Daniel Ek isn’t known for military manoeuvres. However, the Spotify founder’s bet on Helsing, an AI defence start-up, has made him an unlikely figurehead in Europe’s arms race.
His investment vehicle is leading a €600 million round that values the German group at €12 billion, more than double last year’s mark.
It’s not the only thing surging. European defence stocks have soared this year, fuelled by war in Ukraine, threats from Russia and a new UK-EU security pact. Germany’s Rheinmetall is up 190 per cent; German tank maker Renk 270 per cent; France’s Thales 80 per cent; British multinationals BAE Systems and Rolls-Royce some 70 and 50 per cent, respectively. The Stoxx Europe Aerospace and Defence index has jumped 45 per cent.
The bullish case? A decades-long rearmament, led by NATO states eyeing up to 5 per cent of GDP for defence. The bear case? Patchy procurement, political bottlenecks, and increasingly elevated valuations in a defence bull market now over three years old.
Still, investor appetite is ravenous. Morningstar notes a new defence ETF has gathered €2.5 billion in just three months.
Even peace in Ukraine, analysts agree, wouldn’t end the boom – just shift it to replenishment and deterrence. As Helsing’s soaring valuation suggests, the war economy may be just getting started.
