Gallos Technologies is raising $50m, approximately £35m, as investors increase their exposure to businesses developing security, defence, cyber, data, and resilience technologies.
The round in Gallos Technologies is jointly led by Ventura Capital and Aberdeen Investments, with existing investor Lansdowne Partners also participating.
Gallos combines investment with company-building activity rather than operating solely as a conventional venture-capital fund. It was founded by executives with senior backgrounds in national security and special forces and has built an advisory network that includes former GCHQ director Sir Jeremy Fleming.
The company invests from seed to Series B and focuses on security and resilience businesses operating across cybersecurity, artificial intelligence, data analytics, sensors, autonomy, and related technologies.
The fundraising reflects a substantial change in investor attitudes towards security and defence. For much of the previous decade, ESG restrictions and reputational concerns made some institutional investors cautious about businesses connected to defence markets.
Russia’s invasion of Ukraine, intensifying geopolitical competition, cyber threats, and higher government spending have altered the assessment. Defence and resilience are increasingly being treated as strategic infrastructure rather than automatically excluded sectors.
The technology mix has changed at the same time. Many of the fastest-growing security companies do not manufacture conventional weapons. They develop software, communications infrastructure, drones, sensors, data systems, cyber tools, artificial intelligence, and technologies used to protect critical infrastructure or improve decision-making.
Nalaka De Silva of Aberdeen Investments said Gallos had developed “a distinctive ability to identify resilience gaps” and build companies around strategically relevant demand.
Aberdeen’s participation broadens the institutional capital entering a market previously associated more heavily with specialist venture funds, private investors, and government-backed programmes.
Security markets also create different scaling challenges from mainstream enterprise software. Selling to governments and regulated industries can involve lengthy procurement cycles, security clearances, testing, certifications, and a need to demonstrate reliability before a product can be deployed in operational environments.
Those barriers can leave technically strong companies short of the commercial support required to convert products into recurring revenue. Gallos attempts to address that gap by combining capital with access to national-security expertise, government buyers, large companies, and specialist networks.
Dual-use technology expands the addressable market further. Cybersecurity, autonomous systems, secure communications, satellite data, and artificial intelligence can serve both civilian and defence customers, reducing reliance on a single procurement channel.
The UK government is simultaneously raising defence expenditure and seeking to strengthen domestic technology capability. That creates opportunities for startups but also exposes the persistent difficulty smaller suppliers face in public procurement.
Government sales can take significantly longer than conventional software contracts, and emerging companies may need more patient capital to survive the period between product development, trials, certification, and large-scale deployment.
Competition for defence and resilience assets is increasing as more money enters the sector. US and European venture funds have launched specialist strategies, while valuations have risen for companies associated with drones, autonomy, cybersecurity, and battlefield software.
A favourable capital cycle also raises the risk of overvaluation. Security demand can be durable, but not every technology that attracts investment will survive operational testing or secure recurring orders. Investors still have to distinguish between products meeting established requirements and businesses benefiting predominantly from the current geopolitical environment.
Gallos’ company-building model is intended to make that assessment earlier by testing demand and applying specialist expertise before larger amounts of capital are committed.
The new round is modest beside the largest global defence-technology funds, but the participation of Aberdeen and other institutional investors indicates how far the category has moved towards mainstream private capital. UK security companies now have a broader funding base available to support the longer development and procurement cycles associated with government and critical-infrastructure customers.
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