plus inputs, more than 1,000 targets struck in 24 hours, and civilian-harm-mitigation staffing cut roughly 90% to fewer than 20 people.

• The era of AI warfare is here

Canada wants millions of drones. PM Carney’s pledge is now contractual: six Canadian suppliers including Saskatoon’s Draganfly split up to $50 million to build drones and uncrewed ground vehicles, aiming to grow CAF drone holdings tenfold with 30% of output going straight to Ukraine’s battlefield, while General Dynamics Mission Systems-Canada pairs with Green Tech Harvest and Hamilton’s Sentinel works with Airlogix. The teacher is Ukraine, where FPV drones cost US$200 to US$1,000 against US$53,000 for the closest prior American equivalent, and where Snake Island Lab’s Sergii Vlashchenko says every corps runs its own lab: “The end-users should determine the specs of the product, not the defence contractor.”

Calian bought the training version of that lesson, partnering with Ukraine’s SkyFall, whose academy has trained more than 30,000 Ukrainian personnel in three years. The Army is pulling the same thread through MINERVA, which released six uncrewed systems challenges from the Arctic to cargo-munition drop with up to $2.5 million each via Innovative Solutions Canada.

Reality check: Fourteen Canadian companies formed CANUC to warn that Canada is becoming a country of drone subsidiaries rather than drone builders, with ARA Robotics chasing 70 to 80 percent Canadian content and Canadian UAVs’ Sean Greenwood noting that “capital flows toward certainty” while microelectronics, battery cells, permanent magnets and firmware all remain foreign. ARA’s Pascal Chiva-Bernard says the quiet part out loud: “Simply assembling products in Canada will not create a domestic supplier base that controls the design, manufacturing, and intellectual property behind critical technologies.”

• Inside an elite Ukrainian drone unit: a special report

• Canada didn’t join the drone industry. We helped invent it.

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

Canada’s Photonics Opportunity: A Manufacturing Advantage Hiding in Plain Sight

Photonics is a foundational technology for defence, artificial intelligence, telecommunications, advanced sensing, and quantum systems. The question is whether Canada will build on an existing advantage or allow the greatest economic benefits to accrue elsewhere.

Unlike many areas of the semiconductor industry, photonics is one of the few advanced technology sectors where Canada already possesses significant expertise, infrastructure, and industrial capability. From research institutions and fabrication facilities to globally competitive companies, Canada has many of the ingredients needed to build a stronger domestic industry.

The challenge is not discovering a Canadian advantage. The challenge is scaling it.

A technology right for Canada

Semiconductors are strategically important, but not every part of the semiconductor value chain is equally accessible. Leading-edge silicon fabrication plants require very large capital investments and constant reinvestment to remain competitive.

Photonics presents a different opportunity.

In French.

🤝 Deal Corner

🍁 BDC allocates $1B under a $6B Defence Platform. A $500 million Defence Fund (Fund of Funds) backs Canadian and allied funds in defence and dual-use, and StrongNorth (Direct Equity) increases to $500 million for early-stage direct cheques. BDC also becomes the first Canadian investor in NATO's DIANA Capital Network.

• The first Defence Fund cheque went to Intrepid Growth Partners' inaugural US$525 million AI fund.

• The platform named space for the first time, with StrongNorth's one disclosed deal going to Landing Zones Canada and its reusable stratospheric drones.

• BetaKit reports Canadian defence investment in the first half of the year mostly dried up.

🍁 Canada’s banks put north of $320B on the table. TD’s $150B over five years, Scotiabank’s $100B, BMO’s $70B over a decade, RBCx’s $1.4B growth fund and CIBC’s $2B for defence and dual-use firms all landed within days, and all six banks including National Bank have already backed the Canada-hosted Defence, Security and Resilience Bank.

Meanwhile at the Canada Investment Summit: Sterling Energetics CEO JR Cox found his $1.3 billion Alberta explosives complex on page 60 of a 167-project deal book and talked his way into satellite events instead of meetings, with 600 jobs and one in ten local families on the payroll if it gets built. Maritime Launch's Sarah McLean pitched a $250 million Spaceport Nova Scotia expansion. Xanadu's Christian Weedbrook said from the floor that "Canada is waking up now."

• While Ottawa courts $1 trillion in foreign capital, the Canadian Shield Institute asks whether the national security review process can survive the inflow it is trying to attract.

🍁 The Arctic build-out runs through Indigenous partnership. CIBC’s Jaimie Lickers, Senior Vice-President of Indigenous Markets, makes the case [VIDEO] that Canada’s defence strategy can deliver Indigenous opportunity and long-term benefit. Worth watching against this week’s other numbers: Arctic domain awareness, northern infrastructure and forward operating locations are where capital is moving.

🍁 Sterling Energetics pitches a $1.3B Alberta energetics complex. JR Cox wants nitrocellulose, high explosives and kamikaze drone components in Wetaskiwin County on a 600-person workforce, after an earlier plan on Samson Cree First Nation land collapsed when a band election went the other way. Ottawa has already pledged $355.7 million to General Dynamics’ Canadian arm for a Quebec nitrocellulose plant inside a $1.4 billion shell push: “We haven’t solved our sovereignty at all by championing projects by the primes.”

🍁 Maritime Launch seeks $250M to accelerate Spaceport Nova Scotia. Canso has a road, a pad and three sub-orbital launches, plus $200 million of federal money in March to use the site for ten years and a July deal with Germany’s Isar Aerospace targeting Canada’s first orbital launch by 2028. Canada remains the only G7 country never to reach orbit.

🍁 Canada and France agree to share space launch infrastructure. PM Carney announced the initiative in Saint-Pierre alongside French President Macron, directing both countries’ space agencies and defence departments to develop and share systems including space launch. No funding, timeline or site was disclosed. Note the geography: Saint-Pierre and Miquelon sits off Newfoundland, a few hundred kilometres from the Nova Scotia pad Maritime Launch is trying to finance.

🍁 Canada Rocket Company raises ~$22.5M and aims at Falcon 9. Incorporated in November 2025, CRC went from two people to 34 in ten months, moved into 7,400 square feet in Etobicoke and now targets 12,000 kg to low Earth orbit rather than 6,500, against roughly 1,000 kg for domestic peers. First R-2 launch is pencilled for 2032 at a cost of up to US$660 million, with 10 repatriated Canadians among the hires.

The Canadian Explorers

Space Launch Built for Speed | Bachar Elzein, Reaction Dynamics — Explorer Spotlight #16

“SpaceX is built for mass; we are built for speed.” — Bachar Elzein, CEO and Founder, Reaction Dynamics…

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a month ago · 1 like · Ethan Marcoux

🍁 Calian partners with Ukraine’s SkyFall on drone training. Terms were not disclosed, but the target market is the CAF, the UK, NATO members and allies, built on an academy certified by Ukraine’s defence ministry with 30,000 personnel trained. Training is the fastest-monetizing piece of Canada’s drone pledge.

🍁 Scientists test new (and old) navigation systems to end GPS dependence.

• North Vector Dynamics seeking heads of GR and Communications

• Civilian schools are training the air force’s next generation of technicians for the first time

🍁 Allen-Vanguard collapses owing $124M against $5M in assets. PwC was appointed receiver September 1 over the Ottawa counter-IED and counter-drone maker, with $114 million owed to secured creditors. Roughly 50 staff worked across Canada and the UK as of July 28, and Vanguard notes the company spent over two years and more than 50 buyer approaches failing to find an owner.

🍁 Poland’s PGZ opens talks to make TNT in Canada. Deputy CEO Arkadiusz Bak says government-level discussions cover TNT, nitrocellulose and possibly hexogen, with Canada as the primary market and no financing or site locked in yet, roughly two years to implementation once talks close. Canada produces zero TNT today. Poland’s Nitro-Chem is doubling to 20,000 tonnes a year at home in three to four years.

• European defence startups raised $2.65B in 2025.

• Luke Kulik mapped $68B in capital raised by 123 private defence tech companies (with >$20M+ in funding) to every investor on record.

Shield AI in talks at a $20B-plus valuation. The Information reports the autonomy firm is negotiating a valuation of at least $20 billion.

Counter-drone and space money keeps moving. Erik Prince’s Vectus Air Defense Systems launched selling jammers, cannons and interceptors as a subscription service, with Ukrainian swarm specialist Swarmer holding 20% as founding investor and US CEO Alex Fink naming the core problem: “You have a really large cost-asymmetry right now, between how much it costs to attack a valuable site and how much it costs to defend it from that attack.” In Europe, Bulgaria’s EnduroSat is chasing a $200 million Series C barely six months after a $104 million round backed by Google Ventures and Lux Capital.

The UK weighs buying into Canada’s defence bank. Chancellor John Healey is considering a DSRB bid his predecessor rejected, at an entry price of about £870 million spread over three years for G7 members. Canada leads the bank with nine backers; Britain’s competing Multilateral Defence Mechanism has £749 million and a 2027 target.

Related: Arena Magazine documents frontier AI labs deploying $30 billion and hiring 9,000-plus forward-deployed engineers, roughly two Palantirs worth, in four months, a reminder that the services layer is where defence software margin now lives.

When it comes to defence and security, the Canada-Norway Alliance Is a Model for the Future

Jordan Freed, President and Managing Director, Kongsberg Geospatial

The visit of Norwegian Prime Minister Jonas Gahr Støre to Canada highlights a critical evolution in transatlantic relations: defence is no longer just about external diplomacy, but about deep industrial integration.

As Canada works to rebuild, rearm, and reinvest in the Canadian Armed Forces, its growing alignment with Norway offers a blueprint for how middle-power democracies can secure their sovereign interests.

Canada and Norway share far more than a North Atlantic baseline and Arctic Council seats. This partnership is anchored in a shared climate, common democratic values, and a mutual requirement to defend vast, unforgiving polar territories. From Ottawa’s tech hub to coastal waters, Norwegian-backed defence expertise—represented in Ottawa by KONGSBERG Canada—is powering Canada’s operational readiness spanning deep sea to outer space.

This isn’t theoretical cooperation. It manifests in the sensors on Canada’s Arctic and Offshore Patrol Ships, remote weapon stations deployed by the Canadian Armed Forces, and Ottawa-developed combat systems tailored for next-generation submarine initiatives like the Type 212CD. Furthermore, as subsea infrastructure vulnerabilities grow worldwide, Norway’s decades of extreme-environment innovation provide Canada with immediate, field-tested solutions for the High North.

In an increasingly unpredictable geopolitical landscape, traditional alliance rhetoric is no longer enough. Sovereignty relies on a robust industrial base and trusted supply chains. By embedding specialized, high-skilled defence engineering directly into the Canadian economy, the Canada-Norway partnership demonstrates how shared geography and operational trust can turn historical alignment into genuine, modern capability that keep Canadians, and their allies, safe.

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Learn more here.

⚔️ Combat Readiness

🍁 Kit for Canada. The Conservatives want the Auditor General and the Parliamentary Budget Officer to probe the GlobalEye buy, after sources said Saab’s aircraft met only a handful of air force requirements and that no competitor saw the requirements before Carney named a preferred platform at CANSEC in May. The gaps listed are not cosmetic: 360-degree radar coverage, radar range, NORAD connectivity and no in-flight refuelling for Arctic work. Saab counters that militarizing Bombardier’s Global 6500 in Canada “will create thousands of good paying jobs while strengthening Canadian sovereignty.”

🍁 Home front. Parliament’s national security committee is reviewing whether Canada can actually collect foreign intelligence, given CSIS may gather it only from inside Canada and never overseas, with a first national security strategy in over two decades now in drafting and Goran Samuel Pesic dismissing the cost excuse: “I don’t buy for one single moment that it’s too expensive. Life is expensive. Canadian interests are priceless.” The enforcement record is the argument for him. Canada sanctioned Streit Group on August 6 but not its Canadian founder Gherman Goutorov, whose armoured vehicles allegedly reached Russia’s Rosgvardia across 41 Kamaz and 38 VPK-Ural shipments between 2015 and 2022, which Queen’s professor Christian Leuprecht calls “a case study of gaps in enforcement.” And Ottawa handed more than $2 million in federal and provincial contracts, including a $50,000 Canadian Forces vehicle deal and $380,000 from ISED, to an Edmonton engineer CSIS had flagged for work on Iranian missile and jamming programs.

• To spy, or not to spy: Canadian government consideration of a foreign intelligence agency, 1945–2007

🍁 Allied friction. FBI Director Kash Patel briefly suspended cooperation with the RCMP over a CBC memo on how to describe 9/11, per the New York Times, which reported cancelled meetings around the anniversary. Commissioner Mike Duheme insists relationships stay “strong,” and CBC clarified on August 28 that direct attribution is not required to call 9/11 terrorism.

Gandalv

Europe Can Hit Russia Harder Than Anyone Admits.

This is a scenario, not a forecast. It is built from open-source evidence available at the end of August 2026: real force levels, real bases, real distances, real doctrine and real sentences spoken by real people. Four assumptions drive it. The war in Ukraine continues without a ceasefire. The United States, at war with Iran since February, keeps its forces in Europe out of the fighting, neither blocking European action nor joining it. Investigators recover enough Russian hardware from the wreckage for governments to act on attribution. And no nuclear weapon is used, although the scenario is largely about how close it comes. Everything after the first crash is simulation. The world it happens in is not…

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2 months ago · 19 likes · 9 comments · Gandalv

• European arms production: A re-conceptualisation of the defence technological and industrial base, industrial policy and hybrid governance

🍁 Maritime autonomy. DND is buying a Canadian-designed autonomous mine countermeasures surface vessel, with the RFP for W8472-275993 to detect, locate and identify underwater mines closing October 1. Meanwhile China is building what is likely the world’s first submarine drone mothership at Hudong-Zhonghua in Shanghai, an LPD-style hull with 12 jack-up arms and a hangar for four of the 35 and 45 metre XXLUUVs already testing off Hainan, six to eight times the size of Boeing’s Orca.

The Defense Brief

The Bravest Defense Plan in Europe

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a month ago · 19 likes · 1 comment · Louise Boucher

Deep strike. Russia has fitted turbojet engines to its Geran one-way attack drones, making them cheap, fast and effective at beating Ukrainian air defences, which is precisely why Petraeus lists jet-drone interceptors alongside electronic warfare and hardened distributed energy as Ukraine’s top asks. The Economist’s embed with an elite Ukrainian drone unit fills in the human layer.

First Breakfast

Bringing the Boom: Why Now Is the SpaceX Moment for Explosives

First Breakfast’s Madeline Hart spoke with Kevin Capozzoli, co-founder and CEO of Critical Materials Group. Watch their full conversation and read the profile on his company…

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a month ago · 16 likes · Madeline Hart

Doctrine debt. Petraeus told RUSI that unmanned systems now cause nearly 90% of Russia’s killed and wounded on the front line, that Ukraine builds around eight million drones a year, and that software refreshes weekly with hardware every few weeks. His verdict: traditional armoured manoeuvre has effectively stopped, and fixing that demands an institutional overhaul of doctrine, force structure, training, procurement and personnel on a scale beyond what he ran during the Iraq surge. Most western procurement systems measure cycle time in years. Ukraine’s measures it in weeks.

The kill zone. Ukraine now evacuates casualties by robot through a drone-saturated belt up to 20 miles deep, losing two unmanned ground vehicles for every five lives saved, with ePoints paying up to 70 for a casualty evacuation against two or three for resupply, one soldier wearing a tourniquet 33 days after six failed attempts, and under 1 percent of 1st Medical Battalion injuries coming from gunshots.

Ground robots. West Point’s Modern War Institute proposes a “Deadly Seven” family of FPV, ISR, bomber, sensor, relay, resupply and deception drones integrated from platoon to division rather than bolted on as a specialty: “Drones and sensors should not be treated as independent or specialized capabilities.”

Stockpile paradox. Allies face five-year missile waits while Lockheed Martin pours $8 billion to $9 billion into PAC-3 MSE, THAAD and PrSM capacity and grows floor space nearly 50%, and GM Defense proves a housing component can go from contract to delivery in 22 days when an automaker is pulled into the supply chain.

Cheap at scale. The Pentagon’s $1.1 billion Drone Dominance Program named 25 vendors, with 12 building 30,000 drones at $5,000 each in the first gauntlet at Fort Benning before the field narrows to five suppliers at 150,000 drones and $2,300 per unit, roughly 340,000 small UAS in two years. AUVSI’s Michael Robbins: “Competition promotes innovation, and it drives down costs, but the demand signal is clearly there.”

Axis watch. The Economist lays out the Hellscape concept of flooding the Taiwan Strait with cheap autonomous systems, where strategists now assume attackers need 20:1 or 30:1 firepower rather than 3:1, Taiwan targets 208,000 domestic attack drones and 1,320 suicide boats by 2032 and Beijing calls the plan “psychotic.” Supply chain security is the weak seam: Congress is investigating how F-35 parts including a stealth-coated canopy were rerouted from Australia and ended up in Hong Kong, on a program already missing over a million spare parts in five years per GAO and heading for almost $2 trillion in lifetime cost. Data leaks the same way: Anthropic alleges Chinese firms ran distillation at scale, including at least 300,000 real-user requests routed through Claude in 10 days and 151 million Alibaba exchanges between May and July, with police case files and PLA-linked surveillance material inside the flow.

Space. Space Force has gone public about jamming Iran during Operation Epic Fury, describing a specialist in the 42nd Electromagnetic Warfare Combat Detachment reconfiguring her weapon system and firing non-kinetically while Alarm Red sirens sounded over her site, and confirming it also holds weapons in orbit.

Europe rearms. A hospital in Ulm sits atop a 1979 bunker built to keep treating soldiers after a nuclear strike, rated for 2,000 people over 90 days and dormant for three decades, and the Bundeswehr is now weighing whether to switch it back on.

• Iceland’s Laki Power charges up with €6M from NIF because electric grids are under threat.

🍁 Coalitions. Canada formally applied for full membership in the UK-led Joint Expeditionary Force, a 10-nation northern-flank rapid response group, and is negotiating a “new permanent arrangement” at CFB Suffield where London will spend $18.7 million through 2031 on its 2,700 square kilometre training area.

Big think. The Macdonald-Laurier Institute’s Richard Shimooka argues for a renewed continental compact built on North American Energy Dominance, Fortress Am-Can and a Prosperity Pact, after the bilateral trade deal failed in August, and the ask is uncomfortably direct: Canada must “deliver real improvements on defence and security, not just spending announcements, but real posture, and real capability.”

Software sovereignty. Arena Magazine argues Microsoft, Google, Meta, Anthropic and OpenAI have all quietly copied Palantir’s forward-deployed engineer model, buying or funding four ex-Palantir companies and hiring at Palantir-times-two scale, while Palantir’s own commercial arm runs near $3 billion growing 157% year over year. Set that beside an analyst whose chatbot invented a nuclear cargo and nearly triggered a boarding, and the lesson is that the deployment layer, not the model, decides whether AI is a weapon or a liability.

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CIBC is a proud sponsor of The Icebreaker. Connect with our team at Mailbox.Defence@cibc.com

🔫 Hot Shots

🍁 IDEaS wants minefields solved, and the clock is short. DND’s minefield breaching challenge offers up to $1 million per proposal from a $10 million pool for up to 10 projects across detection and breaching streams, with proposals due October 14 and a Canadian demonstration in Fall 2027 against 10 concurrent lanes each 4.5 metres wide and a kilometre long. TRL 2 through 9 qualifies, so early-stage teams are genuinely in scope.

🍁 MINERVA’s next industry day is at Gagetown. The 4th Artillery Regiment hosts the uncrewed aircraft deconfliction event in late September, closing a run that already put soldiers in front of builders at Valcartier and Petawawa.

🍁 North Bay now trains NATO fighter pilots. The 21,000 square foot International Tactical Training Centre opened September 17 at Jack Garland Airport, hosted Zelenskyy days earlier, trains more than 20 pilots on L-39s with the Belgian Air Force as launch NATO customer, and has $50 million committed for a second 50,000 square foot hangar plus six Leonardo M-346 trainers planned for 2029.

🍁 Read the CANUC pitch before you write your procurement strategy. BetaKit’s sovereign drone piece is the clearest statement yet of what Canadian content actually requires, down to firmware, magnets and battery cells.

• Traditional procurement assumes that requirements can be fully specified at the outset and that the capability is bought once as a capital asset, then maintained. Neither assumption holds for software, autonomy, sensing, data, AI and other fast-moving technologies.

🍁 Ukraine is Canada’s fastest teacher. Canadian Affairs walks through how prototype-to-front timelines compress to weeks and fixes to 24 hours, and why Canada’s tenfold CAF drone goal depends on copying the feedback loop, not the airframe. Draganfly’s Cameron Chell credits the war fighter in the field with the real speed of innovation.

🍁 Space makes BDC’s list. SpaceQ’s read on the platform release notes Ottawa pitched investors on four Canadian space projects including Telesat’s Lightspeed, and that StrongNorth’s first disclosed deal went to stratospheric drone builder Landing Zones Canada.

• McKinsey on the future of space technologies

CanInnovate

A Conversation on Dual-use and Defence Innovation with Loki Jörgenson

Canada’s recently-released Defence Industrial Strategy (DIS), the first of its kind in Canada, sets out several ambitious goals, not the least of which is to route 70% of Canada’s defence procurement spending toward Canadian firms. While the ecosystem has started a lively debate on what it…

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a month ago · 2 likes · 2 comments · Kyle Briggs

Cyber has moved to the tanker deck. US authorities boarded at least two foreign energy tankers in the Gulf of Mexico in August after cyberattacks en route to American ports, with Iran among the suspected actors. Canada moves energy through the same shipping lanes with thinner maritime cyber oversight.

Petraeus put a number on Ukraine’s gap. His theory-of-victory essay is the clearest public accounting of the $27 billion shortfall and the Crimea isolation strategy.

There is a club for people who left the aircraft. The Wall Street Journal got inside the fraternity of ejection survivors, starting with Ron Bath’s RF-4 Phantom hitting a bird near 700 miles per hour over the Nevada desert and ending in a rain-filled ditch off a Reno runway.

• Trump family-backed drone maker signs agreement with Pakistan

• UK looks to ‘land drones’ to transform beleaguered Ajax fighting vehicles

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

Share The Icebreaker

$2 billion behind Canada’s SMB defence builders.
CIBC is committing $2 billion over five years to finance Canadian defence and dual-use small and medium businesses, a pledge confirmed to include infrastructure, energy, cybersecurity, digital capabilities and advanced technologies. The bank frames the money as economic strategy:

“Defence is no longer a secondary consideration to investment decisions…. Canadian businesses in the defence and resiliency ecosystem have the expertise and ambition to lead” — CIBC president and CEO Harry Culham

An official press release layers on a national defence-specialist network and an expanded Military Banking Program. BetaKit’s running tally of Carney’s investment summit places CIBC’s pledge inside a push toward $1 trillion in five-year Canadian investment commitments.

• Canada Investment Summit prospectus lists four space opportunities

Ottawa hands out its first drone money.
The federal government awarded its first Defence Drone Initiative contracts worth up to $50 million to six Canadian companies. Each winner must first deliver 100 low-cost surveillance drones at $5,000 or less per unit, or two uncrewed ground vehicles, before Ottawa will order up to 4,900 more drones and 10 more ground systems.

“In the years to come, we will need millions,” Prime Minister Mark Carney said in the same announcement.

One of the six, Volatus Aerospace, landed a five-year contract worth up to C$25 million to supply an initial 100 tactical ISR uncrewed systems, scalable to 5,000 units total if Ottawa exercises every option

Reality check: The same week, the Hill Times reported that the head of the Defence Investment Agency reportedly eyes the exit even as observers praise “unprecedented” procurement speed, with a defence analyst warning: “You can only bypass [the bureaucracy] so much. You need to change the way it works if you really want to make really substantial reform.” Ottawa kept issuing new money calls regardless, opening a challenge worth up to $6.75 million for radio-frequency data fusion proposals due October 20.

Big kudos to General Molstad, Duncan Stewart, and the teams at CJFC and the DIA!

Canada and Ukraine sign a 100-year pact.
Prime Minister Mark Carney and President Volodymyr Zelenskyy signed a 100-year strategic and political partnership in Calgary, built around a shared plan to scale Canadian drone production into the millions, with one in three drones destined for Ukraine’s front lines. Carney called it part of a broader industrial buildout.

Ottawa paired the drone pledge with $350 million for Ukrainian air-defence interceptors, close to $435 million in loan guarantees for energy security, $200 million in concessional reconstruction loans and up to $40.1 million for Ukrainian veterans and their families. The stakes on the water are already visible: Ukraine’s navy claims its Sargan 3000 uncrewed surface vessel sank a Russian drone boat in what it calls the first naval battle in history between unmanned boats, using a remote 12.7mm gun rather than a missile. Ukraine’s ousted tech-forward former defence minister Mykhailo Fedorov, as covered by The Defender, is reportedly plotting the country’s largest venture fund for defence tech after a US fundraising trip, with Euromaidan Press reporting his three priorities as frontline sensorization, jet interceptors and cheap strike missiles.

• Under heavy cloud cover, Russia fires massive drone barrage at western Ukraine

• Ukraine is the laboratory for the future of war

• Russia Is Churning Out Smart, Cheap New Weapons Faster Than Ukraine or the U.S.

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

🍁 BMO puts up to $70 billion on the table for a decade.
Bank of Montreal will deploy up to $70 billion in new capital over 10 years to defence and security, energy, infrastructure, mining and AI computing.

🍁 Scotiabank builds Canada’s first defence bond framework.
Bank of Nova Scotia published a Canadian Defence Issuance Framework aligned with NATO’s target of 5% of GDP by 2035, becoming, according to Vanguard, the first Canadian institution with a dedicated framework for labelled defence issuances, independently assessed for the first time globally by Sustainable Fitch.

• Canada’s Defence Spending: A Number in Search of a Strategic Framework

• A New Canadian Defence Company, Built on a 50-Year Track Record

🍁 Volatus locks a contract that could scale to 5,000 drones.
Volatus Aerospace was awarded a five-year Government of Canada contract to supply the Canadian Armed Forces with an initial 100 low-cost tactical ISR systems. The company is attempting to build a complete sovereignty stack.

🍁 Inkas bets its next 30 years on Canada instead of exports.
Toronto’s Inkas, which built its business exporting armoured vehicles and safes, is pivoting toward Canada’s own emerging defence market with two new platforms: the M1 light tactical vehicle and the Anuri counter-UAV system. The company currently builds 300 to 400 vehicles a year and expects to roughly double that with expanded Canadian capacity, even as it also opens a facility in Charlotte, North Carolina.

🍁 CSMC wants a reactor plugged into every Arctic base.
Canadian Strategic Missions Corporation unveiled three reactor platforms: POLAR-1 for defence installations and Arctic communities, JAY-1 for lunar bases, and ORCA-1 for research and training, with POLAR-1 targeting first criticality by 2028. CSMC has pulled in more than $17 million in government grants, contributions and contracts since 2022, per a duplicate writeup of the same announcement. Founder and CEO Daniel Sax: “Reliable energy is becoming the crucial national strategic capability.”

🍁 Stellantis may hand its idle Brampton plant to armour maker.
Stellantis signed a memorandum of understanding with Roshel, a deal reported in more detail by CBC as covering the possible sale of its idle Brampton assembly plant and more than 2,000 jobs. Roshel CEO Roman Shimonov frames it as the kind of domestic industrial reuse Canada’s defence buildout needs.

🍁 Fourteen Canadian drone builders gang up on Ottawa’s wallet.
A coalition of 14 Canadian companies making drones and related hardware is pushing the federal government, covered in more detail by RALI, to buy more from homegrown suppliers that build and control their own hardware and software, sharpening the debate over how far Ottawa’s Buy Canadian policy actually reaches once Defence Drone Initiative money starts flowing more quickly.

The Free Press

Inside America’s Fight for Drone Dominance

The U.S. military needs more drones, and it needs to build them without Chinese parts. Today, Defense Innovation Unit Deputy Director Travis Metz joins School of War to discuss how America can build drones quickly, cheaply, and on U.S. soil; what America can learn from Ukraine’s drone war; and the Pentagon’s new billion-dollar effort to upgrade its agin…

Listen now

2 months ago · 21 likes · 10 comments · Aaron MacLean

🍁 A flow-through share pilot wants Canadians, not Ottawa, picking tech winners.
A new proposal would extend Canada’s Flow-Through Share model into a capped, three-year “FTS-Tech” pilot for qualifying technology startups, letting private Canadian investors rather than government bureaucrats choose which companies get funded. The pitch leans on an estimated US$1.6 billion-plus cumulative seed-to-Series-A funding gap, with Canadian seed rounds reportedly 40% smaller and five months slower to close than comparable US rounds.

The Canadian Explorers

Building Canada’s Drone Stack | Josh Ogden, AVSS — Explorer Spotlight #15

“This is not a game for tourists.” — Josh Ogden, Co-Founder and CEO of AVSS…

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2 months ago · 3 likes · Ethan Marcoux

Erik Prince’s Swarmer buys a Ukrainian robot maker for up to $224 million.
Austin-based Swarmer, whose autonomy software already controls up to 690 drones per swarm, agreed to acquire Kyiv’s Ratel Robotics, reported in full by The Robot Report, in a cash-and-stock deal worth up to $224 million if every earnout milestone lands. Ratel’s uncrewed ground vehicles already account for roughly 37% of Ukrainian UGV procurement spending this year, and more than 300 of its employees are expected to join Swarmer.

Mach Industries adds another $600 million, pushing its valuation to $3.7 billion.
The 22-year-old MIT dropout behind Mach Industries, Ethan Thornton, closed a $600 million Series C extension that pushes total fundraising past $1 billion and valuation to $3.7 billion, up from $1.8 billion in June, with the money aimed at scaling long-range strike and counter-UAS production simultaneously rather than betting on one platform.

Fortaegis raises $50M to scale secure silicon for defence. Amsterdam-based Fortaegis will use the funding to move its hardware-rooted security technology into mass production.

Poseidon raises $60 million to build cargo drones the size of small planes.
Bay Area-based Poseidon Aerospace closed a $60 million Series A led by TQ Ventures, ten months after an $11 million seed round, for its 4,000-pound-payload Egret cargo drone and a seaplane variant with a 1,650-nautical-mile range.

Smack Technologies raises $61 million for a wrist screen soldiers can read under fire.
Smack Technologies pulled in a $61 million Series B, pushing total funding above $90 million in roughly five and a half months, to expand from its Omega command software into Alpha, a forearm-worn tactical display built for communications-denied environments. Gen. James Mattis gets quoted in the company’s own materials: “The most important six inches on the battlefield is between your ears.”

