This American VC is betting on European defense tech; that’s still very unusual

VCs are known to move in herds, which is why Eric Slaesinger stands out a bit. While most American investors chase AI startups or Defense Tech Startups established in the US, the former CIA officer is looking for defense-technical deals in Europe. In fact, Slesinger, founder of 201 VenturesRecently closed a fund of $ 22 million aimed at Seed phase European Defense Tech Startups. His path of developing gadgets and software for CIA agents to perhaps become the only American VC that invests exclusively in European defense technology, also seems to be a visionary.

What would anyone force “the best first job ever” to leave the CIA to pursue this specific ambition? Like Slesinger WAN in a recent told StrictlyVC Download Podcast -InterviewThe answer came from identifying a critical shift that many missed. “I left because I noticed that the private sector was increasingly playing a role in this competition that I had previously understood to just be a government match,” explained Slaesinger. “What became more obvious was every day that the private sector played such a major role here.”

With degrees from Stanford in Mechanical Engineering and Harvard Business School, SlaSinger’s background helped him to prepare the gap between defense technology and commercial companies. But it was his willingness to go against conventional wisdom that made him interesting for investors, founders, and Tech reporters directly.

“I have always enjoyed going where other people don’t want to go,” said Slaesinger. “That was why I enjoyed the work of the CIA so much. A few things that people used to say there were:” Go where others don’t do what they can’t do. “

As far as US VCs are concerned, there were three things from the point of view of Slesinger. First, “Europe has individual entrepreneurs who are just as hungry, just as high convictions and just as smart as somewhere else in the world.” Secondly, “European governments were waiting far too long to reconsider what the regulation of their own safety meant, and therefore had not really put it critically.” And third, “Europe was soon seen and in my opinion will remain the site of serious gray zone competition”, which means activities of state or non-state actors falling between traditional peace and outright war.

Perhaps the most surprising aspect of the European company of Slaesinger is the cultural resistance that he says that he has encountered defense investments. In 2022, after he moved from the US to Madrid, he started the European Defense Investor Network, which now includes entrepreneurs, investors and policy makers. In a 2023 Medium PostSleesinger wrote about how his European VC colleagues were afraid of talking about their defense -related investments. Unlike in America, he told WAN, Defense Tech Investing in Europe “was seen as unsuitable, something that needs to be done but not talking about it, and certainly not spoken in polite group at the dining table.” (Slesinger soon added: “I am exaggerating a bit, but there is a core of the truth.”

He says that cultural hesitation resulted in ‘many founders who think about it and decided not to build a business in the [defense] Space. “That is changing now.

For example, the attention has caught on by emerging defense-technical startups on the continent, including Helsing in Munich, which AI is developing for use on Battlields and is currently appreciated by more than $ 5 billion by its investors. Another aware of Slaesinger’s portfolio is the Delian Alliance Industries, an outfit -based outfit that develops monitoring towers to detect autonomous threats. Delian has been raised so far seed financing But is a hot ticket that is certainly actively praised by VCs.

With eight investments so far, 201 Ventures focuses on technologies that relate to that gray zone competition, because it will take place in the words of Slaesinger “to scale in Europe, and it will do in the coming decades.” These market disocations, he said, “whether they are price inefficiencies or a government that plays a greater role in a market that could be done differently, if not to want a sovereign capacity … These dislocations of gray zone are actually a good form of Alfa.”

In addition to Delian, another bets of Slesinger Polar Mist, a Swedish startup that produces maritime drones with advanced navigation options. Other focus areas include hyperersonous and mapping underground.

A challenge in financing defense -technical startups is the longer development time line compared to traditional venture investments. SLESINGER recognized this tension in his chat with WAN: “If you have a life cycle of 10-year-venture-fund fund, that is really something that we have to do things to try to accelerate or bend.”

SLesinger also thinks that “European companies in many previous stages are more lobbying.”

Both calls questions about whether his gamble will fruit for investors. At the same time, his early vision of a more autonomous European Defense system is nowadays clearer for a lot of other investors as geopolitical tensions rise and Europe reconsider its security schemes.

Data published earlier this year by NATO Innovation Fund and the dealroom of the research group showed that European startups working on Defense and related technology have collected 24% more capital in 2024 than in 2023, $ 5.2 billion – even exceed AI financing. Now that President Donald Trump returned to the office and doubted in January about the dedication of the US to the European defense, that figure will probably climb even higher.