National security-focused VC firm raises $125 million

Shield Capital, a new VC firm focused on dual-use national security startups, raised $125 million for its debut fund.

Why it matters: Timing is everything. Tech's antipathy toward defense and military applications was waning even before the Russia-Ukraine war, in part thanks to the change in White House occupant, and that abatement should now move even quicker.

Details: Shield's co-founders are Raj Shah, who led DoD's Defense Innovation Unit (DIU) in both the Obama and Trump administrations, and Philip Bilden, a former HarbourVest partner who Trump nominated to serve as U.S. Navy secretary (he later withdrew due to financial divestiture requirements).

• Shah spent part of yesterday at the Pentagon, where he's serving on a Congressionally instructed commission to reform the entire DoD budget.
• The firm's advisory board includes former DoD Secretary Ash Carter and former national security adviser H.R. McMaster.

The bottom line: "Bilden and Shah began planning for Shield Capital in 2015, originally focusing their seed investments on cybersecurity. In 2016, Shah went to lead DIU, where he worked to leverage commercial technology to address national security needs and help non-traditional companies work with the government. That experience helped shape Shield’s investment strategy and after Shah left, he and Bilden decided to institutionalize their investments and create a fund." — Courtney Albon, DefenseNews