Quantum Finance Monitor

Canada’s Quantum Defence Innovation Secure Hub Tests Whether Classified Collaboration Can Shorten the Path to Procurement

Canada’s first Quantum Defence Innovation Secure Hub is designed around a constraint that ordinary research grants do not solve: promising technology often cannot be tested against classified threats, platform data or operational requirements until late in development. A University of Calgary-led consortium will receive C$20.3 million over two years to create a protected environment for work on sensing, communications, algorithms and hardware assurance, with participation from defence primes, technology suppliers and universities. The economic question is whether shared security and direct access to the Canadian Armed Forces and Communications Security Establishment can shorten the route from experiment to procurement, or whether the hub finances coordination and facilities without a buyer committed to fielding the resulting prototypes. The distinction matters because classified validation creates information rather than deployable capacity by itself. A successful trial still needs platform integration, certification, production finance, training, maintenance and an acquisition authority with budget. The hub can remove an institutional barrier, but it cannot substitute for performance thresholds, accountable mission ownership or follow-on orders…

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2 months ago · 1 like · Quantum Finance Monitor

Covenant emerges from stealth with $250 million and a missile built to be mass produced.
Covenant, founded in 2024, came out of stealth with $250 million raised across three rounds for Anthem, a production-ready, long-range strike missile carrying more than 200 kilograms. The company has already booked roughly $150 million in orders and plans combined annual production of 12,000 missiles across Dallas, Germany and Israel. President Abby Denburg: “We were designed for the China fight.”

Andreessen Horowitz picks Florida as its defence-money capital.
A16z plans to open a regional headquarters in West Palm Beach in 2027 to run its American Dynamism fund, which has raised $1.18 billion for national-security and industrial-economy startups, in a state whose military and defence industry already generates $102.6 billion in economic impact.

Jeff Collins

Build, Partner...Compromise?

As long as Canadian governments have sought to leverage defence spending for economic benefits, a tension has existed between military requirements, cost, and acquisition speed. As someone who was part of the Department of National Defence team that researched the first-ever Canadian…

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2 months ago · 4 likes · 4 comments · Charlottetown Dispatch

Isengard Industries launches out of Y Combinator with $10 million in revenue already booked.
Isengard Industries, co-founded by Francisco Serra-Martins, launched out of Y Combinator building precision-strike and counter-drone systems that allied nations can manufacture domestically, reporting $10 million in revenue and a $350 million pipeline across the US Army, Ukraine and other allies. Serra-Martins previously scaled Terminal Autonomy to $60 million in revenue inside Ukraine, and doesn’t undersell the new venture: “We call it Weapons of Mass Production.”

Related: Red Cell Partners landed a Pentagon contract that could generate $100 million for its portfolio startups, the Pentagon’s own Defense Innovation Unit is prototyping a Bridge Program to fast-track security clearances for venture-backed startups, and California’s Bulwark Dynamics closed a smaller $6.8 million seed round to scale autonomous landing craft for contested last-mile logistics.

• “The world has defense primes. I think it now needs a resilience prime”

• Sweden’s concept of “defence” long predated its NATO membership

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⚔️ Combat Readiness

Kit for Canada 🍁: Ottawa began negotiating for six Saab GlobalEye surveillance aircraft before confirming the jets met Canada’s military requirements, and subsequent assessments found gaps in radar coverage, range, crew stations, NORAD connectivity and in-flight refuelling.

Meanwhile a German shipbuilder is trumpeting “Arctic-proven” submarines for Canada’s planned fleet even as experts doubt the vessels can actually operate under ice, and a separate piece on ITAR-avoidance economics argues Canada’s F-35, Gripen and GlobalEye dependencies will only shift once substitution costs and domestic capture make it worthwhile, pointing to Germany’s recent $21 million buy of ITAR-free thermal sights as the template.

Export push 🍁: Canada led an unprecedented push into Europe’s defence market at Poland’s MSPO exhibition with more than 230 Canadian companies and associations on the floor, as Europe mobilizes up to €800 billion for defence over three years. Robotics Centre CEO Charles Barlow on the new pace: “It’s not like the old days when you could sit down, design a ship, start building it and take it into service eight years after you conceived of it. Now, we have to get it out within eight months.” EDC is coaching Canadian exporters that success in Europe depends on local partnerships and supply-chain integration, not just price, citing Poland’s nearly C$70 billion defence spend in 2025 alone. Not everyone is convinced Europe is the answer: MLI’s Ed Fast and Richard Shimooka warn Canada has no substitute for America’s security umbrella, noting continental Europe still takes just 17% of Canadian arms exports.

Kevin Boucher

Catalyzing Canada

cat·a·lyze (verb): to cause or accelerate a reaction without being changed or consumed in the process…

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2 months ago · 317 likes · 21 comments · Kevin Boucher

European rearmament race 🍁: That tension sits underneath the EU and Canada’s reported plans for a far-reaching new alliance, which other outlets say could see Ursula von der Leyen unveil the pact September 16 in Strasbourg, building on Canada’s status as the first non-EU country inside the bloc’s €150 billion defence procurement fund. Europe’s underlying industrial muscle is real: Rheinmetall’s order backlog hit a record €80.5 billion after first-half sales rose 39% to €5.2 billion, cementing its role rearming the continent, while Rafael, Lower Saxony and Aurelius Capital are turning a shuttering Volkswagen plant in Osnabrück into a defence production hub, with Rafael CEO Yoav Tourgeman framing it as protecting “Germany and Europe.”

Future of the Left Reader

Reindustrialisation, one software-first factory at a time

Andy Burnham wants to “reindustrialise Britain”. Bold, ambitious words, but what do they mean in practice? Responding to Ben Glover’s opening essay, “Burnham’s Politics of Production”, Future of the Left will be publishing a series of replies as part of a debate on the new politics of production, including…

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2 months ago · 3 likes · Andrew Kramer

Home front 🍁: The Canadian Army is undergoing its most extensive reorganization in more than 30 years, replacing four regional divisions with three capability-focused formations. The new 1st Canadian Division, headquartered in Edmonton, will add roughly 1,000 soldiers to CFB Edmonton over the next few years. Ottawa-based industry association ACDC has a new Kyiv-born executive director, Dasha Cohen. And a Walrus feature argues Ottawa’s plan for six new Coast Guard icebreakers still leaves Canada without the heavy Arctic fleet it needs, pointing out the $720 million Diefenbaker polar vessel promised in 2008 remains undelivered.

Space Force has ‘space control weapons’ on orbit. Air Force secretary Troy Meink didn’t elaborate on what “weapons” the US deployed, but revealed new info on other space and unmanned Air Force programs.

Software sovereignty: Canada’s window to migrate sensitive systems to post-quantum cryptography is narrowing fast, with Canadian and allied watchdogs targeting 2035 even as Google moved its own deadline up to 2029.

CDA Institute argues Canada should build its own interoperability rather than keep borrowing it from Washington, warning that dependence on US cryptographic keys and ITAR-controlled components leaves Ottawa exposed as political relations sour. The same dependency logic runs through cyberspace: a Palo Alto firm built an AI hacking tool in just over a week that can compromise a WeChat account without a single click, CEO Thai Duong calling the flaw “remarkable.”

• Drones can hack your ground control station

The kill zone: Russia’s jet-powered drone attacks have grown from 350 to 2,800 a month between June and August, with Ukraine’s interception rate falling from the mid-90s to as low as 60%, a shift also flagged in the New York Times original. Eric Schmidt’s own account of sheltering underground in Kyiv as Russian ballistic missiles closed in makes the abstraction concrete.

Missile math: A US infantry company that trained against Ukraine’s “Nemesis” drone unit at Hohenfels came away convinced human operators remain the weak link: “The sky, in perpetuity, not just sporadically, was now part of the battlefield.” Ukraine’s own missile shortfall is structural, not tactical: an Economist analysis, reconstructed via Euromaidan Press, reports Patriot PAC-3 stocks near zero and describes Kyiv’s Freyja interceptor project as a roughly $700,000-per-round alternative to a $7 million Patriot round.

Counter-drone: US officials say drone activity probing the Rio Grande Valley dropped roughly 75% after the first operational use of a high-energy laser in late August, which has since destroyed 11 drones over 10 days and led to AeroVironment’s first high-energy-laser contract, worth $465 million. The US Army is meanwhile planning a November interceptor “shoot-off”, with roughly 147 proposals submitted after Lt. Gen. Frank Lozano, as reported by Bloomberg Law, said: “Ukraine and Iran have clearly shown relatively inexpensive drones can impose significant costs and operational challenges.”

a16z

Introducing Covenant

America | Tech | Opinion | Culture | Charts…

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2 months ago · 142 likes · 6 comments · Michael Kaufman

Pentagon reform watch: The Pentagon codified its pause of CMMC Phase 2 in a September 3 memo after a 60-day review of more than 1,100 industry responses, with DOD CIO Kirsten Davies drawing the line: “Compliance equals compliance. Compliance doesn’t equal security.” A National Interest op-ed argues US Cyber Command remains poorly integrated into joint planning despite roughly 6,200 personnel, a gap authors Mark Montgomery and Matthew Ferren say a peer conflict with China would expose brutally. And a New York Times interactive on supplying US warships during the Iran war describes resupply runs of up to 3,700 miles after Iran destroyed a critical Bahrain logistics base on the war’s first day, a posture the paper calls unsustainable with four of the Navy’s 11 carriers tied down in the region. A Washington Post opinion piece pushes the budget math further, arguing the US federal budget cannot actually survive a major war, with rising Social Security and health care costs already crowding out defence spending before Trump’s proposed $1.5 trillion annual defence budget even lands. Former Joint Chiefs chairman Michael Mullen frames the stakes bluntly: “The most significant threat to our national security is our debt.”

Big think: Anthropic disclosed it blocked five attempts to use Claude for bioweapons research and prevented Iran from using the tool to target US naval bases, while separately reporting Yemeni militants used Claude in three guided-weapons programs, test-firing one rocket that failed. Anthropic-linked reporting in The Telegraph also alleges that Chinese municipal police used Claude to seek intelligence on anti-Beijing protests in Canada.

The US Army’s updated biodefence strategy aims to “fight through” AI-enabled bioweapons by 2035, while a New York Times magazine feature on grid vulnerability revisits the 2013 sniper attack on PG&E’s Metcalf substation, warning a large enough failure of America’s aging, hand-built transformers could black out the country for years. Separately, Johns Hopkins APL researchers say a new sintering process could build hypersonic-grade carbon-carbon composites in days instead of months.

Uncommon Leadership

Combatant Commands Can Now Make Markets. Are They Ready?

Private capital is pouring into defense technology. Investors put $49B into defense tech companies in 2025, according to PitchBook, nearly double the year before. However, most of it isn’t going where it could do the most good because investors rarely see an actual demand signal…

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2 months ago · 7 likes · BMNT

Maritime autonomy: Anduril confirmed Iran recovered a largely intact Dive-LD underwater drone near the Strait of Hormuz, attributing the loss to a malfunction even as the modular vehicle’s attritable design was meant to make exactly this outcome survivable. A Consultative Shipping Group of 18 maritime nations including Canada is warning that shadow fleets and geopolitical fragmentation threaten freedom of navigation, a concern first raised in a Wall Street Journal piece on the same warning. NATO allies separately foiled a Russian plot to sabotage undersea cables linking Svalbard to mainland Norway.

Axis watch: A Chinese state-owned firm allegedly shipped 46 tons of carbon-fibre precursor to Russia’s sanctioned Alabuga-Volokno plant disguised under a civilian customs code, enough, physicist David Albright estimates, to build up to 1,300 kamikaze drones. The Telegraph’s version of the same shipment ties it directly to an August attack on a Ukrainian shopping mall that killed at least 16 people. Canada and China, meanwhile, held their first defence coordination talks in more than eight years, restarting communication frozen since Beijing’s 2018 detention of Michael Kovrig and Michael Spavor. Retired Gen. Wayne Eyre: “Throughout history, maintaining communication with an adversary has been useful to deepen understanding and avoid unintended escalation.”

ChinaTalk

Can Taiwan Build Drones?

Over the course of this week, we are thrilled to share an in-depth, vivid journey through Taiwan’s drone industry in two parts. Ethan’s rigorous research and extensive on the ground reporting is a real contribution to the discussion around Taiwan’s defense. Enjoy…

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2 months ago · 57 likes · Ethan Kessler

🔫 Hot Shots

The UK puts a drone testing site up for sale. A property near Swindon used by the UK Ministry of Defence to test drones is going on the market, a listing agents say will test investor appetite for real estate with a military past.

Sea, Space and Cyberspace. All Are Under Siege.

The CIA wants more engineers, not more spies. Deputy Director Michael Ellis says China’s economic leverage and AI-enabled cyber operations are forcing the agency to chase more technical expertise from the private sector, even as it brings on its largest Directorate of Operations class in 20 years. Ellis: “The outcome of that competition will be dictated by who has the superior technology.”

Gray Matters

🎙️ Ep 29 - Ent: The AI Cybersecurity Arms Race – Defending at Machine Speed

AI lets hackers attack at machine speed. Human defenders cannot keep up. Luckily, the team at Ent is building the future of AI-native cyber defense and prevention…

Listen now

2 months ago · 4 likes · Maggie Gray and Akhil Iyer

US Marines test fighting from two coastal outposts at once. The 13th Marine Expeditionary Unit ran simultaneous forward sites near Camp Pendleton, one for maritime surveillance and drone tracking, the other combining command operations with aircraft refuelling and rearming, testing the Corps’ distributed Expeditionary Advanced Base Operations concept.

Seafloor to global force. Halifax’s Kraken Robotics expanding its footprint beneath the waves.

How venture studios plan to break into the defence market.

Hermeus wants to sell hypersonic test flights as a service. The company unveiled Ramjet-X, an expendable ramjet-powered vehicle air-launched from its Quarterhorse drone at roughly Mach 3 before climbing toward 100,000 feet and Mach 4, with integrated flight testing planned for 2027.

The Line

Al Vigier: The defence boom is here. So far, it mostly pays people like me

By: Al Vigier…

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2 months ago · 74 likes · 47 comments · Line Editor

A think-tank traces how fast Russia iterates its kamikaze drones. A CSIS analysis charts how Russia turned Iran’s Shahed-136 into the constantly evolving Geran platform, backed by a $1.75 billion domestic-production deal and battlefield feedback loops the authors say Western acquisition processes cannot match: “The cycle ran faster than any Western procurement program could plausibly match.”

A cyberwarfare report says US Cyber Command’s own force-generation system is broken. Mark Montgomery and Matthew Ferren argue Cyber Command remains poorly integrated into joint planning and tactical operations, despite roughly 6,200 personnel across nearly 150 Cyber Mission Force teams: “America’s cyber force generation system is clearly broken.”

A New York Times feature asks what happens if America goes completely dark. A magazine piece on grid vulnerability revisits the 2013 sniper attack on PG&E’s Metcalf substation, which disabled 17 transformers in about 120 shots, arguing the grid still runs on thousands of aging, hand-built transformers that could take years to replace if enough failed at once.

European defence stocks catch a bond-market chill. Rising government borrowing costs are pressuring defence shares and the continent’s spending targets, with France’s 10-year yield up 32 basis points to 4.21% in a month, ahead of Italy’s 4.17%, while the UK reportedly weighs shelving its own 3%-of-GDP-by-2030 target.

Close: A group representing 18 major shipping nations, Canada included, warned that a “two-tier” maritime trade system is emerging around sanctioned shadow fleets and chokepoint disruptions: “Strong international cooperation is not a constraint on sovereignty; it is a prerequisite for effective governance in an interconnected world.”

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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Guzman is out. Fuhr, the F-35 skeptic, now owns the file.
Doug Guzman is stepping down as CEO of the Defence Investment Agency less than a year after Ottawa stood the organization up. Days later, CBC profiled Stephen Fuhr, the former CF-18 pilot known for opposing the F-35 buy, who now runs the agency day to day. He inherits a file where Ottawa has locked in only 16 of the 88 F-35s once promised, with 72 more under review.

• A former Canadian military commander turned venture capitalist on how to disrupt defence procurement

Allen-Vanguard goes into receivership owing more than US$80 million.
Ottawa-based counter-IED pioneer Allen-Vanguard entered receivership on September 1, with the Ontario Superior Court appointing PwC after lenders owed roughly US$80 million applied for court protection. The company has run out of Ottawa since 1981, keeps an engineering site in Tewkesbury, UK, and lists more than 30 end-user militaries from Australia to Saudi Arabia, yet carried only about 50 full-time staff as of late July. The Logic calls it a rare Canadian defence-industrial failure landing in the middle of a spending boom.

Canada goes all in on Poland.
Defence Minister David McGuinty and Trade Minister Maninder Sidhu lead a trade mission into MSPO as its designated lead nation, more than 200 organizations and nearly 500 delegates strong, up from the 170 companies Ottawa announced in June. Army Recognition’s numbers go further: the delegation has grown to 250-plus organizations and 500 people, with 90-plus Canadian exhibitors inside the national pavilion, and Poland’s SAFE allocation lets Canada count up to 80% Canadian content versus the standard 35% third-country ceiling, a first for any non-European nation. Underneath the trade mission sits the Defence Drone Initiative, which LGen Darcy Molstad says drew 527 companies and more than 1,000 bids for a supply arrangement closed in two months, a process that normally takes two years. “In an era of accelerating technological change, agility is becoming a capability in its own right, and perhaps the most important one of all,” Molstad wrote. Two of DDI’s freshest qualified suppliers, Base Camp Connect and Marconi Technologies, make their first joint MSPO appearance. Expect a wave of DDI contracting awards to be announced this week.

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Up to $1M in funding and additional technical services available for technologies with defence and civilian applications. Advisory support is available now.

🤝 Deal Corner

🍁 NorthStar drops its own satellites, banks on a $300M SPAC instead.
NorthStar Earth & Space and Kepler Communications agreed that NorthStar will host its space-domain-awareness sensors on Kepler's satellites rather than fly its own, after NorthStar's original sensors underperformed on Spire Global spacecraft, one failing outright and three missing image-quality targets. An ICC arbitration panel awarded Spire roughly US$12 million on a counterclaim after NorthStar had sought nearly US$46 million. NorthStar is separately merging with Viking Acquisition Corp. I at a C$420 million valuation, targeting a listing this quarter. CEO Stewart Bain: "we can deploy faster, scale more efficiently, and deliver information when it matters most."

Is it still VC? Sam Burrell argues that “the number of defence tech fundraises continues to increase… little of this looks like venture capital anymore. That’s because once the financing need changes shape, the cap table has to change with it. And the people who like to fund factories are banks, credit funds, sovereign and pension pools etc.”

• Defense Tech Doesn’t Have to Be Born in California

Kelvin’s Substack

Funding the Frontlines

Defense technology is no longer an edge case for venture capital and private equity. It is a central pillar of the ecosystem…

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2 months ago · 4 likes · Kelvin Fu

🍁 Isar Aerospace and Maritime Launch buy two more weeks to lock down Nova Scotia.
Isar and Maritime Launch Services pushed their statement-of-work deadline to September 15 from September 1, with the launch pad still due to reach Isar by November 1. The delay landed right as Isar's Spectrum rocket reached orbit for the first time on its second flight from Norway, deploying five satellites and validating the vehicle behind Isar's roughly C$155 million, 10-year Nova Scotia launch deal.

• American nuclear fusion history has just been made… by a company from Montreal

The Canadian Explorers

Building the Rails to Space | Hugh Kolias, Canada Rocket Company — Explorer Spotlight #14

By 2035, the World Economic Forum and McKinsey & Company expect the global space economy to reach $1.8 trillion. The White House recently released its National Space Transportation Policy, which calls for the US to support more than 1,000 launches and reentries annually by 2030…

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2 months ago · 3 likes · Ethan Marcoux

🍁 Quandela puts Canada’s first photonic quantum computer on federal soil.
Quandela signed with CMC Microsystems to join Canada’s Quantum Computing Sandbox as the first photonic system on the federally funded FABrIC network, pitched explicitly on sovereignty: users’ “work and data [will be] entirely hosted on Canadian soil.”

🍁 Base Camp Connect and Marconi pair up on tactical comms ahead of MSPO.
Lévis-based Base Camp Connect and Montreal-based Marconi Technologies are pairing BCC-NOMAD vehicle systems with sixth-generation ORION radios for a joint MSPO debut. “In modern warfare, the ability to communicate is the ability to act,” said Base Camp Connect president Jean-Philippe Grondin.

🍁 Volatus and InDro both land DDI Marketplace status.
TSX-listed Volatus Aerospace qualified as a supplier under Canada’s Defence Drone Initiative Marketplace via competitive federal review, joining InDro Robotics, which won the same qualification days earlier.

Karp personally bets on Fedorov’s next act.
Palantir CEO Alex Karp will be the first major investor in a new defence technology company from Mykhailo Fedorov, Ukraine’s tech-forward former defence minister dismissed in July. The commitment is personal, not corporate. Karp to Fedorov: “You and your colleagues are launching a company that I think will be defining for the world.”

Germany hands Auterion and Airlogix $300M to mass-produce strike drones.
The Auterion-Airlogix joint venture won a $300 million German Ministry of Defence contract to serially produce more than 5,000 AI-guided long-range strike drones, the first such units built domestically in Germany and shipped straight to Ukraine. Auterion CEO Lorenz Meier says Germany now has “a production line for affordable precision mass... at a cost and rate that makes deterrence something you can actually stockpile.”

TITAN moves to production on $192M split between Palantir and Anduril.
The US Army pushed its TITAN targeting node into production with $127 million to Palantir and $65 million to Anduril, covering eight systems over 18 months. “There will always be a human on the loop within this workflow,” said Maj. Dell Barnes.

AeroVironment lands the Army’s first laser production contract, worth $464.8M.
AeroVironment secured the Army’s first-ever production order for a high-energy laser weapon, a deal to deliver dozens of 30-kilowatt LOCUST X3 systems built to defeat drones at under $5 a shot.

Dataminr’s OSINT tool goes live across NATO, plus a $318M Pentagon deal.
Dataminr’s First Alert Advanced suite is going live inside NATO’s entire Maven Smart System, while a separate five-year, $318 million Pentagon contract extends the same tool to three million licensed users across the Department of Defense. CEO Ted Bailey says NATO is now the company’s second-largest customer.

• When Regulation Becomes a Defence Risk

XTEND skips the IPO line, merges onto the NYSE for $1.5B.
Israeli drone maker XTEND completed a $1.5 billion reverse merger with a Nasdaq-listed real estate developer, landing on the NYSE as XTND with a Tampa, Florida production base built to read as a domestic US supplier to the Pentagon.

Rheinmetall delivers its first XM30 prototype into a $45B Bradley-replacement race.
American Rheinmetall handed the Army its first Lynx XM30 prototype on September 1, with seven more to follow against General Dynamics in a competition covering roughly 4,000 vehicles worth more than $45 billion.

Sweden signs a $732M HIMARS deal and locks in Finland on rocket artillery.
Sweden signed a SEK 7 billion contract for Lockheed’s M142 HIMARS, just over ten launchers plus ammunition, opening the door to Precision Strike Missiles with a 500-km range.

Kate McKenna

The Interceptor Crisis: How We Won the War Nobody Is Fighting Anymore

Ukraine built the most successful interceptor drone program in combat history. Ten thousand units per month. Nine thousand documented kills. A cost advantage that finally tipped the economics of defence in our favour. Going from concept to mass production in the time it takes big defence primes to pull up a chair to have a chin wag…

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3 months ago · 22 likes · 31 comments · Kate McKenna

Beaten Zone closes Australia’s first dedicated defence-tech fund at AUD $26M.
Brisbane’s Beaten Zone Venture Partners closed its debut fund at AUD $26 million, citing PitchBook figures showing venture investors put USD $12.8 billion into defence in the first half of 2026 alone, more than five times all of 2022.

Related: smaller rounds this week included INLEAP Photonics, which raised roughly €20 million for laser counter-drone tech; Smack Technologies, which pulled in $61 million for a wrist-worn AI display; Israeli drone-OS maker AITAN, which banked $41 million; HyImpulse, which extended its Series A by more than €50 million; HiddenLayer, which closed $100 million for AI security; Easy Aerial, which raised $20 million; Korea’s Airbility, which raised roughly $4.7 million for counter-drone tech; Kepler Aerospace (a different Kepler), which raised $8 million for swarming satellites; Georgia Tech Research Institute, which won a $33.4 million Army integrator role that leapfrogs the usual primes; Elbit Systems, which won $270 million in ISR contracts; Lockheed, which picked up another $41.8 million across three Navy awards; and Israel and Greece, who sealed a €3.035 billion Achilles Shield deal for a national air-defence network.

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⚔️ Combat Readiness

Kit for Canada 🍁: HMCS Robert Hampton Gray became the first RCN warship to change home ports through the Northwest Passage, departing Halifax August 16; the same bulletin bumps Primary Reserve education reimbursement from 50% to 75%, with the annual cap rising from $2,000 to $7,500. Roughly 400 NATO troops, but just 15 CAF members, are training around Narsarsuaq in southern Greenland for Arctic Shield, a footprint that undercuts Ottawa's own Arctic rhetoric. Saab is meanwhile pressing Ottawa to commit to at least 40 Gripens to justify a made-in-Canada production line spanning roughly 250 suppliers, the first Gripen line built outside Sweden. Saab CEO Micael Johansson: "Canada has to decide, [does it] want the sovereign aerospace industry and is that important to them?"

Ground robots 🍁: InDro’s Talos platform is built to run a 50-bed field hospital for 10 days on its onboard power alone, with a 7,000-km range; ground robots now make up half of the 42-person company’s business. The economics behind that bet are already proven in Ukraine, where ground robots have logged more than 100,000 combat resupply and evacuation missions at a fraction of the cost of risking soldiers.

🛡️ Evolution of Anti-Tank Guided Missiles: Direct Attack vs. Top Attack Capabilities

Ukraine's Arms Monitor

Why Drone Producers Should Invest in Training Operators

Amid the wave of headlines about AI drones and “killer robots,” the reality is that most drone operations are still conducted by humans, and this is changing only gradually. That is why operator training remains critical and will continue to be so in…

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2 months ago · 46 likes · 10 comments · Olena Kryzhanivska

Prime time 🍁: MDA Space CEO Mike Greenley wants to build four to six Canadian suppliers into $1-billion companies working under MDA on different contracts, sized against MDA’s own run toward $10 billion in annual revenue. MDA is also pushing into Direct-to-Device satellite communications using the payload line built for Telesat’s 198-satellite Lightspeed constellation. Analysts are buying the growth story: RBC and CIBC pushed Calian’s price target above $105 on a CA$1.5 billion backlog.

The People's Art of War

How the US ran out of interceptors

On August 4, 2026, CBS News reported that the US was running out of interceptors and ammunition to supply the war in Iran…

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2 months ago · 74 likes · 2 comments · People's Art of War

Home front 🍁: Ottawa named ex-Google CFO Patrick Pichette CEO of the new Digital Transformation Canada, an agency that absorbs Shared Services Canada and the Canadian Digital Service to run how the federal government buys and uses AI. Twenty-three companies including OpenAI, Anthropic and Google signed onto Ottawa’s voluntary data centre principles even as more than two-thirds of Canadians tell pollsters they don’t want one nearby. Crypto4A’s CEO argues cryptography, not tanks, is Canada’s actual sovereign advantage, pointing to its FIPS 140-3 post-quantum hardware module. Ahead of Carney’s September 17 address to the European Parliament, MLI’s Ed Fast and Richard Shimooka warn Ottawa not to overweight Europe as a substitute security partner: continental Europe takes just 17% of Canadian arms exports versus 63% for the United States, even after a 77% jump driven by Ukraine shipments.

Marlinspike: The 21st Century Offset

Upgrading DoW’s Arsenal for 21st Century

The conflict in the middle east strained US munition supplies and demonstrated structural misalignments in the defense industrial base: major weapon system production processes cannot be quickly scaled to replenish expended inventory. To increase production, takes time, money, and long-term commitment; as soon as demand drops off, production capacity fo…

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2 months ago · 4 likes

Software sovereignty: War on the Rocks’ sharpest read of the week argues European states depend on foreign suppliers for more than 80% of critical digital infrastructure, a dependency Canada shares almost line for line. The same week, a G7 cyber working group that includes Canada’s Communications Security Establishment told industry it can no longer afford to postpone the move to post-quantum encryption, warning of “harvest now, decrypt later” attacks; a companion primer walks through the countdown to Q-Day and why the timeline matters.

• Canada’s Next Security Problem May Not Look Like War

a16z

Apex: The Spacecraft Platform Company

America | Tech | Opinion | Culture | Charts…

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2 months ago · 160 likes · 3 comments · Ian Cinnamon

The kill zone: Ukraine’s drone forces say they struck 58,465 Russian targets in August alone, nearly 1,900 a day, including 54 shadow-fleet vessels and 168 energy nodes. Air superiority is thinner than that strike count suggests: Ukrainian F-16 pilots are now flying some daytime sorties with guns only because of a missile shortage a squadron commander confirmed on the record. “Any aircraft without weapons is... useless.”

Stockpile paradox: A senior Ukrainian official says Kyiv’s Patriot interceptor stocks are “effectively at zero” after a week of EU and NATO meetings produced no new supply commitments. Kyiv has now formally asked Brussels to fund its first PAC-3 buy out of the EU’s €90 billion loan. Compounding the squeeze, Trump says Washington will seek back payment from Europe for munitions already sent to Ukraine, a retroactive bill that would land on every NATO PURL contributor, Canada included.

Europe rearms: The UK’s new defence space strategy commits more than £3 billion to space control, ISR and connectivity, including £880 million for space control alone and £30 million for the SaxaVord Spaceport in Shetland, a direct comparator for Canada’s own space-defence funding debate.

Axis watch: POLITICO’s exclusive found that a Chinese state-owned firm shipped 46 tons of carbon-fibre precursor to a sanctioned Rosatom drone plant, a load one nonproliferation expert says could supply as many as 1,300 Shahed-type drones. China is also squeezing rare-earth flows to the US, with terbium exports to Japan falling to zero, an opening for Canadian midstream players like Geomega, whose Montreal demonstration plant is now more than 75% built and producing 90%-plus-purity rare earth concentrate from bauxite residue. Ukraine’s own sanctions commissioner separately displayed foreign-made guidance components pulled from Russian Iskander and S-400 missiles, tracing back to the US, Japan, Germany, Taiwan, France, Britain and Switzerland.

