Balnord, Casimir Pulaski Foundation and the Polish Development Fund (PFR), today launched the second edition of the Dual-Use Founder's Handbook at the Warsaw Security Forum 2025. The comprehensive guide, titled "From Foundation to Scale," features contributions from 36 industry experts and launches as European dual-use and defense technology investments reach a record $3.881 billion in 2025.

The handbook debuts at the Warsaw Security Forum, gathering 2,500+ participants from 90 countries to address Europe's most pressing security and technology challenges. The timing reflects the sector's rapid evolution from the first edition's focus on "opportunities and challenges" to this edition's emphasis on practical scaling strategies.

$14.76 Billion Investments Create Unprecedented Founder Opportunities

The numbers tell a compelling story: European dual-use and defense technology investments have reached $14.76 billion since 2016, with over $9.35 billion flowing into the sector since the full-scale war in Ukraine began. The sector reached new heights in 2024 with $2.22 billion in funding, but 2025 has already set unprecedented records with $3.88 billion year-to-date—making it the highest annual investment total in the sector's history.

"Financing is only one part of the equation for building successful dual-use companies. What founders also need is predictable demand from institutions such as the Ministry of Defence. At PFR Ventures, we work to unlock both sides of this ecosystem: by channeling capital into specialized VC funds through initiatives like PFR Deep Tech, and by supporting efforts to make public procurement more accessible to innovative companies. Only by combining investment with market access, we can ensure that Europe’s most advanced technologies scale effectively and strengthen our security." – said Aleksander Mokrzycki, Deputy CEO, PFR Ventures

"The second edition of Dual-use Founder’s Handbook reflects how rapidly the dual-use landscape is evolving," said Marcin P. Kowalik, General Partner at Balnord. "With record investments flowing into the sector, founders need updated guidance to navigate both commercial and government markets effectively. This handbook provides the strategic framework and practical tools necessary to build successful dual-use companies in today's geopolitical environment."

The surge in financing reflects fundamental market dynamics. Dual-use companies command valuation premiums, with the handbook revealing that dual-use startups consistently raise significantly higher amounts compared to purely commercial counterparts across all funding stages. This premium is driven by extended development cycles and technology sovereignty imperatives.

M&A Analysis Reveals Acquisition Rush

The handbook delivers the first comprehensive analysis of European dual-use mergers and acquisitions (M&A) ever conducted, based on 293 dual-use exit transactions and 37 secondary transactions since Russia's annexation of Crimea. The data reveal a dramatic shift in the market after the outbreak of full-scale conflict in Ukraine in 2022. 

Defense contractors tripled their acquisition market share from 6.5% to 21% in comparison to the 2019-2021 period, pivoting from outsourcing models to building capabilities in-house. Space operators nearly doubled their activity to 8.1%, signaling that orbital infrastructure has become a critical asset class. A new category emerged—startup-to-startup consolidation now accounts for 3.77% of deals, with companies like Quantum Systems pursuing aggressive acquisition strategies to build integrated platforms faster than traditional R&D cycles allow.

The data reveals crucial insights for founders: strategic buyers consistently value companies with genuine dual-use DNA. The top 10 buyers account for 34% of the total transaction volume, while intra-European deals represent 67% of the activity, demonstrating that European buyers actively seek European solutions.

The Baltic Sea region has emerged as Europe's fastest-growing dual-use innovation corridor, encompassing the Nordic countries, the Baltic states, Poland, and Germany. In 2025, the region accounted for 25.93% of all European dual-use M&A transactions, led by German and Nordic buyers consolidating critical technologies.

Practical Guidance from Industry Veterans

The handbook addresses the complete scaling journey with contributions from industry practitioners who have successfully built dual-use companies. The European Investment Fund provides a detailed analysis of the Preligens acquisition by Safran, offering insights from a public Limited Partner's perspective on how AI-powered satellite analysis companies achieve strategic exits in the defense sector.

The guide maps Europe's dual-use funding infrastructure, identifying over 50 active investors including dedicated VC funds backed by the European Investment Fund and PFR Ventures, corporate venture arms from aerospace leaders like Airbus and Thales, and accelerators ranging from NATO DIANA and Estonia's Darkstar to Poland's FORT Kraków and government platforms, including Ukraine's Brave1 and PFR's IDA Bootcamp.

The European Investment Fund's €175 million Defense Equity Facility is expected to mobilize €500 million in private capital for dual-use startups, while national programs like PFR's Deep Tech initiative target approximately €150 million in VC fund investments across AI, robotics, cybersecurity, quantum computing, and space sectors. European sovereign funds play an increasingly strategic role in catalyzing private investment—Estonia's SmartCap launched a €100 million defense fund targeting NATO-aligned dual-use companies, while BGK plans to deploy PLN 1.1 billion in Polish strategic sectors including dual-use technologies. This institutional capital acts as a catalyst, with every euro of public investment typically mobilizing five euros of private capital.

Strategic Partnership and Expert Contributions

The collaboration between Balnord, PFR, and Casimir Pulaski Foundation combines venture capital expertise, institutional support, and policy insight. 

