Varangians Closes $10.5M for Ukraine DefenceTech

Jan de Vries · 2026-06-12

A new fund is putting real money behind a simple idea: the best battlefield tech is being built right now in Ukraine, under fire. Stockholm-based Varangians has closed its debut fund at over $10.5 million (roughly 100 million Swedish kronor), and it's already backing companies that are testing their systems in actual combat zones. Co-founded by Andreas Flodström, the man behind the Swedish-Ukrainian tech ecosystem Beetroot, Varangians isn't your typical venture fund. It's a DefenceTech-focused investment vehicle with a razor-sharp mandate: find Ukrainian engineers who are innovating under extreme pressure, and give them the capital to scale. ### What Varangians Is Actually Investing In The fund has already placed bets on three Ukrainian companies, with a fourth still under wraps. Here's what they're backing: - **Norda Dynamics** – Building an autonomous UAV piloting system that can execute missions even when all communications are jammed or cut off. - **Himera** – Creating secure, user-friendly communication systems that resist electronic warfare, designed for both civil defense and emergency services. - **Sine Engineering** – Working on a next-gen UAV communication and positioning platform that functions in contested environments full of jamming, interference, and spoofing. - **Confidential fourth company** – Described as a manufacturer of drones, ground vehicles, and unmanned system components, plus a drone pilot training program and an R&D lab. “We founded Varangians because we have seen how Ukrainian engineers innovate under fire; producing low-cost, effective tech that Europe urgently needs,” the co-founders said in a statement. ### Why This Fund Matters Right Now Sure, $10.5 million is small compared to the monster funds hitting the market. DTCP just raised $525 million for Project Liberty, and Kembara closed $787.5 million in its first round. But Varangians isn't trying to compete on size. It's competing on proximity. The fund's entire model is built around being close to the action — scouting through Ukrainian defense innovation networks, evaluating companies based on technical insight and operational relevance, and then actively supporting them post-investment. That hands-on approach includes consulting services for organizations that want to set up operations in Ukraine. We're talking help with local partners, security planning, field testing, and even frontline-driven R&D. It's a model that blends venture capital with real-world logistics. ### The Bigger Picture: Europe's Shift Toward Defense Varangians sits inside a much larger trend. European capital is flowing into defense, dual-use tech, resilience, and deep tech like never before. You've got Seraphim Space, 360 Capital, and even the EU-Ukraine defense innovation program all pointing in the same direction: technologies tied to sovereignty, autonomy, cybersecurity, and industrial capacity. But Varangians' Ukraine-first mandate gives it a unique angle. These aren't lab-tested prototypes. These are systems being refined in real frontline conditions — and that kind of feedback loop is hard to replicate anywhere else. ### The Story Behind the Name If you're wondering about the name, it's a nod to the Varangians — Swedish Vikings who traveled to Ukraine and Kyiv around the year 800 and helped shape the region's early history. For the fund, that name symbolizes a renewed connection between Sweden and Ukraine through tech, resilience, and defense innovation. The founding team brings together a leading Swedish family office alongside entrepreneurs Pär Lager, Andreas Flodström, and Jonas Rydin. Their stated mission is twofold: strengthen Ukraine through DefenseTech investments, while helping re-arm Sweden, the Nordics, and wider Europe using Ukrainian innovation and battlefield experience. In a world where defense spending is rising and the line between civilian and military tech is blurring, Varangians is betting that the best solutions come from those who are already living the problem.