NATO nations last week agreed to spend at least 5% of GDP on defense by 2035, in a major diplomatic win for the Trump administration.

Why it matters: This is a strong tailwind for defense-tech startups, which in the past few years have moved from venture capital's Island of Misfit Toys to Love Island.

• And it comes on the heels of Trump's plans for a "Golden Dome" missile shield that could cost $175 billion (including an initial $25 billion earmark in the reconciliation bill).

Driving the news: The NATO pledge includes 3.5% on core defense and 1.5% on securing critical infrastructure.

• Axios Future of Defense author Colin Demarest explains: "Countries close to Russia have traditionally spent the most. This includes Estonia, Latvia and Poland — all of which have broken the 3% mark. Tallinn also is home to the alliance's digital brain trust, the NATO Cooperative Cyber Defence Centre."

By the numbers: More than 400 global defense-tech companies have raised nearly $13 billion so far in 2025, per PitchBook.

Zoom in: As venture capitalists rush into the sector, there are some pretty big questions about how they'll ever exit.

• Not for market leaders like Anduril, which could go public tomorrow if it wanted, but for the rank-and-file and even some smaller unicorns.
• M&A multiples in defense are lower than in broader tech, and that's true whether the buyer is a legacy prime or an upstart like Anduril (which has been acquisitive, but hasn't been buying VC-backed startups).
• One possibility is that Big Tech will expand deeper into defense, and thus will pay revenue multiples that will help VCs clear the preference stack. But that hasn't yet played out, particularly as those companies dig into the couch cushions for cash to spend on general AI.
• Another is that legacy primes will fear obsolesence and pay up — although they may be content to just ride the NATO/Golden Dome rocket.

The bottom line: Defense-tech investment is booming. But it may also be sitting on a bomb.

Republic has begun selling reservations for "mirror tokens" for equity upside in select unicorn companies. It began last week with SpaceX, and today is launching both Anthropic and Epic Games.

Why it's the BFD: This is the latest step in the march toward private market democratization, as retail investors otherwise wouldn't have access to such names.

How it works, per Axios Crypto's Brady Dale: Users can reserve exposure to future shares, or fractional shares, as tokens on the Solana blockchain. They only can trade with other wallets approved to interact with the underlying smart contract that governs the token.

• Republic initially is running these sales via regulation crowdfunding, which has a $5 million raise limit and a $5,000 non-accredited investor cap, but hopes to eventually expand to uncapped Reg D. Currently this is what's known as the "testing the waters" phase.
• It also claims to already have the underlying shares. Worth emphasizing, however, that users are reserving options to receive equity in the future — not actual stock for which the issuers have legal obligations.

The bottom line: Stock tokenization is coming, with Coinbase and Robinhood both recently announcing public equity plans in the U.S. and Europe, respectively.

• Klar, a Mexican financial services platform, raised $170m at a valuation north of $800m. General Atlantic led, joined by Santander Group, DEG, Grupo Televisa, Grupo Fórmula, Citius, and insiders Prosus, IFC, Mouro Capital, and Quona Capital. It also secured $20m in venture debt from WTI. axios.link/3GoxtCs

• Genesis AI, a developer of foundational models for robots, raised $105m in seed funding. Eclipse and Khosla Ventures led, joined by Bpifrance and HSG. axios.link/46t4W9k

• Levelpath, an SF-based procurement platform, raised $55m in Series B funding. Battery Ventures led, joined by Redpoint Ventures, Benchmark, 01A, New View Capital, and World Innovation Lab. axios.link/3I9gSD7

🚑 Syntis Bio, a Boston-based developer of oral therapies for obesity and diabetes, raised $33m in Series A funding. Cerberus Ventures led, joined by Mansueto Investments, Woori Venture Partners, Apollo Labs, Bold Capital Partners, W. R. Berkley, Safar Partners, Portal Innovations, Colorcon Ventures, and Cerity Partners Ventures. axios.link/3ZTu0Ta

• Campfire, an SF-based provider of ERP software, raised $35m in Series A funding. Accel led, joined by Foundation Capital, YC, and Capital 49. axios.link/3I69p80

🚑 Portal Biotech, a London-based protein sequencing biotech focused on detecting biological threats, raised $35m in Series A funding. NATO Innovation Fund and Earlybird Venture Capital led, joined by SCVC, Pillar VC, 8VC, Amino Collective, Outsized, We Venture Capital, British Business Bank, and WS Investment. axios.link/3I5Qvy5

