Varangians Raises $10.7M for Ukraine DefenseTech

Jan de Vries · 2026-06-12

A new Stockholm-based investment fund, Varangians, has closed at over $10.7 million (100 million kronor) to back Ukraine's DefenseTech ecosystem. Co-founded by Beetroot founder Andreas Flodström, the fund has already invested in Ukrainian companies like Norda Dynamics, Himera, and Sine Engineering, with a fourth portfolio company still under wraps. Varangians Co-founders Pär Lager, Andreas Flodström, and Jonas Rydin shared their motivation: "We founded Varangians because we have seen how Ukrainian engineers innovate under fire; producing low-cost, effective tech that Europe urgently needs." ### A Smaller Fund with a Big Mission Varangians' close might be smaller than other large 2025 vehicles, but it fits a wider shift in European capital allocation. Bigger funds like DTCP's $525 million Project Liberty and Kembara's $787.5 million first close point to larger pools of growth-oriented capital. Meanwhile, programs like Seraphim Space, 360 Capital, and the EU-Ukraine defense innovation program show investor focus on technologies tied to sovereignty, space, autonomy, cybersecurity, and industrial capacity. Varangians stands out not by size but by its Ukraine-first mandate and focus on companies building and testing systems in real frontline conditions. That's a unique edge in a crowded field. ### What Varangians Invests In Founded in 2025, Varangians will primarily back Ukrainian DefenseTech startups, but it's open to non-Ukrainian companies working on military and civil defense. The fund targets high-impact technologies being developed and tested under fire, with special attention on: - Unmanned systems (UAVs, UGVs) - Electronic warfare - Strategic communications - Demining tech - Secure communications - Selected dual-use technologies The fund was launched by a leading Swedish family office alongside entrepreneurs Pär Lager, Andreas Flodström, and Jonas Rydin, blending tech, defense, and Ukraine experience. ### The Portfolio So Far Varangians' current investments show its focus on frontline innovation: - **Norda Dynamics**: Building an autonomous UAV piloting system for missions in communication-deprived environments. - **Himera**: Creating user-friendly, EW-resistant secure communications for civil and emergency use. - **Sine Engineering**: Developing a next-gen UAV communication and positioning platform for contested environments with jamming and spoofing. - **Confidential fourth company**: A manufacturer of UAVs, UGVs, and components for unmanned systems, plus drone pilot training and an R&D lab. The fund's model combines targeted scouting, context-aware evaluation, and active post-investment support. They find promising companies through Ukrainian defense innovation ecosystems and trusted networks, then assess them using technical insight, operational relevance, and governance standards. ### Beyond Investing: Consulting Services Varangians also offers consulting for organizations looking to set up in Ukraine. This includes help with local partners, security and risk planning, field testing, field engineering, and frontline-driven R&D. It's a hands-on approach that goes beyond just writing checks. ### The Story Behind the Name The name "Varangians" refers to Swedish Vikings who traveled to Ukraine and Kyiv around 800 AD, playing a role in the region's early history. For the fund, it reflects a renewed link between Sweden and Ukraine through technology, resilience, and defense innovation. Flodström is best known as co-founder of Beetroot, the Swedish-Ukrainian tech ecosystem launched in Stockholm in 2012. This background gives him deep roots in both countries' tech scenes.