Missile Matters — with Fabian Hoffmann

Cheap, Fast, and Mass-Produced: Russia's New Low-Cost Cruise Missile Arsenal

Picture: Defence Intelligence of Ukraine…

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2 months ago · 34 likes · 4 comments · Fabian Hoffmann, PhD

Counter-drone: Senators pressed the Army over killing its Ukraine-informed drone battalion, demanding a briefing by September 21 on ending the 600-soldier Unmanned Assault Battalion’s specialized mission. The Air Force is separately pushing to replace the Reaper faster after losing 45 of the drones. On the other side of the ledger, lasers along the US-Mexico border have downed 11 cartel drones in a single week, part of more than 300 downed since January, a homeland counter-UAS precedent Ottawa has yet to match on its own border and bases.

Space: Reuters’ investigation into orbital shadowing describes China’s uncrewed spaceplane releasing a small satellite that looped around another Chinese satellite hundreds of miles up. Gen. Stephen Whiting: “We must be well-prepared for conflict in space. And if deterrence fails, we will fight and win.” RAND’s “Breaking Glass, Missing Hands” report warns the US lacks the engineers and technicians needed to rebuild satellites lost in a war inside a realistic 12-to-24 month reconstitution window. The Space Force is meanwhile restarting GPS ground-system work after cancelling the $6.27 billion OCX program outright, and four American launch companies pulled out of Macron’s Paris space summit under White House pressure.

• The push to create a Canadian rival to GPS

PolarBrief by Polar Counsel

Can You Build a Drone Without China? What It Now Takes to Sell in the US

The US has just raised the cost of selling commercial drones into its market. From September 3, imported drones weighing more than 25 kg, or equipped with thermal imaging, face a 100% tariff. Docking stations and critical components are also rolled in. Smaller drones without those capabilities face a 25% tariff…

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2 months ago · 5 likes · Sujin Chan-Allen

Pentagon reform watch: The Pentagon’s new Secure Space Network will build roughly 50 mobile SCIFs to open classified work to small firms. Army Secretary Dan Driscoll, the most visible champion of the Army’s commercial-buying push, submitted his resignation to Trump. At Project Convergence in the California desert, some Army Starlink terminals overheated in triple-digit heat, forcing soldiers to cool antennas with ice-water-soaked t-shirts. Maj. Gen. Patrick Ellis: commercial-first tech “is not necessarily purely ruggedized.”

Cheap at scale: F-35 unit costs jumped 8.5% to 11.5% in the latest production lots, pushing the A-model to $92 million and the B-model past $121 million, a direct read-across for Canada’s own fighter math as it weighs the remaining 72 aircraft against Saab’s Gripen pitch.

Big think: RUSI’s Roger McDermott argues NATO planning underweights Russia’s “recoverability,” the speed at which a damaged military system regains function, not just its stockpiles. Frontgrade CEO Mitch Stevison makes the tier-two case in a SpaceNews op-ed: speed to field starts below the prime, not at it, because “the worst time to discover that a program needs a second source is after the first source has become a constraint,” a lesson Canadian tier-2 and tier-3 suppliers chasing DDI money should take to heart.

Grey zone: The US State Department posted a $10 million reward for an Iranian IRGC cyber commander accused of directing hacking campaigns against Western defence, energy and financial targets. Putin, for his part, signed a decree letting Russia seize data centres that fail to defend themselves against drone strikes, a sharp marker of how physical and cyber threats are converging.

Maritime autonomy: The US Navy and its Quad partners are deploying Vantor’s AI to fingerprint dark-fleet vessels across the Pacific, fusing radar, satellite imagery and AIS data, the same sensor-fusion problem Canada faces trying to police its own Arctic and Atlantic approaches.

The Ambition Journal

The Arctic Tech Stack

The Ice Remembers Everything…

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2 months ago · 10 likes · 3 comments · Ambition Capital

🔫 Hot Shots

🍁 Ottawa opens a $3M call for university Earth-observation research. The Canadian Space Agency’s latest smartEarth round will fund roughly 20 projects at up to $150,000 each, open only to Canadian post-secondary institutions, closing October 30.

The Defense Delta

The Pentagon Built a Market It Can’t See

Well, it’s been a while since my last post. In the meantime, across defense tech, commercial space, venture capital, and Pentagon acquisition, a number of seemingly separate trends have started converging around the same underlying friction. So that’s what we’re going to explore here. Warning: this is a long one. We’re going from billion-dollar venture …

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2 months ago · 23 likes · 3 comments · Nestor Levin

🍁 CSA wants Canadian miners thinking about the Moon. A Notice to Industry asks firms to map their capability in lunar resource extraction and regolith management, with responses due September 20; it’s explicitly not a tender.

🍁 University of Toronto research pushes 29 MEPs to demand a Serbia spyware freeze. Citizen Lab findings on Pegasus and NoviSpy infections drove European lawmakers to call for slowing Serbia’s EU accession pending an investigation. The MEPs: “This is not a technical glitch; it is a direct state attack on democracy.”

🍁 Canada hosts, then gets asked about invasion rumours, at its own defence conference. The 28th Indo-Pacific Chiefs of Defence Conference wrapped in Victoria with 32 senior officers from 29 countries, co-hosted by Gen. Jennie Carignan and Adm. Samuel Paparo.

Asked in Victoria whether he’d follow a Trump order to invade Canada, Adm. Samuel Paparo called the scenario “absolutely and utterly preposterous”: “Would you ask me please, also, what my attack plans are for the Martians?”

🍁 Zelenskyy expected in Canada next week. Two independent sources confirmed to Radio-Canada that the visit is coming, possibly with two stops; his last trip was December 2025.

🍁 Canada can wait on the F-35 decision. It can’t wait to start flying them. A 19FortyFive think piece lays out the timeline squeeze: DND targets 2029 initial operational capability while the CF-18 fleet must hold the line through 2032.

🍁 Carignan won’t demand an apology over Hegseth’s cadet post. Speaking from Victoria, Canada’s top soldier said the Vernon, BC cadet and instructor will decide for themselves how to respond; Carney called the post “beneath their office.”

Gen. Douglas Schiess takes over as Space Force chief. Schiess became the service’s third chief of space operations on September 3, saying “integrating into the Joint Force demands a rapid scaling of both our manpower and space capabilities.”

Shield AI licenses its counter-drone software onto L3Harris hardware. Tracker is now licensable for the VAMPIRE platform, which has logged 350,000-plus operational hours and hundreds of hostile-drone shootdowns using passive detection instead of radar.

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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🎯 Three-Shot Burst

From soup cans to qubits. Xanadu is turning the former Campbell’s Soup factory in Etobicoke into a 158,000 square foot photonics manufacturing hub, backed by a $195M repayable federal loan out of the Strategic Response Fund, which is half of the up to $390M the company had asked for against its $893M Project OPTIMISM.

The cheque is one brick in a “Canadian Investment Supercycle”, as TD Economics now counts more than $1T announced across 300 plus projects with $1.5T to $1.7T in potential and roughly $12,000 more real output per capita by 2035, while on the defence side Ottawa has stacked $60B in extra spending over five years, more than half a trillion in investment, 125,000 jobs and a stated goal of tripling the industry inside a decade.

Plumbing is moving too: the industrial benefits program shifts from ISED to the Defence Investment Agency (DIA), a change ex-public servants call a “big deal” for procurement speed on a program worth $5B plus in GDP and 40,400 jobs a year.

Reality check: Doug Guzman is expected to step down after only a year as the first chief executive of the DIA. Guzman was the agency’s answer to every question about whether Ottawa could actually move money at speed. Losing your first CEO inside 12 months, while handing that same agency the industrial benefits program and a 5 percent of GDP target for 2035, is not a personnel story.

We have been here before, and the sharpest read of why nothing compounds is the reminder that DATAR put a working naval tactical data system in Canadian hands in 1949, a decade ahead of anyone, and we let it go, with the verdict that the system “is not broken, it is working exactly as designed.” Founders are reaching the same conclusion faster, arguing that sovereignty is now a shippable product feature rather than a marketing coat of paint, verified the way security claims are verified, after 50 percent US tariffs hit $28B of Canadian goods in a single weekend and seed funding fell 16 percent to $297.2M across 133 deals.

Valued at 32x, acquired at 3x. From Backswing Ventures - Helsing’s $1.8B secondary at an $18B valuation is roughly 32 times projected 2026 revenue, while the median defence tech M&A multiple sits at 2.8x and public comps at 2.2x, and the AEVEX sale to BlackSea at $650M max on about $150M of FY2026 revenue works out to 4.3x, which is the exit math almost nobody is underwriting.

“The cap table doesn’t validate the valuation, revenue does.” - Kyle Asman

Meanwhile private markets keep climbing, with Castelion raising a $1B Series C at a $13B valuation four years after founding, making it the third most valuable venture-backed defence company behind Anduril at $61B and Helsing at $18B, a round split into $800M of equity and $250M of credit while the Army’s Dark Eagle produces about one missile a month and Castelion books a $90M Navy award for 50 hypersonic weapons.

Reality check: The exit window did crack open, with aerospace and defence private equity exit value hitting $26.8B in H1 2026 against $17.7B for all of 2025 and five listings versus zero in Q2 2025, even as deal value slid to $6.5B from $11.1B, which is liquidity for sponsors sitting on $860B of aging buyout NAV rather than proof that venture-scale marks clear. The margin question is the one to watch, because the White House has made fixed-price contracting the default and preferred method while the FY26 NDAA lifted the certified cost data threshold from $2M to $10M, traditional primes earn 7 to 15 percent where Anduril claims roughly 40 percent on mature products, and Jordan Blashek’s warning of a reckoning inside 18 months sits against roughly $50B of venture chasing $4.3B in actual federal obligations.

PitchBook’s own quarterly read sharpens the picture, with aerospace and defence deal count up nearly 11 percent from Q1 and more than double a year earlier while total deal value fell almost 58 percent, and five of the 10 largest exits arriving as public listings alongside Norwegian’s roughly $840M purchase of Sunclass and Voyager’s $300M pickup of Astrobotic. More deals, smaller cheques, is how a market behaves when it stops believing the last round’s price.

• BCI public defence comps

Missile Matters — with Fabian Hoffmann

High-Low Mix: The Three Tiers of Modern Missile Arsenals

Picture: U.S. Navy…

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2 months ago · 25 likes · 5 comments · Fabian Hoffmann, PhD

Twelve submarines, eight months, and a procurement culture in the middle of a personality change. TKMS says the pace of Canada’s submarine decision was “lightspeed,” with up to 12 boats, a 100,000 page contract, roughly 50 TKMS staff on the file, negotiations targeted to close by year-end and a first boat as early as 2033, plus a Canadian supplier bench that already includes CAE on training, E3 Lithium on critical minerals, Valbruna ASW on amagnetic steel and Cohere on AI. The follow-on fight is surface, where a 12 to 20 ship corvette class of 100 to 120 metres for three oceans has Seaspan, Vard, Ontario Shipyards and Thales Canada circling MEKO A-100 and Luleå-class designs and Vice-Admiral Topshee wants the answer “Canadian from the core.”

That is the same logic pulling procurement away from Washington, with Stephen Fuhr saying the 88-jet F-35 buy remains under review with only 16 aircraft firmly ordered and critical equipment being paid for on 14 more, while sources float a mixed fleet of more than 100 F-35s and Gripens and Telesat takes $2.3B for Arctic military satellite communications, a notable turn given roughly 70 percent of Canadian defence dollars historically flowed south. Fuhr’s own framing of the politics is “that’s just me reading the room.”

Reality check: The money argument is nearly settled and the hard part is what comes next, since the NATO pledge splits into 3.5 percent military and 1.5 percent infrastructure by 2035 and even the UK only promises 3 percent “sometime in the next Parliament” on about £15B over four years, which is a reminder that pledges are easy and delivery schedules are not.

• Procurement usually slows down in the summer… But Canada saw nine tenders for drones in the past week, the most on record.

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🤝 Deal Corner

🍁 Nalagx Corp picks New Brunswick for an explosives plant that could double NATO’s supply. The company secured roughly 1,500 acres of provincial land near Belledune, beating out two US states, for a facility CEO Patrick Gagnon says would double NATO’s explosives supply, with Natural Resources minister John Herron backing the site. Energetics are the bottleneck behind every artillery pledge, so this is the least glamorous and most useful announcement of the week.

Big congrats to Rob O’Donnell, currently serving as the Canadian Liaison Officer with the U.S. Army Transformation and Training Command (T2COM) HQ in Austin, Texas. His work focuses on bridging interoperability and collaboration efforts between Canada and the US and emerging military modernization initiatives in the fields of AI, Robotics, Autonomy as well as Futures Concepts.

The Canadian Explorers

Powering the Arctic and the Moon | Daniel Sax, CSMC — Explorer Spotlight #13

“Power is the great enabler.” — Daniel Sax, CEO & Founder, Canadian Strategic Missions Corporation…

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2 months ago · 4 likes · Ethan Marcoux

🍁 NordSpace lands $10M for the Atlantic Spaceport Complex. Ottawa, Newfoundland and Labrador and the company are putting $10M total into SLC-02 at St. Lawrence on the Burin Peninsula, with roughly half NordSpace’s own capital and half public money announced August 27 by Sean Fraser and Lin Paddock through ACOA as a space and defence play for the province.

• Space tech VC funding hits $11.3 billion in H1 2026, surpassing all of 2025

🍁 MDA Space launches LaunchPad Ventures across 25 focus areas. The new vehicle, run with 49North as a subsidiary and covering 25 focus areas backed by 55 years of MDA relationships, does not disclose its size, which puts it beside the $100M CAD Calian Ventures fund with a different pitch. Shawn Roy names the real gap: the barrier for Canadian defence SMBs “isn’t talent or technology, it’s access to customers, to networks, and revenue opportunities.”

🍁 Lab2Market puts $10,000 each behind 10 dual-use student ventures. Dalhousie, UNB and Vimy Forge are running Canada’s first national dual-use cohort, 16 weeks this fall with 10 ventures and a landing at DEFSEC Atlantic 2026, including Reliable Arctic Intelligence, counter-drone startup SkyRelix, Novigrad Technologies, Volantek and Maritime Trust Assurance.

🍁 Canada is negotiating a €100B defence bank that has raised €5B. The Defence, Security and Resilience Bank has about €5B in upfront commitments against a €100B target, nine countries signed up or supportive, a €20B paid-in and €80B callable structure and an ambition to be rated AAA, with Canada’s Isabelle Hudon as lead negotiator and a charter signing planned for the autumn.

REGENT raises $240M for seagliders the Marine Corps keeps re-upping. The Series B is a 50-50 equity and debt mix taking total funding past $340M, behind a 255,000 square foot plant, a reported $10B order book and a defence Viceroy variant carrying 3,500 lb at up to 180 mph, on top of a $4.75M Marine Corps Warfighting Lab agreement in 2023 and a $10M follow-on in 2025. REGENT claims a 40 percent improvement in theatre-setting timelines in war games, with programs of record targeted for 2029.

In-Q-Tel’s small cheque helped build an $8B German drone champion. Quantum Systems co-CEO Sven Kruck credits the CIA-backed investor, whose cheques are often under $3M, with opening the doors that made CIA and FBI business possible for a company now valued around $8B, while the European Parliament’s Marie-Agnes Strack-Zimmermann warns that IQT “is not a purely financial investor.”

Army commits up to $2.2B to five nuclear microreactor vendors. The Janus program pairs Antares with Fort Bragg, BWXT with Fort Campbell, General Atomics EMS with Fort Hood, Radiant with Fort Benning and Westinghouse with Fort Drum, worth up to $2.2B across FY2027 to FY2031, targeting 20 plus reactors with the first online by September 2028 under Executive Order 14299 after nine bases made the November shortlist.

Canadian AI Newsletter

CanadianAI: One of Canada's largest-ever seed rounds, and Anthropic wants gigawatts in Canada

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2 months ago · 3 likes · Raif Barbaros

Ursa Major goes public at roughly $2.3B post-money via SPAC. The propulsion company is merging with Bleichroeder Acquisition Corp III to form Inflection Point Mach X Bleichroeder Corp under ticker IPXX in Q1 2027, at about $1.6B pre-money with $350M plus in PIPE commitments, against roughly $380M raised to date, 5,500 plus ground tests, 140,000 test seconds and a fresh $10M MK 104 award.

Terra Industries closes $52M seed for Global South defence infrastructure. The 2024-founded company added $18M to reach $52M total from 8VC, Silent Ventures and Nova Global, building drones and mine-detecting combat vehicles for African markets and tracking toward $100M in contracts, which is the geography almost every Western defence startup ignores.

• 𝗔 𝗿𝗮𝗱𝗮𝗿 𝗱𝗲𝘀𝗶𝗴𝗻𝗲𝗱 𝘁𝗼 𝗰𝗼𝘂𝗻𝘁 𝗰𝗮𝗿𝘀 𝗮𝗽𝗽𝗲𝗮𝗿𝘀 𝘁𝗼 𝗯𝗲 𝘀𝗶𝘁𝘁𝗶𝗻𝗴 𝗶𝗻𝘀𝗶𝗱𝗲 𝗮 𝗱𝗿𝗼𝗻𝗲-𝗶𝗻𝘁𝗲𝗿𝗰𝗲𝗽𝘁𝗼𝗿 𝘀𝗲𝗲𝗸𝗲𝗿.

Maglut Heavy Industries raises $3.1M pre-seed to break China’s magnet grip. The California startup emerged from stealth with ARC-1 rare earth chromatography claiming 99.9 percent plus purity, aimed at a supply chain where China holds 60 percent of mining and roughly 90 percent of magnets while an F-35 carries 900 lb of rare earths and a nuclear submarine 9,000 lb, with the 2021 NDAA sourcing ban starting to bite in 2027. Curtis Wu: “we were pretty shocked at the vulnerability of American industry.”

Dirac Labs takes $1.8M pre-seed for positioning where GPS cannot reach. The UW-Madison spinout is using diamond magnetometry for quantum universal positioning, backed by TitletownTech, Automotive Ventures, quantumEDGE, Jude Gomila and Balaji Srinivasan, on the thesis that “GPS is global, but not universal.” Underground, undersea and jammed is most of the modern fight.

The Defense Brief

The European defence checkpoint

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2 months ago · 12 likes · Louise Boucher

Related: The Pentagon and SBA want a Smaller War Plants Commission modelled on the June 1942 corporation, aimed at small manufacturers that make up 70 percent of the industrial base with nearly $500B of SBA lending behind it, which tells you where Washington thinks the capacity shortfall actually lives.

• JetZero Closes $100 Million Financing Facility to Advance the Z4 Program

• Arkenstone talks about the most boring parts of military manufacturing

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⚔️ Combat Readiness

Kit for Canada 🍁 IDEaS opened an austere medical challenge worth up to $2.8M through March 2028, with up to 10 semi-finalists at $180,000 each across forward oxygen delivery and sustainable surgical capability, and the spec is demanding: FiO₂ above 0.8 for more than four hours, rucksack-portable, no pressurized cylinders. Deadline is Thursday October 8.

Buy sheets 🍁 Innovative Solutions Canada has four live calls closing in September, MINERVA uncrewed ground systems for surveillance on the 10th, infrared quantum light on the 15th, MINERVA tactical cargo on the 21st and MINERVA Arctic UAS on the 24th, all at 14:00 ET, and the Army separately wants land and aerial drones for cargo and munitions resupply plus ISR platforms rated for “extreme cold” Arctic use.

• Canada’s Strategic Partnership Framework is the most important new tool in defence procurement. It lets the government designate trusted Canadian companies to deliver sovereign capabilities.

• Is the Valley of Death in Canadian defence procurement getting wider, not narrower?

Industrial Warfare

Rethinking the Defense Industrial Base in the Age of Industrial Warfare

Over the past few weeks, I have come across several independent analyses discussing what appears, at first sight, to be a relatively narrow industrial topic…

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5 months ago · 2 likes · Christophe DAUNIQUE

Sovereign drones 🍁 The Defence Drone Initiative drew 527 companies and more than 1,000 bids in a first round that closed August 14, three weeks after launch, across five streams and six capability areas on a five-year instrument that reopens every three months to mid-2027.

Fixed price, frozen ground 🍁: Deloitte’s warning that the default fixed-price model could stall the Arctic buildout, with the contingency-loading and no-bid dynamic, Jordan Eizenga’s “speed should be the main barometer” line, the staged-delivery fix, and the Nanisivik precedent.

• The ONE9 team is back in the Arctic connecting with the Sapujjijiit team on the ground, building the relationships needed to help innovative companies establish a northern footprint.

Power projection The case for reactors on bases is arithmetic, not ideology: the US military burns more than 3 GW of baseline power and 12 million gallons of liquid fuel daily, energy per soldier is up twentyfold since 1945, and 1 kg of U-235 carries the equivalent of 650,000 gallons of gasoline. Fuel convoys are the most predictable casualty generator in modern war.

The long bill is in the software 🍁 Caseway’s Al Vigier argues the River-class fight over hull counts misses the real cost, because 15 ships delivered across roughly 25 years run three separate design authorities, TKMS adds a fourth, and the Halifax-class combat system modernization alone ran $4B, with threat libraries and fire-control logic revised on a timescale of months rather than decades. Submarine contracting closes in 2027, so the data-rights and update-authority clauses being drafted over the next 18 months decide whether Canadian engineers touch that code for 30 years.

Software wins wars Ukraine’s Delta platform pulls drone video, radio intercepts and satellite imagery into one system that detects targets and pushes them to thousands of reconnaissance and attack drones, creating a miles-wide kill zone credited with slowing Russian advances to a near standstill. Detection, tracking, strike, all orchestrated by code, which is the argument for treating battle management as a sovereign capability rather than a subcontract.

• Fedorov offers drone technology to US in exchange for Patriots, seeks funding for defence tech fund

• Don’t write off Russia’s defence industry yet

Battery hygiene Chariot Defense’s Ben Kesling, a former Marine infantry officer, argues the Pentagon should purge the Chinese-made power banks American troops are buying off the shelf and carrying into the field, which is the unglamorous supply-chain hole nobody budgets for.

Sustainment 🍁 Kognitiv Spark’s RemoteSpark puts holographic repair guidance in front of a technician over low bandwidth, built by a roughly 25-person team since 2016, on the company’s estimate that about 80 percent of field procedures are undocumented, with UK Defence Innovation money doing the heavy lifting while Canada watches. Yan Simard’s read on the home market is blunt: “in Canada, I think everyone’s waiting to see the dollars actually being spent.”

Retooling 🍁 Tool and die shops squeezed by US tariffs of 15 to 50 percent are eyeing defence work, with Kitchener’s XL Tool down to about 40 percent automotive and Windsor’s Cavalier Tool at roughly 15 percent, in a sector that has been making 16 to 18 million tooling units a year for carmakers. XL Tool’s Chris Hergott has the warning label the strategy needs: “if you think you’re just going to turn off the automotive switch and hit the defence switch, it doesn’t work like that.”

Counter-drone An Army high-energy laser defeated three cartel-linked drones at the southern border, a first for the AMP-HEL system, under July’s Joint Laser Weapon System awards worth $86M initially against an $847M ceiling, which beats firing a $2M missile at a cheap airframe. The Air Force is layering the same problem, with the 31st Air Task Force running detection through AI, then electronic warfare, then shotguns as the last line and a Pentagon task force now publishing a catalogue of validated systems.

• New Test Footage: Black Hawk executes rocket-powered launch of Altius-700.

Ground robots At Sandhills 2.0 on Fort Bragg’s Range 63, the 20th Engineer Brigade ran 9 Mothers’ Bumblebee V2 and “Bee Hive,” Edda’s 12-gauge turret, Perennial Autonomy and Forterra’s autonomous Ford F-250s through a live breach, with Col. Jeff Burges declaring “gone are the days of a soldier running with a grapnel hook.” Col. Tom Monaghan’s self-diagnosis is the quotable one: the Army knows it has to stop delivering yesterday’s technology tomorrow.

The kill zone The Times spent several days in Zaporizhzhia, a frontline city where drones have made movement itself the hazard, and the reporting is the clearest picture yet of what a 20 km transparent battlespace does to daily life.

Autonomy crosses a line A Russian drone running a few hundred dollars of Nvidia Jetson Orin hardware selected its own target and killed three civilians in Zaporizhzhia on July 6, including 19-year-old student Tetiana Bubynets, the strongest documented case yet of a fully autonomous lethal strike. The policy debate about human-in-the-loop is now trailing the hardware by about $300.

Big think Brandon Tseng’s retrospective is the most honest piece a founder has written this year: ubiquity slipped from 2035 to somewhere between 2040 and 2045, 30 investors said no in 2015, and Hivemind now flies on 30 plus platforms with autonomy integration down from three years to under two weeks with two engineers. The Ukraine lesson he keeps returning to, designing for zero dependency on connectivity as a hard requirement, is the one Canadian programs still treat as optional.

Ukraine’s next act: Mykhailo Fedorov courting US and Western capital for a defence tech fund plus weapons-development companies, weeks after his July dismissal and the Kyiv protests, with his stated priorities on cheap AI-guided missiles, robotising the line of contact and sensor nets.

Drone doctrine wobble The Army is phasing out the 173rd Airborne’s Unmanned Assault Battalion, a unit championed by generals since removed, including Gen. Chris Donahue in July, with CNAS analyst Stacie Pettyjohn warning of a risk the Army invests in the wrong or already obsolete drone types.

Axis watch A Beijing Institute of Technology study found China could fill only about 60 percent of wartime drone orders at triple peacetime demand, with AI-led mobilisation reaching roughly 58 percent fulfilment against 34 percent for none at all, and Prof. Zhang Jihai’s conclusion is that competition is “no longer merely about the performance of weapon systems” but industrial capacity.

Software sovereignty A federal judge ruled the Pentagon’s supply-chain-risk designation against Anthropic “illegal and baseless” in a 59-page decision, finding the punishment was driven by a desire to make a public example of the company for criticizing the government, with OpenAI signing its own Pentagon deal hours later. On the other side of the same technology, a Russian-speaking ransomware crew used SpaceX’s Cursor agent across 28 chat sessions to run hundreds of malicious operations against at least six confirmed victims, which one analyst estimates makes attackers 30 to 50 percent faster.

Europe rearms Dutch insurers are sitting on €455B of assets while the Netherlands needs €16B to €19B more per year to reach 3.5 percent of GDP by 2035, with ASR capping exposure at €100M per transaction and Achmea up to €150M from €20M in 2025, and PwC reckons roughly 400 suppliers must grow output three to four times over.

Palantir’s European problem A little-known French company is now winning the contracts Palantir used to hold, with ChapsVision’s ArgonOS taking France’s DGSI intelligence platform and a German BfV deal on roughly €200M of revenue, 1,100 staff and a €1B target for 2028. Founder Olivier Dellenbach already sold eFront for more than $1.5B, so this is not a first-time bet.

Gray Matters

🎙️ Ep 28 - The Navy's Chief Talent Officer on Attracting Top Talent

Assistant Secretary of the Navy Benjamin Kohlmann has flown F-18s in combat, invested in startups, and run a hard-tech company. Now he's the US Navy's chief talent officer, responsible for a workforce of over a million people…

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2 months ago · 4 likes · Maggie Gray and David Rothzeid

🔫 Hot Shots

🍁 A radome from Arnprior is now keeping America’s clocks safe. Competition Composites delivered an 18-foot, 25-panel, five-ply “C-Sandwich” radome to the US Naval Observatory’s Master Time Clocks Facility in three crates with a 20-year gloss polyurethane finish. Small contract, precise capability, exactly the kind of supplier the industrial strategy should be scaling.

Can quantum sensors map Earth’s gravity for navigation? Q-CTRL says yes.

Jewish Space Lasers? Israel Wants ‘Rods From God’, plans new military frontier with space-to-ground strike weapons.

Space. Low Earth orbit is turning into a traffic problem, with the Journal reporting that the accumulation of satellites and debris roughly 100 to 1,200 miles up now forces SpaceX and its rivals into constant dodging, raising the odds of a collision that damages or destroys spacecraft. SpaceX’s own filings to the FCC put the manoeuvre count above 355,000 in a single year, which works out to every Starlink satellite swerving more than 40 times annually.

🍁 Greenland and Nunavut just started building an Arctic port network without asking Washington. The Port of Nuuk’s operator signed an MOU with the proponents of the Qikiqtarjuaq Deep Sea Port and the Grays Bay Road and Port projects covering maritime resilience, emergency response, vessel support and supply chains.

The London firm quietly mapping state-sponsored technology theft. The Times profiled Strider Technologies, valued at $450M, and its use of AI to detect state-backed espionage against companies and universities, which is the category most Canadian research institutions still treat as somebody else’s compliance problem.

Someone finally shipped an exoskeleton light enough to wear. Edgerun launched a 10 lb bilateral hip exoskeleton cutting metabolic cost 30 to 45 percent, tested 100 plus times with Ukrainian operators since May from a Kyiv office, which is notable given TALOS burned $400M before its 2019 cancellation. Soldier loads went from 40 lb for 2,500 years to 90 to 140 lb today, and load carriage causes twice as many evacuations as enemy contact.

Ukrainian founders wrote the pitch guide the rest of us need. Defence Builder Fund’s Andrii Hryshchuk warns that decks get 2.5 minutes, unclear by slide three means dead, and confirmation from real military users is the hardest currency in the sector, with some deals closing only after investors watch a team for six months.

The J-20 mystery had a boring answer. Those aircraft-shaped objects spotted in China turned out to be fire trainers, though the same reporting notes the PLAAF may already field roughly 500 J-20s across 14 operational units and three training bases, possibly 1,000 airframes by 2030. The mock-ups were the least interesting number in the story.

Justice named a Chinese campaign, then quietly walked part of it back. DOJ exposed a state-sponsored operation by a group it calls QTFY targeting NASA, the Federal Reserve, the Senate, military networks, hospitals, power companies and defence contractors, using a Chinese tech company as cover, then corrected the release days later to say those were “among the targets” rather than confirmed victims.

Ukraine is winning with balloons. More than 1,000 balloons have gone up since autumn, dropping small munitions, distracting air defences, relaying radio and now launching drones to extend their reach.

First Breakfast

Getting Creative About the Munitions Crisis

It’s no secret that America has a weapons production problem…

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2 months ago · 26 likes

The CIA director flew to Moscow and was home by dinner. Open-source trackers followed John Ratcliffe’s C-17A into Moscow on an unannounced trip, the first such visit since November 2021, which Trump called “sort of semi-routine”, with later reporting suggesting the message was a warning not to attack NATO.

The document that predicted the mobilization gap is seven years old. Quinton Lucie documented how FEMA dismantled civil defence and national mobilization planning on November 28, 1993, leaving 4.5 positions on national-security resource preparedness and roughly 25 years without a wartime mobilization strategy.

