Spotify founder Daniel Ek invests €600 million in German startup supplying drones to Ukraine

Financial Times reported the information.

Swedish entrepreneur and billionaire Daniel Ek, founder of the audio streaming service Spotify, has invested €600 million in the German defense tech company Helsing. Valued at €12 billion, Helsing is one of Europe’s most valuable startups, ranking among the top five most valuable private tech companies.

The deal took place amid the Munich-based startup's expansion from developing AI software to producing its own drones, aircraft, and submarines. Helsing is on the rise, as the extremely tense geopolitical situation is pushing countries around the world to increase military spending. Additionally, the outlet notes that the war in Ukraine is prompting a reevaluation of combat technologies.

Prima Materia, the investment company founded by Daniel Ek and early Spotify investor Shakil Khan in 2020, made its first major investment in Helsing in 2021.

As Ek told the outlet, Prima Materia is now “doubling down.” The company made the largest investment alongside backers such as Swedish defense group Saab and venture capital firms Lightspeed Ventures, Accel, Plural, and General Catalyst. The deal brings Helsing’s total raised capital to €1.37 billion.

“The world is being tested in more ways than ever before. That has sped up the timeline” for Helsing’s financing, Ek said, pointing in particular to the conflict between Russia and Ukraine, where drones and other AI-powered systems have been deployed at scale for the first time.

"There’s an enormous realisation that it’s really now AI, mass and autonomy that is driving the new battlefield,” Ek said. “We can’t understate the implications of that for this conflict [in Ukraine] or really any conflict going forward."

Helsing has sold thousands of strike drones to Ukraine, produced at its factory in southern Germany. The company has also secured contracts with the United Kingdom, Germany, and Sweden.

“We’re now at an inflection point . . . where we are going from a software company to an all-domain, AI software and hardware company,” Ek noted.

Ek’s initial investments in Helsing sparked backlash against the music platform Spotify, which he co-founded in 2006 and still leads as CEO. However, he emphasized that he is not concerned about a potential new boycott.

“I’m sure people will criticise it and that’s OK,” Ek said. “Personally, I’m not concerned about it. I focus more on doing what I think is right and I am 100 per cent convinced that this is the right thing for Europe,” the entrepreneur added.