• Ambrook, a provider of accounting software for agriculture, raised $26.1m in Series A funding, per Fortune. Thrive Capital and Field Ventures led, joined by insiders Homebrew, BoxGroup, Designer Fund, Mischief, and Not Boring. axios.link/4euyTrB

⚡ Emerald AI, a data center power startup, raised $24.5m in seed funding. Radical Ventures led, joined by Nvidia and Amplo. axios.link/44GATK2

• Tailor, a headless ERP platform, raised $22m in Series A funding from ANRI, JIC Venture Growth Investments, NEA, Spiral Capital, and YC. axios.link/44HD4wX

🚑 Gallant, a San Diego-based developer of off-the-shelf stem cell therapies for pets, raised $18m in Series B funding. Digitalis Ventures led, joined by Bold Capital, Hill Creek Partners, NovaQuest Capital Management. gallant.com

• Deeto, a New York-based sales enablement startup, raised $12.5m in Series A funding led by Jump Capital, per Axios Pro. axios.link/4l7sIMG

• Audos, a New York-based startup studio, raised $11.5m led by True Ventures, with participation from Offline Ventures and Bungalow Capital. axios.link/3ZYGKI3

• Kerys Software, a French IT infrastructure convergence startup, raised €6.2m in pre-seed funding from Daphni, Seedcamp, and Backtrace. kerys.software

• TopK, a Czech enterprise search startup, raised $5.5m in seed funding from Earlybird, KAYA, and Irregular Expressions. axios.link/4lBVYLB

• Aircon, an air cargo tech startup, raised $5m on seed funding led by Blumberg Capital and Las Olas VC. airconai.com

• Zango, a London-based provider of regulatory compliance software, raised $4.8m led by Nexus Venture Partners. axios.link/3I9h0m5

• LogicFlo AI, a Boston-based developer of AI agents for life sciences teams, raised $2.7m in seed funding led by Lightspeed. logicflo.ai

⚡ Advent International agreed to acquire a majority stae in LayerZero, an Ohio-based maker of static transfer switches and power distribution units for data centers. layerzero.com

🎲 Apollo completed its $6.3b acquisition of International Game Technology's (NYSE: IGT) gaming and digital business (dba Brightstar Lottery) and Everi Holdings. axios.link/4nupYui

🎵 Bain Capital and Warner Music Group (Nasdaq: WMG) launched a $1.2b joint venture to acquire music catalogs. axios.link/468kob9

🎲 Brightstar Capital Partners completed its $1.1b take-private of casino game equipment maker PlayAGS. axios.link/44czcUA

⚡ H.I.G. Capital acquired 4Refuel, a Canadian provider of mobile on-site refueling services, from Finning International (TSX: FTT) for C$400m. axios.link/4nrmn0c

• LevelBlue, a Dallas-based portfolio company of WillJam Ventures, agreed to acquire Trustwave, a Chicago-based provider of cybersecurity and managed detection and response services, from a PE fund affiliated with The Chertoff Group. levelblue.com

• Namirial Group, a digital transaction management software provider owned by Bain Capital, is in talks to acquire Spain's Signaturit, which is backed by PSG Equity (which will reinvest). namirial.com

• The Rohatyn Group completed its $710 purchase of a majority stake in Rayonier's (NYSE: RYN) New Zealand forestry group. axios.link/40xCqzA

• Secur-Serv, backed by Transom Capital Group, acquired Arrowhead Technologies, a Fort Worth, Texas-based provider of managed IT and security services. secur-serv.com

• Trinity Hunt Partners acquired Blackhawk Supply, a Hoffman Estates, Ill.-based distributor of HVAC parts. blackhawksupply.com

• Truelink Capital acquired Zep, an Atlanta-based maker of maintenance and cleaning solutions, from New Mountain Capital. zep.com

• Valsoft, a Montreal-based software acquisition platform backed by Coatue and Viking Global Investors, acquired CollectionHQ, a U.K. provider of collection performance improvement software for libraries. valsoftcorp.com

• Warburg Pincus is in advanced talks to acquire Uvex, a German maker of ski helmets that could fetch €800m, per Bloomberg. axios.link/4lqVaJ6

• Accelerant Holdings, a specialty insurance marketplace backed by Eldridge Industries, filed for a $100m IPO. It reports $23m of net income on $603m in revenue for 2024, and plans to list on the NYSE (ARX). axios.link/46pf9Un

🎲 Cirsa Enterprises, a Spanish casino operator owned by Blackstone, will seek to raise €453m in its domestic IPO at a €2.5b valuation. axios.link/4nrSFZ1