And the week’s most efficient business development hire. A Miami maritime-threat software firm turned drone defence startup brought on Eric Trump as an adviser in May on a two-year deal granting a 6 percent stake now poised to be worth about $12M, explicitly for his network of contacts.

The Icebreaker is written for the people building Canada’s defence technology base. Forward it to someone who needs it.

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China’s digital bombs and supply-chain snares are already inside the wire. Wired sat in on a war game simulating a Volt Typhoon style Chinese hacking crew taking down American infrastructure, and the uncomfortable lesson was that nobody in the room could stop the simulated blackout before real damage was done. The Economist mapped how tightly Chinese firms have wound their manufacturing supply chains around the globe, leaving even non-Chinese factories dependent on Chinese-controlled inputs and Western defence primes with fewer real alternatives than procurement officers assume. The Economist separately asked why the world’s richest country cannot defend its own vital infrastructure, and answered that Washington is still moving slower than the hackers it is supposed to be outpacing. Iran already proved the concept works: Iranian hackers reportedly shut down a power plant in the UK this week, and The New York Times Magazine used a hypothetical national blackout scenario to show how thin America’s grid resilience actually is once the lights go out at scale. Washington’s answer so far is bureaucratic: the White House’s new National Security Science and Technology Strategy calls for automated vetting of foreign research partners, while a US government lab is quietly probing Chinese made lidar for security holes in the autonomous vehicles that Rivian, GM, Ford, Kodiak and Lucid all put on the road.

• Cybersecurity expert Alex Stamos predicts that the next two years could be chaotic, as open-weight AI models with advanced cyber capabilities get into the hands of hackers, turning Grade C scammers into Grade A hackers; and allowing bad individuals to do the kind of work previously only possibly by large teams:

Derek Thompson

How to Survive the AI Cyberpocalypse

Let me make an odd confession to begin a detailed article about cybersecurity: On any given day, I would rather think about pretty much anything other than cybersecurity…

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2 months ago · 221 likes · 12 comments · Derek Thompson

Ottawa’s defence plan. The Globe and Mail’s editorial board wants a roadmap for how Canada will hit four percent of GDP in defence spending by 2030. Policy Magazine found Canada’s six month old Defence Industrial Strategy is already tilting toward large primes and foreign subsidiaries, pointing to Bombardier’s AEW&C talks with Saab and GDLS’s armoured vehicle expansion in London, Ontario, while smaller Canadian firms wait for a real seat at the table. Some of that gap is getting patched from outside government: Calian Ventures is partnering with Publicus on a Canadian government procurement matching platform aimed at exactly the SMEs Policy Magazine says are being left behind, and Vanguard Defence reports Ottawa just opened a $20.3 million Quantum Defence Industrial Strategy Hub at the University of Calgary even as the first Defence Drone Initiative supplier round closed with no public word yet on volumes or delivery dates. Even the auto sector smells the opportunity: the Globe and Mail’s reporting shows Hanwha courting Canada’s Auto Parts Manufacturers Association to build armoured vehicles domestically for a plant sector running thirty percent below capacity, a bid explicitly tied to Hanwha’s push for the Royal Canadian Navy’s up to twelve boat submarine contract, at a moment when AGF Capital Partners argues Canada is a differentiated entry point into a global defence sector now spending $2.9 trillion a year.

A billion dollars for missiles, but zero shells from a half billion dollar factory. Castelion raised a $1 billion Series C at a $13 billion valuation, co-led by Carlyle, JPMorgan’s Strategic Investment Group and Andreessen Horowitz, built on more than $500 million in US military contracts signed over eighteen months. Contrast that against Task and Purpose’s reporting that a $469 million US Army funded ammunition plant in Mesquite, Texas has produced zero 155mm shells in nearly two years against a target of 30,000 a month, while Ukraine burns through roughly 8,000 shells a day on the front. ProPublica went further, tallying $533 million spent on that same General Dynamics run plant, three production lines with two halted since last August, eight missed deadlines, and $26.3 million paid out in December despite no usable shells to show for it. The Council on Foreign Relations says the US has roughly a two year window to rebuild its arsenal before China gains real capability to take Taiwan, and pushes “precise mass,” meaning cheap drones and cruise missiles rather than more of the same shells nobody can make. MDA awarded X-Bow $11 million to keep developing a sub $750,000 interceptor against the roughly $4 million Patriot, a modest bet set against The Economist’s warning that interceptor stockpiles are running out faster than allies can replenish them. Even the venture side is nervous about its own math: one analysis of the sector pegs some Series A defence tech valuations at $300 to $400 million with no revenue at all, flagging one team of four ex government staffers that raised $160 million at a $1.4 billion valuation before shipping a product.

The Ambition Journal

The Arctic Tech Stack

The Ice Remembers Everything…

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2 months ago · 5 likes · 3 comments · Ambition Capital

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🤝 Deal Corner

🍁 Isar Aerospace locks in a Canadian launch pad for the next decade. SpaceNews reports Isar signed a deal worth $3.75 million a quarter over ten years, plus two five year options, for a pad at Spaceport Nova Scotia near Canso, with a 30 month fee waiver kicking in after year one. The agreement builds on a May letter of intent and lands as Isar’s German launch partner TKMS is separately bidding to build Canada’s next submarines, tying two very different Canadian procurement stories together through one company.

🍁 Caseway teams up with Taiwan’s MiTAC on a counter drone platform. Taiwan News reports the Canadian AI firm is partnering with MiTAC on Synthium, a maritime and counter UAS threat detection system, with Caseway’s CEO Al Vigier arguing that consumer tools like ChatGPT and DeepSeek are unsuitable for defence work because the data gets routed through foreign servers.

The Canadian Explorers

The Canadian Defence & Deep-Tech Capital Guide

Click here to skip to the full list of capital providers…

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2 months ago · 8 likes · 2 comments · Ethan Marcoux

Castelion’s $1 billion round is the biggest defence tech raise of the month. The Wall Street Journal’s original scoop lists Lightspeed, Lavrock, Altimeter, General Catalyst and Interlagos among returning backers, plus new investor T. Rowe Price, on top of Carlyle, JPMorgan’s Strategic Investment Group and Andreessen Horowitz. Castelion says its Blackbeard hypersonic missile went from clean sheet design to program of record in under four years.

Gray Matters

Work in Defense Tech 🇺🇸

Want to work in defense tech? 🇺🇸 The U.S. and its allies need more talented people working towards a mission that matters. I’m launching a new initiative to match talented engineers and operators with early stage companies building at the cutting edge of commercial technology and national security (both in and out of the…

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2 months ago · 12 likes · 1 comment · Maggie Gray

Brian Singerman’s GPx anchors an $85 million fund built to back the next Saronic. Tectonic Defense reports Silent Ventures closed Fund II with GPx as anchor LP, adding to a portfolio that already includes Saronic, Castelion itself, Hadrian, Armada and Firestorm, run by solo GP Jackson Moses.

CIBC’s thought leadership podcast unpacks Canada’s new submarine strategy.

Saildrone is building production lines in three European countries at once. Breaking Defense reports new manufacturing at Van Der Valk Shipyard in the Netherlands for its 52 metre Spectre vessel, at Umoe Mandal in Norway for the Surveyor, and at Southern Spars in Poland for wing components, alongside a new European headquarters in Denmark, announced the day before DALO Industry Days.

Erik Prince is betting on air defence as a subscription. Tectonic Defense reports Prince has launched Vectus, an air defence as a service startup, holding 80 percent alongside Swarmer’s 20 percent, while Prince also sits as Swarmer’s non executive chair with roughly a million shares tied to its IPO.

A Plymouth startup just tripled its ocean drone fleet with a Royal Navy customer in mind. The Times covers Oshen, the UK maritime intelligence firm founded by 26 year olds Anahita Laverack and Ciaran Dowds, which raised £5 million led by Lunar Ventures with Albion VC to expand its fleet of solar powered ocean sensing vessels used to track Russian submarine activity.

A Trump family backed dronemaker is racing to scale up production tenfold while cashing in on Gulf demand. The New York Times reports Powerus, a West Palm Beach start-up whose board includes Donald Trump Jr. and Eric Trump after a March SPAC merger, has workers in a United Arab Emirates facility spending up to twelve hours a day snapping together 3D printed components into “Guardian” interceptors that knock Iranian drones out of the sky at speeds up to 200 miles per hour. The company is currently producing roughly 3,000 interceptors a month and aims to reach 15,000 a month worldwide by mid-2027, momentum that helped it land a $22.3 million contract with a Gulf based energy firm for counter-drone detection equipment this past week.

The Canadian Explorers

Defending the Dominion | Eliot Pence, Dominion Dynamics — Explorer Spotlight #12

The Canadian Arctic has more than 162,000 kilometres of coastline, accounting for 75% of Canada’s total. Temperatures can fall below -50°C, geomagnetic disturbances can interfere with communications and sensors, and shifting permafrost makes the terrain unstable. The Arctic is both vast and harsh, but it needs to be defended. Meanwhile, Canada’s defence…

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2 months ago · 6 likes · 1 comment · Ethan Marcoux

Washington wants to beat China at shipbuilding by going nuclear instead of cheap. The Financial Times reports the US Maritime Administration is preparing a public-private partnership with London based Core Power to accelerate nuclear propulsion for commercial vessels, targeting faster licensing, insurance and port access for a US flagged nuclear fleet. MarAd administrator Stephen Carmel put the strategy plainly: “We are not going to beat China by being a cheaper version of China. They have mastered the art of being cheap,” arguing the US wins instead on nuclear technology it already leads in. Core Power, which has raised roughly $200 million from Mitsui, Mitsubishi and Sumitomo and has a relationship with the Port of Corpus Christi in Texas, plans to start building its first nuclear powered vessel in 2028.

🍁 A Canadian quantum computing firm just tested its battlefield software inside a live US defence exercise. SuperQ Quantum Computing says it was the only Canadian technology company deployed in a live operational exercise at Texas A&M’s Bush Combat Development Complex, simulating a contested extraction alongside US military command, intelligence agencies and defence primes. The exercise tested whether SuperQ’s Super Edge platform can re-solve a battlefield plan and deliver a new course of action to troops on tactical devices within 60 seconds of a threat change, all backed by the Canada Q-Branch Dual-Use Accelerator with support from Global Affairs Canada.

🍁 Ottawa just handed Quebec the biggest shipbuilding contract in its history. Prime Minister Mark Carney announced $11.3 billion in federal funding for six new Canadian Coast Guard icebreakers to be built entirely at Chantier Davie in Lévis, Quebec, fulfilling a promise first made in 2019 and supporting 5,000 jobs during construction.

⚔️ Combat Readiness

Kit for Canada 🍁: the Defence Drone Initiative’s marketplace opened this summer. Clank and Slop confirm five qualification streams closed their first request for supplier applications on August 14, running as a five year standing instrument that reopens quarterly through mid 2027.

Axis watch: Bloomberg reports Estonia is investigating a Russia linked arson at Milrem Robotics’ Tallinn facility, with suspects already identified and no injuries reported, though CEO Kuldar Väärsi says it is too early to assess the damage to a company that builds the THeMIS unmanned ground vehicles Ukraine relies on for casualty evacuation. Breaking Defense reports China’s own military press is calling the Iran war evidence of a shift toward “systems guerrilla warfare,” built on AI enabled networked kill webs rather than traditional force on force fighting. Iranwatch’s drone fleet table is a useful reference for exactly what Tehran has been exporting to prove that doctrine works, and The Economist reports Russian strikes are doing severe and lasting harm to Ukraine’s economy even as the front lines hold roughly steady.

• EU defence executives are no longer as safe as they were

Software sovereignty: DefenseScoop reports the Army’s four month old Task Force Lexington now runs seventeen agentic and cyber protection mission elements a day, hunting threats inside the DODIN with AI agents that took roughly forty five days to train, run by a task force of only eight to ten people. Defense One says the administration’s tech strategy is leaning hard into drones, swarms, undersea systems and autonomy for Indo Pacific deterrence, while flagging a glaring omission in how that strategy handles allied interoperability.

Canada’s defence relationship with Washington may not stay insulated from the trade war much longer. The Globe and Mail reports experts now warn that with US-Canada trade talks broken down, major defence procurements are increasingly likely to become bargaining chips on either side of the border, even though the two countries remain deeply integrated through NORAD and joint military exercises.

Russia is using drone confusion as a weapon against NATO’s eastern flank. The Times reports Russia is exploiting GPS jamming and spoofing to steer Ukrainian drones off course and into NATO airspace, part of a pattern that has already put Russian drone debris on Romanian soil and wounded two civilians, the first casualties on NATO soil since the 2022 invasion began.

A fully autonomous drone kill. The New York Times reports a Russian drone, reportedly built around a repurposed Nvidia microcomputer, killed three Ukrainians last month in Zaporizhzhia, in what officials believe are the first Russian inflicted deaths with no human in the loop at all.

A Navy SEAL turned founder bet his career on the idea that the AI pilot matters more than the aircraft. War on the Rocks profiles Shield AI co-founder Brandon Tseng, who pitched thirty Silicon Valley investors in August 2015 and got zero yeses, then twenty five more the following year and got two, on his way to building the Hivemind autonomy software that now flies Shield AI’s V-BAT and X-BAT aircraft. Tseng once expected autonomous defence systems to be ubiquitous by 2035; he now says slow Pentagon procurement and slower investor appetite pushed that date closer to 2040.

🍁 A student rocketry team just broke a world altitude record in northern Ontario. CityNews reports the University of Waterloo’s Waterloo Rocketry team sent its liquid bi-propellant Polaris rocket to 63,497 feet at the Launch Canada Challenge in Timmins, nearly 7,000 feet past the previous world record for a student built rocket.

US Congress is quietly studying whether cyber deserves its own military branch. A Congressional Research Service brief published August 19 lays out the case for and against creating a dedicated Cyber Force as its own service, the same debate that produced the Space Force just a few years ago.

Cheap at scale: The Wall Street Journal reports acting Army chief of staff Christopher LaNeve is ordering a “back to basics” elimination of a futuristic drone battalion that was a signature program of his ousted predecessor, General Randy George. That same appetite for cheap and fast is exactly what is fuelling Neros: an exclusive preview details how its FPV racer founders with no defence background scored 87.5 out of 100 in the Pentagon’s Gauntlet Phase I trial, finishing second in a crowded field, on the way to a $250 million round that tripled the company’s valuation in nine months.

• Canadian companies eye speed, quick contracts from Ottawa’s new drone marketplace

Pentagon reform watch: the Department of War says Secretary Hegseth has made “supercharging the defense industrial base” one of four lines of effort in the 2026 National Defense Strategy, tasking the Defense Innovation Unit with converting private capital into what the department calls tangible combat power. Whether the money behind that mandate is disciplined enough to work is exactly what a new defence tech bubble analysis questions, given how many Series A rounds are pricing in revenue that has not shown up yet.

• America’s Missing Military Revolution

Big think: War on the Rocks argues that cheap battery powered drones, now responsible for the majority of Ukrainian casualties, run on the same consumer electronics supply chain, batteries, motors and chips, that China already dominates, which means the West’s drone ambitions are hostage to the same firms it is trying to out compete militarily. A New York Times opinion piece from an electricians’ union representative makes the opposite case about the same grid strain, arguing his members want more data centres built because the country needs the power capacity regardless of who is buying it. Meanwhile the Gloves Off podcast’s season two finale teams with the Canadian Shield Institute to report that mentions of “sovereignty” in Parliament just hit their highest level since 1901.

Ground robots: Milrem’s THeMIS remains the backbone of Ukraine’s unmanned ground vehicle fleet even as its maker deals with the Estonia arson above, and National Defense magazine quotes Ukrainian officer Yuriy Filatov saying battlefield technology goes obsolete in as little as six months, which is the entire argument for why process, not any single robot, is what actually wins.

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🔫 Hot Shots

Ottawa’s photonics founders have three weeks to apply for federal money. ISED’s Innovative Solutions Canada challenge on infrared quantum light characterization and secure communication opened August 18 and closes September 15.

A Navy officer is still warning that underwater UFOs are a real threat. Popular Mechanics revisits Lieutenant Ryan Graves and the 2014 Virginia Beach sightings that started the conversation.

Steve Jobs’s post-Apple exile had a secret intelligence customer. Digital Trends, reconstructing the Wall Street Journal’s reporting, says CIA officials approached Jobs in 1986 and committed to buying 20,000 NeXT workstations for satellite imagery analysis at the National Reconnaissance Office, a deal that kept NeXT alive long enough for Jobs to return to Apple.

CBC marks five years since Kabul fell. The retrospective revisits the evacuation and the years of Taliban rule that followed, a reminder of how quickly a twenty year commitment can unwind.

If you’ve got battlefield intel, classified tips, or just want to call in an airstrike on our typos, hit “reply” and sound off. Whether it’s a new tech sighting, a rumour from the mess hall, or feedback on our comms, we want your SITREP.

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🎯 Three-Shot Burst

For two days last week, roughly 200 Canadian Armed Forces personnel stood on a decommissioned airfield outside Killaloe, Ont. and watched nearly 30 Canadian companies put uncrewed systems through their paces. Canada is looking to increase its military drone and robot supply for a new era of warfare, and this was the CAF making that operational. The event: the RED COBALT Uncrewed Systems Accelerator, a first-of-its-kind CAF-industry drone test.

Quadcopters, fixed-wing, command-and-control stacks, counter-UAS, unmanned ground vehicles. Names on the flight line included Sentinel R&D, Robotics Centre, Redwire, Remote Robotic Systems, Screaming Geese, ARA Robotics, Draganfly, Remeo One, Kelluu, Sensofusion, Indro Robotics, and many more.

Running point was Lt.-Gen. Darcy Molstad, commander of Canadian Joint Forces Command, who has the unenviable job of deciding what the CAF needs, and how much, in a category where the answer changes faster than the staffing cycle. His framing, and it’s the quote of the week: the military has to “innovate at the edge directly with industry” because this is “technology that evolves on a weekly basis in a modern operational theatre.”

Translation: write a spec, tender it, deliver in five years, receive obsolete kit. Ukraine settled that argument in 2023. Ottawa is catching up.

RED COBALT happened at Area X.O, the R&D and demonstration complex built by Invest Ottawa, and one of Canada’s NATO DIANA test centres. The Killaloe site is Area X.O’s secondary facility, a former airport chosen because you cannot do serious airspace work in the shadow of Ottawa International Airport. CEO Sonya Shorey put it plainly: Area X.O Killaloe unlocks “testing, demonstration, validation opportunities” that aren’t possible closer to the capital.

That’s the whole game. Sovereign capability doesn’t materialize from strategy documents. It materializes when a 12-person company can fly a payload in controlled airspace, in front of the operators who’ll actually use it, without a six-month regulatory odyssey. Invest Ottawa built that, before it was fashionable, on municipal-scale resources. Lt.-Col. Jayme Leclerc, who organized the event, made the same point from the uniform side: RED COBALT put military officials in front of manufacturers they’d otherwise struggle to reach.

Convening power is infrastructure. Hats off to Sonya and her team.

The industrial wrapper is the Defence Drone Initiative, a DND-DIA marketplace under the Defence Industrial Strategy. Sovereign capability, DND said, means access to the expertise, intellectual property, production capacity, supply chains, and sustainment. The initial application window closed 14 August. Around 500 vendors are expected in the first pool. The feds are standing up that pre-qualified supplier pool to compress acquisition from years to roughly two months, with three significant RFPs queued behind it. If that holds, it’s the most consequential change to this market in a decade. Two months is a cycle a startup can survive. Five years is a cycle that kills companies before the contract lands. Molstad also said the quiet part out loud: Canada’s SMEs are underutilized. Better coming from him than from us.

One of the first six asks from that pool is a deep-precision strike (DPS) system sitting between a long-range one-way attack drone and a cruise missile. Defence Minister David McGuinty: adversaries already have them, they are improving them, and “this is an area we can’t let slip.” Lt.-Col. Nick Verreault, head of the Joint Uncrewed Systems Office and DPS program director, put the production target on the record. Increase drones made in Canada by 200 times, or two million a year. Ottawa will still buy a foreign DPS first, inside about 10 months, then try to stand up a sovereign line.

IDEaS is standing up a downtown Ottawa urban CUAS sandbox for 26 to 30 July 2027: detection only, $1.75 million in prizes ($1 million / $500,000 / $250,000), $20,000 in expenses, RCMP and U.S. DoD SSO as observers, applications due 1 December 2026. A Joint CUAS Office is forming. The training pipeline confirms this is not a fad. MWO Blake Berggren, building FPV drone courses for the CAF, calls it “the biggest and fastest-paced change” of his 25-year career. Nobody builds a school for a fad.

The lesson from Ukraine is not a particular airframe. Yuriy Filatov told National Defense Magazine that kit is stale in six months. “You can copy a drone, but you cannot copy the speed [at] which it was born.” NATO just watched the point land. In Combined Resolve in Germany (April to May 2026), Ukraine’s 412th Nemesis handily beat a Texas mechanized brigade with FPV and dropped munitions. “Killed” U.S. troops had to be recycled as reinforcements to keep the game running. Gen. Alexus Grynkewich said that experience cannot be replicated in the United States, which is another way of saying the CAF cannot photocopy it from a CONUS range either.

Bottom Line: A serious CAF-industry conversation, on infrastructure Invest Ottawa had the foresight to build, in a policy environment finally admitting procurement is the bottleneck. In Canadian defence, that’s close to a miracle. The caveats: a showcase is not a contract, “two months” is an aspiration until it’s a signed PO, and Ukraine’s real lesson isn’t that drones are good. It’s that drones are consumable. Now show us the contracts.

Ukraine's Arms Monitor

Newtype Industries: The First Korean Defence Startup Testing in Ukraine

President Zelensky announced that Ukraine is ready for a Drone Deal and closer defence cooperation with South Korea. And I’ve just met the first Korean startup, Newtype Industries, that is testing its defence solution with Ukrainian military units, and interviewed its CEO…

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3 months ago · 70 likes · 2 comments · Olena Kryzhanivska

Related:

• The single biggest leading indicator of more defence spending is more RFPs. That DND signal is here

• Ukraine’s first jet-powered interceptor drones for countering jet-powered Shaheds undergo combat testing

  • Ukraine developed a €200 trajectory correction kit for precision drone drops, known as “FireFly”… Pocket sized drone defence out of Ukraine… Wuxly awarded CBRN Protective Clothing contract for CAF

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🤝 Deal Corner

PitchBook’s Q2 2026 Defense Tech Report logged $16.4 billion across 249 deals, down 32.8% from Q1’s record $24.4 billion and still the fourth-largest quarter on record. Trailing twelve months: $69.5 billion. Autonomy took 42.1%. Anduril’s $5 billion Series H at $61 billion is the concentration problem in one line. Eleven public listings reopened the exit window. The next test is funded orders, scaled production, and recurring revenue. That test is already sorting winners. The Pentagon is buying weapons from startups under Secretary Hegseth, not just writing them science-project cheques.

JPMorgan’s $1.5 trillion Security and Resiliency Initiative now covers Canada, with advisers including Robert Gates, Chris Cavoli, Paul Nakasone, and Paul Ryan. NatSec100 has 12 IPOs. Joby is paying $500 million for Resonant Sciences. Heaviside raised $60 million at a $600 million valuation. First In argues today’s scalers become the next primes, naming Castelion and Saronic, and comparing the 2022 to 2027 vintage to the 2005 to 2011 cybersecurity boom against a U.S. defence budget “well over $1 trillion.” Ukraine already minted the wartime version. UForce hit $1 billion on $50 million in March, Swarmer IPO’d, and Brave1 issued nearly 1,000 grants worth about $140 million. In Europe, Molten Ventures is hunting specialist VCs with industrial know-how in space, defence, and health.

Gray Matters

Demystifying Defense Corporation Sales: Insights for Startup Founders

Talk to almost any employee at a large corporation, and they will tell you that the technology their employer uses internally is clunky, old, and hard to use. To this day, many corporations rely on decades-old software and legacy hardware vendors, reducing employee satisfaction and efficiency. This problem is especially true for A&D…

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a year ago · 9 likes · 4 comments · Maggie Gray and Pat O'Reilly

Made in Canada is now a procurement doctrine. Implementation is the weapon.
CIBC’s industrialization paper puts numbers on the 5% of GDP by 2035 pledge: 70% of federal defence contracts to Canadian firms, a 50% export increase, about 125,000 jobs. National Defence tenders jumped from about 53 a month in FY2024-25 to 128 a month in Q1 2026-27. Disclosed awards hit $2.70 billion, including Bombardier ($634 million), Colt Canada ($307 million), Safran ($118 million), General Dynamics Ordnance ($81 million), and Insitu ($80 million). The Coast Guard moved to DND on 2 September 2025 and took about $10 billion in shipbuilding and 7,855 positions with it. ITBs now sit at the DIA, and bid clocks that used to be months are sometimes weeks. TKMS is the preferred submarine supplier. Elbridge Colby, on an Asia trip, praised AUKUS and warned middle powers, naming Canada, not to hedge Washington or “use your defense industrial dollar as a kind of political or industrial economic strategy for your domestic context.”

Meanwhile Barn VC’s Dominion List counts 517 U.S. companies with Canadian founders and about $414 billion raised. Waterloo fed 216 of them.

🍁 Palitronica closes Series A (amount undisclosed). BDC leads.
Waterloo’s embedded-electronics cyber shop closed a Series A led by BDC’s Industrial Innovation Venture Fund, with Three Kings Capital, Frostbite, and Unpopular Ventures. Bell Textron already picked the company for cyber assurance on the MV-75 Cheyenne.

🍁 EarthDaily, $2.23 million, RCMP border AI.
EarthDaily won a DRDC/CSSP contract to build SMATAK, an AI change-detection platform for RCMP border monitoring, with a 2027 demo. Chris Rampersad’s brief is timely, actionable intelligence for analysts and field personnel. The Financial Post framed the same $2.2 million award as a springboard into more defence work.

Industrial Base Alpha

AI Visibility Index: Drones

Finally, after much delay, I am releasing my analysis of the AI Visibility Index for Drones…

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2 months ago · 3 likes · Matthew Bernard

🍁 IDEaS puts $4.96 million on Ukrainian minefields.
Five projects, up to $1 million each: THALES Canada SwarmScan at $1,000,000, Agile Electromagnetics at $999,895, FLIR Unmanned Aerial Systems at $972,659, plus Agent-F and Mine Defeat By Air Blast. Explicit dual use. Ukraine now. CAF later.

Neros, $250 million, triples to $2.5 billion.
Sequoia and the American Strategic Technology Fund led. Thiel participated. The Archer FPV runs about $2,000 bare and $5,000 with a warhead, no Chinese parts. A $500 million Army IDIQ sits underneath, aimed at up to 10,000 units.

Hadrian, $1.37 billion Series D at $7.87 billion.
Seven months ago it was worth $1.6 billion. Chris Power had barely touched the $260 million Series C. The Merge asks the right question: why raise a billion more than you need, and can venture return 10x on factories?

Uforce talks north of $4 billion.
Less than six months after a $1 billion unicorn round on $50 million, the autonomous air/land/sea shop is back in market.

Newcomer

AI Frenzy Brings Dual Valuation Deals into the Mainstream

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3 months ago · 52 likes · M. Sriram

Airbus anchors E2D at €500 million.
AVP and Earlybird. About 20 companies, about €25 million each. First cheque: Alta Ares, French ISR and CUAS. Michael Schoellhorn’s mandate is to keep the capital, talent, and IP on the continent.

Code Metal, $80 million OTA for WarMatrix.
Pentagon wargaming, layered on AFSIM, after a $17 million initial operating capability. Cycle time under 12 months. CEO Peter Morales: “I have never seen them move this fast.” Johns Hopkins APL’s Kelly Diaz on AFSIM: “it feels like you need a PhD.”

Gray Matters

A Startup’s Guide to Working With Large Corporations

Large corporations and early stage startups need each other. While many in the startup and defense tech ecosystem love to criticize traditional defense primes and other large corporations (often for good reason), ultimately corporations serve a crucial role for American national security, managing massive, multi-billion dollar projects responsible for d…

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3 months ago · 11 likes · Maggie Gray and Pat O'Reilly

HighGround, $6.5 million seed.
Former Green Beret John Price. Next Frontier led, with Tandem, Fulcrum, and Context. An AI intel layer for Pentagon acquisitions, sitting between Washington and Wall Street.

Europe Doesn’t Have a Defence Funding Problem. The Real Challenge Is Capital Alignment with Capability Generation. Germany leads European defence tech by a wide margin.

The Defense Brief

Going all in on European defense — Alex Ferrara, Partner at Bessemer Venture Partners

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3 months ago · 5 likes · 1 comment · Louise Boucher

Related: European VCs still cannot get enough drone startups even in an overcrowded market, and they are already looking past defence into mosquito control and firefighting.

⚔️ Combat Readiness

🍁 Kit for Canada. Ottawa is buying a foreign DPS inside 10 months, standing up the DDI marketplace, and running an urban CUAS sandbox in 2027. The price point Canadian vendors will be measured against is the U.S. Army’s Next Generation C-sUAS Missile under $150,000, Coyote-compatible, Group 2 and Group 3, at least 5,000 rounds, 50 for assessment by Q1 FY28, distinct from the separate Low-Cost Interceptor effort under $250,000. RFI responses are due 20 August. NORTHCOM and NORAD deputy Lt. Gen. Joseph Jarrard, asked if he can defend the homeland against a drone swarm, said “No.” “We don’t have the sensors... we’re not there yet.” He pointed at Ukraine’s Operation Spiderweb.

The kill zone. Ukraine took a midrange-strike edge in the first half of 2026 with six innovations that chewed Russian logistics and slowed the advance. The same WSJ visual is the field manual the RED COBALT team must be looking at.

Deep strike. A year ago, satellite imagery took days to reach a Ukrainian drone team. Michael Schwirtz and Tyler Hicks watched it arrive near real time. Call sign Tikhi. Bravo1Alpha’s handheld looks like a game console and plots the flight path.

The Canadian Explorers

Detecting the Invisible from Space | Chris Robson, Wyvern — Explorer Spotlight #11

Traditional satellite imagery can show a ship. Wyvern’s hyperspectral satellites can reveal what it is made of. “Deception is the way modern warfare is waged these days. Hyperspectral sees through deception…

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3 months ago · Ethan Marcoux

Ground robots. The Army handed Infantry Last Tactical Mile prototype OTAs to Maren-Go, Overland AI, Forterra, Hendrick’s Motorsports, American Rheinmetall, and HDT: four vehicles each, casevac and resupply, operational assessment early 2027. Forterra’s doctrine note: “attritable is not a price point.” Score effect, human life, capital, and speed to replace. GAO: 30 major programs added $49.3 billion in a year and now take more than 10 years to field.

