This is venture capital moving decisively into hard defence manufacturing, because Frankenburg is raising growth capital to build missile output, not just prototypes.
Estonia-based Frankenburg Technologies has closed a EUR 30 million Series A round led by Plural, with participation from SmartCap, according to EU-Startups. The company says it will use the funding to industrialise production of its air defence missiles designed to counter drones and Shahed-type munitions.
Why this round matters
European defence funding has risen sharply, but most private capital still clusters around software, sensors and dual-use components. Frankenburg is pushing in the opposite direction: scaling a physical, regulated product that must be produced consistently, tested rigorously and delivered into procurement cycles.
Two details make the story more than another “defence tech” raise:
- A direct route into government demand. Frankenburg has an R&D contract with Latvia’s Ministry of Defence to develop and supply its Mark I air defence missiles. That is an unusually concrete anchor for a young manufacturer.
- A leadership bench built for procurement and credibility. CEO Kusti Salm previously served as Secretary General of Estonia’s Ministry of Defence and was a director at the NATO Innovation Fund. The company also employs senior former military leaders, including General Martin Herem and Major General Veiko-Vello Palm.
From valuation jump to industrial plan
Frankenburg’s funding trajectory has been steep. It secured EUR 4 million in early March 2025, a round that reportedly tripled its valuation from EUR 55 million to EUR 150 million. Less than a year later, it has now raised EUR 30 million to move from development into scaled production.
The company was founded by Taavi Madiberk, known as the CEO of Skeleton Technologies. That background is relevant: industrialising a complex product is a different discipline from iterating software, and Frankenburg is explicitly selling manufacturability and unit economics. The firm positions its missiles as around 10x cheaper than alternatives, aiming for systems that can be produced at volume rather than in limited batches.
Distributed manufacturing is the execution test
Frankenburg is expanding into eight European countries, including the UK and Germany, to build a distributed manufacturing footprint. Strategically, that speaks to resilience and capacity: spreading production can reduce bottlenecks and align output with national procurement preferences.
Operationally, it raises the hard questions investors are now underwriting:
- Quality control and certification at scale. Defence manufacturing tolerates little variance; distributed production increases process complexity.
- Supply chain robustness. Components, energetics and specialist inputs can become single points of failure.
- Procurement timelines and working capital. Even with demand tailwinds, contracting and delivery can stretch cash cycles, especially when production ramps.
The bigger signal
This round is a marker of where European defence investment is heading. The implied valuation momentum and the size of the Series A suggest investors are increasingly willing to fund manufacturing capacity, not just R&D, as European governments prioritise stockpiles and replenishment.
For Frankenburg, the strategic bet is simple: if the company can turn a “cheap enough to mass produce” missile concept into repeatable production and government orders, it sits in a fast-forming category where capacity is itself a competitive moat.