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Shield AI, a Start-Up Making Military Drones, Raises $2 Billion

Among them is Shield AI, which plans to announce on Thursday that it has raised $2 billion, with... The new capital will value Shield AI at about $12.7 billion, more than double the level it...

Shield AI, a Start-Up Making Military Drones, Raises $2 Billion

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Shield AI, a Start-Up Making Military Drones, Raises $2 Billion

The company, which develops autonomous military technology, also plans to buy a maker of simulation software as interest in next-generation defense soars.

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Shield AI’s software and drones are being used by several governments, including Ukraine’s.

Credit...

Caroline Chia/Reuters

By

Michael J. de la Merced

March 26, 2026,

7:57 a.m. ET

Artificial intelligence, autonomous drones and other technologies have transformed battlefields in hot spots like Ukraine and Iran. A tech-driven arms race to develop the tools has put next-generation defense contractors in high demand.

Among them is Shield AI, which plans to announce on Thursday that it has raised $2 billion, with some of the proceeds going toward buying Aechelon Technology, a smaller defense-tech start-up specializing in simulation software.

The new capital will value Shield AI at about $12.7 billion,

more than double

the level it achieved in a fund-raising round a year ago.

Shield AI’s latest money-raising effort underscores the interest in defense technology in Silicon Valley and beyond as investors rush to buy in.

“A.I. plus autonomy is changing the game in the military,” Gary Steele, a former Cisco executive who is now Shield AI’s chief executive, said in an interview. He added, “The capabilities that we can deliver, the cost curve that we can deliver, is fundamentally different than in the past.”

The role of A.I. in military applications has drawn scrutiny, especially during the

Pentagon’s dispute with Anthropic

, which said it did not want its A.I. used for mass surveillance of Americans or for autonomous lethal weapons. Mr. Steele and Doug Philippone, a Shield AI board member, say their company follows the Defense Department’s rules about A.I. use, and Mr. Philippone said he personally favored ensuring that humans could make the final call.

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