Cheap at scale. Auterion is putting one-to-many swarms into real operations. One operator. Many airframes. Shared state.

Stockpile paradox. Bloomberg Economics: the United States has fired more than half its PAC-3 MSE stock and about 40% of THAAD. Precision Strike Missile numbers are “likely exhausted.” The war “consumed important weapons faster than they can be bought and built,” opening a generational gap that “cannot be quickly overcome.” FY27 still asks for 7,031 interceptors, 86% of them via reconciliation, including 2,936 PAC-3.

Space. GUR’s Maj. Gen. Vadym Skibitskiy says Russia’s Rassvet constellation (Bureau 1440) is at 16 satellites now, 292 by 2027, and 924 by 2035, and Moscow has “already begun launching it much faster than originally planned.” Once complete, it operates like Starlink. Ukraine cannot run Starlink over Russia. Russia would be able to run Rassvet over Ukraine.

Axis watch. PLA researchers reading the Iran war are writing about “systems guerrilla warfare” and the U.S. Maven Smart System, plus the cost gap between cheap drones and Patriot or THAAD. Ukraine’s GUR found an Nvidia Jetson Orin inside Russia’s S-71M Monokhrom, a Su-57-launched cruise missile with a 250-kilogram warhead and a stated 350 to 400 kilometre range. Thirty-five foreign components in the latest dump. Sanctions are a routing problem, not a physics problem.

🍁 Home front. Biwei Zhang was arrested at NATO Mons. She had cleared CSIS and the RCMP despite a 2023 fraud finding and sat a CBSA exam twice under two names. Richard Fadden: “It’s going to happen again.” Winnipeg lab. Hydro-Québec. NRCan, 2,000 documents. Meanwhile Canadian and U.S. negotiators put critical minerals and defence on the table ahead of the 19 August 50% tariff threat. Tariffs first. Minerals and defence in phase two.

Software sovereignty. The White House wants capable models in operators’ hands. Hugging Face just used a Chinese open-weight model to investigate an OpenAI test system that escaped its lab, because commercial safety filters refused the incident-response questions. Cory Ondrejka: “A model that refuses the questions an incident responder has to ask is not a defensive tool.” Same week, a Trump memo lets vetted firms hack foreign criminals under DOJ and DHS supervision, with a $1 million penalty and a ban on loss of life. Jeff Gray: “The United States just revived privateering for the digital age.” The New York Times version is the same memorandum.

Supply chain. A $150 million weapons system can die for want of $20,000 to $30,000 in magnets. Phoenix Tailings has a $500 million Pentagon loan and still cannot close the samarium gap of 50 to 100 tons a year. China still runs about 80% of tungsten mine supply. Pentagon tungsten deadline: 1 January 2027.

• Donald Trump launches tariffs targeting Chinese drone technology

• A massive explosion hit KNDS’s military plant in Colleferro, outside Rome - a company that supplies Ukraine’s defense forces and produces inside Ukraine

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🔫 Hot Shots

🍁 MINERVA wants an Arctic UAS.
Innovative Solutions Canada has one open challenge on the board: Arctic Uncrewed Air System, closing 24 September.

🍁 550 Canadians showed up to learn how to sell to DND.
DIGITAL’s Defence Market Access Series has drawn 550-plus attendees. Security clearance still takes 18 months or more.

DONRCO stands up Plug and Play.
The Navy Rapid Capabilities Office launched a National Security consortium for commercial and non-traditional vendors, managed by the Creative Defense Foundation. Jim Juster’s phrase is “speed of relevance.” First meeting: 18 September.

Amanda’s Substack

Defence Critical Minerals: When Mineral Supply Chains Become a Matter of National Security

For the past several years, much of my work has been devoted to explaining why critical minerals matter…

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3 months ago · 15 likes · 9 comments · Amanda van Dyke

Ethos is scoring 50,000 troops.
The California readiness startup’s engine is live across the Air Force, Space Force, Army, and Navy, plus a handful of NFL teams. Andrew Powell: stop training like it is the 1990s when the threat changes week over week.

ODNI wants a master list of spies.
Jonathan Fredman, 36 years at CIA and ODNI, says a central roster of targets, suspects, and recruits is a catastrophic counterintelligence vulnerability, not a deconfliction tool.

The Pope just called just war outdated.
Leo XIV’s encyclical, Magnifica Humanitas, still demands an identifiable chain of responsibility for autonomous weapons. “No algorithm can make war morally acceptable.”

Wisconsin wants Area 52.
Lake Michigan, restricted airspace R-6903, Fincantieri building Saildrone’s 170-foot Spectre, and more than $800 million already in the yards. Autonomous Heartland Forum: 6 September.

Carson Powers

Balance of Powers Portfolio - 7.31.2026

And here we go. Welcome to the first issue of Balance of Powers where we track the companies generating the largest share of U.S. defense revenue and explore the trends shaping the defense sector. America’s defense industry is concentrated within 10 companies generating approximately $275 billion in defense revenue in 2024, spanning everything from subm…

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3 months ago · Carson Powers

World War IV, already on.
A Hill column opens in Beijing with a general briefing Xi on a cyber campaign against the United States.

The Greenbrier’s bunker is a tourist attraction.
112,544 square feet under a West Virginia hotel, a 28-ton blast door marked “High Voltage,” and 35 years of continuity-of-governmen.

Your router already knows your gait.
KIT researchers identified 197 people at nearly 100% accuracy from unencrypted WiFi beamforming feedback, no camera and no phone required. Julian Todt: “This technology turns every router into a potential means for surveillance.”

If you’ve got battlefield intel, classified tips, or just want to call in an airstrike on our typos, hit “reply” and sound off. Whether it’s a new tech sighting, a rumour from the mess hall, or feedback on our comms, we want your SITREP.

Share The Icebreaker

Special congrats this week to Mark Robbins, a member of DND’s BOREALIS team, who just graduated Canadian Forces Leadership and Recruit School, better known as Basic Training. Well done, soldier.

🎯 Three-Shot Burst

Canadian banks are re-entering defence financing, but most defence SMEs still cannot get a loan without a signed government contract in hand, since procurement cycles run roughly seven years from pitch to decision, and no bank wants to carry that risk alone. The Defence Minister isn’t thrilled about the situation:

“I’ll be really blunt. We don’t have any choice. We need to move forward now. We need to look out for ourselves. We need to step it up domestically.” — Defence Minister McGuinty

Contrast that with Silicon Valley: Palmer Luckey’s challenger bank Erebor is nearing a $1.5 billion raise at an $8 billion pre-money valuation explicitly positioned to replace Silicon Valley Bank for defence founders.

Northside Ventures counts just 84 Canadian dual-use startups founded in the last five years against a federal plan to nearly double core defence spending to roughly $159 billion by 2035, and its own portfolio data shows only 12 of 34 investments are dual-use despite screening 5,000 companies a year. “We will need force multipliers,” says Clearpath Robotics co-founder Ryan Gariepy.

DLA Piper counts more than EUR 18 billion invested into European aerospace and defence startups so far this year alone, dwarfing anything moving through Canadian venture channels. And the new Defence, Security and Resilience Bank that Canada helped stand up with eight allies carries about $190 billion in capital but still leaves the hardest problem unsolved.

Canada bets the Arctic on satellites, reactors and shadowing Chinese icebreakers. True North Map ties together Ottawa’s Arctic buying spree: a $2.3 billion, 15-year contract for secure Ka-band connectivity, a Polar Class icebreaker joining the Canadian Coast Guard this season, and nine Prairie manufacturers entering the AeroTrace supply chain pipeline. The Telesat satellite build-out headlines the push, with the Lightspeed constellation expanding from 156 to 225 satellites, and Telesat and MDA shares soared on the announcement. MDA Space picked up a $474 million contract increase to build the extra 27 satellites in Montreal.

CTV put the total federal Arctic military technology investment at $2 billion. That sovereignty concern is not abstract: Canada and the US are actively shadowing Chinese icebreakers Xue Long and Xue Long 2 after they sailed through the Bering Sea, with an RCAF CP-140 flying out of Alaska since July under Operation Latitude.

Energy security is the other Arctic leg: Ontario’s Darlington site will host the first small modular reactor in the G7, but Canada will still enrich its uranium fuel in the United States, reversing “the original rationale for the CANDU program.” Both The Record and CBC report that a Waterloo startup wants a cleaner fix: Canadian Strategic Missions Corporation is building a desk-sized microreactor meant to replace diesel generators across the North, backed by $4.5 million from Ottawa and $1 million from the Canadian Space Agency, with founder Daniel Sax targeting fleet deployment by 2030.

Canada’s defence-tech founders are getting louder, and some of them fly F-18s. Start with the numbers: AI-powered defence tech has drawn a record $32 billion in VC funding since 2022, with H1 2026 alone pulling in $12.8 billion, more than five times all of 2022, according to Forbes’ survey of veteran founders now running the sector’s marquee names. Shield AI’s Brandon Tseng put the founder pitch plainly: “Veterans are really good at enduring pain and suffering. A 22-year-old marine has probably endured much more than a 22-year-old fresh out of college going to work at XYZ company in Silicon Valley.”

Canada has its own version of that story:

The Canadian Explorers

Vertical Takeoff Planes | Brandon Robinson — Explorer Spotlight #7

The Cavorite X7 is an aircraft that can take off vertically like a helicopter, fly forward like a plane, and recharge mid-air…

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4 months ago · 2 likes · Ethan Marcoux

Horizon Aircraft’s Cavorite X7, a hybrid-electric VTOL built around a patented “HOVR Wing,” comes from a Lindsay, Ontario company co-founded by ex-RCAF F-18 pilot Brandon Robinson, who explains the tilt-wing design simply: “There’s a reason why you don’t see large birds with these tiny little propellers on top.” Muskoka has its own veteran-founder story too, with Skadi Cyber Defense’s Rachel Clark, a former US Marine and Navy submarine-systems engineer, building an autonomous cybersecurity platform called Frostbow for DND, NATO and mining clients.

Meanwhile a new hiring data set shows who is actually building this industry: Anduril alone made 258 external engineering hires in 2026 so far, more than a quarter of all hires tracked across nine defence “neo-primes,” and 79 percent of those hires came from commercial tech rather than the military, prompting the blunt verdict that “this is a commercial-tech recruiting operation wearing a defense badge.” Anduril’s own CEO Brian Schimpf spent the week on a media circuit explaining that philosophy on CNBC’s Tech Download, insisting autonomous weapons already exist quietly in torpedoes and anti-radiation missiles.

Japan is chasing the same wave from a different angle: Terra Drone’s pivot from commercial drones to defence contracting has sent its Tokyo-listed shares up 499 percent year to date.

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Up to $1M in funding and additional technical services available for technologies with defence and civilian applications. Advisory support is available now.

🤝 Deal Corner

🍁 CellCore builds Canada’s first sovereign nitrocellulose supply chain, from flax straw and an Indigenous-owned facility. CellCore Technologies plans to make nitrocellulose, the explosive propellant base Canada currently produces none of, from Canadian flax straw and dissolvable wood pulp, targeting 6,000 tonnes annually by 2028. The facility will be Canada’s first Indigenous-owned sovereign nitrocellulose plant, anchored by Des Nedhe Group Defence and English River First Nation, with pre-sold supply agreements already exceeding initial capacity. CEO David Brough frames the urgency plainly: “God forbid a larger conflict kicks off. All those chains of supply, most likely, the countries that actually hold on to those will start to draw them back.”

• Take a look at this Global Energetics Tracker

🍁 North Vector Dynamics lands European capital and pushes its valuation past USD 90 million. Calgary’s North Vector Dynamics landed a strategic investment from Dutch-listed defence manufacturer CSG N.V., which posted EUR 6.7 billion in 2025 revenue across 14,000 employees, pushing NVD’s valuation past USD 90 million on the strength of its ITAR-free, NDAA-compliant CM-70 drone interceptor. “NVD gets a manufacturing and export network it would otherwise need years to build. Ottawa gets a sovereign missile capability with a European accelerant attached.”

🍁 ThinkOn and AVSS give Canadian public safety and defence a sovereign alternative to hyperscaler-hosted TAK. Toronto’s ThinkOn and New Brunswick drone maker AVSS partnered to let Canadian agencies run Team Awareness Kit entirely on Canadian cloud infrastructure, streaming MAVLink-compatible drone telemetry straight into TAK’s common operating picture without a foreign hyperscaler in the loop. DroneXL adds that AVSS has now manufactured more than 2,000 systems this fiscal year and that ThinkOn has held sovereign certification for eight years across Canada, the US, UK, Australia and the Caribbean.

• Finland’s Kelluu is bringing autonomous, cold-weather airships into Area X.O in Ottawa to push Canadian Arctic ISR forward, and The Walrus lays out why Canada’s military is preparing for the drone wars in the first place.

• Vimy Forge publishes a look book on its very first cohort.

Audace Advisory

Sovereign Until Someone Needs an Exit

On 19 June 2026, MDA Space, the closest thing Canada has to a sovereign space prime, signed a definitive agreement to acquire Blue Canyon Technologies of Colorado from RTX for US$620 million, approximately C$874 million, in cash [1]. The rationale was not the technology; MDA already builds satellites. What MDA bought, by its own chief executive’s accoun…

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3 months ago · Audace Advisory

🍁 Canada Rocket Company races to fill the void SpaceX is leaving behind. BetaKit reports SpaceX has started turning away rideshare customers on Falcon 9 past 2028, favouring its own Starlink satellites, leaving Canada, the only G7 country without independent orbital launch capacity, scrambling. Financial Post reports Canada Rocket Company has raised $22.5 million, mostly from Canadian investors including BDC, plus an $8.3 million federal grant under DND’s “Launch the North” program, with CEO Hugh Kolias noting “everyone thought it was oversupplied” when explaining why so few companies had targeted the medium-lift launch gap his company now occupies.

🍁 Calogy’s thermal-management IP turns a near-shutdown into a $1.2 million dual-use drone contract. Sherbrooke’s Calogy Solutions will design the battery system for Jaunt Air Mobility Canada’s next hybrid-electric, autonomous VTOL drone, a $1.2 million CAD win built on air-cooling tech the company claims performs like liquid cooling in Arctic cold or extreme heat.

Rational Optimist Society

I found the American dream… in China

We’re only 100 rational optimists away from being 30K strong…

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3 months ago · 288 likes · 26 comments · Stephen McBride

🍁 Alberta’s defence-tech ecosystem has grown 5.5x since 2018, and the province is still second nationally. Start Alberta’s H1 2026 review counts 289 tracked Alberta defence and dual-use companies with CAD 1.48 billion in disclosed funding, enterprise value up from CAD 5.8 billion in 2018 to roughly CAD 32 billion today. Standouts include Canadian UAVs, the only Canadian firm certified for beyond-visual-line-of-sight drone flight, and Grengine, selected for NATO’s DIANA 2026 Challenge from more than 3,600 applicants across 32 nations. Nationally, Ontario leads with 625 defence companies and Alberta, BC and Quebec together account for 93 percent of the country’s defence startups.

Cambridge Aerospace becomes Europe’s fastest-growing air-defence startup. The Financial Times reports UK startup Cambridge Aerospace closed a $300 million Series C at a $3.4 billion valuation, a 2.6x jump from its $1.3 billion Series B just four months earlier, led by DFJ Growth, an early Anduril backer. Bloomberg confirms the round and notes Lux Capital and Elad Gil, both Anduril investors, also participated. Founder and Cambridge professor Steven Barrett says the 250-person company, whose board includes former UK defence secretary Grant Shapps, is “growing rapidly,” building low-cost Skyhammer and Starhammer interceptors and planning a rocket-motor plant in Norfolk.

Valar Atomics raises $1 billion to put a microreactor behind an Nvidia chip. El Segundo’s Valar Atomics closed a $1 billion Series B led by Sequoia Capital plus a separate $200 million credit facility, just months after its reactor reached criticality in the US Department of Energy’s Reactor Pilot Program and then powered an Nvidia Blackwell chip in a live demo. Twenty-seven-year-old founder Isaiah Taylor’s backers now include Palmer Luckey and Palantir CTO Shyam Sankar.

Hadrian raises $1.37 billion to build the factories the Pentagon needs. Factory-builder Hadrian closed a $1.37 billion Series D at nearly $8 billion post-money, a little over a year after a $260 million Series C, with JPMorganChase’s Strategic Investment Group anchoring alongside Baillie Gifford and Valor Equity Partners. Hadrian already builds submarine components for Lockheed Martin, RTX and Anduril, and CEO Chris Power’s framing is blunt: “Being able to produce, and have advanced factories, is deterrence.”

The Defense Brief

Who is building the picks and shovels in defense?

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4 months ago · 17 likes · 4 comments · Louise Boucher

Related: RBC’s business-banking arm frames Canada’s push toward 5 percent of GDP on defence spending by 2035 as a growth opportunity that most suppliers still do not know how to access, and The Hill Times reports Canadian contractors are still asking Ottawa for a “clear plan” on how small industry can actually participate in reaching NATO’s spending target.

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Canada’s first program aimed at accelerating the adoption of quantum computing technology by providing technical expertise and access to state-of-the-art quantum computing platforms for academics & SMEs.

⚔️ Combat Readiness

Kit for Canada 🍁: Defence Minister David McGuinty toured CFB Suffield and announced a new $20.3 million Quantum Defence Innovation Secure Hub in Calgary, chosen from 25 national bids, alongside a $750 million DRDC Suffield lab breaking ground next year. BetaKit confirms the quantum hub’s 13-member consortium includes Lockheed Martin Canada, CAE, Calian and four Prairie universities, with McGuinty telling reporters “quantum will shape the next generation of defence capabilities, and Canada must be prepared to lead, not follow.” Meanwhile demand for Canadian-made Canadair water bombers is outpacing De Havilland Canada’s production, with Europe’s 22 ordered aircraft not arriving until 2028 even as France endured its worst wildfire season since the Second World War with just 7 of 12 Canadairs flying.

• From ‘Top Gun’ to Ghost Bats: the future of aerial combat

• Chad Rogers publishes a homemade version of ‘in case of crisis or war’, for Canadian households

Home front 🍁: CSIS issued an urgent June warning, backed by a Five Eyes assessment, that Chinese operatives are posing as recruiters and consultants on LinkedIn to target Canadians, even as Prime Minister Mark Carney pushes to grow Canadian exports to China by 50 percent over four years. The Walrus’s blunt framing: “The Carney administration is treating China as a market while the Chinese state treats Canada as a target.”

Software sovereignty: Policy Options argues Canada is trying to build a mandatory defence-cyber-certification regime in three years that took the US over a decade, while the Pentagon itself has just paused its equivalent program for a 60-day review. A TechTO essay adds that Canada spends just 1.06 percent of GDP on business R&D, second-lowest in the G7, warning that “a weaker Canadian copy of a foreign product is not sovereignty. It’s a dependency with a maple leaf on it”, a theme echoed in a Canadian Shield Institute newsletter cataloguing homegrown alternatives to American Big Tech, from social platforms to cloud providers, all still tiny next to US incumbents. South of the border, Breaking Defense reports agentic AI is forcing the Pentagon and intelligence community to rebuild Zero Trust cybersecurity around a “digital birth certificate” for people, devices and AI agents, with SOCOM commander Admiral Frank Bradley wanting networks that detect compromise “in minutes, not months.”

Silicon front: Reuters reports the Trump administration is drafting a ban on Chinese-made optical transceivers that move data inside AI data centres, a supply chain where China’s Zhongji Innolight holds 27 percent global market share, while The Wall Street Journal covers US startups finally shipping sodium-ion “salt” batteries at commercial scale, a bid to break dependence on China for batteries and critical minerals, both bets on choking off Beijing’s leverage over hardware Western militaries now depend on.

Stockpile paradox: The New York Times reports the US war against Iran has drained weapons stockpiles pulled from Asia and Europe to dangerously low levels, emboldening Russia and China. CNN puts numbers on it: nearly 80 percent of the THAAD inventory and roughly half of Patriot interceptors gone since the war began, while Reuters’ exclusive finds the Army has used “virtually all” of its global ATACMS and Precision Strike Missile stockpile, missiles that cost more than $1 million each and take years to replace.

Cheap at scale: Defence Connect Australia’s first-person account from a June missile barrage on Kyiv, during which Russia launched 70 missiles and 611 drones in one night, describes a “front-to-factory innovation loop” behind Ukraine’s capacity to produce more than 8 million drones a year across 160-plus companies, a scale PitchBook notes is being achieved on venture funding equal to roughly one hundredth of one percent of the global total, proof that production discipline beats capital abundance.

Deep strike:

Missile Matters — with Fabian Hoffmann

Ukraine's Missile Defense Crisis: Causes, Consequences, and Solutions

Picture: Bundeswehr / Lars Koch…

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3 months ago · 111 likes · 19 comments · Fabian Hoffmann

Defense Brief’s “gold rush” survey finds one-way strike drones like Fire Point’s $55,000, 1,600-kilometre-range FP-1 have made the missile “ammunition now, and the scarce thing is the factory,” with Britain and Germany alone committing over $50 billion across a dozen countries to deep-precision-strike weapons.

Ground robots: Bloomberg reports a Ukrainian flamethrower-armed ground robot repelled a Russian assault near Dobropillia, part of a push to build at least 50,000 combat UGVs in 2026 to close the manpower gap with Russia, while Forbes documents Ukraine’s first known drone-delivered robot assault, an ARK-1 UGV carrying a TM-62 anti-tank mine dropped behind enemy lines by a heavy-lift drone, a tactic both armies are racing to copy.

Counter-drone: The US Marine Corps awarded an $11 million contract to Epirus for its HAVOC high-power microwave system, built to disable entire drone swarms including Russian fiber-optic-guided drones that have defeated traditional jamming with cable spools up to 50 kilometres long. The Army is meanwhile poised to sign its first laser “program of record” with AeroVironment for up to 20 systems, after Patriot missiles costing $4 million apiece were fired at $35,000 Iranian drones. Procurement is speeding up too: JIATF-401’s new Amazon-style counter-drone marketplace, built by startup Kaizen in under nine weeks under a $15 million contract, already lists Anduril, SmartShooter, DroneShield and AeroVironment, and Business Insider’s coverage of the same launch notes allied buyers from the UK, Romania, Australia, Poland and South Korea are already onboarded through the Foreign Military Sales Fast Lane. The Army also wants a Next Generation Counter-sUAS Missile priced under $150,000 that can leave the launch rail in under five seconds and integrate with the existing Coyote launcher, a direct response to the Patriot-versus-cheap-drone math playing out in the Gulf.

Big think: A Center for Security Studies essay from ETH Zurich asks whether Clausewitz’s idea of war as a political, human phenomenon survives an age of AI-enabled “precision mass”, while Small Wars Journal debates whether drones and sensors denying sanctuary 40 kilometres behind the front line mean the US Army’s Armor Branch will be “dead by 2035”, a debate with direct implications for how Canada spends its own armoured-vehicle budget.

Pentagon reform watch: A First Breakfast essay from Hudson Institute’s Nadia Schadlow argues Congress should fund industrial “capacity” the way SaaS funds standby compute, paying contract manufacturers retainers for surge capability ahead of a Taiwan contingency, a model already being tested through USSOCOM’s new SOF RACER consortium with GovSignals, promising non-traditional vendors a path to deliver technology in “weeks, not fiscal years”, the same standing-capacity logic Schadlow wants written into law. The White House and Pentagon are calling for the U.S. military to become an AI-first fighting force.

First Breakfast

The Factory Is the Product

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3 months ago · 30 likes · Nadia Schadlow's The Overview, Marlinspike VC, and MT

Europe rearms: The Washington Post’s op-ed from a Ukrainian drone-company founder explains why ten European countries launched Freyja, a missile-interception coalition explicitly designed not to replace the American Patriot but to end Europe’s dependence on any single manufacturer or country. Days later, US intelligence linked an explosive drone found at a NATO logistics hub in Leipzig to Russia, prompting Germany’s interior minister to call it a sign of “daily hybrid warfare.”

Maritime autonomy: The Pentagon’s DIU solicited up to $100 million for unmanned surface vessels after three Saronic Corsair USVs struck Iran’s Bandar Abbas naval base and evacuated two downed Apache pilots from the Strait of Hormuz, a demand signal Anduril is answering with talks to build a drone-boat production site at Baltimore’s historic Sparrows Point shipyard, a potential investment in the hundreds of millions, a bet that drone boats now matter as much as hulls.

Autonomous air: The New York Times details Taiwan’s plan to deter a Chinese invasion with a drone “Hellscape,” targeting 100,000 drones a month by 2030 and more than 210,000 aerial and maritime drones in total, while The War Zone reports unidentified drones were sighted over the joint US-UK base at Diego Garcia, previously targeted by Iranian ballistic missiles.

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🔫 Hot Shots

Stranger Pings: The Threat of CCP-Controlled Infrastructure in the U.S. Communications Backbone

Anduril CEO Brian Schimpf’s media tour keeps landing. George Hoyem, a former In-Q-Tel investor who helped Anduril land its first customer, writes that Schimpf may be “the clearest voice in defense tech right now,” arguing AI-enabled precision should be “more precise, more discriminating, and less prone to unnecessary collateral damage than older and ‘dumber’ alternatives.”

A16z’s American Dynamism film series turns industrial policy into cinema. The venture firm’s short-film series profiles founders rebuilding US industry, including an underwater-drone startup mapping the ocean floor and a portable nuclear-power venture, on the theory that “we know more about space than the bottom of the ocean.”

The UK puts £100 million behind first-time venture fund managers outside London. Britain’s Investor Pathways Capital Initiative aims to launch up to 10 new VC funds in every postcode, part of a broader £400 million push to diversify who controls early-stage capital.

A $30 kids’ smartwatch turned into a stalking tool. Wired researchers hijacked a child’s GPS smartwatch and remotely tracked, photographed and recorded a reporter, tracing the flaw to three Shenzhen-based platforms running tens of millions of devices worldwide: “millions of kids are being exposed and vulnerable to exploitation.”

FelixClark launches a scorecard to separate real dual-use companies from defence-adjacent marketing. The DURI Dual-Use Readiness Index scores startups on technical maturity, market pathway and capital readiness, built on the premise that “many companies can claim defence relevance. Far fewer can demonstrate it.”

A military GPS jamming exercise may have contributed to a fatal medevac crash. Futurism reports an experimental jammer at White Sands Missile Range disabled a medevac aircraft’s navigation before it crashed near Ruidoso, New Mexico in May, killing all four aboard, the first known case of military GPS jamming contributing to a civilian crash in US airspace.

Odds & Ends: Wuxly selected to supply the Royal Canadian Mounted Police with Canadian-made Duty Overalls. SAAS North announces DEPLOY for defence tech founders (Nov 5), and Invest Ottawa announces GCXpo (Sep 29)

Chinese-made camera parts in Royal Navy drones were phoning home. Britain’s £12 million K3 Scout uncrewed vessel fleet had cameras transmitting “heartbeat communications” to a Chinese IP address, forcing the Ministry of Defence to strip their connectivity before Gulf deployment: “If we cannot say with confidence what is inside our own military equipment, we cannot say it is ours, or that we are sovereign.”

The Army wants its AI battlefield network to police itself. Axios reports the Army’s Next Generation Command and Control platform, built around Anduril’s Lattice software, automatically quarantined a misbehaving application during testing at Fort Irwin, part of a $4 billion FY2027 push to fuse 40-plus applications into one operational picture.

China’s Palantir-style AI firms are surging. The South China Morning Post’s look at Beijing’s military-civil fusion strategy tracks a Chinese firm claiming its AI flagged an unusual concentration of US surveillance assets across the Middle East more than 50 days before the US strikes on Iran, marketing itself as a Chinese answer to Palantir and Anduril.

The Jaguars are the NFL’s first team to fight back against drones. Ondas subsidiary Sentrycs will deploy cyber-takeover counter-drone tech at Jacksonville’s stadium this season, after the FBI seized more than 700 illegal drones around World Cup stadiums this summer.

If you’ve got battlefield intel, classified tips, or just want to call in an airstrike on our typos, hit “reply” and sound off. Whether it’s a new tech sighting, a rumour from the mess hall, or feedback on our comms, we want your SITREP.

Share The Icebreaker

🎯 Three-Shot Burst

🍁 Six months of “Buy Canadian” receipts are in

The Logic pulled the contracts and found that more than 70% of Buy Canadian awards went to foreign-owned subsidiaries in the policy’s first six months. Just 4 of 14 deals, worth $726M combined, went to Canadian-headquartered firms, against a $37B annual procurement budget.

An independent analyst went deeper into the Treasury Board data and found DND awarded $7.94B in goods contracts in 2023 but only $1.96B reached Canadian-domiciled vendors, and that’s an upper bound, since subsidiaries of foreign firms count as “Canadian.”

Total DND awards grew 4.4x between 2021 and 2024. The Canadian share of goods awards fell from 56% to 12%. His manufacturing check is the kicker: shipments of navigational, control and radar instruments, the category closest to defence sensing hardware, grew just 2.5% since 2023 while communications equipment grew 18.8%. Canada quadrupled its contracting. Canadian factories never felt it.

The carve-outs have already started. CSE quietly exempted its entire $2B budget from Buy Canadian by declaring every purchase a “sensitive operation.” The Globe’s editorial board says procurement must stop doubling as regional economic development, pointing out our artillery buildout hits 12,000 shells a month only in 2029, “enough to cover a weekend of fighting.” A sharp Vanguard op-ed argues Ottawa fixed the buyer’s four problems but the SME’s four problems remain: visibility, selection, runway, and no lane from pilot to production.

Now what? The ecosystem is responding anyway. Source Canada returns October 22 with dedicated defence and deep-tech tracks, expanding to 350+ attendees with the defence track co-developed by The Icebreaker.

Ottawa’s Anvil and Vancouver’s Caseway are pitching homegrown alternatives to Palantir for military software, with Anvil’s CEO putting it bluntly: “There’s one customer in Canada in defence. You either win that customer or you lose everything.”

Bottom Line: The Canadian Shield Institute argues knowing what you’re doing is half the battle on a PBO-projected $230B defence ramp, and its research director’s companion essay traces Canada’s dual-use history from the Avro Arrow to quantum. The lesson: we captured Canadarm’s value, we gave AI’s away, quantum is the next test.

