Shield AI has secured $2 billion in new funding, doubling its valuation to $12.7 billion as the defense-tech sector booms. The San Diego-based company, founded by former Navy SEAL Brandon Tseng, plans to use part of the proceeds to acquire Aechelon Technology, a simulation software maker. This move signals growing investor appetite for AI-driven military solutions.

Interest in autonomous defense technology has surged amid conflicts in Ukraine and the Middle East. Shield AI's drones and software are already deployed by multiple governments, including Ukraine's forces. The company's V-BAT drone, capable of vertical takeoff and landing, has proven valuable in combat operations against Russian forces.

The funding round, led by Advent International with participation from Blackstone and JPMorgan Chase, will also support development of Shield AI's forthcoming X-BAT drone, described as an armed autonomous fighter jet. CEO Gary Steele emphasized the company's ability to deliver advanced military capabilities at lower costs than traditional defense contractors.