#USA #McLean #National Security #Veteran Ventures #Fund II

Veteran Ventures Capital Closes $60 Million Fund II

Veteran Ventures Capital (VVC) has officially announced the successful closing of its second fund, Veterans Fund II, totaling $60 million, significantly oversubscribed due to an impressive investor response. This fundraising achievement marks a noteworthy leap from its inaugural Fund I, which was set at $20 million, tripling its size to cater to the accelerating demand in the defense and aerospace sectors.

Leveraging Strong Market Momentum

The backdrop of this fundraising is a historical peak in U.S. defense expenditure, projected to exceed $900 billion in FY2025. This allocation includes a substantial $145 billion directed toward research, development, testing, and evaluation. Analysts anticipate continued increases in budgets driven by the urgent necessity to modernize defense capabilities, particularly in unmanned systems and artificial intelligence applications. Data from PwC illustrates a parallel surge in investments in space technology, leading to innovations that merge national security imperatives with commercial opportunities.

The capital markets reflect this burgeoning momentum, with notable increases in aerospace and defense transactions, which rose approximately 20% in Q1 2025 compared to previous years. This rapid growth has created a fertile ground for VVC to identify and support pioneering technologies that address critical national security challenges.

VVC's Distinctive Investment Model

VVC has garnered strong backing from a diverse array of institutional investors, from state entities like the Virginia Innovation Partnership Corporation and the State of Tennessee to university endowments and family offices. This support underscores the confidence in VVC's unique investment approach, which focuses on veteran-led companies that contribute significantly to national security technologies.

According to Derren Burrell, Founder and Managing Partner of VVC, “VVC has consistently proven that veteran leadership at our portfolio companies can yield remarkable returns while tackling pressing national-security requirements.” The firm’s strategy not only marries private capital with substantial non-dilutive government funding but also fosters innovations crucial for modern defense technologies.

Capital Allocation and Early Investments

Fund II has commenced capital deployment toward companies that are creating solutions for high-stakes problems in sectors such as space, autonomous systems, and defensive infrastructure. Standout early investments include:

• - Agile Space Industries: This company, a leader in in-space propulsion, employs additive manufacturing and vertical integration to tackle the current global shortage of high-thrust systems. Supported by major players like Lockheed Martin Ventures, it is pivotal in enhancing U.S. and allied orbital capabilities.
• - Turion Space: Known for its innovative DROID satellite architecture, this firm provides high-throughput non-earth imaging and real-time space domain awareness at costs much lower than industry averages, bolstered by over $30 million in government awards.

These investments signify VVC’s commitment to not just invest but actively collaborate with portfolio companies, enhancing their capacities to navigate the intricate defense market landscapes and boosting their operational resilience.

A Vision for the Future

The collective expertise of VVC's partners, with over a century of experience across military leadership, strategic contracting, and venture capital, positions the firm uniquely to address the dual-use technology sector's exigencies. As outlined by Josh Weed, VVC General Partner, “This oversubscribed Fund illustrates the confidence that our Limited Partners have in our investment thesis, our team, and ultimately, the founders we support. Fund II empowers us to back more of these visionary leaders.”

In conclusion, VVC's closing of Fund II at $60 million underscores a transformative shift in investment into dual-use national security technologies, aiming not only for significant returns but also for impactful contributions to national security and defense advancements.

For further details on Veteran Ventures Capital, visit www.veteranventures.us.