A new wave of defense tech startups, dubbed “neoprimes,” is reshaping America’s national security landscape and drawing billions in venture funding in Silicon Valley. Companies like Anduril Industries, recently valued at $30.5 billion, are positioning themselves as challengers to traditional defense contractors such as Lockheed Martin, Northrop Grumman, Boeing, General Dynamics, and RTX.

“There’s more money than ever going to what we call the ‘neoprimes’,” said Jameson Darby, co-founder and director of autonomy at investment syndicate MilVet Angels (MVA).
“It’s still a fraction of the overall budget, but the trend is all positive.”

Other startups like SpaceX and Palantir Technologies are also part of this growing cohort, leveraging software-first approaches and lean operations to address critical technology gaps in areas such as hypersonics, space technology, integrated sensing, energy resilience, and cybersecurity.

“Unlike the primes, these startups are faster, leaner, and focused on software, building solutions that can close technology gaps vital to national security,” said Ernestine Fu Mak, co-founder of MVA and founder of Brave Capital.

The shift reflects a broader change in U.S. defense priorities. While the post-9/11 military focus centered on counterterrorism and asymmetric warfare, today’s conflicts emphasize great power competition, requiring advanced technological capabilities.

Venture funding for U.S.-based defense tech startups reached roughly $38 billion in the first half of 2025, and analysts from JPMorgan predict the sector could surpass its 2021 funding peak if investment continues at the current pace.