A conversation with Andreas Flodström, co-founder and chairman of Varangians, traces his path from establishing the Swedish-Ukrainian technology ecosystem Beetroot to backing Ukraine's emerging DefenceTech sector.

Varangians operates as an investment vehicle focused on DefenceTech, channelling capital into Ukrainian companies whose products have been forged and validated under the pressures of active conflict. The fund has assembled more than €10 million in capital and deployed it across portfolio companies such as Norda Dynamics, Himera and Sine Engineering, which develop autonomous UAV systems, secure communications infrastructure and solutions designed for contested operational environments.

Throughout the interview, Flodström reflects on over ten years of entrepreneurial work within Ukraine's technology sector and how those experiences shaped his perspective on engineering excellence, organisational resilience and what drives genuine innovation. The discussion also examines the historical and cultural ties embedded in the Varangians name itself, which connects Swedish and Ukrainian traditions.

The conversation navigates the nuanced terrain separating pure DefenceTech from dual-use technologies, the ethical dimensions of defence investment, and what European nations can extract from Ukraine's accelerated advancement in drone systems, electronic warfare capabilities and encrypted communications.

Against a backdrop of approximately €667 million in publicly disclosed European DefenceTech and related dual-use startup funding during 2026, combined with nearly €3 billion in pledged investment capacity across emerging funds and investment vehicles, Flodström examines whether the sector is attracting sufficient capital and what strategic moves Europe must undertake moving forward.

Key Points

  • The formative role Beetroot played in shaping Flodström's connection to Ukraine
  • Ukraine's emergence as a DefenceTech innovation hub
  • Navigating the spectrum between dedicated DefenceTech and dual-use technology investment
  • Lessons Europe can draw from Ukraine's progress in drones, electronic warfare and innovation velocity
  • Whether the current surge in DefenceTech funding signals the start of a transformed European industrial landscape

Source: EU-Startups