British platform Grenadyr has invested in five Ukrainian defence tech startups. Defender is telling its story for the first time

British venture platform Grenadyr has to date made seven investments in defence tech companies: five in Ukrainian companies, and another two in British companies that work closely with Ukraine. Cheque size: $350,000 to $1.3m.

Grenadyr was founded by four partners, who initially supplied the Armed Forces of Ukraine with vehicles and other aid. They later began investing capital in defence manufacturers that could strengthen the defence of all of Europe.

Defender Media spoke to two of the platform’s partners – Tom Wozniak and Ash Hughes – about Grenadyr’s history, portfolio, typical cheque size, and the sectors of interest to investors.

Why the British began investing in Ukrainian defence tech

Grenadyr began as a humanitarian project – its founders have been supplying the Armed Forces of Ukraine with trucks, other vehicles, and non-lethal equipment since March 2022.

For example, they have handed over more than 550 vehicles. The money was raised privately from their own network in the UK, the US, and other countries.

Tom Wozniak says that they spent a lot of time with military units, including the Unmanned Systems Forces and special forces. The team began to develop increasingly deep connections with units, which told them about working technologies, products, and directions.

‘And as a logical continuation of our aid to the Armed Forces of Ukraine, we started making investments’, says Wozniak. Work in this direction started around two years ago.

The platform is run by four partners, two of whom do not disclose their names. Ash Hughes spent 25 years in the British Armed Forces, and later worked at an American defence tech company.

Hughes does not reveal its name, but hints that it was founded by a wealthy American and that its products are present in Ukraine. ‘Since 2017, I’ve spent 3–4 years of my life travelling to Ukraine’, he adds.

Tom Wozniak worked as a lawyer in M&A and private equity, was a partner at British and American law firms, and has also worked in Ukraine since 2007.

Both men have now left their previous positions and are fully focused on their work at Grenadyr. The partners explain that their motivation is to help Ukraine today – and their own ecosystem tomorrow – by supporting the development of defence tech companies and their entry into the international market.

Cheque size – from $350,000 to $1.3m

The partners call Grenadyr a venture-building platform because they are deeply involved in developing the companies they invest in. But over time, they plan to move to a more classic fund format.

The partners mostly use their own capital, but also raise external funds in parallel. Besides them, the team includes two more people.

‘But because of our background, history, and relationships across the entire defence technology ecosystem, there’s a huge network of people who bring us new opportunities’, adds Hughes.

To date, Grenadyr has invested in seven companies. Cheque size – from $350,000 to $1.3m.

Two of the companies that received money from the investors are British and work closely with Ukraine. The other five are Ukrainian. However, the speakers clarify that all the businesses they invest in have an international structure and legal entities in other countries.

In Britain, the team invested in a company working on drone autonomy that is also present in Ukraine, as well as in jet engine manufacturer Dynamic Propulsion.

The portfolio of Ukrainian startups looks as follows:

• Firebolt Engineering – developers of the Griffen jet interceptor drone. Dynamic Propulsion is developing the engine specifically for them;
• Forland Systems – UGV manufacturers, who are developing a drone together with the Achilles Unmanned Systems Brigade;
• Coalas Tech – developers of communications technologies;
• A smart mining system (the name is not disclosed);
• A British-Ukrainian response to the Hornet drone – a mid-strike drone with vertical take-off that is similar in characteristics and price to the American drone. It is already being used in combat missions.

A representative of Firebolt Engineering says that the partners from Grenadyr help them with their expertise in finance and company development. Meanwhile, the manufacturer’s team is more responsible for product development and its application in Ukraine. The developers met Grenadyr through the Defence Builder accelerator – the British were specifically looking for a product to invest in.

Forland Systems adds that Grenadyr not only provides financial support for their next-generation UGV project, but also has a good understanding of the challenges and works closely with the team to resolve them. This refers to engagement with the UK ecosystem to resolve production issues, source components, and so on.

What interests investors and how they choose companies

Grenadyr focuses on finding teams capable of building an international business. According to Wozniak, there are many companies with excellent products, but it is much harder to find manufacturers with international ambitions.

Thus, one of the criteria for selecting a startup is whether it can work with NATO and meet the alliance’s standards, and whether it can scale up production in the future.

Another criterion is whether the company closes a critical gap in European defence capabilities.

Speaking about areas of interest, Hughes names air defence at the tactical and operational levels. ‘There’s also the amalgamation of data and displaying that in a coherent and time-effective manner. Here, Ukraine is ahead of anyone in the world in terms of the volume of input data flowing into decision-making systems, the partner adds.

The third sector of interest to investors is components for defence tech products that will allow Europe to become more independent in production.

At the same time, the partners clarify that they do not plan to make a specific number of investments this year or next. At present, they are focused on developing the companies already in the portfolio.

But Wozniak says that they are still monitoring new opportunities and are in talks about potential investments. One possible future deal is with a developer of EW equipment.