The Paris-Milan VC’s new vehicle is the latest sign that European investors are hardwiring defence into their deeptech strategy.
There is a version of this story that could have been told three years ago and would have raised eyebrows in polite European venture circles: a deeptech fund, backed by a major defence prime, raising tens of millions to invest in dual-use technologies at the intersection of software, hardware, and national security.
The French-Italian early-stage VC, which operates from Paris and Milan and manages more than €500 million in assets, has raised €85 million for a new deeptech vehicle with backing from at least one European defence prime.
The fund represents a clear pivot toward the harder, longer-horizon technologies that Europe’s reindustrialisation agenda is beginning to demand, and a recognition, shared by a growing number of continental investors, that the cleanest returns in deeptech over the next decade may come from technologies with a dual-use character.
Why defence money is flowing into deeptech VC
360 Capital’s announcement arrives in a market that has changed materially since the invasion of Ukraine in 2022. European defence primes, the large established contractors that supply militaries with everything from armoured vehicles to electronic warfare systems, have historically had limited engagement with the venture ecosystem.
Their innovation pipelines ran through internal R&D programmes and established supply chains, not through seed-stage funds making €1 million bets on autonomous systems or AI-enabled logistics.
That calculus has shifted. The pressure to modernise military capability at speed, combined with a recognition that the fastest-moving technologies are being developed outside traditional defence supply chains, has pushed several European primes toward LP positions in venture funds as a form of technology access and strategic intelligence.
The European Investment Fund has itself committed €50 million to Join Capital’s Fund III, targeting deeptech and dual-use startups, under the InvestEU Defence Equity Facility — a signal that institutional backing for this model is no longer exceptional.
For 360 Capital, a prime LP is not merely a source of capital. It is a potential route to procurement conversations for portfolio companies, a connection that has historically been one of the most difficult obstacles for European defence startups to navigate.
The continent’s procurement processes are slow, fragmented across national defence ministries, and historically resistant to working with early-stage companies. An anchor LP with a long-term interest in the portfolio’s commercial success changes that dynamic, at least at the margins.
360 Capital’s track record and focus
Founded in 2001, 360 Capital has operated through several cycles of European technology investment, ranging from internet-era digital startups to its current emphasis on deeptech and climate technology. Its portfolio spans early-stage companies in AI, robotics, energy technology, and advanced materials, sectors that the new fund’s mandate is likely to extend further into defence-adjacent applications.
The €85 million raise follows a 2024 announcement in which the firm closed its first €30 million tranche of 360 Digitaly, a fund focused on digital transition. The defence-adjacent deeptech vehicle appears to represent a separate strategy, one that reflects both the opportunity the firm sees in the current geopolitical moment and the structural capital available from defence primes seeking technology exposure.
