Why Britain needs a defence innovation engine
Britain must follow the US by aligning government demand, private capital, and entrepreneurs to leverage its technological talent against modern national security threats, says Simon Pavitt
Britain has spent years celebrating entrepreneurs who changed how we shop, bank, travel and work. From Deliveroo and Revolut to Wise, British founders have shown they can build world-class technology businesses. The next test is whether that same talent can help protect the country itself.
This is no longer a question for generals, civil servants and traditional defence contractors alone. The technologies determining national security are being built in the same innovation economy that produced Britain’s fastest-growing companies.
The United States has understood this better than Britain. It has built a defence innovation engine in which government demand, entrepreneurship and private capital reinforce one another. Government acts as an early customer for frontier technologies, signalling demand before markets are fully formed. That gives young companies validation, attracts capital and helps technologies move from prototype to deployment.
The sequence is powerful: government demand creates proof, proof unlocks investment, and investment accelerates capability.
This model has shaped entire industries. DARPA helped lay the foundations for the internet and autonomous systems. NASA contracts helped SpaceX survive when the company was close to failure. Today, SpaceX and Starlink sit at the centre of global communications infrastructure, including in conflict zones.
The same pattern is visible across defence AI, autonomous systems, robotics, maritime technology and space. Companies such as Anduril, Shield AI and Saronic have benefited from a US ecosystem willing to test, contract and increase capability quickly. The result is a market in which founders and investors can see a credible path from idea to scale.
Britain has many of the same ingredients: world-class research, ambitious founders and capital. What it has lacked is clarity of demand from government, a credible signal showing which problems matter most and with what urgency. Without that, even strong technology struggles to gain traction.
The Strategic Defence Review recognises that business as usual is no longer an option, calling for procurement cycles measured in months rather than years. That matters because the nature of security itself has changed. A hostile state no longer needs missiles or tanks to destabilise a country. It can attack supply chains, jam communications, disrupt satellites or water systems, interfere with elections or target the digital infrastructure modern economies depend on.
New frontiers
Future conflict will not be confined to land, sea or air. Space is increasingly the nervous system of modern warfare and the domain where the next major confrontation may begin. Britain will continue to depend on alliances, but the era of assuming others will provide the technology and protection we need is ending.
This is where entrepreneurs and investors matter.
Palmer Luckey built Anduril because he believed defence technology needed to move faster. Estonian entrepreneur Ragnar Sass launched Darkstar after Russia’s invasion of Ukraine, arguing that “even the strongest word or coolest presentation has never stopped ballistic missiles”. Spotify’s Daniel Ek has backed defence technology businesses through Prima Materia.
These are founders applying speed, iteration and first-principles thinking to a sector that urgently needs it. Britain needs more of that mindset.
The next generation of defence companies will not resemble the prime contractors of the past. Many will be software businesses, AI labs, robotics companies and advanced manufacturers. Many should also be dual-use technologies, strengthening military capability and protecting infrastructure as well as improving the everyday lives of citizens.
The British government must define requirements more clearly, send stronger demand signals and make procurement more accessible to startups and scale-ups. But it cannot do this alone. Investors must also recognise that defence, resilience and strategic infrastructure are becoming defining themes of the next decade.
That is why Britain needs its own defence innovation engine. Government must move faster, investors must back capability earlier and entrepreneurs must see national security as a legitimate arena for innovation.
The challenge is to connect Britain’s talent and capital to the country’s long-term security needs. The United States has shown what is possible when government, capital and entrepreneurs move in the same direction. Britain now needs to do the same.
Entrepreneurs and investors: your country needs YOU.
Simon Pavitt is chief advisor to the London Technology Club and author of Capstones: The Art and Architecture of Meaningful Passion Projects