🚑 DRC Medicine, a Japanese biotech, agreed to go public at an implied $422m equity value via a merger with Ribbon Acquisition (Nasdaq: RIBBU), a SPAC led by Bubai Ghosh. axios.link/4488Zqi

• Cohen Circle Acquisition II, a fintech SPAC led by Betsy Cohen, raised $220m in its IPO. axios.link/44QfFKv

• Indigo Acquisition, a SPAC formed by the founders of investment bank Cassel Salpeter, raised $100m IPO in its IPO. axios.link/4031fmQ

• McKinley Acquisition, a SPAC focused on "progressive industries," filed for a $150m IPO. axios.link/3GroaSj

• NMP Acquisition, a SPAC formed by Next Move Partners, raised $100m in its IPO. axios.link/3ROpW25

• Clio, a Canadian provider of cloud software for legal practice management valued by VCs at $3b, agreed to buy Spanish legal-tech platform vLex from Oakley Capital for $1b. axios.link/40xNjRY

⚡ Rehlko, a power equipment company owned by Platinum Equity, agreed to sell its Curtis Instruments business to Parker Hannifin (NYSE: PH) for around $1b in cash. axios.link/4nqSzkj

• The San Francisco Standard, a news outlet backed by Mike Moritz, is acquiring Charter, which focuses on the future of work. Charter had raised $4m from Bloomberg Beta, Precursor Ventures, FT Ventures, Everywhere Ventures, and Old Town Media. axios.link/4l4Ff3n

🚑 Sheridan Capital hired Houlihan Lokey to sell Tarrytown Expocare, an Austin, Texas-based specialty pharmacy, per Axios Pro. axios.link/44b76cv

• Aviva (LSE: AV) got U.K. antitrust approval for its pending £3.4b takeover of Direct Line Insurance Group (LSE: DLG). axios.link/45OSErR

• Onto Innovation, a Wilmington, Mass.-based maker of chipmaking software, agreed to acquire Semilab International's material analysis business for $545m in cash and stock. ontoinnovation.com

• TransDigm (NYSE: TDG) agreed to acquire Simmonds Precision Products, a Vermont-based provider of fuel and proximity sensing solutions for aerospace and defense, from RTX (NYSE: RTX) for $765m in cash. axios.link/3Gi3RH2

Greenoaks raised $2.5 billion for its sixth flagship VC fund, Axios has learned.

• It's a step up from the SF-based firm's $2.1 billion fifth fund, and was said to be 2.2x oversubscribed on the hard cap. Portfolio companies include Databricks, Scale.ai, and Stripe.

🚑 Catalio raised $400m for its fourth biotech VC fund. cataliocapital.com

• Halogen Ventures, led by Jesse Draper, raised $30m for its third fund. axios.link/4njargW

• Growth Capital Partners, a U.K. venture firm, raised £411m for its sixth fund. axios.link/44pJAan

• Shore Capital Partners raised over $450m for its third food and beverage fund. shorecp.com

• TQ Ventures of New York is raising $600m for its fourth fund, per an SEC filing. tq.vc

• Grant Behman is stepping down as managing partner of Behrman Capital, where he'll take the titles of senior partner and cofounder. Simon Lonergan will serve as sole managing partner going forward. behrmancap.com

• Mark Brune and Philipp Mohr both left William Blair to join Harris Williams as Frankfurt-based managing directors. harriswilliams.com

• Mary D'Onofrio left Bessemer Venture Partners to join Crosslink Capital. axios.link/40xvGBP

• Will Dunham was named the American Investment Council's next president and CEO, succeeding Drew Maloney. He's a former Hill staffer for both Kevin McCarthy and Steve Scalise, and most recently was AIC's VP of government affairs. axios.link/3ZYXkrn

🌍 Onur Gokerand (ex-Anthelion Capital) and Sonali Aggarwal (H.I.G. Capital) joined decarbonization-focused PE firm Ara Partners as a managing director and principal, respectively. arapartners.com

• Akira Kiyota is leaving Nomura to join Citigroup as co-head of Japan investment banking. axios.link/45KLYef

• Andy Nick joined Piper Sandler as a managing director and global co-head of secondary advisory. He previously was with Jefferies. axios.link/3TQsIVj

• Muneya Taniguchi joined Blackstone a vice chair of Japan. He previously was with Mitsubishi UFJ Financial Group. axios.link/40s1sjB

The first half of 2025 is in the books, and U.S. stocks ended higher after a harrowing drop in the middle.