December 13, 2025
•European CommissionCommission roadmap calls for 6-12 month procurement replacing "very slow and cumbersome" processes, as 230+ companies founded since 2022
The European Commission published its Defence Industry Transformation Roadmap on November 19, acknowledging that Europe's defence sector requires a "fundamental change of mindset and procedures inherited from peace time."
The document, addressing both the European Parliament and Council, proposes creating an up to €1 billion Fund of Funds by the first quarter of 2026 to provide growth capital to defence-related small and medium-sized enterprises and scale-ups.
Record private investment
Private investment in European deep tech defence and security startups reached a record €5 billion in 2024, marking a fivefold increase compared to 2019, according to a NATO Innovation Fund and Dealroom report cited in the roadmap. These companies received 10 per cent of all venture capital funding in Europe last year.
More than 230 defence tech startups have launched in Europe since Russia's February 2022 invasion of Ukraine. The Commission refers to these as "New Defence" players, defining them as companies operating with "rapid iteration, agility, cutting-edge innovation, software-first architectures, and greater risk-taking."
AGILE programme for rapid procurement
The roadmap identifies current defence innovation cycles from ideation to capability as "very slow and cumbersome, falling short to meet the defence readiness Europe needs to achieve by 2030."
The Commission will propose a pilot instrument called AGILE (Agile Rapid Defence Innovation) with time-to-result not exceeding 6-12 months. The proposal is scheduled for the first quarter of 2026.
This compares to existing processes the document describes as fragmented across member states with "lengthy and burdensome" evaluation and implementation procedures.
Four areas for action
The roadmap proposes action across 4 domains:
Investment journey: Lack of growth capital remains "a persistent gap in the European defence innovation journey." While the EU hosts several defence unicorns, the growing number of new companies requires greater investment efforts. The €1 billion Fund of Funds will support private funds including venture capital, private equity, private credit and infrastructure investments.
Time to market: Manufacturing capacity "is expensive and requires major upfront investments." New companies hesitate to commit resources without clear commercial prospects. Access to testing infrastructure remains limited, with capacity constraints and lack of cross-border mobility creating obstacles. The Commission will propose Manufacturing-as-a-Service and Security-as-a-Service initiatives by second quarter 2026, allowing defence companies to leverage existing industrial capacities.
Contract access: New entrants "often face a knowledge and information gap" without direct access to armed forces, prime contractors or system integrators. Defence procurement processes "were designed in peace time and for large system integrators." The Commission will launch EUDIS Tech Alliances connecting startups with armed forces, and create a marketplace for EU-backed defence technologies by fourth quarter 2026.
Skills and talent: The sector faces difficulties attracting professionals with advanced skills in artificial intelligence, quantum computing and autonomous systems. Security clearance requirements, including citizenship requirements, limit mobility within the EU. The Commission targets annual upskilling of 12 per cent of aerospace and defence workers, with 600,000 workers to be reskilled by 2030.
Ukraine lessons
The document extensively references Ukrainian battlefield experience. Ukraine "successfully leveraged its innovation ecosystem to rapidly and cost-effectively scale military drone and counter-drone systems," the Commission states.
Software-defined weapon systems represent a defining feature, from real-time data fusion and digital targeting to adaptive electronic warfare. Ukrainian companies "can integrate operational feedback in real time, to rapidly develop tailored solutions, and deliver them at remarkable speed."
The Commission and High Representative will strengthen the EU Defence Innovation Office in Kyiv to become an EU Defence Industry Office, monitoring military technological developments and frontline innovation.
Following provisional agreement on defence-related investments in the EU Budget, the Commission will start the process to associate Ukraine to the European Defence Fund. It will swiftly implement BraveTech EU, a partnership connecting the EDF, EU Defence Innovation Scheme and Ukraine's BRAVE1 defence tech platform.
Technology priorities
Artificial intelligence: "The future battlefield will be marked as much by algorithms and data as by kinetic capabilities," according to the document. AI applications "contribute to fewer casualties by limiting human combat interactions."
Quantum: The EU hosts approximately 32 per cent of the world's quantum-specialised companies. Quantum sensors provide precision in navigation and target detection in GPS-denied environments. Quantum communications enable ultra-secure data transmission.
Space: Initiatives including IRIS² for secure communications, Galileo's Public Regulated Service for military navigation, and the planned Earth Observation Governmental Service provide the "data backbone for decision superiority and operational coordination."
Cyber: Treated as the fifth domain of warfare alongside land, sea, air and space, cyber capabilities are "already defining the military might in the battlefield."
The European Defence Fund dedicates 4-8 per cent of its annual budget to disruptive technologies.
The Commission will:
Certification: Propose mutual recognition schemes to align certification and validation of defence technologies across the EU, supported by a "28th regime" concept for harmonised regulatory frameworks.
Data: Establish a European Defence Data Space by 2028 to facilitate development of AI models, digital twins and predictive maintenance.
Procurement marketplace: Create a marketplace for EU-backed defence technologies by fourth quarter 2026, facilitating fast-track procurement for EDF-backed projects.
Contract allocation: Encourage member states to allocate at least 10 per cent of armament procurement budgets to emerging and disruptive technologies.
Procurement reform: Revise Directive 2009/81/EC Defence and Sensitive Security Procurement with measures for faster, more streamlined procedures favouring innovative SMEs.
Existing programmes
The EU Defence Innovation Scheme (EUDIS), launched in 2022, dedicates up to €1.5 billion until 2027 for game-changing technologies through defence hackathons, business acceleration, matchmaking, targeted research calls and equity financing access.
The Defence Equity Facility, launched January 2024, combines €175 million in Commission and European Investment Fund co-financing under InvestEU, expected to channel over €500 million into EU defence companies by 2026.
The Commission will organise an Annual Strategic Dialogue on Defence Industrial Transformation with member states, industry and the European Defence Agency to monitor implementation.
Full document available at https://defence-industry-space.ec.europa.eu/document/download/513de692-d08c-40cc-80c3-cb6611ace178_en?filename=EU-Defence-Industry-Transformation-Roadmap.pdf