"In today’s geopolitical environment, dual-use technologies are not just about defense, they are about Europe’s capacity to innovate and shape its own future. At PFR, we see founders as the key architects of this transformation. Our role is to make sure that Polish entrepreneurs have the tools, capital, and partnerships they need to scale globally while strengthening Europe’s technological sovereignty," - said Eliza Kruczkowska, Director of Innovation Development at Polish Development Fund (PFR)."

The handbook features contributions from military leadership, including General Tomasz Piotrowski, former Operational Commander of the Polish Armed Forces, and General Karol Molenda, Commander of Poland's Cyber Command (DKWOC), alongside representatives from Estonia's Ministry of Defense. Institutional contributors include the Defence Policy & Innovation unit, Directorate-General for Defence Industry and Space (DG DEFIS), the European Investment Fund (EIF), PFR Ventures, BGK, NATO DIANA, and Poland's Ministry of Defense.

Industry perspectives come from leading companies, including ICEYE, APS, Palantir or ATMOS Space Cargo, while the investment community is represented by major European VCs, including Project A, Lakestar, Expansion Ventures and Balnord, and institutional investors. Innovation hubs and defense tech accelerators provide additional insights into ecosystem development.

"Warsaw Security Forum, hosting leaders such as Ukrainian President Volodymyr Zelensky, Prime Minister Donald Tusk, former NATO Secretary General Jens Stoltenberg, General Ben Hodges, and Defense Minister Władysław Kosiniak-Kamysz, has become the ideal platform for premiering the second edition of the Dual-Use Founder's Handbook. The presence of Europe's and the transatlantic community's most important security decision-makers demonstrates the magnitude of challenges facing our continent. The Handbook provides a practical response to building technological autonomy - bridging the startup world with security needs in an era of record investments. As part of this year's edition, we have prepared a special program block titled 'Dual-Use, Cyber and GovTech Frontiers: Startups Powering Transatlantic Security," said Wojciech Dzięgiel, Board Member of the Casimir Pulaski Foundation.

Media partners of the publication are: Defence24 and Vestbee.

Europe's Path to Technological Sovereignty

The handbook addresses Europe's critical transition from defense dependency to technological sovereignty. Recent geopolitical shifts have accelerated the convergence of commercial and government technologies, creating unprecedented opportunities for entrepreneurs capable of navigating both markets effectively.

The publication analyzes how European institutions have systematically built comprehensive ecosystem infrastructure capable of identifying, funding, and scaling technologies critical to both commercial success and strategic autonomy. This infrastructure spans from dedicated VC funds backed by the European Investment Fund and PFR Ventures to corporate venture arms and government-supported accelerators.

Future Outlook: €800 Billion Reshapes the Market

Looking toward 2030, the handbook maps how Europe's dual-use landscape will be transformed by the €800 billion ReArm initiative and national defense programs. For dual-use companies, this creates a unique moment. Governments and European primes are now urgent buyers, operating with more risk tolerance, stronger demand for technological superiority, and large pools of liquidity to fund it.

The publication identifies key technology domains that will define Europe's future competitiveness: space and satellite infrastructure, cybersecurity and data protection, energy resilience systems, autonomous platforms, physical logistics infrastructure, and biosecurity solutions. Success in these areas will determine whether Europe achieves technological sovereignty or remains dependent on external solutions.

 "Building dual-use technologies means creating Europe's backbone—its technological autonomy, societal resilience, and ability to act independently. This is a civilizational project." summarizes Marcin P. Kowalik, General Partner at Balnord. 

Availability and Access

"From Foundation to Scale: The Dual-Use Founder's Handbook" is available for download at

https://resources.balnord.vc/dual-use-handbook

The handbook represents the definitive European resource for dual-use founders, providing the strategic guidance and practical tools necessary to build successful companies serving both commercial and national security markets in an era of unprecedented opportunity and challenge.

About Balnord

Balnord is a high-conviction first-check investor in frontier tech from the Baltic Sea Region. Balnord’s investment focuses on deep tech and data-driven software, including dual-use. We are one of the few early-stage investors in the region capable of deploying up to €10 million. Utilizing our ex-entrepreneur and operator background, we are hands-on investors working only with a select number of companies, from pre-seed to exit and beyond. The Foundation was established by Zbigniew Pisarski, Katarzyna Pisarska, Radosław Ciszewski, and Adam Jarczyński.

About Casimir Pulaski Foundation

Founded in 2005, the Casimir Pulaski Foundation is an independent, non-for-profit, non-partisan Polish-think tank conducting research on different aspects of European and Transatlantic security, with a special focus on Central and Eastern Europe. The Foundation brings together dozens of international experts in various fields (foreign policy, defence, energy, democratic resilience) and publishes analysis describing and explaining international events, identifying trends in the European and Transatlantic security environment and recommending solutions for government decision-makers and the private sector. The Foundation was established by Zbigniew Pisarski, Katarzyna Pisarska, Radosław Ciszewski, and Adam Jarczyński.

About PFR (Polish Development Fund)

The Polish Development Fund (Polski Fundusz Rozwoju, PFR) is committed to supporting Poland’s sustainable economic growth by fostering domestic investment, promoting the international expansion of Polish companies, collaborating with foreign partners, developing the innovation ecosystem, advancing the energy transition, and strengthening the resilience of the Polish and European economies. Through its entity, PFR Ventures, it is the largest institutional investor in the Central and Eastern European region.
Learn more about us at www.pfr.pl.

‍