20 September 2025

Notes from Lviv Defense Tech Valley 2025

What Europe's Defense-Tech Inflection Point Looks Like on the Ground

Author: Michael Hübner, ua.ventures

I attended Lviv Defense Tech Valley 2025 as a co-founder/partner at ua.ventures, where we back Ukrainian founders with smart capital and EU market access. For us at ua.ventures, the defense sector is particularly interesting because of its potential for applications in dual-use and civilian sectors, with extremely rapid development and commercialization cycles.

The following observations do not contain any confidential information that would not also be published elsewhere. Corresponding links have been included.

Key takeaways:

• Lviv spotlight – 5,000+ participants made the summit Europe’s largest defense-tech event.
  
• Core tech – Swarms, autonomy, and C2/datalinks; edge lies in software and integration.
  
• Investment view – Fragmented market, consolidation ahead; UAV bubble risks noted.
  
• Policy frame – Export controls, Ukraine governance, EU dual-use spillovers shape context.
  
• War & innovation – Conflict speeds tech cycles; ethics center on security and resilience.

Scale and Signal

Defense Tech Valley billed itself as Ukraine’s largest defense-tech gathering—and it showed. Organizers promoted Sept 16–17 in Lviv with a startup competition, investor matchmaking and prime-contractor access; independent listings likewise framed it as a flagship European battlefield-innovation forum. Estimates ranged from 5,000+ to 6,000+ participants; on the ground it certainly felt like a mega-meetup for dual-use builders, buyers and backers. (Defense Tech Valley 2025)

The crowd skewed differently from typical Ukrainian startup events: we met many U.S. investors, plus active interest from Scandinavia and the Baltics. Fewer German funds were visible than we’d expected—even with German OEMs present—an observation I’ll return to below.

Picture © ua.ventures 2025

What the tech stack is telling us

Four themes dominated conversations and demos:

• Drone swarms and synchronization. The research community is still working out robust command-and-control (C2) for distributed swarms—latency, resilience, and human-on-the-loop ergonomics remain open problems. Policy analysis echoes this: we lack mature doctrine for tasking, supervising, and safely constraining large autonomous collectives. (psaa.meil.pw.edu.pl)

• Autonomy across domains (UGV/UAV/USV). Swarm logic is migrating from air to ground and maritime platforms, pulling in new sensing, EW resilience and assured datalink requirements. A satellite-assisted architecture for swarm C2 is one of several approaches being tested to maintain reliable control when contested. (ResearchGate)

• Assured C2 & datalinks. Secure, jam-resistant comms and spectrum agility are becoming the rate-limiters for capability at the edge; they’re also the most partnership-hungry layers because of certification and interoperability demands. (Expect more EU/NATO-centric standards work and vendor consolidation here.).

• Volume, not vanity. Ukraine plans to scale domestic drone procurement dramatically, reflecting a cost-imposition strategy where swarms of relatively cheap systems stress higher-end adversary assets. That demand signal is already shaping founders’ product roadmaps. (Reuters)

Picture © ua.ventures 2025

Markets, consolidation, and the investor lens

From an investor’s seat, the vendor landscape can feel crowded—hundreds of drone makers with seemingly similar claims. That’s normal at a frontier: differentiation often hides in the software stack, data advantage, and C2 integration rather than airframes. Expect consolidation and capability roll-ups; recent public-market and M&A trends show capital rotating into next-gen battlefield tech across autonomy, AI, and communications. (Reuters)

It’s also worth keeping a contrarian note in mind: some industry leaders warn parts of the UAV segment may be bubbly. Disciplined underwriting—milestone triggers, go-to-market proof with end-users, and ruggedized supply chains—matters more than ever. (Wall Street Journal)



Policy headwinds (and why Europe still matters)

Two policy realities shape execution:

• Export controls & dual-use rules. Europe is tightening and centralizing controls on sensitive tech flows—especially dual-use. This reduces ambiguity but adds compliance load for startups selling or partnering across borders. (Financial Times)
• Governance context in Ukraine. The country has improved but still faces governance risks, which investors price into timelines and covenants. Transparency International’s 2024 CPI data offers a sober benchmark. (Transparency.org)

At the same time, European policy thinkers are explicitly positioning defense budgets to catalyze dual-use spillovers—a pragmatic path to scale innovation that benefits both security and the broader economy. (EUISS)

Picture © ua.ventures 2025

War and innovation: the uncomfortable truth

Economic historians and innovation scholars have long noted that war (and preparation for it) accelerates technological change, with spillovers that later reshape civilian life—from aviation and computing to materials and networks. That dynamic is visible again today in autonomy, sensing, communications, and resilient software. The ethical tension is inescapable, but so is the obligation to steer outcomes toward deterrence, defense, and human safety. (digitalcommons.csbsju.edu)

Where ua.ventures fits

At ua.ventures, we back founders who can navigate this terrain:

• Capability over chassis. We look for defensible software, data network effects, and integration into Assured C2/datalink ecosystems.

• Policy-ready by design. Programs that can survive export-control scrutiny and pass European due-diligence filters.



• EU market access. We help teams localize for Germany/EU, build with end-users, and form industrial partnerships that shorten certification cycles.

We also see rising EU appetite—from Nordics to Baltics—for cross-border syndicates in dual-use, while Germany still underweights early-stage defense tech relative to need. The opportunity is to connect Ukrainian ingenuity with European scale—responsibly.

Picture © ua.ventures 2025

Final lessons from Lviv

• The valley is real. Europe’s defense-tech ecosystem is moving from cottage industry to scaled platforms.

• Demand will stay spiky—but durable. Procurement is shifting toward attritable, autonomous, networked systems. (Reuters)

• Winners won’t just fly better—they’ll connect better. The moats are C2 integration, data, and certification, not airframes alone. (psaa.meil.pw.edu.pl)

• Ethics matter. The mission is protection: keep people safe, reduce human exposure at the frontline, and ensure civilian spillovers are positive.

If you’re building dual-use capabilities with potentials for civilian and industrial applications in Ukraine and you are aiming for the EU market, or if you’re an EU/German partner looking to collaborate with Ukrainian teams, let’s talk.

Michael Hübner from ua.ventures. Picture © ua.ventures 2025

References and Further Readings

Defense Tech Valley Summit, Lviv (event info & program). (Defense Tech Valley 2025)

Good Time Invest: preview of “world’s biggest summit for battlefield innovation” (attendance context). (GTInvest)

Reuters: Market rotation toward next-gen battlefield tech; 2025 venture/M&A backdrop. (Reuters)

Reuters: Ukraine to sharply raise purchases of domestically produced FPV drones in 2025. (Reuters)

Financial Times: EU consolidation of export-control powers on dual-use tech. (Financial Times)

Transparency International: Corruption Perceptions Index 2024. (Transparency.org)

EUISS: Leveraging European defence budgets to drive a dual-use tech boom. (EUISS)

Bęben & Głębocki, “Architecture of UAV Swarm C2 Systems – An Overview.” (psaa.meil.pw.edu.pl)

UNIDIR, Swarm Robotics (human-swarm C2 and governance gaps). (UNIDIR → Building a more secure world.)

Ruttan, Is War Necessary for Economic Growth? (historical perspective). (digitalcommons.csbsju.edu)

(For background on evolving dual-use concepts: Singer, “Dual-Use or Omni-Use?” SSRN). (papers.ssrn.com)