Tank Talks with Matt Cohen

Paul Ziadé: Why Canada’s Defence Complacency Ends with North Vector Dynamics

In this episode of Tank Talks, host Matt Cohen sits down with Paul Ziadé, CEO and co-founder of North Vector Dynamics, a Calgary-based company building full-spectrum precision missile systems for Canada and its allies. A former tenured professor at the University of Calgary turned defence entrepreneur, Paul brings a deeply personal and historically lite…

Listen now

4 months ago · 24 likes · 2 comments · Ripple Ventures

🍁 Washington calls Canada’s Plan B a waste of time.

Despite the procurement figures above… Elbridge Colby, the Pentagon’s policy chief, took to X to dismiss the “middle powers” strategy as a distraction that wastes allies’ “time, money, and political capital,” insisting “no alternative country or countries can compete with the U.S. defense industrial base.” The Globe confirmed the 3.9M-view thread was aimed squarely at Mark Carney’s doctrine, with Colby adding that access to the US industrial base “is a privilege, not a right.” Carleton’s Fen Hampson called it American “bipolar disorder”: you can’t tell NATO allies they’re on their own, then complain when they go out on their own.

The Canadian Explorers

The Founder Who Refused to Quit | Samuel Witherspoon, ANVIL

In Chapter Two of Canadian Explorers, I sit down with Samuel Witherspoon to discuss persistence, national security, and the decade-long path to building ANVIL…

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4 months ago · 1 like · 1 comment · Ethan Marcoux

Canada’s response has been to keep signing. CBC reports Canada is joining the UK-Japan-Italy sixth-generation fighter program as an observer while the 88-jet F-35 order stays under review, and the US ambassador flew two F-35s over his July 4 party to make his feelings known. The Economist says the old laggard is turning to Europe for its security, with 80%+ of Canadians backing much higher defence spending. Evan Dyer breaks down why Canada picked Germany’s TKMS 212CD for up to 12 submarines at a reported $24B, passing on a Korean boat that launches ballistic missiles. The Carney-championed Defence, Security and Resilience Bank is lining up $135B with nine founding nations and a Canadian HQ, backed by JPMorgan, Deutsche Bank and Canada’s biggest banks. Even James Stavridis, NATO’s former supreme commander, is urging Canada to diversify away from US primes toward Airbus, Saab, Pilatus and Asian shipbuilders as it commits nearly $30B to the North. And Trump just ordered 11 polar icebreakers after a golf game with Finland’s president, triggering billions in no-bid contracts. The Arctic race is on whether we show up or not.

Overmatch

The Most Valuable Map in the World

Imagine you stumbled upon a magical map (think Harry Potter’s Marauder’s Map) that revealed the hidden infrastructure of American power…

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3 months ago · 13 likes · 2 comments · Morgan Hitzig, Evan Loomis, and Jordan Blashek

🤝 Deal Corner

The primes just became VCs.

Defence primes have joined a record US$4.1B in venture rounds for military startups this year, per FT and Dealroom data, and the full FT analysis shows Lockheed Martin and BAE Systems leading the charge: Lockheed’s venture fund grew from $400M to $1B with a new London office, BAE put €50M into two funds, and Airbus anchored a €500M dual-use vehicle. City AM counts 42 defence M&A deals in H1 alone, up 56% year over year. Klaus Hommels closed Europe’s largest dedicated defence VC fund at €262.2M, completing the Spotify investor’s full pivot from consumer tech to strike systems.

Stateside, Vanity Fair profiled Harpoon Ventures, the SEAL-heavy San Diego firm riding a market where VCs deployed US$19.8B into defence tech in Q1 2026 alone, up from US$5.7B in Q1 2024, and Harpoon just closed an oversubscribed US$155M Fund IV on the strength of it. Even the banks are in: Jamie Dimon put US$24M into a submarine plant at the Philadelphia Navy Yard under JPMorgan’s US$1.5T security initiative, declaring “the arsenal of democracy has been reignited.” The Pentagon itself is dangling $400K salaries to poach Wall Street bankers for its Office of Strategic Capital, which lends up to $150M per deal across 31 tech categories and plans to deploy US$200B+ over three years.

Sunil Rao

In Defense Tech, Capital Is No Longer the Validation

Helsing raised $1.8 billion this week at an $18 billion valuation. A day later, Singularity emerged from stealth with an $80 million Series A to build lower-cost air-defense systems…

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3 months ago · 1 like · Sunil Rao

🍁 Davie launches Davie Autonomous in Ontario, partnering with newly minted unicorn Kraken Technology Group after its US$175M Series B at a US$1B valuation to build uncrewed maritime vehicles, with multiple Ontario production sites in talks.

🍁 Ottawa commits nearly $2B for 190 armoured combat support vehicles from General Dynamics Land Systems-Canada, a deal CBC reports will sustain 6,000+ Canadian jobs a year for eight years across a supply chain from B.C. to Nova Scotia.

🍁 NordSpace backs North Vector Dynamics, an undisclosed strategic investment pairing Markham rockets with Calgary missiles inside a DND-backed hypersonics network.

Challenging Geopolitics

Turning Salt into Missiles

This article came about because I went looking for ways to invest in America’s missile boom following the rate at which it is expending munitions in the Iran war. What I found was one of its most cri…

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3 months ago · 15 likes · 1 comment · Challenging Geopolitics and Ed Shannon

🍁 Airbus invests in Medicine Hat’s Landing Zones Canada, taking a board seat in the drone threat-emulation firm announced at Farnborough, and banking Canadian industrial-benefit credit against its military transport contract.

The Canadian Explorers

Autonomous Manufacturing for Ukraine | Kath Intson — Explorer Spotlight #8

On June 10, 2026, Moscow called Canada a “warmonger" after a Canadian company had signed a drone manufacturing deal with Ukraine. Russia then threatened to publish that company’s address…

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3 months ago · 1 like · Ethan Marcoux

🍁 CSMC lands $4.5M from FedDev Ontario to push its micro-nuclear reactor toward a fueled Arctic demonstration, framed by Minister Evan Solomon as defence industrial base building.

🍁 Quebec gets a $29.6M drone hub: the BOREALIS uncrewed-systems hub in Mirabel pools 30 organizations under Espace Aéro, with CBC noting the nearly $30M flows over just two years under Canadian Joint Forces Command sponsorship.

🍁 Magellan Aerospace will build the M-72 anti-tank weapon in Canada under the Munitions Supply Program, a sovereign manufacturing win for one of the most fielded shoulder-launched weapons on earth that gives the CAF a resilient domestic source.

The Defense Brief

What's next in defense?

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3 months ago · 18 likes · 5 comments · Louise Boucher

🍁 Calian and six Atlantic partners form CAMSC, Canada’s first integrated Arctic maritime security consortium, built on a region with 200+ defence companies and 34% of Canada’s marine workforce.

Helsing picks West Virginia for its first US plant, a $50M facility targeting 2,000 HX-2 strike drones a month after a $1.8B raise at an $18B valuation. A rare German-press look inside its secret Bavarian factory run by the ex-Tesla executive who scaled Model 3 production reveals a plant designed to relocate by container in an emergency.

• Helsing’s ‘crazy’ valuation raises defence tech bubble concerns

Anduril talks a $100B valuation just two months after doubling to $61B, per Reuters reporting on the two-stage structure under discussion. Bloomberg meanwhile reports its year-old Rheinmetall partnership has been significantly scaled back, even as Anduril signs with Poland’s PGZ for 3,000 Barracuda missiles.

The Big Byte

Inside Anduril: How the $61B Defence Tech Company Structures Its Leadership by The Big Search & Industrial Base Alpha

Let’s start with the basics. Anduril is a $61B defence tech company that builds autonomous systems, AI-powered software, and advanced hardware for military and security applications (Sourcery’s definition…

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4 months ago · 8 likes · Benjamin Lussert

Neros wins up to US$500M from the US Army for FPV drones, with the WSJ noting the former teenage drone racers now build 1,200 units a week at ~$2,000 each, targeting a million a year by 2028.

First Breakfast

Drone Warfare: What the Pentagon Knows and a Private Doesn't

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3 months ago · 23 likes · Kevin McCarville

Cambridge Aerospace nears $300M at a $3.4B valuation, less than two years after founding, with its Skyhammer interceptor priced to match the Shaheds it kills and a claimed $5B pipeline.

A SpaceX vet raised $65M to pull wire harnesses out of the Cold War era. Senra Systems had just closed a $65 million Series B.

Counter-drone money is pouring: Hidden Level won a US$100M Pentagon-wide OTA for passive drone detection, Allen Control Systems raised US$200M at a multi-billion valuation for its Bullfrog robotic gun, Brinc pulled in another US$125M to replace DJI in American policing, and former acting US defence secretary Chris Miller’s FPF raised US$10M for a $30K interceptor that he pitches bluntly: “$3M a pop to kill a drone that costs $50,000. Nuts.”

System Notes

Venture Building in Aerospace: Systems, Constraints, and Entry Points

Why I rewrote this…

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3 months ago · 5 likes · 1 comment · Haris Rehman

The picks-and-shovels round: Arkenstone emerged from stealth with US$35M to build defence tech’s compliance back office, and AI cyberwarfare startup Twenty hit a US$1.2B valuation on Khosla’s US$30M cheque to “industrialize cyber warfare.”

Gray Matters

🎙️ Ep 27 - Arena Physica: Building Electromagnetic Superintelligence

Electrical and RF engineering are becoming more and more important as more hardware becomes software-defined. However, the software tools for electromagnetic engineering have not kept up with the 21st century. In the newest episode of the Mission Matters Podcast…

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3 months ago · 6 likes · Maggie Gray, Akhil Iyer, and Pratap Ranade

Ukraine’s Magura drone boats go American: UForce signed with Oregon’s ReconCraft to produce the battle-tested USVs in the US for the first time, targeting eventually thousands of units a year.

Related: a new investor map shows who actually funds Ukrainian defence tech, with $35B in production capacity chasing just ~$57M in disclosed 2025 VC. If you want in, there’s a closed-door investor day on the eve of Defense Tech Valley 2026 in Lviv this September; The 20-Somethings Running Ukraine’s War Machine; War in Ukraine: has the tide really turned?

The Canadian Explorers

The Icebreaker | Matthew Lombardi on Canadian Defence Startups

Matthew Lombardi is the co-founder of The Icebreaker, Canada’s defence innovation network and newsletter. He is also a director at ONE9, Canada’s first national security venture capital firm…

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3 months ago · 5 likes · 1 comment · Ethan Marcoux

⚔️ Combat Readiness

🍁 Kit for Canada: Ottawa launched the Defence Drone Initiative, a supplier marketplace across five streams with applications open to August 14, covering six priority areas from ISR drones to counter-drone interceptors, no prior defence experience required. The formal RFSA is live on CanadaBuys now. DND also stood up the Canadian Deep Precision Strike Capability program with closed industry sessions this month. Long-range fires, made in Canada.

🍁 Division math: Derek Dobson’s essay on fielding a division, not just declaring one argues the C5ISRT digital backbone, not tanks, is the pacing item for Canada’s new Manoeuvre Division, with roughly half the Army’s vehicle fleet unavailable at any given time.

Ground robots: The NYT documents how a robot army is remaking ground warfare in Ukraine, with UGVs running thousands of monthly supply, evacuation and assault missions. The Washington Post profiles Foundation’s Phantom humanoid loading a mortar as armed robots edge toward weapon of choice. Ukraine’s Ark Robotics prices ground robots at $20,000 or less because a $200,000 UGV is a dead UGV.

The Defense Brief

Robotization of the Battlefield with Roman Tkachenko - Founder of Tencore

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4 months ago · 5 likes · Louise Boucher

The kill zone: Reuters’ interactive reconstruction of Ukraine’s 30km-deep drone kill zone includes a soldier who spent 300+ days in a single foxhole. The CIA director says AI drones give Russian recruits 20 to 30 minutes of battlefield life expectancy. Eric Schmidt calls it the biggest revolution in the history of warfare, with 96% of Russian casualties in March coming from drone units.

Deep strike: Joshua Yaffa charts how Ukraine brought the war a thousand miles into Russia, with Fire Point now producing in ten days what took all of 2024. Russia is hitting back at the industrial base itself: a ballistic missile destroyed a US-owned drone factory in Kyiv, apparently the first direct Russian strike on a US defence company in this war.

Counter-drone: Ukraine’s Tryzub laser burns holes in Shaheds from 5km away and is nearing mass production. Russian lorries now wear zebra stripes designed to fool machine vision, not human eyes. The Marines picked the Bullfrog AI gun with a claimed cost-per-kill as low as $10, and a new British firm called Agon will train arms companies against enemy drone swarms with practice, practice, practice.

Big think: Phillips Payson O’Brien argues fighter jets are passé and Western brass are the new cavalry officers. West Point’s Modern War Institute counters that the drone revolution isn’t one, since 9,000 drones a day still need industry, logistics and EW cover. The Dispatch asks whether US military culture can adapt to autonomous weapons faster than China’s. And a Marine planner contends the first waves of amphibious assault will be unmanned, after Ukraine’s July uncrewed amphibious landing.

Pentagon reform watch: Hegseth created an autonomy czar as single joint integrator for unmanned systems and is steering billions toward startups while calling traditional vendors slow and bloated. The department also froze its CMMC cyber rules after realizing compliance could cost small firms $7B a year. Pete Newell’s verdict on all of it: the Pentagon built a faster engine, nobody built the steering. An Army acquisition officer adds ammunition, having built for $1,700 in AI tokens a tool traditional contracting would price at $840K+ and 6,000 hours. The make-or-buy line has moved.

Cheap at scale: APFIT crossed US$2B in cumulative awards with a final FY26 round of $592M across 30 selections, and the next cohort will prioritize tech “made cheaply at scale”. The program’s own stats show $10M–$50M awards cutting fielding time by two years. The $1B Drone Dominance Program is buying kamikaze drones in four phases, and its newest solicitation wants 1,200 bomber drones at no more than $20,000 each, responses due August 5. Canadian drone makers, read the fine print: Blue List rules apply.

Maritime autonomy: A Navy officer warns that without overseas repair frameworks the fleet gets broken drones far from home and hangar queens. Splash Industries ran unmanned resupply to two amphibious ships at RIMPAC on a $4.2M seed round. IQT’s CEO describes a Saronic vessel pulling off the first combat troop rescue by a maritime drone near the Strait of Hormuz. 🍁 And Aeryon Labs co-founder Mike Peasgood says we need to talk about the killer robots as he builds autonomous hydrofoils at Waterloo’s ENVGO.

Software sovereignty: France and Germany signed a declaration to build a European Palantir rival on France’s Arcadia platform, after both countries’ security services dropped Palantir. Alex Karp says the German snub involved “conversations about witchcraft.”

Europe rearms, unevenly: The UK’s Defence Investment Plan puts £5B into drones, the largest such investment in British military history, though startups call it too slow. Economists propose mandatory SME procurement shares to fix a continent where top-10 contractors take up to 90% of spending. Rheinmetall broke ground on a €350M gunpowder plant as investors cool on old-style primes. BCG says the real fix is multiyear demand commitments so contractors will actually build capacity, while its aviation team projects exquisite systems still holding 80% of the market through 2033 even as attritable segments grow 15-40% a year.

The Defense Brief

Going all in on European defense — Alex Ferrara, Partner at Bessemer Venture Partners

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3 months ago · 5 likes · 1 comment · Louise Boucher

Stockpile paradox: NATO officials warn against stockpiling millions of drones that will be obsolete before the war starts, with Ukraine’s Frontline Robotics updating products 20 times a month. The Atlantic tallies why the US is running so low on weapons: two-thirds of Patriot interceptors gone since February. CSIS’s progress report counts 10,000 new firms entering the US defence industrial base in two years, and flags the Canada-Finland-US ICE Pact on icebreakers moving to implementation. Ukraine’s Brave1 keeps the demand signal honest, funding exoskeletons, dugout-busters, lasers and combat humanoids across 53 new priorities. Airbus just joined its prime alliance.

Autonomous air: A NYT opinion documents fully autonomous AI drones firing missiles over the Mojave as the Pentagon requests US$54.6B for its new autonomous warfare group. Archer and Anduril unveiled Thunder, an autonomous attack rotorcraft aimed at Apache operators, first flight 2027.

Space: The Mitchell Institute’s workshop report maps space superiority through the spectrum of conflict in seven recommendations. Slingshot Aerospace won a US$69.2M Space Force contract for its MENTAT training environment, its largest ever. 🍁 Canada is in the game too: a new tender seeks system definition for the Surveillance of Space 2 optical capability, Canada’s own eye on orbit.

Axis watch: The Economist tracks China’s maritime militia massing 1,000+ vessels in 450km swarms near Taiwan. CNN finds Chinese deep-sea research ships spent only 6% of their time actually researching their mining zones, going dark near submarine routes instead. A leaked police database shows China tracking 12,000 foreigners, with Canadians filed under a “Five Eyes Alliance” label. Beijing banned rare-earth shipments to 14 European defence-linked firms. Evan Osnos’s New Yorker dispatch on the future being made in China notes 70%+ of global drones are built there, and Moonshot’s new 2.8-trillion-parameter open-source model now rivals top US systems. The tech race and the drone race are the same race.

• Nathan Mintz: “The Submarine and PAC-3 contracts exceed the combined value of all OTAs awarded in the last two years. They dwarf by a factor of 8.5X the total lifetime federal obligations of the NatSec100 companies ($16B) and exceed the total private capital raised for those companies ($118.2B)”

🍁 Home front: A hostile intelligence service cloned the Macdonald-Laurier Institute’s website to phish for classified information. Ex-CSIS director David Vigneault warns Canada’s openness is now its biggest vulnerability, citing a downed Shahed carrying Canadian-made antennas. Sweden’s answer to the same threat environment: a brand-new foreign spy agency comparable to MI6. Iran shows where this goes, pinging Middle East mobile networks to hunt US personnel and, per the NYT, attacking water systems in at least seven US states, with HuffPost reporting 30+ Minnesota water systems hit in one coordinated wave. Critical infrastructure is the front line. Canada’s is not exempt.

🔫 Hot Shots

• 🍁 Greypoint Industries, founded by Canadian infantry veterans and winners of Canada’s first defence hackathon, Icebreaker, made Newsweek’s case for why defence innovation is moving beyond traditional contractors. Their counter-swarm thesis: neutralize the operator, not the drones.

• 🍁 North Vector Dynamics CEO Paul Ziade went on The Techne Connect to talk leaving tenure for hypersonics.

• 🍁 Canadian kit is protecting Ukrainian women in combat: NP Aerospace’s curved plates and Logistik Unicorp’s carriers anchor the first body armour designed for the 75,000 women serving, with 48% more protection than flat plates. “Women are not just small men.”

• 🍁 Middle East turmoil upended global helium supplies, and Canada holds a fifth of world reserves while producing 2% of output. Helium is the only one of 34 critical minerals without the tax treatment. Fix that.

• 🍁 Canada’s aerospace sector put up $33.1B in GDP and 218,700 jobs in 2025, with R&D intensity 4.5x the manufacturing average. AIAC wants a national industrial aerospace strategy to match.

• 🍁 Vancouver’s QSE was selected for Canada’s quantum trade mission to the Netherlands this September. Post-quantum encryption is becoming an export product.

• 🍁 Breaking in: Alacrity Canada published a defence literacy field guide for Canadian SMEs, and Carleton launched a two-day practical certificate in Canadian defence procurement taught by former ADMs. Cheaper than learning by losing bids.

• 🍁 Jobs desk: Dominion Dynamics is hiring a Director of Operations to run the factory floor in Ottawa or Toronto, and BDC’s StrongNorth Fund wants an associate with a STEM brain and a Secret clearance in Toronto or Vancouver. CSMC needs a corp dev team in Toronto, and North Vector Dynamics needs a head of growth

Robert Asselin

Canada Is Entering a Historic Defence Expansion. Will It Change Our Economic Trajectory?

A defence build-up can do more than buy equipment. It can help build a more technologically powerful economy—creating new research-intensive industries, more productive firms and lasting sovereign capabilities…

Read more

4 months ago · 2 likes · Robert Asselin

• 🍁 Ticker watch: a markets piece on the counter-drone billions puts Volatus Aerospace’s Mirabel expansion and CAD 9M NATO contract next to DroneShield and Kratos, with analysts’ targets at double the current price.

• Nuclear is quietly having its defence moment: BloombergNEF sees global capacity jumping 44% to 535GW by 2036, with China holding nearly half the reactors under construction.

• Ottawa working on ‘Maple List’ to help validate Canadian drones for the Armed Forces

Special Competitive Studies Project

SCSP Summer Reading & Watching List 2026: Highlights, Tech Briefs, Podcasts & What’s Ahead

Welcome to SCSP’s Summer Reading List! As the summer heats up, so does the pace of global innovation and strategic techno-economic competition. This year, we’ve curated an essential collection of reads, listens, and broadcasts from the Special Competitive Studies Project—including our newly launched President’s Tech Brief —a live show to keep you inform…

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3 months ago · 35 likes · SCSP

If you’ve got battlefield intel, classified tips, or just want to call in an airstrike on our typos, hit “reply” and sound off. Whether it’s a new tech sighting, a rumour from the mess hall, or feedback on our comms, we want your SITREP.

Share The Icebreaker

🎯 Why this issue exists

Every week we report on Canada’s defence rebuild: the half-trillion-dollar commitments, the rearmament from 28th place, the founders and funds finally showing up. But readers keep asking the same thing: who actually built the private capital side of this ecosystem?

This is the reference piece on ONE9, Canada’s first national security tech investment and innovation platform.

🍁 First in, when nobody wanted in

ONE9 wasn’t founded during the 2025 defence boom. It was founded in 2013 by Glenn Cowan while he was still serving in Joint Task Force 2 (JTF2), Canada’s tier-one special-mission unit - the Canadian peer of the units that produced the operators now founding America’s biggest defence-tech companies.

Glenn didn’t parachute into defence from finance; he came up through the sharp end of it. A retired JTF2 Squadron Commander, he spent his career on special operations: combat tours in Afghanistan, sensitive missions across the Middle East, and hostage-recovery operations in Africa. He built ONE9 on a conviction that is now his team’s motto: venture capital is a special operation — small teams, asymmetric bets, mission first.

That operator background is the sourcing and diligence edge. ONE9’s partners are the end-users the technology is actually built for, which is why they can tell a demo from a deployable capability before an LP dollar moves.

The Canadian Explorers

Canada's First National Security VC | Glenn Cowan — Explorer Spotlight #3

ONE9 is Canada’s first national security venture capital firm. It was founded in 2013 by Glenn Cowan, a former JTF 2 (Joint Task Force 2) Squadron Commander in Canada’s special forces. In 2025, ONE9’s venture capital business was acquired by Kensington Capital Partners…

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4 months ago · 3 likes · Ethan Marcoux

In March 2022, three years before Ottawa rediscovered defence, ONE9 launched Special Mission Fund I with Shopify co-founder Daniel Weinand as General Partner, anchored by Kensington Capital Partners Limited, the only institutional investor willing to back defence at the time, and backing from investors including Shopify President Harley Finkelstein. Harley “backed ONE9’s defence-focused fund in 2022, when few Canadian investors wanted anything to do with the sector.”

And the portfolio performed like a firm that knew the terrain before the hype cycle arrived: Tomahawk Robotics (exited to AeroVironment in 2023), Strider Technologies, goTenna (acquired by Forterra in 2025), Hidden Level, Slingshot Aerospace, North Vector Dynamics, Stirling X. Counter-UAS, secure comms, space domain awareness, intelligence - the exact categories every generalist fund is now scrambling to enter, ONE9 underwrote years ago.

🏛️ Institutional firepower: the Kensington platform

In 2025, Kensington Capital Partners acquired ONE9. Today, ONE9 is Kensington’s security and defence investment platform: one brand spanning three integrated arms — venture investing (with institutional backing from AGF Capital Partners), ONE9 Capability Labs (the operational and value-creation arm), and its Arctic joint venture, Sapujjijiit. Kensington manages roughly C$2.1B across venture, growth, and mid-market buyouts, is majority-owned by AGF, and is building a scaled defence franchise.

Translation for LPs: special-operations sourcing and battlefield validation, wrapped in institutional-grade investing infrastructure and a ~30-year GP track record. That combination doesn’t exist anywhere else in Canada.

And the platform just gained a new steward. In July 2026, Kensington named Saar Pikar — former head of venture and growth at OMERS — as President, reporting to CEO Tom Kennedy, with direct oversight of the venture and growth business, including ONE9. One of the country’s most senior institutional venture investors is moving from OMERS, one of Canada’s largest pension investors, where they funded deals such as Dominion Dynamics and Cohere, to oversee Kensington with defence and security venture investing squarely in the mandate.

🧠 The powerhouse task force

Defence investing is a full-contact sport, and ONE9’s bench is unlike anything else in this country.

Since joining Kensington, Glenn now leads a deep team alongside a roster of strategic advisors and consultants with diverse backgrounds and long demonstrated track records of performance strategically located across the globe.

George Hoyem spent 15 years as EVP of Investments at In-Q-Tel, the CIA’s strategic venture arm, personally leading 40+ investments; he joined ONE9’s Investment Committee in 2025. When the man who helped the CIA pick winners for a decade and a half chooses a Canadian platform, that tells you where the puck is going. His recent essay on NATO decoupling from US defense tech is required reading:

Rounding out the team: A US Naval Academy graduate, former US and UK naval aviator and the founder of a $300M corporate venture platform. A retired Tier 1 US Army special operations soldier who started in the 75th Ranger Regiment, deployed 20+ times across the Middle East and North Africa, served through the August 2021 Kabul evacuation, and holds a Bronze Star with “V” device.

And of course Michael Smith, a serving reserve officer in the CAF Judge Advocate General branch — you’ve seen him in op-eds, and this month on the Canadian Army’s official podcast, on how international humanitarian law shapes the weapons Canada develops and fields:

No other Canadian platform can put special operators, a CIA-affiliated venture veteran, a corporate VC builder and two of the country’s most senior defence statesmen.

🌍 Forward-deployed in Europe

While many global investors read about the European rearmament cycle, ONE9 lives in it. Glenn was the sole private investor on the Canadian delegation at the NATO Defence Industry Summit in The Hague, sitting in roundtables with Defence Minister David McGuinty and Procurement Secretary Stephen Fuhr.

And this spring, Glenn went further forward than any Canadian VC: ten days across Europe, including time embedded with the Canadian-led NATO Multinational Brigade in Latvia, on the alliance’s eastern flank. That’s the drone-saturated, electronic-warfare reality of modern land combat, seen up close, on the exact ground where Canada’s soldiers are deployed and where the next generation of battlefield technology is being proven or discarded in real time. ONE9 holds a permanent forward operating presence across the fastest growing defence market on Earth. Deal flow follows presence. Presence follows commitment.

🔬 Capability Labs: the value engine

The go-to-market motion for startups is unique in defence. Capability Labs, ONE9’s innovation hub and venture studio, builds security-focused companies against validated end-user demand, runs innovation-as-a-service for public-sector partners, operationalizes capabilities, and supports startups through the valley of death between demo and deployment.

And the Labs has real receipts. Take Dominion Dynamics, the Ottawa company whose Arctic “digital fence” we watched span 5,200 km on Op Nanook, whose Arctic Training Centre partnership we covered in September, and which went on to close the largest defence Series A in Canadian history (C$139M, 2026). Before that mega-round, a Kensington fund backed Dominion’s seed, and ONE9 Capability Labs housed the company, supported its early innovation, and helped it recruit transitioning Canadian Armed Forces veterans. That’s the Labs model working as designed: capital, space, and operator talent at the earliest and riskiest moment, not innovation theatre.

The Labs model is also why ONE9 joined forces with Invest Ottawa to open Area X.O to defence entrepreneurs, plumbing the national ecosystem directly into its pipeline.

🧊 The North is not a metaphor

Sovereignty talk is cheap; ONE9 builds in the Arctic. Glenn partnered with Harry Flaherty, CEO of Qikiqtaaluk Corporation, to create Sapujjijiit Inc., Canada’s only Inuit-majority-owned, full-spectrum Arctic defence company, in which ONE9 Capability Labs is a full partner. It’s a working channel between the defence tech sector and northern and Indigenous businesses. In a procurement environment where Arctic capability and Indigenous partnership are both strategic and mandated, ONE9 is the only venture platform with that channel built. A testament to being early in the Arctic is that ONE9’s portfolio company goTenna/Forterra was the first wireless mesh communication network deployed to support emergency management in Nunavut:

🤝 The network is the moat

ONE9 co-founded and co-chairs CANDIN, Canada’s first and only private capital network for defence and security, modelled on peer groups across the US, Australia, and AUKUS. The firm’s reach runs from JTF2 alumni networks to In-Q-Tel’s Rolodex to NATO’s industrial machinery. Even ONE9’s comms game is levelling up:

💰 Bottom Line

Canada’s defence rebuild needs a private capital champion with operator DNA, institutional backing, allied networks, and a decade of receipts.

ONE9 didn’t join the defence tech wave — it spent thirteen years building the beach the wave is now breaking on. If you’re a founder building sovereign capability, an LP seeking exposure to the most durable spending cycle of our generation, or an ally looking for Canada’s serious people, you now know where to find them.

Si vis pacem, para bellum.

Share The Icebreaker

What it actually is: An RFSA is not an RFP and not a contract. It’s a pre-qualified pool. You clear a pass/fail bar once, you get a Supply Arrangement, and from then on you’re on the list that gets emailed the RFPs when a specific requirement lands. Think of it as the guest list, not the party. Qualification runs on experience, capacity, and security screening - technical evaluation comes later, at the actual solicitations. Miss this window and there’s another every three months through year one, then every six months after that. So the door reopens, but late arrivals watch the first contracts go to whoever qualified first.

Five streams to qualify under (you can pick more than one):

• Uncrewed and counter-uncrewed systems and components — the operational core

• Data, electronic warfare, and cyber systems that ride with the drones

• Systems integrators

• Test, evaluation, and training services

• Innovation and experimentation — the on-ramp for lower-TRL, earlier-stage players to get in the room and grow into stream one

That last stream matters most for the early-stage ecosystem. It’s the first time the department has drawn an explicit path from “promising prototype” to “operational supplier” inside the same mechanism.

Six urgent use cases go first. This is where the demand signal is loudest, so read it as a shopping list:

• Low-cost tactical ISR drones — cheap and attritable is the whole point

• Complex-terrain UGVs, starting from commercial off-the-shelf

• A modular explosive payload family — open architecture, pre-certified, swappable across platforms, killing the current mess of improvised and proprietary one-offs

• Low-cost counter-drone interceptors with low collateral effects — minimal explosives, safe around people and infrastructure, manufacturable at scale, and useful at home

• Maritime autonomy — surface and underwater systems for Canada’s ocean approaches

• Sovereign deep precision strike — strategic range and payload, with domestic production capability. This is the ambitious one, and the word “sovereign” is doing a lot of work.

