U.S. defense startup Shield AI completes $2 billion funding, post-investment valuation reaches $12.7 billion

U.S. defense technology startup Shield AI has completed a new funding round of $2 billion, valuing the company at $12.7 billion, doubling its valuation from a year ago, highlighting strong investor demand for defense tech and artificial intelligence (AI).

On Thursday, Shield AI announced that the $1.5 billion Series G funding round was led by Advent International, with strategic investment group JPMorgan Chase participating as co-lead, along with existing investors Snowpoint Ventures and Riot Ventures.

In addition, a fund managed by Blackstone Group will invest $500 million in preferred stock, along with a commitment of $250 million in a delayed draw credit facility, bringing its total investment to $750 million.

As the United States and Israel conduct joint strikes against Iran, and with ongoing military operations in Ukraine and Russia, the application of autonomous technology has increased significantly, driving demand for products from companies focused on autonomous flight software.

Shield AI’s core product, “Hivemind,” software that enables drones and aircraft to operate autonomously without GPS, has been tested on multiple platforms, including the F-16 fighter jet and the U.S. Air Force’s unmanned combat system “Kinetic Combat Aircraft.”

With global governments—from Germany to the United States— increasing defense spending, such technologies are gaining more attention and funding support.

Shield AI stated it will use part of the funding to acquire simulation software company Aechelon Technology, though the transaction amount was not disclosed. Aechelon is a defense software company known for high-fidelity simulation, physics-based sensors, and synthetic reality applications.

CEO Gary Steele said in a statement, “Acquiring Aechelon will accelerate our R&D around Hivemind, especially in simulation, such as the Department of Defense’s Joint Simulation Environment (JSE) program.”

JSE is a high-fidelity virtual combat platform used by the U.S. military to test aircraft, autonomous systems, and tactics in highly realistic battlefield threat environments.

Advent executive David Mussafer commented on the decision to lead the round: “Shield AI is a rare asset with strong growth potential over the coming years. Hivemind is one of the most experienced and mature AI pilots globally. We look forward to working with the Shield AI team.”

Shield AI’s previous funding round was in March 2025, when the company raised $240 million at a valuation of $5.3 billion, with investors including Andreessen Horowitz and defense contractor L3Harris Technologies.

(Source: Cailian Press)