Finland Attracts Nearly 90% of Nordic Defence Tech Investment Since 2020

The Nordic Defence Tech Report 2026, jointly produced by Danske Bank and Amsterdam-based data intelligence firm Dealroom, revealed that Finland-based companies have raised 1.6 billion U.S. dollars in venture capital since 2020.

Dual-use technologies refer to innovations that can serve both civilian and military purposes, covering areas such as national security, defence, healthcare, infrastructure and energy.

"Helsinki is a significant hub for defence and dual-use technology startups, standing out clearly from other Nordic capitals," said Teppo Havo, head of startups and growth companies at Danske Bank.

Havo said Finnish defence technology companies had secured substantial funding through large investment rounds, helping the country establish its leading position in the Nordic market.

According to the report, venture capital investment in defence and dual-use technology companies across the Nordic region has increased significantly since 2020. The growth has been driven largely by major funding rounds involving Finland-based quantum computing company IQM and satellite technology company ICEYE.

Since 2023, nearly a quarter of all venture capital raised in Finland has gone to defence and dual-use technology companies. This represents the second-highest share in Europe after Ukraine. In Germany, the corresponding figure stood at 16 percent.

The report also found that the valuations of Nordic defence and dual-use technology companies have increased more than tenfold over the past six years.

Nordic investors have played a major role in financing the sector, accounting for 61 percent of early-stage venture capital investments since 2019.

However, larger funding rounds have attracted an increasingly international investor base. For investment rounds worth at least 15 million U.S. dollars, Nordic investors accounted for 53 percent, followed by investors from other European countries at 22 percent and the United States at 17 percent.

Havo noted that financing for defence and dual-use technologies differs considerably from the conventional startup market, with European investors and public-sector institutions playing a central role.

Finland has a well-established high-tech research base and has been working to strengthen its defence technology industry amid growing security concerns and closer cooperation with NATO.

According to the European Commission's 2026 country report, Finland's research and development expenditure reached 3.22 percent of gross domestic product (GDP) in 2024, approximately one percentage point above the European Union average. This reflects the country's strong research and innovation capabilities.

The European security environment has changed significantly since the escalation of the Russia-Ukraine conflict in 2022, bringing increased attention to defence-related technologies.

Since joining NATO in 2023, Finland has sought to strengthen cooperation with allied defence industries and expand opportunities for domestic technology companies, local media reported.

The report examined 170 Nordic startups developing defence and dual-use technologies, as well as defence-related applications, including space and quantum technologies.