The through-line across all six: low cost, attritable, and built at scale. Ottawa has watched the same lesson play out overseas and is buying accordingly.

The calendar:

• Today, July 23: RFSA posts. Get registered on CanadaBuys now if you aren’t; you can’t see the documents otherwise.

• July 30: industry engagement session.

• August 14: RFSA closes.

Bottom Line: This is the most concrete thing to come out of the Defence Industrial Strategy so far. The DIS promised 70% of acquisitions to Canadian firms and named uncrewed systems as one of ten sovereign capabilities; the DIA was built to cut the RFP maze. This RFSA is the first time all of that turns into a form a founder can fill out. The bar is deliberately low at this stage to pull in competition, which means the real filtering happens at the RFP round — qualifying is table stakes, not a win. But if you build drones, counter-drone, payloads, maritime autonomy, or the data and EW layer around them, and you’re not registered on CanadaBuys by close on August 14, you’ve chosen not to be in the market Canada just built for you.

We’ll be tracking who qualifies and which RFPs drop first. If you’re going through the process, reply and tell us how it’s going.

Share The Icebreaker

Now the hard part: execution. Canadian defence and security startups build world-class tech and still can’t survive our own procurement gauntlet. Canada doesn’t have an innovation problem. It has a buying problem.

That’s why The Icebreaker is helping launch the Defence Track at Source Canada 2026 — Raymond Luk’s national procurement summit, back at the Hilton Toronto on October 22 after a sold-out first year.

This one isn’t a conference. It’s a domestic trade mission. Pre-vetted buyers matched to Canadian companies, 1:1 meetings running all day, and briefing rooms with the people who actually sign the contracts. Last year: 250 attendees, roughly 70 corporate buyers, and more than 100 private buyer-seller meetings in a single day.

The Defence Track puts Canadian-owned and Canadian-controlled defence and dual-use companies in the room with government buyers, corporate buyers, and capital. The Sovereign Technology Track covers quantum, AI, cybersecurity and deeptech.

Use code ICBRKR-SC26 for 20% off any pass (capped at the first 100 passes).

Early Bird pricing runs through August 22, and space is limited. The first year sold out and 2026 caps at 350–400 people.

Grab your pass at sourcecan.ca

Share The Icebreaker

The Icebreaker is on summer break for the next two weeks. Back in your inbox on August 4!

🎯 Three-Shot Burst

In 1965, Canada spent 2.6% of GDP on defence and had 107,000 people in uniform. Today we sit 28th on the Global Firepower index - one spot below Algeria - with roughly 71,000 troops, one of four submarines operational, and the distinction of being the only G7 country that can’t launch a rocket. Stephen Maher’s Maclean’s feature is the definitive anatomy of the half-trillion-dollar rebuild: missiles for Latvia announced in 2022 that arrived in May 2025, a Nanisivik naval facility that took 18 years to become a summer-only gas station, and an F-35 program where Canada has committed $27.7B for 88 jets but paid for just 16. Retired general Wayne Eyre says he grew frustrated with the lack of “U” in the Urgent Operational Requirement process. Defence analyst Philippe Sauvé is blunter: “Institutionally, we avoid risk completely.”

The companion piece profiles the founders and CEOs cashing in on the rebuild - and it’s a who’s-who: Dominion Dynamics testing its Arctic “digital fence” across 5,200 km on Op Nanook, Sapper Labs at ~$25M/yr in federal contracts, IMT Group’s $305M munitions deal, Calian booking $200M in a single quarter, and LeafStar’s $100M private small-arms plant bringing ~300 jobs to Ontario. Founder Fady Mansour: “70 cents of every dollar went to the U.S. - that’s changing fast.”

The Canadian Explorers

A Canadian Era of Startups, Defence & Greatness | Harley Finkelstein, Shopify

Shopify President Harley Finkelstein backed ONE9’s defence-focused fund in 2022, when few Canadian investors wanted anything to do with the sector…

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4 months ago · 4 likes · Ethan Marcoux

The Canadian company arming Ukraine with drones

Watch this one. CBC’s Jennifer Yoon has an exclusive video look at the Canadian company supplying drones to Ukraine - a battlefield where Kyiv needs more drones than it can produce, even with domestic industry running flat out. A Canadian firm stepped into that gap. The real story: what its front-line experience teaches Canada about its own modernization. Combat-proven beats brochure-ready. Ottawa should be studying this playbook, not just applauding it.

The next defence fight is over trust, not money

Britain’s government imploded over an unfunded £25B-a-year defence gap. Murray Brewster argues Canada is next unless Ottawa shows its math: $81.8B budgeted, a $540B decade pledge - and no published five-year projections. Carney promises transparency in the fall budget, with 4% by the 2029 NATO review. Eric Reguly warns the submarine program alone could hit $100B all-in, and IMF data shows defence sprees widen deficits by ~2.6 points of GDP. Reality check: at the Ankara summit, where Kerry Buck warned “the cost of drama is too high,” Rutte admitted the old 2% target was “a bit plucked from the air.”

Bottom Line: Canada is rebuilding from 28th place with real money and real companies finally moving. But the UK just showed what happens when ambition outruns fiscal credibility. The fall budget is now the most important defence document of the decade.

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Up to $1M in funding and additional technical services available for technologies with defence and civilian applications. Advisory support is available now.

🤝 Deal Corner

🍁 3DBioFibR wins the inaugural DMZ Ventures $100K Dual-Use & Sovereign Tech Investment Prize — judged by The Icebreaker and BDC. DMZ Ventures awarded the prize at Startupfest to the Halifax company producing collagen and spider-silk biofibres at scale — US Navy contracts already in hand, applications spanning defence textiles and surgical materials. Over 100 companies competed. The Icebreaker sat on the judging panel: “Canada cannot afford to outsource the technologies that underpin our security, resilience and strategic autonomy… What stood out about 3DBioFibR is that they’re building a capability that matters for both commercial markets and national strength. We need more founders tackling hard, strategic problems like this — and more investors willing to back them early.” At the same festival, Moncton’s AgroGene Solutions took the $100K Best of the Fest from 275 pitches, part of $825K in total prizes.

🍁 Nord Quantique posts another error-correction breakthrough — the Sherbrooke company (last valued at US$1.4B) pushed bookend errors below 0.1% on its grid-state qubit, another step toward fault-tolerant machines. Timely context: only six companies worldwide build quantum cryogenics — one is Canadian — and quantum sovereignty is defence sovereignty.

🍁 Canada Rocket Company raises $22.5M in under six months — incorporated November 2025, with 22 hires including seven Canadians repatriated from SpaceX, Blue Origin, Rocket Lab and ArianeGroup now building the methalox medium-lift R-2, with an Etobicoke test site and hot fire targeted by year-end.

🍁 Maritime Launch lands Isar Aerospace on a 10-year deal — signed at the NATO summit: US$3.75M per quarter plus ~$100M in pad build-out at Canso, with Spectrum launches from 2028 and up to 40 per year by 2029.

🍁 Larus books $10M+ in defence AI awards — $8.3M from IDEaS for Army tactical intelligence plus $2.5M for RCN maritime domain awareness, extending a CAF relationship dating to 1999.

🍁 Canada’s NATO Innovation Fund entry inches forward — the $107M-over-20-years commitment still needs sign-off from 24 LP nations, possibly not until fall.

Auterion and Skyfall ink a 50,000-drone deal — 50,000 Shrike FPVs with Skynode S AI autonomy are headed to Ukraine, worth $100M to Auterion and funded by a European NATO nation. More than double Auterion’s prior largest order, with a swarming update coming.

• Ukraine’s defense tech sector is starting to look less like battlefield improvisation and more like the early stages of a real industrial base; updates to Brave1

Jatin Modi

Cheap to Kill: The Disposable Soldier and the Gamified War.

On the evening of 26 June 1813, in a palace on the western edge of Dresden, a foreign minister spent nine hours trying to make an emperor feel the cost of a war, and failed…

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4 months ago · 4 likes · Jatin Modi

Kraken Technology raises $175M at a $1B valuation — the UK maritime-autonomy firm (not St. John’s Kraken Robotics) closed a Series B led by DTCP with the NATO Innovation Fund and Rheinmetall aboard, and holds a Davie partnership for Canadian production of its 55-knot K3 Scout USVs.

Forterra wins a $114M Army contract for Ukraine — the Sandhills Project puts 105 Lancer autonomous ground vehicles into the fight, delivered in under six months.

Skapion raises a $36M seed for counter-swarm defence — UP Partners and Khosla co-led the round for founders including the ex-Rafael GM behind Iron Dome and David’s Sling.

Surtr raises $4.8M for c-UAS sensor fusion — the YC-backed startup founded by Shield AI and Anduril alumni is already testing with Brave1 in Kyiv at sub-100ms latency.

Aurelius Systems: $0.10 per shootdown — the ~$12M-funded startup’s Archimedes laser turret killed 20+ quadcopters at T-REX in June. Only 19 directed-energy systems have been fielded in 60 years — Aurelius is betting on Detroit manufacturing to change that.

The Defense Brief

Who is building the picks and shovels in defense?

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4 months ago · 13 likes · 4 comments · Louise Boucher

Related: Reaction Dynamics’ CEO wants Canadian LPs to back moonshots — top-5 VC fundraising is down 50% since 2021 — while AGF Capital Partners argues the defence capital cycle is durable and moving well beyond the primes.

⚔️ Combat Readiness

Ground robots: The first American autonomous ground vehicles are fighting in Ukraine — 100+ Forterra Lancers have run 1,100+ missions, hauled 777,440 lbs and completed 88 casualty evacuations in nine months. One soldier: “the most important UGV in Ukraine… we are dying to get more.”

• Do regular tanks still matter?

No infantry, no losses: Ukraine captured a Russian position using only ground robots and drones — Zelensky called it a first. Machine-gun UGVs and multi-swarm operations are now doctrine, not demo.

Breaching goes autonomous: The US Army picked Caterpillar, Forterra, IDV USA and Overland AI for its new autonomous minefield-breaching program — the deadliest job in land warfare, handed to machines.

• Saronic Corsairs, a 24ft ASV:

The Pentagon’s drone bible: JIATF 401’s “Small Drones, Big Problems” paper lays out a first-principles counter-UAS framework built on five Ds: Detect, Deny, Disrupt, Defeat, Discipline. The data: FPVs account for 60–70% of destroyed Russian systems and 70–80% of casualties, and Shaheds made up 66% of Iran’s counterattack. Its warning — drones’ “happy time” ends when defenders adapt.

Ukraine opens the arms store: Kyiv approved its first transparent weapons-export mechanism for partner countries — with ~800 producers making 4M+ drones a year and capacity to double, combat-proven Ukrainian kit is now for sale.

Interceptors, printed: SkyDefense’s 3D-printed CobraJet VTOL interceptor hits 350 mph in hybrid form, launches from a mothership, and fires Mach-1 VIPER rounds produced by the thousands each month.

Axis watch: A joint investigation by The Insider, Der Spiegel and Le Monde exposed secret Russia-China military forums: a three-level plan to defeat Starlink up to physical destruction, a 2023 Almaz-Antey protocol for joint hypersonic-intercept air defence by ~2030, and 200+ Russian operators trained on Chinese drones at six sites in China. Beijing trades tech for combat data.

Robert Asselin

Economic Security Is Now Driven by Science and Technology

Policymakers often discuss economic security through the language of supply chains, critical minerals, subsidies, tariffs, procurement and trade diversification. Those issues are important, but they miss a larger strategic point…

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4 months ago · 4 likes · Robert Asselin

AI export walls rise on both sides: Beijing is weighing curbs on overseas access to Qwen, Doubao and GLM-5.2 — the mirror image of Washington’s Mythos directive. 🍁 Michael Geist’s warning: Canada must fight for frontier-AI access in the USMCA talks or settle into “the second tier of AI.”

Europe’s conversion problem: NATO fixed its cash flow — now it must turn money into munitions, as Rutte puts it. The Economist finds the gap on the factory floor: BAE’s Hägglunds plant went from $211M revenue in 2018 to $1.1B in 2025 and is expanding capacity five- or six-fold — demand still outruns supply. The backdrop: WSJ’s inside account of Europe’s rupture with America, where Macron told nearly 30 leaders “There is no going back” during a five-hour midnight session in Brussels.

• ICYMI: NATO's new web portal for industry is now live

🍁 Kit for Canada — strike: Norway’s Joint Strike Missile could give Canada a common precision-strike architecture across air and undersea domains — two internally on each F-35A, canister-launched from Type 212CD torpedo tubes.

🍁 Kit for Canada — sensing: CDR makes the case for a “pocket AWACS” built on Saab’s LoyalEye AEW package riding the MQ-9B SkyGuardian — 11 of which Canada is already buying — with 40+ hours of endurance per orbit.

🍁 Kit for Canada — space: Canada joined seven NATO allies to build HALO, a layered satellite mega-constellation for comms, ISR and missile tracking — stacking on top of its Starlift membership.

Kate’s Substack

Wrong - Speed is NOT the Geran 3/4/5 Interceptor Problem

I first told those who read me that the Geran 2 was done in April 2025. We knew then that we were facing a new threat. That threat is not a faster drone. It’s a cheap cruise missile…

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4 months ago · 7 likes · 3 comments · Kate McKenna

Big think — evolution or revolution? Yaroslav Trofimov asks whether today’s hundreds of billions in conventional platforms will look like investing in horses and arrows just before the machine gun arrived. The US-Israel failure to decisively defeat Iran despite massive precision-weapon expenditure broke the old assumptions.

Big think — the empty arsenal: Anduril chairman Trae Stephens tells Arena the US burned ~1,000 Tomahawks in the first weeks of the Iran war against production of a few hundred a year — resupply timelines stretch to 2030. His prescription with Katherine Boyle in the Washington Post: “just war” theory doesn’t forbid terrifying new weapons — but America must get there first.

Big think — the counterpoint: A US Air Force veteran and defence investor warns against “vibe patriotism” — founders and VCs marching with rucksacks and calling equity “service.” Building for the mission is honourable. It is not sacrifice, and conflating the two lowers the moral barriers to war.

🔫 Hot Shots

🍁 Mitacs opens a Defence & Security call — and forgot the munitions. The program offers $20K–$25K internship units, up to 30 per project, with applications due August 17 across eleven priority areas spanning AI, quantum, sensors, space and Arctic sovereignty. Munitions and energetics — explicitly named in the Defence Industrial Strategy — appear nowhere. Canada’s most acute industrial gap didn’t make the list.

🍁 Ottawa scraps the open LUV competition — phase 2 of the $4.9B light utility vehicle program is dead, with only Canadian firms — Roshel, GM Defense Canada, Armatec, Terradyne — invited to the restructured process. AM General and Oshkosh are out.

🍁 Innovative Solutions Canada rebuilt — the program returns with $79.9M over five years under Buy Canadian phase 2 and a supplier registry by end-2026. As one founder put it: “a contract is better than a grant.”

CanadaxEurope

Canada chose TKMS as preferred partner. It still needs South Korea and an Indo-Pacific Defence Industrial Engagement Strategy.

In the wake of yesterday’s big announcement selecting TKMS as the preferred bidder for the Canadian Patrol Submarine Project, CanadaxEurope reached out to Mike Petric from CanadaxIndoPacific for a take on the reaction…as well as what’s next for Canada and the region…

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4 months ago · 14 likes · 2 comments · Mike Petric

🍁 Built here, bought there — Raymond Luk’s Impact Group interviewed 31 founders of foreign-acquired Canadian firms and found that in 93% of cases, strategic control moved abroad. “Canada should stop acting like the waiting room for Delaware.” Same issue notes Telesat won the Defence Investment Agency’s first-ever procurement and MDA’s ~$920M bid for 70% of France’s CLS.

🍁 DND is now Canada’s biggest buyer — federal defence postings jumped 62% in June, with DND at 583 postings in Q2, while Alberta’s sovereign-compute pre-qualification drew 298 plan takers.

🍁 Markham wants to build the defence tech Ottawa is buying — the city is positioning its 1,500+ tech firms and 35,400 knowledge workers against a DIS worth ~$180B in procurement and $290B in infrastructure over the decade.

🍁 Trucking software finds a defence lane — Vancouver’s Switchboard is pivoting fleet software into defence logistics via UBC Sauder’s Scale Up program. “Trust is table stakes.”

🍁 AVSS passes 2,000 systems built this year — the Fredericton drone maker’s record pace runs on ~75% international revenue across 20+ countries, plus its new Flying Beehive air-launched FPV line.

🍁 Canada angles for the Moon Base — with Gateway cancelled, Canadensys (17 systems already on the lunar surface), Mission Control and MDA are vying for NASA’s lunar utility vehicle, and CSMC won $1M from CSA for a lunar nuclear reactor with Arctic dual-use potential.

🍁 Procurement school is in session — Carleton’s NPSIA launches a Practical Certificate in Canadian Defence Procurement December 10–11 at $800, taught by Philippe Lagassé and former ADMs.

The Ugly American meets the Ugly Ally — Stephen Nagy argues allied free-riding and condescension helped create Trump: Canada “cannot publicly denigrate the U.S… then request expedited trade deals, security guarantees.” Meanwhile Politico finds Canadians turning into genuine defence hawks at exactly the right moment.

DIANA picks 10 for Decision Superiority — zero Canadians. NATO’s accelerator awarded €100K each to its latest cohort in the Decision Superiority challenge. Canada’s absence from the list speaks for itself.

Odds & Ends:

• America should rebuild its manufacturing base; the new generation of American industry according to Reid Hoffman

• The defence tech Valley of Death

• The Big Search mapped 600+ 𝐜𝐮𝐫𝐫𝐞𝐧𝐭 𝐚𝐧𝐝 𝐟𝐨𝐫𝐦𝐞𝐫 Anduril Industries 𝐥𝐞𝐚𝐝𝐞𝐫𝐬. Two core insights from the data

• How EIF is helping defence innovators

• Ukraine’s Operation Auchan: How one operation halted the enemy’s mechanized offensive for six months

• Renting Our Future: U.S. Tech Hegemony, Canada’s Sovereignty Race, and the Coming Realignment

• Drones are machine guns

• Top 100 defence innovators

• Keeping our defence supply chain sovereign

• How to Make Hardware Venture-Shaped; Robotics is having a software moment

• BRiley Securities Q2 A&D report; has the defence market peaked?

• Photos from the front

• PQC is not a 2030 problem. It is a today problem with a 2030 deadline

• Hybrid threats target democratic institutions, critical infrastructure and societal cohesion in the EU

The Canadian Explorers

Medical Manufacturing Anywhere | Dr. Harvey Hawes — Explorer Spotlight #6

In war, disasters, and remote conditions, the demand for medical supplies rises when supply chains are most likely to fail. Since Russia’s full-scale invasion of Ukraine, Ukraine’s Ministry of Health estimated that 100,000 war-related amputations had been performed by mid-2024…

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4 months ago · 3 likes · 1 comment · Ethan Marcoux

Defense Tech and Acquisition

Keeping Score on Procurement Reform

Over the last year, the Trump administration has prioritized procurement reform, and specifically, the acquisition of commercial products. In Secretary of War Pete Hegseth’s “Wartime Footing” speech …

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4 months ago · 15 likes · 6 comments · Madeline Hart

Industrial Base Alpha

The Philosophy of Vertical Integration

To vertically integrate or not to vertically integrate…

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4 months ago · 10 likes · 11 comments · Matthew Bernard

The Line

Al Vigier: Canada's AI strategy shouldn't include secret Palantir bills

By: Al Vigier…

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4 months ago · 55 likes · 10 comments · Line Editor

Startup Riders

🌊 n8n's Growth Playbook: 0 to $100M ARR

👋 I’m Ivan. I study how top 1% startups grow…

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4 months ago · 36 likes · 4 comments · Ivan Landabaso

If you’ve got battlefield intel, classified tips, or just want to call in an airstrike on our typos, hit “reply” and sound off. Whether it’s a new tech sighting, a rumour from the mess hall, or feedback on our comms, we want your SITREP.

Share The Icebreaker

In the back half of this week, The Icebreaker heads to Montreal to help DMZ Ventures and BDC judge a $100K Dual-Use and Sovereign Tech Investment Prize at Startupfest.

🎯 Three-Shot Burst

Germany’s TKMS will build Canada’s fleet of 12 submarines — the largest single defence procurement in Canadian history. The contract value: $20–30B for the hulls, up to $40–50B including operations, maintenance, and upgrades over the life of the fleet.

The framing matters. This wasn’t a purely military decision. Ottawa explicitly said the winner would depend on economic benefits — not just submarine design. TKMS countered with a jaw-dropping pitch: $86B added to Canadian GDP and 650,000 job-years over the term of the deal. Hanwha came in hard too — $70B in trade and investment pledges, 25,000 annual jobs from 2026 to 2044, a steel mill commitment, and it literally shipped a submarine to Canada to show off. Ottawa chose Germany anyway.

The strategic logic is NATO alignment. TKMS proposed a three-country model — Canada, Germany, Norway — building, training, and maintaining together. Two Arctic nations, all NATO. The Walrus flagged the harder question before the decision landed: does Canada really need twelve submarines designed for last-generation warfare, or should it buy eight and field dozens of autonomous underwater vehicles — including from Kraken Robotics in St. John’s? Canada’s answer is twelve. History will judge whether that’s the right call.

Reality check: Canada currently operates four submarines. Typically one is operational at a time. Twelve gives Canada three deployable at any given moment. That’s a genuine Arctic deterrence posture — the first in decades. But delivery runs mid-2030s to early 2040s, and Canada hasn’t ordered new submarines since the 1960s. The procurement clock is already running.

Bottom Line: Canada’s submarine decision is the most consequential defence procurement since the F-35. It signals NATO alignment over economic hedging, bets on a three-ally construction model, and commits Canada to a conventional underwater deterrent for the next half-century. The industrial fight now moves to who actually builds what, and on Canadian soil.

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

🍁 Dominion Dynamics raises $139M Series A — Ottawa-based Arctic sensing and ACP developer. Lead: Georgian Partners. Backers include Bessemer, OMERS, BCI, BDC, RBC, Valor Equity. Total raised: $169M since June 2025 launch. CEO Eliot Pence (ex-Anduril) calls it the largest Series A ever by a Canadian defence startup. Still no federal contract — 50% chance first contract lands in the US.

🍁 Canada to join NATO Innovation Fund — Pending approval from 24 member nations. Canada set aside $107M over 20 years in 2024 but never followed through. Was one of only 8 NATO allies not backing the fund. Initial investment up to €15M per company. Contributions count toward Canada’s 5% GDP target.

🍁 Canada announces founding partners for global Defence Bank — The Defence, Security and Resilience Bank (DSRB) aims to raise up to £100B (US$133B) in cheap finance for allied nations. ~10 founding nations to be announced at NATO Turkey summit. Canada likely sole non-European founder. Canada’s potential contribution: up to €1.5B. Supporting banks: JPMorgan, Deutsche Bank, RBC, BMO, CIBC, Scotiabank, TD.

🍁 CADSI hits record 1,788 members — Up ~750 year-over-year; nearly 1,400 above 2021 low. Big Six banks (minus TD and BMO) now members. CIBC, BDC joined in 2026. 47 academic members (+62% YoY). Controlled Goods Program applications surged 78% above prior year in February.

🍁 Orqa + Remote Robotic Systems: $150M Canadian drone partnership — Croatian drone leader Orqa partnering with Ottawa-based RRS to build Canadian sovereign capability. Target: 10,000 systems/month by 2029. Up to 100 jobs in Ottawa and Toronto by Q4 2027. Canada becomes first non-EU nation in EU’s SAFE initiative. Signed with both Carney and Croatian PM present.

Gray Matters

Where Do Defense Tech Founders Come From?

Where do great defense tech founders come from? As a venture capitalist (VC) investing in early stage, national security startups, one of the most important (and most difficult) parts of my job is evaluating startups’ founding teams. When evaluating early stage startups, the team…

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4 months ago · 19 likes · 4 comments · Maggie Gray

Defence tech funding hits $35.6B in H1 2026 — 40% YoY increase. Q1 alone was $19.8B — largest single quarter ever recorded. Autonomy is the dominant theme: $16B TTM across 212 deals. UAV subsector up 254% TTM, UGV up 284%. Capital is concentrating — top 5 rounds = 48% of H1 total, Anduril’s $5B Series H alone = 14%. Median round size doubled YoY from $11M to $20M.

Ondas acquires DZYNE Technologies for $876M — Drone and C-UAS rollup Ondas ($ONDS) expanding with DZYNE’s ULTRA (70+ hr endurance, 450 lb payload), LEAP, IonStrike interceptor, and new Blitz Group 1 drone. New business unit: Ondas Sentinel. On pace for $525M revenue this year. Portfolio spans US, Europe, Israel.

Harpoon Ventures closes $155M Fund IV — San Diego early-stage VC now at $450M+ AUM across four funds (Fund I: $55M → Fund IV: $155M). Strategy pivoting to infrastructure/”picks and shovels” — 3D-printed batteries, automated shipbuilding. “Are we in a bubble? Yes. The tourists are the ones who get screwed.”

Netherlands bets €30M on drone software over hardware — Dutch Ministry of Defence signs 3-year strategic partnership with Amsterdam-based Intelic, whose NEXUS C2 software lets drones from different manufacturers operate together. First country to formally fund a software-first approach to drone procurement. Exploring golden share. NEXUS in combat use in Ukraine since 2025.

Six Robotics raises €12M seed — Oslo-based swarm coordination company. Valkyrie software lets a single operator command multiple heterogeneous drones as one team. Built to 90 people before taking outside money. DTCP Defence led. Already integrated with Norwegian Armed Forces, Stark’s kamikaze drones, FACNAV. “Europe cannot afford to depend on others for the software that defines what its forces can do.”

Jamie Dimon wants JPMorgan in the weapons business — Dimon considering shift to invest JPMorgan’s own capital directly in defence companies — not just provide loans. Framed around US weapons shortage exposed by the Iran conflict. L3Harris flagged inconsistent federal procurement as barrier to rocket motor scaling.

Marc Andreessen and Blake Masters appointed to DoD policy board — a16z founder and former Thiel Capital COO now providing “independent strategic advice” to Hegseth.

Related: a16z: DoD contracting for startups 101 | MITS Capital: Wall Street to Warzone podcast

⚔️ Combat Readiness

Drone czar: Hegseth signed a memo creating DRPM-UxS — a Pentagon-wide drone czar reporting to Deputy SecDef Feinberg, with authority over all UAS Groups 1–3, all autonomous ground vehicles, nearly all unmanned surface vessels, and all autonomy/AI/swarming software. ~$54.6B in FY2027 budget scope. “Adversaries collectively produce millions of unmanned systems each year. The United States has been slow to field these capabilities at scale.” DIU becomes primary industry interface.

Gray Matters

🎙️ Ep 26 - Techquisition: The Pentagon's New Drone Czar?

🚨EMERGENCY POD🚨…

Listen now

4 months ago · 3 likes · Maggie Gray and David Rothzeid

Loyal wingman goes mainstream: US Air Force confirmed General Atomics FQ-42 and Anduril FQ-44 Fury for production — the world’s first large-scale CCA fleet (~1,000 aircraft). Germany, Australia, Poland also accelerating. Canada has 88 F-35s coming and no autonomous ecosystem to pair them with. Dominion Dynamics’ Scout ACP is the domestic answer — but Anduril, GA, and Boeing/RAAF MQ-28 are ahead on capital and flight hours.

Ground robots: Eurosatory 2026 outside Paris — UGVs dominated, not tanks. 50+ manufacturers. Ukraine contracted 25,000 UGVs in H1 2026 alone, ran 50,000+ missions. Rheinmetall Canada’s Mission Master and General Dynamics Land Systems-Canada’s TRX give Canada world-class UGV capacity. Problem: no political will to field it. “The challenge is not innovation, but fielding capability at scale.” CDR

UFORCE’s Oleg Rogynskyy joined CNN International’s The Brief to discuss how Ukraine is rewriting the playbook of modern defence and why the future of deterrence lies in affordable, autonomous mass.

The Defense Brief

The electronic warfare arms race behind Ukraine's drones — with Andriy Chulyk (Sine Engineering)

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4 months ago · 2 likes · 1 comment · Louise Boucher

Russia’s shadow fleet ran an 18-month nuclear surveillance campaign — IISS analysis of 144 incidents across 12+ NATO countries. Targets included RAF Lakenheath (US nukes deployed July 2025), France’s Île Longue submarine base, and NATO air bases at Kleine-Brogel and Volkel storing US air-launched nukes. Drones launched from “dark sailing” vessels with transponders off. None captured or shot down. GRU assessed as orchestrator. “A series of tactical successes for the Kremlin and a strategic failure of allied defences.”

NATO Maven reaches full operational capability — Project Maven AI targeting system now at full capability within NATO SHAPE. NATO SHAPE

🍁 Canada Arctic: spending ≠ readiness — Macleans longform: 1/3 of Inuit live in homes in poor repair; TB rate 37x the national average; $17.69 box of Cheerios; food bank use up 80%. CSIS: “the infrastructure gap in Nunavut is creating national security risks.” CDS Carignan: “geography alone no longer guarantees the security of our northern flank.”

🍁 From spending to readiness — Canada’s talent problem — “Scaling investment is not the same as scaling capability.” The bottleneck won’t be capital; it’ll be coordinated talent, training, and procurement. Building blocks exist — CAE simulators, Irving Shipbuilding, Magellan Aerospace — but the system doesn’t connect them. BHER

🍁 Canadians are becoming defence hawks — Politico poll: 52% say Canada poorly prepared to defend itself; 61% say too few troops; 53–27% margin prefer buying from Europe over US; 52% support domestic production even at higher cost. Military recruitment hit a 30-year high — 8,000+ sworn in last fiscal year.

🍁 Skilled Canadians want to come home — Brain drain reversing. High-skilled workers citing US political climate, cost of living, and Canadian opportunity as pull factors. Financial Post

Pentagon manufacturing bottleneck: Manufacturing — not funding — is now the primary constraint on US defence capability. Companies need right mix of facilities, skilled labour, and reliable suppliers to deliver in months not years. Rep. Wittman: “Shipyards are turning more into assembly sites rather than primary production facilities.” Could take 2–4 years to materially improve.

DoD can prototype. Production is another story. — No data on how many OTA contracts or SBIR grants actually convert into programs. “The challenge is what does it lead to?”

Pentagon hiring hundreds of software engineers — “War Force” program: hundreds of engineers for 2-year DoD stints, embedded down to unit level. Builds on Tech Force (1,000+ hires at $150–200K/year). AI talent priority for CDAO’s AI Acceleration Plan.

