NATO"s Tech Scouts Fortify Europe For a World With "The Donald"

 MORGAN MEAKER

Wired

It’s the day after Donald Trump declared his election victory, his election victory, and a tech scout for NATO is peering down at a miniature factory, the size of a shoebox, designed to manufacture semiconductors in space.

Chris O’Connor, with his black bomber jacket and military haircut, has spent the past year scouring Europe for companies that will give NATO a technological edge over Russia and China—a job that has become even more urgent in the past 36 hours as the region rushes to prepare for Trump 2.0. Here, in a gray industrial estate on the outskirts of Cardiff in Wales, he believes he’s found one.

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One Space Forge satellite could eventually create enough semiconductor material to power tens of thousands of phones, estimates chief technology officer Andrew Bacon, speaking in an office overcrowded with freshly-hired staff. Bacon says he is more interested in making chargers for electric cars to fight climate change, and Space Forge’s potential to exorcize all polluting industries from the planet.

But O’Connor is here because Space Forge has piqued the interest of the €1 billion ($1bn) NATO Innovation Fund (NIF). Manufacturing semiconductors in space, where there is no dirt, air, or gravity, has the potential to provide efficiencies that could create superior versions of military tools such as radar.

 

“The distance that radar can cover—translating to what it can see and how quickly it can do that—can be dramatically improved by using these materials,” O’Connor says, explaining why Space Forge was among the NIF’s first six investments to be made public.

Alongside Space Forge, the one-year-old NIF’s investments include battlefield robots, a company manufacturing a lighter version of the carbon fiber used to build cars and rockets, and several space startups.

This is the alliance’s first foray into the high-risk, high-reward world of venture capital, using its members’ money to fund the experiment. Space Forge has never actually made semiconductor material in space. The only time the company attempted to launch its satellites, the Virgin Orbit rocket giving them a ride failed 177 km above Earth before crashing into the ocean. O’Connor, one of three partners at the fund, is sanguine about the fact there is no guarantee the investments will work out. “We've been given a mandate to go take this risk,” he says.

Trump’s win has intensified existing concerns over NATO’s reliance on US support, which is expected to falter under the new administration. The President-elect's comments about NATO allies that do not meet their military spending targets of 2 percent GDP (for example, Italy) have been scathing. “If they’re not going to pay, we’re not going to protect,” he threatened on the campaign trail in February.

Meanwhile, Trump’s impatience with war in Ukraine—which he claims he would have “settled prior to taking the White House”—have generated anxiety that he is planning to pressure the country to cede regions to Russia. Last week, Trump ally Bryan Lanza said the new administration would be focused on restoring peace, not lost territory. “Crimea is gone,” he said. Trump’s team later said Lanza did not speak for the President-elect.

In response, many people across government and industry have been calling for the same solution: for Europe to step up. “I don't think there’s a high likelihood that the US will pull out of NATO,” caveats O’Connor. He doesn’t believe anyone is planning for that. “It seems to be more how Europe is going to step up and play a bigger role.”

The NIF, based in Amsterdam, is one vision of how the region might do that. The fund plans to jumpstart ailing European deeptech innovation in a way that may also benefit its members and their militaries—independent of US support. The US, which already spends more on defense than any other nation, is among eight NATO members that have so far decided not to contribute to the fund.

“They obviously weighed up the pros and cons and just felt that this doesn’t make sense for the US, given their strong heritage in venture capital,” says Rob Murray, the former British army officer who was an early proponent of the NIF in Trump’s first term.

In 2019, Murray watched European states scramble in response to the former President’s NATO critiques—“too expensive” and “obsolete”—and wrestle internally to raise their defense budgets. He sketched out how a NATO bank, a defense-focused version of the World Bank, might work. But, he claims, NATO higher-ups believed the world was not ready. The idea—which continues to attract support—was controversial because it could mean rich countries end up bank-rolling smaller countries’ militaries through collective debt. Then, Murray was disappointed. Now, he appreciates his timing was off. “The geopolitics just just weren’t there for it,” he says.

Yet, the idea refused to totally die. What he describes as a “footnote” in the original pitch, suggesting “Venture capital for emerging and disruptive technologies,” would eventually become the NIF in October 2021. Still, in early meetings, ambassadors balked at being asked to back the kind of moonshot companies even ordinary VCs were too risk averse to support. Yet Murray’s team persevered, believing the NIF could lead-by-example and persuade European investors to be more bold.

Governments became more receptive to that idea after Russia’s invasion of Ukraine in 2022. Officials were watching the use of drones in Ukraine and realizing they needed the startup community to keep up. Among them was German military officer-turned startup founder Marc Wietfeld, who co-founded ARX Robotics three years ago—another company among the NIF’s early investments. The startup has been building what look like reinforced robot lawnmowers, capable of racing around the battlefield to help with reconnaissance missions or to evacuate casualties.

“We do not weaponize the robots,” Wietfeld stresses, “but theoretically, it would be possible.”

Wietfeld foresees his robots, which are being used by seven NATO members and Ukraine’s Armed Forces, as an answer to two problems. First, Europe needs a way to multiply its waning human forces to prevent being outnumbered. ARX can help because the robots are so autonomous, he claims, a single soldier can control up to 12 at once. Second, he believes the robots could save lives. “I don't want to see my kids fighting as soldiers against Chinese and Russian robots,” Wietfield says.

The autonomous ground units from ARX.

 COURTESY OF ARX ROBOTICS

 

Catching the attention of the NIF carries the benefits of both cash and connections. The fund acts as a conduit to link European defense ministries and startups—reassuring governments the startups have been vetted and their supply chains aren’t going to become a problem if there is a trade war or conflict with China.

“Armed forces are not really used to working with startups and there’s a trust issue [around] are we really capable of scaling the systems,” Wietfeld says, adding it’s been much easier to contact governments since the NIF investment went public.

One billion euros is not enough to fix Europe, a region whose issues French President Emmanuel Macron diagnosed as a mix of strategic and economic. “We tend to think we should delegate our geopolitics to the United States,” Macron said at a meeting of European leaders in Budapest the day after Trump’s election, “and our technological innovation to American hyperscalers.” For Europe to be in a position to “step up”, the region needs to find answers to both those problems.

In theory, the NIF will become a funding model that’s self-sustaining for NATO innovation priorities, says Michael C. Horowitz, a professor at the University of Pennsylvania who worked on emerging capabilities in the US Department of Defense until earlier this year. He sees what the NIF is trying to do as part of a worldwide trend. “Governments around the world, including in the United States, have understood they need to change the way they’re interacting with the private sector if they want to be able to more effectively both harness and nurture technology development to achieve their national security goals.”

There’s no guarantee the plan will work. But for Europe, in an uncertain world, it’s a start.