More defense spending by NATO is welcome, and overdue. The world has become more dangerous, and peace no longer preserves itself.
After decades of complacency, we’re relearning a simple truth: security requires resilience.
Between now and 2035, billions will flow into tanks, planes, ports, energy lines, troops, and training. The question is whether that money builds the future or just reinforces the past.
Spending More Doesn’t Mean Spending Smart
When directed wisely, defense spending has ripple effects far beyond security. The internet, GPS, and radar all began as military projects before transforming civilian life.
That’s why NATO’s newly agreed 5 percent-of-GDP target matters. In theory, it earmarks 1.5 percent to “protect critical infrastructure, defend networks, ensure civil preparedness and resilience, innovate, and strengthen the defense industrial base.”
But the announcement fails to mention technological innovation specifically. And without innovation baked in, Europe could just be doubling down on yesterday’s weapons instead of investing in tomorrow’s breakthroughs.
Ukraine Shows the Power of Innovation
I write as an investor in growth-stage space tech firms, many of them dual-use. You don’t need to live in pitch decks and forecasts to see the truth: technological innovation is the present and future of warfare. Ukraine proved it.
In 2022, Russia invaded with a Soviet-style army — tanks, artillery, massed troops — expecting a smaller neighbor to crumble. Instead of speed and surprise, Moscow brought bulk and bureaucracy, betting that sheer scale would crush resistance.
What happened instead? Ukraine fought like a 21st-century force: agile, decentralized, and tech-savvy.
Cheap drones scouted and struck Russian units. Starlink kept command networks running when power and internet were cut. Western precision weapons like HIMARS and Javelins let Ukraine punch far above its weight. And NATO intelligence gave Kyiv the edge to anticipate and counter Russian moves.
Innovation has been key. In Ukraine, government agencies work directly with startups and inventors. Young engineers push battlefield tech to the front in weeks, sometimes days.
Garage-built drones blow up multi-million-euro tanks. Soldiers gauge performance, engineers tweak, and new prototypes cycle back almost immediately.
Ukraine’s gains are largely down to the flexible, responsive innovation ecosystem the country has nurtured.
Europe’s Legacy Contractors Can’t Keep Up
The rest of Europe, largely free from the urgency of recent conflict, spends defense money predictably.
A handful of vast contractors with storied histories and strong connections scoop up most of the cash, but their size makes rapid innovation impossible. Now isn’t the time to fund decades-long projects at slow-moving primes.
Europe should put its money behind the fastest, most creative, and most ambitious tech companies; the ones pushing the edges of AI, quantum sensing, cyber defense, optical communications, advanced materials, and Earth Observation.
The Real Risk Is Falling Behind
Risk is a key word here. I’m an investor, and I live with it daily. But governments often misunderstand it. They see startups as “risky” because they’re unproven, while established giants look safe.
In reality, the real danger isn’t wasting a few million on a young company. The real danger is failing to back the innovators who will keep Europe battle-ready. Put bluntly: the risk is that Europe won’t be able to stand up to a hostile power when it matters most.
Europe Must Choose Innovation Over Complacency
Defense spending isn’t optional when war is back in Europe. Soft power matters but it doesn’t stop tanks.
The United States has learned to put money into the innovators shaping tomorrow’s battlefield, not just the giants of yesterday.
Europe’s circumstances are different, but the lesson is the same. It’s not enough to spend more. We have to spend smarter — or risk building a 20th-century arsenal for 21st-century wars.
Bogdan Gogulan is CEO and Managing Partner at NewSpace Capital, one of the world’s first growth-stage investment funds focused exclusively on the space sector.
Bogdan previously worked across security and defence agencies, where he gained insight into the crucial role of satellite technology in modern warfare.
Today, he invests in companies at the intersection of space, defense, and intelligence — including Cailabs and FibreCoat.
The views expressed are those of the author and do not necessarily reflect the editorial position of NextGen Defense.
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