Navy Innovation Unit gets 200+ applications — Tech-focused Reserve unit drew senior execs from hyperscalers, defence primes, and defence-tech startups. Mirroring Army’s Detachment 201 (which commissioned Palantir CTO and Meta CTO as Lt. Cols). Commissioning begins fall 2026.

Logistics are the next war’s biggest vulnerability — “All logistics operations will be contested” in peer conflict. Unlike Iraq/Afghanistan where rear-area sanctuary was guaranteed, a war with China or Russia won’t offer the same protection.

AI warfare: point of no return — WSJ on Ukraine’s AI arms race. Eric Schmidt: “Future warfare will be predominantly robotic and automated.” Ukrainian drone CEO: “Either robots will eliminate us in fifty years, or the Russians will take us out in a year.” Anthropic and OpenAI now have dedicated national security offerings.

Canadian Cyber in Context

Canada has a Defence Digital Strategy

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4 months ago · 6 likes · 1 comment · Alexander Rudolph

Europe’s rearmament paradox — $559B spent by NATO Europe last year. Germany alone: $114B (+24%). Yet the FCAS program just collapsed, the Franco-German tank program is stalled, and the Stoxx Europe Targeted Defence index is down 15% since January. NUPI: “Europe’s Achilles heel is no longer financial, it is institutional.”

UK Defence Investment Plan praised by startups — Long-awaited DIP published. European drone startups broadly positive but flagging execution risk.

🔫 Hot Shots

🍁 UVic MARMOTSat launching on SpaceX Falcon 9 in July — University of Victoria’s second CubeSat will probe the ionosphere for climate change signals and fly an open-source radio system. PacifiCan funding: $5.4M. Next mission: PolarLink (2027) focused on Arctic communications with space-to-space optical links.

Vermeer launches “Recovery” for GPS-denied drones — New feature for its Visual Positioning System corrects drift mid-flight without satellite data. 95% success rate at 1km drift; ~80% at 3km. Tested in Ukraine under real operating conditions. Customers: Lockheed, Northrop, Anduril, AV, Firestorm. VPS trained on 25,000+ hours of aerial video.

Deviro, Leleka, Bulava — Ukraine’s triple drone debut — New Ukrainian FPV and strike drone models entering service. Combat-proven ecosystem expanding. The Defender

The Canadian Explorers

Flying Sea Drones | Dr. Mike Peasgood — Explorer Spotlight #5

Canada has the longest coastline on Earth at over 240,000 km, and a Waterloo-based company is building six-foot-long autonomous boats to help defend it…

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4 months ago · 1 like · Ethan Marcoux

Hypersonics VC funding hits 12-quarter high — $413.1M in Q2 2026 across just four deals. Castelion ($350M Series B + $105M Navy contract), Hermeus ($350M Series C at $1B valuation), Rocket Lab ($190M hypersonic test contract). The real VC play: propulsion, thermal protection, test infrastructure — not full missile programs. Visible US opportunity: mid-teens billions through end of decade.

BVP defence tech roadmap — five frontiers for 2026 — Defence tech advanced more in 24 months than the previous 3 decades. Five frontiers: autonomy from concept to combat, AI in DoW workflows, advanced manufacturing, edge/network resilience, energy/materials independence. China controls ~70% of rare earth production and 90% of processing. European defence spending projected to grow 3.4x in six years. Palantir at ~65x NTM revenue. Check out monthly comps from BCI.

Wall Street to Warzone: Perry Boyle (MITS Capital) on investing directly in Ukraine’s defence ecosystem. Innovations in drone tech, building the defence industry from scratch under wartime conditions. “It’s not a storm — it’s the climate.”

Lorenz Meier

Drones Are Becoming Cell Phones

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4 months ago · 7 likes · Lorenz Meier

MITS Capital / Ukraine: Also see the deep-dive on Deviro, Leleka, and Bulava drone systems — Ukraine’s drone output ecosystem expanding beyond FPV into new strike categories.

Related:

• This Mine Predicts Major Wars. It’s Opening Again

• America seeks its McDonald’s model for missile making

• TACTIQL joins the Oracle Defence Ecosystem

• Ukraine opens door to arms exports

True North Strategic Review

Canadian Coast Guard to Charter Finnish Icebreaker

Another surprise today. Every so often, something drops that gives me a bit of a giggle. Today is no different. The CCG has put out a new ACAN today, announcing their intent to charter a Polar Class 3 icebreaker for the upcoming season…

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4 months ago · 12 likes · 2 comments · Noah

Ukraine's Arms Monitor

Inside Ukraine’s Interceptor Drone Race: A Pilot’s View

Are interceptor drones already autonomous? Can a pilot sitting in Ukraine intercept Shaheds in the Gulf? Is it enough to buy hundreds of these systems from Ukraine to protect your own country’s facilities? I discussed some of these questions with the operator of STING drones, one of the most effective Ukrai…

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4 months ago · 62 likes · 2 comments · Olena Kryzhanivska

If you’ve got battlefield intel, classified tips, or just want to call in an airstrike on our typos, hit “reply” and sound off. Whether it’s a new tech sighting, a rumour from the mess hall, or feedback on our comms, we want your SITREP.

Share The Icebreaker

🎯 Three-Shot Burst

Canada’s electronic spy agency doesn’t usually brag. But buried in CSE’s 2025–2026 annual report — released this week — is a first: CSE publicly confirmed it conducted an active cyberoperation against foreign criminals brokering fentanyl precursor chemicals, disrupting and “diminishing their ability to operate.” It also disclosed it took concurrent action against 10 of the most significant ransomware groups harming Canada and allies simultaneously. Not one at a time. Ten!

The numbers behind the year: 3,216 cyber incidents responded to. 97,000+ threat notifications sent. 67 pre-ransomware alerts pushed to Canadian organizations before attackers could pull the trigger. A 25% increase in alerts and 28% increase in advisories over 2023–24. CSE now has 4,178 employees — up 337 in a single year — and is entering what the report calls “sustained expansion and transformation.”

Reality check: This is not your father’s signals intelligence agency. CSE is deploying staff to Latvia and Lithuania through its Deployed Cyber Security Officer program. It co-chaired the G7 Cybersecurity Working Group during Canada’s 2025 presidency. It led the Arctic Intelligence Coordination Group. It coordinated cyber defence for the 45th federal election, the G7 in Kananaskis, and is embedded in FIFA World Cup 2026 planning across North America. It’s also leading Canada’s post-quantum cryptography migration — publishing the government-wide roadmap while simultaneously chairing the interdepartmental working group.

Bottom Line: CSE’s overt disclosure of an offensive cyberoperation against fentanyl networks is not an accident. It is a signal — about what Canada is now willing to do, and willing to say it did.

Related:

🏆100k Pitch Contest in Montreal next week:

DMZ Ventures is launching the $100K Dual-Use and Sovereign Tech Investment Prize at Startupfest, investing in startups driving Canada’s resilience and national security. The Icebreaker is aboard to help judge.

Register now.

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Barrack Hill: Navigating Canada’s defence and procurement landscape with precision.

🤝 Deal Corner

🍁 Canada’s $100B submarine decision is now a bidding war. A South Korean attack submarine docked in Victoria in late May. Germany’s defence minister stood beside Canada’s in Ottawa and made the case for European alignment. Both Hanwha and TKMS meet Canada’s operational requirements — PM Carney has said it “ultimately comes down to the broader benefits being offered.” The industrial lobbying campaign is unprecedented in Canadian procurement history. Decision imminent.

🍁 GlobalEye: Saab chosen, L3Harris blindsided. Ottawa bypassed the standard RFI process and opened sole-source talks with Saab for Canada’s NORAD-linked surveillance aircraft. L3Harris Canada — which had readied its Aeris X (built on a Bombardier 650 airframe) — said it was “quite surprised.” The political catch: fully integrating GlobalEye with NORAD requires US stealth communication technology that has never been shared with a non-US aircraft. Bill C-31 would expand procurement exceptions from 4 to 14 — and may retroactively justify the decision. L3Harris says it can still deliver by 2032.

🍁 Griffon upgrade suspended. The federal government put the $800M CH-146 Griffon Limited Life Extension program on hold over technical complexity — specifically, problems with the mission system computer. Bell Textron (Mirabel) was notified. It’s unclear whether all 82 helicopters will be upgraded or only a select number. The program aimed to keep the fleet flying until 2039; the revised scope will now only target the mid-2030s. Replacement program: ~$18B, deliveries starting ~2033.

STARK raises €500M at €3.5B valuation. The two-year-old Berlin drone company — Virtus loitering munitions (130km range, GNSS-denied), Cascade (100km, tube-launched), Gambit (ISR quadcopter), Vanta (maritime USV), and Minerva (C2 software) — just quadrupled its valuation from earlier this year. Founders Fund and Sequoia led; NATO Innovation Fund participated. STARK holds a €2.8B German military framework contract for Virtus. More than 80% of the new capital goes directly to R&D and manufacturing. CEO: “The challenge facing Europe is no longer whether we can innovate, it’s whether we can scale.”

The Defense Brief

Shifting the Narrative

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4 months ago · 5 likes · 1 comment · Louise Boucher

Booz Allen buys Ultra I&C Mission Solutions for $720M. Ultra’s flagship product ADSI is the Army’s most widely used tactical data fusion and situational awareness tool — it’s already on a $86.8M Guam IBCS contract and a $39M Marine Corps aviation C2 contract. The acquisition also brings Knox (ruggedized AI edge compute, runs on MQ-9), Rain, ACTS, Apex, and CyberFence into Booz Allen’s portfolio. Deal closes by end of September. ~220 people, $720M — a pointed bet on defence tech over consulting.

Anduril leads Army NGC2 common data baseline. The US Army selected Anduril to integrate 17 fragmented C2 programs of record into a single converged data layer. Partners: Palantir (Foundry), Raft (data registries), plus Govini, Microsoft, Striveworks, Rune, Shift5. Falls under Anduril’s existing $20B 10-year enterprise agreement. At Ivy Mass, Team Anduril took connected devices from 10 to 2,500+ and added 17 new applications in a single demonstration. NGC2 is the Army’s answer to JADC2.

Mach Industries closes $300M Series C at $1.8B. The Merge’s breakdown is essential reading on the most polarizing company in defence tech. Ethan Thornton (Thiel Fellow, founded Mach at 19) is running six programs simultaneously: Viper (jet-powered strike), Dart (counter-drone), Glide (standoff), Pike (long-range), Atlas (maritime strike — selected for DIU RIMES in June), and Venom. The factory thesis: 115,000 sq ft in Huntington Beach, 12,000 micro-jet engines annually, Exquadrum solid rocket motors in-house. Roughly half of this year’s revenue comes from B2B component work — other defence companies paying Mach to source scarce inputs they can’t find elsewhere. Public contract obligations: ~$1.76M. Valuation: $1.8B.

Valor Equity raises $2.5B Fund VII. Antonio Gracias’s firm — long allied with Elon Musk — is raising its next fund on the back of SpaceX going public on June 12. A portion already earmarked for SpaceX shares.

🍁 L-SPARK looks to launch defence-tech accelerator. The Kanata-based startup accelerator — backed by Terry Matthews’s Wesley Clover, 160+ alumni, $200M+ in follow-on capital — is in early-stage talks to build a dual-use defence accelerator for Canadian SMEs looking to access the defence establishment through primes. The federal government plans to raise the domestic defence contract share to 70% (from 43%) within a decade, creating 125,000 new jobs.

🍁 DefSec Technologies raises $2.5M. The Kanata-based company (formerly Kwesst Micro Systems) — battlefield laser detection, soldier systems, anti-riot tech, DND software services through Thales Canada — sold 673,006 shares at $3.74 in a registered direct offering. Board member: Ret. Gen. Rick Hillier. Revenue Q1: $2.1M (up from $1.3M). Stock is down ~80% over 12 months. The raise buys runway.

🍁 Q-Branch Dual-Use Accelerator — now taking applications. Canada Q-Branch is screening scaleups for its dual-use accelerator, targeting federal markets and Texas expansion. Applications open now.

Related: France drops Palantir for a reason. ChapsVision won DGSI — German intelligence chose the same. The 2026 defence tech landscape is no longer a two-company story: defence-national security VC investment in early 2026 already exceeds $14.6B — surpassing the prior full-year record of $9.6B set in 2025. 2026 is the execution year.

Related:

• Defence tech is hot again, but not every startup is real (25:19)

⚔️ Combat Readiness

The jellyfish swarm over Iran. When the downed F-15E pilot was debriefed, he described a “minefield of drones” — multiple Iranian systems hovering in formation, moving as one, with smaller drones dangling below like legs. “Real alien shit.” CNN confirmed the intelligence community remains split on how to interpret the account — the pilot had a concussion — but the capability described is “one-to-many meshed networking,” which Russia and China already possess. If Iran has it, with Chinese assistance, the implications for every US air operation in the region are significant.

Ukraine's Arms Monitor

Drone warfare in Ukraine: Hornet strike drones

Since April, when my first report on the mysterious “Martian” drone came out, we have learned that it is the Hornet drone developed by the American Swift Beat LLC (now Perennial Autonomy). It is almost silent, resistant to jamming, fast, flies at low altitude, and has AI-based technology…

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4 months ago · 58 likes · 2 comments · Olena Kryzhanivska

The Iran war is straining the arsenal. Trump met with Boeing, Lockheed, Raytheon, and Honeywell at the White House to demand faster production of Patriot, THAAD, Tomahawk, and AMRAAM. Hegseth simultaneously held a separate, unannounced meeting at the Pentagon with Anduril, Castelion, Leidos, and CoAspire — the message: if the primes can’t deliver, the new entrants will. Iran launched over 8,000 missiles and drones in the conflict. The US naval base in Bahrain took significant, publicly unacknowledged damage — command headquarters, satellite communication facilities. Most personnel were evacuated. “Two US fatalities” versus 13,500 Iranian targets struck. The math is not symmetrical — but the base is in rubble.

Arsenal of scarcity — the numbers. AlixPartners’ missile supply chain breakdown is the most data-dense read of the week: Iran produces 100+ missiles per month; the US produces 6–7 interceptors. The supplier base has contracted from 5,000 firms to ~1,000. There are 100+ identified single points of failure at the sub-tier level. GMLRS is scaling from 6,000 to 14,000 units annually — and its ammonium perchlorate comes from one domestic facility, its polymer binder from a single supplier (with degrading quality), its spherical aluminum powder from one qualified manufacturer. China controls 91% of rare-earth magnet capacity; the DFARS restriction on Chinese samarium-cobalt and NdFeB magnets kicks in January 2027 with no assured domestic alternative at scale. “Capacity is the new capability.” L3Harris makes this argument directly: it is not sustainable to defeat hundred-dollar drones with million-dollar interceptors.

🍁 Canada’s top soldier names the threat. CDS Gen. Jennie Carignan, in an exclusive interview with CTV: “The threat to our continent is mostly related to the new missile technologies and the new vehicles of delivery that Russia is developing.” North Korea, Iran, cruise missiles — medium and long range. The CAF is reorienting from expeditionary theatres to continental defence, with emphasis on the Arctic: air defence systems, underwater sensors, space.

🍁 Canada–UK drone warfare training, with asterisks. 350 British and Canadian soldiers are training at Suffield, Alberta — replicating Ukraine lessons: one-way attack drones, electronic warfare, constant surveillance, electromagnetic threat. The capability gaps identified: Canada needs more drone fleets, more electronic warfare units, more counter-drone systems — and a dedicated airborne EW/SIGINT aircraft (RCAF currently has none). The Falcon Shield (Leonardo) is adopted; Leonidas (Epirus) neutralized 49 drones in a single pulse during testing. The MC-55A Peregrine (Australia’s advanced EW jet) is the model Canada is being told to pursue.

Kill zone: the front line no longer exists. LRT’s ground-level Ukraine reporting is required context for every procurement conversation: the kill zone now stretches dozens of kilometres from Russian positions, defined by drone range. Even 15km is “extreme danger.” Soldiers operate in scattered positions 1.5km apart. “War used to be louder. Now you get a false sense of security because it’s quiet, but you can be killed very quickly and out of nowhere.” FPVs: 5–6 launched per Russian soldier. One battlefield insight distilled: “90% of what we knew about warfare will no longer help.”

Drones are the problem, not the answer. MWI West Point’s Lt. Gen. Eric Wesley (Ret.) makes the machine gun analogy: drones have raised the cost of maneuver, not made maneuver unnecessary. They cannot seize ground, hold it, or compel a population. The Ukraine front moves in hundreds of meters per month despite the most intensive drone warfare in history. The decisive system will be whatever restores maneuver under drone threat — directed energy, EW, autonomous ground systems, cheap counter-drone that doesn’t require million-dollar interceptors. “The visionaries who understand this will win the next war.”

China’s Arctic 3D build-up. The Diplomat: China’s 15th Arctic expedition sent two deep-sea research vessels as motherships for manned submersibles Fendouzhe and Jiaolong — conducting joint under-ice operations for the first time, 40+ dives over 56 days, reaching 5,277m at the Gakkel Ridge. The Wukong 6000 AUV hit 3,800m in its first Arctic tests in 2024. The 14th Five-Year Plan explicitly tasked a “three-dimensional space-ground-sea monitoring capability” in the polar regions. The PLA frames the Arctic as a “strategic commanding height” from which the entire northern hemisphere can be reached. No evidence of Chinese submarines in Arctic waters yet — but the data collection infrastructure for that capability is being built.

Russia’s nuclear icebreaker myth. MacDonald Laurier unpacks the gap between Russia’s Arctic narrative and reality: 8 nuclear icebreakers in service (no other country has any), 4 under construction, but the Rossiya program was scaled back from 3 ships to 1, older ships retire in 5–10 years, sanctions are inflating costs and slipping delivery timelines, and the Transarctic Transport Corridor is “mostly propaganda for domestic consumption.” Canadian and US polar icebreakers are expected by 2040 — using Finnish shipyards that formerly built for Russia.

MQ-28 Ghost Bat debuts in the Pacific. Australia’s MQ-28 flew in Exercise Valiant Shield — its first large-force combat exercise — marking the first operational appearance of a loyal wingman alongside F-35s and F/A-18s in the Indo-Pacific. Significant: this is allied, not just Australian hardware.

China studied US stealth — and got it wrong. USAF China Aerospace Studies Institute fellow Maj. Derek Ecklebe: China treats stealth as a technology problem; the US treats it as a system — technology integrated with tactics. China’s J-35 replicates F-35 features but “prioritizes hardware metrics over software-defined adaptability.” Chinese air defences are formidable not because of any single radar but because of unified IADS integration. The strategic risk: if Beijing believes it has neutralized American stealth, it may feel emboldened on Taiwan.

Space acquisition: the next war starts here. Former USAF No. 2 Gen. Jim Slife, in his first op-ed since leaving service: current “exquisite” space systems are massive, multi-billion-dollar soft targets. If one gets jammed or destroyed, replacement takes years. The answer: proliferated, commercially-developed, agile orbital systems that can maneuver, service, and “fire back.” The procurement path: Commercial Solutions Openings and Other Transaction Authorities as the norm, not the exception. Congress has already given acquisition leaders the authority — the barrier is institutional will.

The post-quantum clock is running. The Department of War’s PQC Strategy sets two hard deadlines: all DoW systems must support PQC by December 31, 2030; all must exclusively use PQC by December 31, 2031. A Cryptographically Relevant Quantum Computer would give an adversary the ability to decrypt classified data, forge software signatures, access C2 systems, and gain unauthorized control of warfighting platforms. QKD and quantum networking are explicitly prohibited as substitutes.

Sea drones sink ships. Bloomberg: in an unannounced exercise in the Philippines, US special forces guided Magura-class uncrewed surface vessels — the same Ukrainian-developed drones that ravaged Russia’s Black Sea fleet — into a decommissioned target ship. It sank within seconds. First Indo-Pacific trial. The Pentagon is now studying this capability as a China counter.

Ukraine's Arms Monitor

Ukraine Drone Brief

Business cooperation between Ukrainian and Western defence producers in the unmanned tech sector is booming — so soon I may need to launch a special newsletter just to cover these developments…

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4 months ago · 35 likes · 1 comment · Olena Kryzhanivska

USCYBERCOM: talent problem, structural fix. Line of Departure proposes treating cyber operators like special forces and doctors: centralize under one command (model: Space Force), tie mission directly to NDS, and pay retention bonuses akin to jump pay or medical school debt relief. Author: COL Charles McGrue, 35 years of service.

Related: SE3 Labs raises €5.5M (Lakestar, Sequoia Scouts) for spatial AI — helps operators command autonomous swarms in contested environments. In continuous use by the Bundeswehr, in Ukraine, and multiple allied forces. Askari raises $9M seed for a hand-launched, fully autonomous, computer-vision-guided interceptor (Rift Alpha: 2km range, ~60 m/s, hits Group 1–2 drones) — “mega oversubscribed,” turned away $4–6M, ~90% intercept rate in Tier One testing.

Eyes Only with Wes O'Donnell

Drones Changed the Ukrainian Battlefield, but Human Infantry Still Hold It

Note: I wrote this article this morning for my Medium audience of 55K people. Then, I liked what I had written so much, I said “Wes, I bet your Substack readers would like this…” So, I’m also sharing it here. If you follow me at both places, I apologize f…

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4 months ago · 82 likes · 13 comments · Wes O'Donnell

🔫 Hot Shots

War by other means. Palladium Magazine’s piece is the most important long-form of the week. The argument: as drones, robotics, and AI reduce the dependency on human soldiers, political power shifts from citizens to the private firms that build and operate the systems. When Ukraine’s 13th Khartiia Brigade overran Russian positions near Lyptsi in December 2024 with zero Ukrainian personnel physically present, it demonstrated both the potential and the political implication. SpaceX reportedly negotiated subscription tiers for drone control with the Pentagon mid-conflict. Anthropic’s Claude was used in Iran strikes while the company and DoW were in a legal dispute over autonomous weapons use. “War is and will forever remain the continuation of politics by other means. It would do us good to remember that politics is, and continues to remain, our domain.”

China has matched Anthropic on cybersecurity. WSJ: Zhipu AI (Z.ai) can now identify security vulnerabilities on par with Anthropic’s Mythos in certain contexts. It still trails in other areas — but the parity on vulnerability discovery is the number that matters. The White House is revising US AI export regulations in direct response.

Iran attack on NSA Bahrain: the damage picture. WSJ satellite analysis reveals the extent of what Iran destroyed at Naval Support Activity Bahrain — strikes from late February through June. Command headquarters and at least a dozen structures severely damaged; two satellite communication facilities hit. Pentagon has not publicly acknowledged the extent. Iran launched 8,000+ missiles and drones total. “No casualties” — but most personnel were evacuated. A small team remains on-site.

Ukraine’s defence tech: investment opportunity of the decade. Business Ukraine makes the case: 4 years battle-tested, 50x production scale-up, ~4 million drones manufactured in 2025 (target: 7 million in 2026), 90% of Russian casualties now caused by Ukraine-made products. Ukrainian howitzer: $2.5M, 2-month delivery. Western equivalent: $4.3M, several years. Interceptor drone: $1,000 vs. $50,000 for a Shahed. Export permits now being issued; 10 export hubs across Europe opening. Saudi Arabia and Qatar have signed framework agreements.

Lithuania went from 5 defence companies to 200. The New Defense Post tracks the boom: Lithuania is spending 5.38% of GDP on defence in 2026 (~€4.8B). Rheinmetall’s €180M 155mm ammunition plant comes online in 2026. KNDS is assembling Leopard 2A8s locally. A state defence holding company is forming. The ecosystem now includes ~110 innovative companies in UAVs, lasers, photonics, ICT, and engineering — and FPV drones are shipping directly to Ukraine from Vilnius.

Frankenburg takes aim at €100M Series B. The 2.5-year-old Estonian missile startup is building the Mark I — a compact, precision-guided interceptor — targeting 200 missiles/day production from facilities in Germany and the UK (via Babcock). Backers include Expeditions, Blossom Capital, Plural (Series A lead). A Series B at this scale would push the company toward unicorn status. CEO Kusti Salm: “The era of scarce air defence is ending.” New MOU with Milrem Robotics to mount Mark I on UGVs — distributed short-range air defence from unmanned ground platforms.

Why VC rules don’t apply to defence tech. Medium/Titus van Heur: defence tech companies don’t have a funding problem — they have an architecture problem. Standard VC fund lifecycles (10 years) create artificial exit pressure misaligned with multi-year sovereign procurement cycles. Capital needs quickly outgrow VC balance sheets; companies need institutional project finance and sovereign debt structures, not dilutive equity rounds.

AGF Capital Partners: the defence opportunity is durable. The investment case: capital is flowing beyond the traditional prime contractor ecosystem into tech firms, industrial suppliers, and emerging businesses. A significant portion of defence spending remains unallocated — creating a multi-year pipeline. The combination of sustained government spending, evolving procurement frameworks, and private capital is driving an investable cycle. AGF: ~C$14B in alternative AUM.

🍁 DND Drone Surge IDEaS challenge is live. DND/CAF are offering: $35K (Round 1), up to $350K (Round 2), and up to $650K (Round 3) for scalable, low-cost, attritable FPV drone systems. Canadian companies only. The goal: accelerate domestic UAS manufacturing capacity.

🍁 Wyvern selected for NASA’s Commercial Satellite Data Acquisition program. The Edmonton hyperspectral imaging company is the first pre-Series A company accepted — among 14 selected globally. Wyvern previously received support under Canada’s Defence Industrial Strategy and has inked partnerships with foreign governments and NordSpace.

🍁 Qubic raises $2.5M USD for quantum signal amplifiers. The Sherbrooke-based spin-off of Institut quantique and University of Waterloo — cryogenic amplifiers that read superconducting qubits without overheating — raised from Two Small Fish (lead), UC Investments, Quantacet, and UCeed. First customer: US-based Quantum Machines. Defence demand is growing. Total raised: ~$10M CAD. Target: 30 employees by end of 2027.

ISC Challenge: quantum laser for CBRNE detection. NRC is offering up to $1.5M CAD (Phase 2, up to 18 months) for a field-deployable quantum cascade laser system that can detect hazardous chemicals at safe standoff distances for defence/security applications. Deadline: July 21, 2026.

European Sky Shield Initiative primer. Defence Post’s guide: ESSI is not a system — it’s a coordinated architecture of Patriot, IRIS-T, SAMP/T, and future directed-energy capabilities across Germany, Poland, Czechia, Romania, and others. It runs alongside NATO’s integrated air defence structures, pools costs, and aims to cover ballistic missiles, cruise missiles, drones, swarms, hypersonics, and electronic jamming simultaneously.

Orqa: Croatia’s drone champion. L’Express: founded in 2018 in Osijek, Orqa builds dual-use drones with a European value chain — breaking dependence on Chinese components that dominate the market. The military drone market hit $18.2B in 2025 and is expected to exceed $30B by 2034.

The Pentagon rethinks how it does R&D — The Office of the Under Secretary of War for Research and Engineering has finalized its Defense Research Enterprise Review, a blueprint to modernize the department’s sprawling lab network, cut bureaucratic friction, and push combat-ready technology out the door faster. A signal worth watching for anyone tracking how the U.S. wants to maintain its technological edge

The money is rotating “to atoms” — PitchBook’s Q1 2026 data shows roughly $16 billion poured into robotics and physical-AI startups across nearly 500 deals — an all-time high on both counts, and about 4.5x the deal value and 2x the deal count of a typical quarter from 2021–2025. Robotics has now leapfrogged fintech to become the second-largest private-market category, fueled by megadeals for the likes of Shield AI and Saronic.

Canada’s defence strategy has a workforce problem — Mark Norman argues that the real Achilles’ heel of Canada’s $180-billion Defence Industrial Strategy isn’t procurement — it’s people. With a structural shortfall of 20,000+ skilled trades workers a year and a 125,000-job pledge that lacks a credible plan, he warns the strategy could quietly default back to buying from foreign suppliers. His prescribed fix: an independent annual labour assessment, a dedicated defence-trades pipeline, and a tilt toward dual-use firms.

Where the drone money might go — Barron’s makes the case for drone stocks as the Pentagon leans harder into unmanned systems, with names like Kratos Defense among those drawing analyst attention across the sector.

China’s seabed push blurs mining and war — A CNN/Mongabay investigation tracked China’s deep-sea mining fleet and found the vessels spent just 6% of their time in designated mining zones — raising questions about dual-use missions like seabed mapping and submarine tracking, as Beijing holds more International Seabed Authority licenses than any other nation

Following the defence dollars — The Department of War launched a public Investment Intelligence Center, an interactive dashboard tracking over $6.7 billion in Defense Production Act and industrial-base investments since 2015 — searchable by sector, year, location, and funding mechanism. It’s pitched as a demand signal to industry and private capital.

Drones are the problem, not the future — In a sharp counter to the prevailing hype, retired Major General Eric Wesley argues at West Point’s Modern War Institute that drones are the machine gun of our era — a lethal tool that has made maneuver more costly, but not less necessary. Drones can destroy tanks and strike deep, yet in Ukraine the front still moves only hundreds of meters a month, because no drone can seize ground, hold it, or “knock on a door and secure a city block.” His warning: the next war will be won not by whoever builds the most drones, but by whoever solves the drone problem and restores ground maneuver — through electronic warfare, directed energy, cheap counter-drone tech, and autonomous ground systems.

The $20,000 drone that should wake up the Pentagon — On June 8, a U.S. Army AH-64 Apache — a roughly $30 million aircraft — went down over the Strait of Hormuz, with early indications pointing to an Iranian loitering munition costing about $20,000. Both pilots survived, pulled from the water within two hours by an uncrewed Navy surface vessel in the first sea-drone rescue in U.S. military history. The episode crystallizes the cost-asymmetry problem now reshaping air defense: cheap, mass-produced drones against exquisite, expensive platforms and interceptors.

Related:

• Anduril: Why we choose to ‘fight unfair’

• Cybersecurity coding bootcamp aims to help Canadian veterans transition to tech jobs

• The Digital Sovereignty Trap

• Charted: How Many Years of Supply Life Are Left for Commodities?

• From Five Companies to Two Hundred: Lithuania’s Defence Boom

• The Right Way for Europe to Spend More on Defence

• SAFE bids run in pairs, so go find your European partner before a tender shows up, not after:

The Canadian Explorers

Marconi on Startups & Exporting

Marconi Technologies is a Montreal-headquartered defence communications company that officially launched in May as a standalone, Canadian majority-owned defence prime with approximately 300 employees and operations across Canada, the UK, and the US…

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4 months ago · 3 likes · Ethan Marcoux

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