Artificial intelligence start-up Shield AI will nearly double its valuation to $5bn in a new fundraising round, as investors race to fund defence technology groups producing cutting-edge military systems.
The San Diego-based group, which makes AI-powered software for autonomous aircraft and drones, is raising around $200mn from defence and aerospace companies set to include Palantir, Airbus and L3 Harris, according to people close to the deal. Venture capitalists including Andreessen Horowitz, Point72 and Riot Ventures are also expected to participate, they added.
The fundraising will boost Shield’s valuation from the $2.8bn it enjoyed a year ago amid a flood of investor appetite for companies likely to benefit from higher federal spending on national security under Donald Trump’s incoming government.