Varangians Closes $10.5M for Ukraine DefenceTech

Jan de Vries · 2026-06-12

Stockholm-based Varangians, a new DefenceTech-focused investment fund co-founded by Beetroot founder Andreas Flodström, has closed at over $10.5 million (100 million kronor). The fund is dedicated to backing Ukraine's DefenceTech ecosystem, a sector that's been booming amid ongoing conflict. The fund has already made investments in Ukrainian DefenceTech companies like Norda Dynamics, Himera, and Sine Engineering. A fourth portfolio company remains confidential for now, likely due to security concerns around sensitive tech. "We founded Varangians because we have seen how Ukrainian engineers innovate under fire," said Co-founders Pär Lager, Andreas Flodström, and Jonas Rydin. "They're producing low-cost, effective tech that Europe urgently needs." ### A Smaller Fund in a Bigger Trend Varangians' close might be smaller than other large 2026 vehicles that recently closed. But it fits a wider shift in European capital allocation towards defence, dual-use, resilience, and deeptech investment platforms. Consider this: DTCP's $525 million Project Liberty and Kembara's $787 million first close point to larger pools of growth-oriented capital. Meanwhile, Seraphim Space, 360 Capital, and the EU-Ukraine defence innovation programme show investor and institutional focus on technologies linked to sovereignty, space, autonomy, cybersecurity, industrial capacity, and Ukraine-related defence needs. Within that landscape, Varangians is differentiated less by fund size than by its Ukraine-first mandate. It focuses on companies building and testing systems in frontline conditions, which gives them real-world validation that other startups can't match. ### What Varangians Invests In Founded in 2025, Varangians will invest primarily in Ukrainian DefenceTech startups. It also considers non-Ukrainian companies working across military and civil defence. The fund targets high-impact technologies developed and tested in real frontline conditions. Key areas include: - Unmanned systems (UAVs, UGVs) - Electronic warfare - Strategic communications - Demining - Secure communications - Selected dual-use technologies Varangians was founded by a leading Swedish family office alongside entrepreneurs Pär Lager, Andreas Flodström, and Jonas Rydin. They bring together experience in technology, defence, entrepreneurship, and Ukraine. ### Current Portfolio Companies **Norda Dynamics** is developing an autonomous UAV piloting system for mission execution in communication-deprived environments. Think drones that can operate even when jammers cut off their signal. **Himera** builds user-friendly, EW-resistant secure communications systems for civil and emergency use. Their gear is designed to work even when enemy forces try to disrupt signals. **Sine Engineering** is working on a next-generation UAV communication and positioning platform for contested environments involving jamming, interference, and spoofing. It's essentially a hardened navigation system for drones. According to Varangians' website, their fourth confidential company is described as a manufacturer of UAVs, UGVs, and components for unmanned systems. They also provide drone pilot training and run an R&D lab for innovation and testing. ### How Varangians Operates Varangians' model combines targeted scouting, context-aware evaluation, and active support after investment. The team says it identifies promising companies through Ukrainian defence innovation ecosystems and trusted networks. Then they assess them through a combination of technical insight, operational relevance, and governance standards. It also offers consulting services for organisations looking to establish operations in Ukraine. This includes support with local partners, security and risk planning, field testing, field engineering, and frontline-driven R&D. ### The Story Behind the Name The name Varangians refers to the Swedish Vikings who traveled to Ukraine and Kyiv around the year 800. They played a role in the early history of the region alongside Ukrainians. For the fund, the name reflects a renewed link between Sweden and Ukraine through technology, resilience, and defence innovation. It's a nod to history while looking firmly toward the future. Flodström is best known as the co-founder of Beetroot, the Swedish-Ukrainian tech ecosystem founded in Stockholm in 2012 by Flodström and Gustav Henman. The firm has been a key bridge between Swedish and Ukrainian tech communities for over a decade.