Varangians Closes $11.5M for Ukraine DefenceTech

Jan de Vries · 2026-06-12

### A New Fund for Battle-Tested Tech A Stockholm-based investment fund called Varangians just closed at over $11.5 million (100 million Swedish kronor). It's a DefenceTech fund co-founded by Andreas Flodström, who also started the Swedish-Ukrainian tech ecosystem Beetroot. The money is going straight into Ukraine's defence technology scene. The fund has already backed three Ukrainian companies: Norda Dynamics, Himera, and Sine Engineering. There's a fourth portfolio company that's still under wraps, but we'll likely hear about it soon. "We founded Varangians because we have seen how Ukrainian engineers innovate under fire," the co-founders Pär Lager, Andreas Flodström, and Jonas Rydin said. "They're producing low-cost, effective tech that Europe urgently needs." That quote captures the whole mission right there. ### Why This Matters Now Varangians' close might seem small compared to some of the massive funds we've seen lately. For context, DTCP's Project Liberty raised $580 million, and Kembara hit $870 million in its first close. But here's the thing: Varangians isn't trying to compete on size. It's competing on focus. The fund is part of a bigger shift happening across Europe. Capital is moving toward defence, dual-use tech, resilience, and deep tech. Investors and institutions are zeroing in on technologies tied to sovereignty, space, autonomy, cybersecurity, and industrial capacity. Ukraine is right at the center of that. ### What Sets Varangians Apart Varangians is different because of its Ukraine-first mandate. The team isn't just writing checks from a comfortable distance. They're working with companies that build and test systems in real frontline conditions. That's a huge advantage when you're trying to figure out what actually works. Founded in 2025, the fund focuses on Ukrainian DefenceTech startups. But they'll also consider non-Ukrainian companies working in military or civil defence. The sweet spot is high-impact tech that's been proven under fire. **Key areas they're watching:** - Unmanned systems (drones and ground vehicles) - Electronic warfare - Strategic communications - Demining technology - Secure communications - Dual-use technologies ### The Team Behind the Fund Varangians was founded by a leading Swedish family office alongside three entrepreneurs: Pär Lager, Andreas Flodström, and Jonas Rydin. Together, they bring experience in tech, defence, entrepreneurship, and deep knowledge of Ukraine. Their mission is twofold: strengthen Ukraine through DefenceTech investments, and help re-arm Sweden, the Nordics, and wider Europe using Ukrainian innovation and real-world experience. ### Inside the Current Portfolio Let's look at who they've already backed. **Norda Dynamics** is building an autonomous UAV piloting system. It's designed for missions in places where communication is cut off. Think drones that can think for themselves when the signal goes dead. **Himera** creates secure communications systems that are resistant to electronic warfare. They're user-friendly, which matters a lot when soldiers need to operate under stress. The tech works for both civil and emergency use too. **Sine Engineering** is working on a next-gen UAV communication and positioning platform. It's built for contested environments where jamming, interference, and spoofing are constant threats. The fourth company, still confidential, manufactures UAVs, UGVs, and components for unmanned systems. They also provide drone pilot training and run an R&D lab for testing and innovation. ### How They Pick Their Bets Varangians uses a model that combines targeted scouting with context-aware evaluation. They find promising companies through Ukraine's defence innovation ecosystems and trusted networks. Then they assess each one based on technical insight, operational relevance, and governance standards. After investing, they don't just walk away. The team offers active support, including consulting services for organizations that want to set up operations in Ukraine. That covers local partnerships, security planning, field testing, field engineering, and frontline-driven R&D. ### The Story Behind the Name "Varangians" refers to the Swedish Vikings who traveled to Ukraine and Kyiv around the year 800. They played a role in the region's early history alongside Ukrainians. For the fund, the name symbolizes a renewed link between Sweden and Ukraine through technology, resilience, and defence innovation. Flodström is best known as co-founder of Beetroot, the Swedish-Ukrainian tech ecosystem launched in Stockholm in 2012. That background gives him unique insight into how Ukrainian engineers operate under extreme conditions. This fund might be smaller than some, but its impact could be outsized. When you're investing in tech that's being tested in real combat, you're not guessing anymore. You know what works.