Between Independence and Dependence: American Investments Deepen in European Defense Industry

Europe seeks to reduce its military dependence on the United States and build a more independent defense industry, but a striking paradox emerges at the heart of this project: some European companies relied upon to develop the next generation of weapons and military technologies receive funding and support from an investment network tied to American intelligence and security agencies.

A story about the German drone company "Quantum Systems" reveals the scale of this contradiction. In a report published yesterday by Reuters, the agency disclosed that In-Q-Tel, linked to the U.S. Central Intelligence Agency (CIA), helped the German company enter the American market and establish channels with government and security institutions there.

"In-Q-Tel": An Investor Unlike Any Other

"The presence of American investors, including In-Q-Tel, made it easier for our company to launch operations in the United States and paved the way to access government clients, including the CIA and FBI," said Sven Kroch, co-CEO of Quantum Systems, in an interview with Reuters.

He added that the company had to establish manufacturing facilities and dedicated teams in the U.S. to comply with Washington’s requirements for foreign suppliers.

Quantum Systems produces drones and surveillance systems used by entities including the German Armed Forces and Ukraine. According to Reuters, the company’s valuation reached approximately $8 billion following a funding round of $1.2 billion in July 2026.

The significance of In-Q-Tel lies in the fact that it is not a conventional investment fund. Founded in 1999 on the initiative of U.S. intelligence officials, its mission was to identify technologies that could serve national security and accelerate their deployment into government institutions.

The company states on its official website that it invests in areas including artificial intelligence, cybersecurity, space, and drones, and collaborates with several U.S. intelligence and security agencies.

In-Q-Tel was an early investor in companies such as Palantir and Anduril, which later became leading names in the U.S. military technology sector.

52 European Companies Under Scrutiny

Quantum Systems is not an isolated case. A May 11 investigation by the Dutch platform Follow the Money concluded that In-Q-Tel has invested in at least 52 emerging European startups, including Austria’s Blackshark, specializing in satellite image analysis, and Germany’s Cerebit, focused on data storage.

According to the investigation, In-Q-Tel’s investments in Europe rose from around $5 million in 2017 to $35 million in 2023, reflecting a clear expansion of capital linked to the U.S. security apparatus within Europe’s technology sector.

Investment Is Not Control—But It Is Influence

The presence of an In-Q-Tel investment does not mean the CIA owns or directly controls the European companies. Quantum Systems is a German company, and available data do not indicate U.S. agency ownership.

Yet the issue goes beyond the size of financial stakes. In the defense industry, investment can open doors to government institutions, provide insider knowledge of market needs, and help companies secure contracts and field testing opportunities.

Mary-Agnès Schwalbe-Zimmermann, chair of the European Parliament’s Committee on Security and Defense, warned in statements relayed by Reuters against treating In-Q-Tel merely as a traditional financial investor, emphasizing that its mission includes securing access to advanced technologies for the benefit of U.S. intelligence agencies.

The Most Dangerous Constraint: Technology Export Rights

The sensitivity of the issue increases when U.S. technology becomes part of European products. According to the same investigation, Quantum Systems cannot sell certain technologies developed in the United States to other countries without U.S. approval.

Here, the central question shifts: it’s no longer just who owns the company? But who controls the right to use and export the technology?

The company may be German and headquartered in Europe, but parts of its technology or production processes may fall under U.S. regulations that determine where the product can be sold.

American Capital: Dependence Beyond Weapons

This issue places the European defense independence project in a dilemma that extends beyond weapons themselves. A study by the German Institute for International and Security Affairs (SWP) titled "With Washington, Without It, Against It: Redefining Europe’s Relations with the United States" warns that Europe’s reliance on U.S. technology could become a tool of political pressure, especially as the continued U.S. security umbrella is no longer guaranteed.

The study argues that enhancing European autonomy requires more than increased military spending—it demands building greater resilience in technology and cybersecurity, alongside strengthening European military capabilities and reducing strategic dependencies on the United States.

This perspective gains particular urgency amid the growing American investments in European firms. The issue is not only about who builds the drone or missile, but also who funds the technology, owns its rights, sets licensing and export conditions, and controls access to markets and government contracts.

Europe may succeed in producing European-made weapons, but it will not achieve full defense independence if key elements such as technology, capital, supply chains, and export rights remain tied to entities outside the continent.