MUNICH, Aug 31 - Quantum Systems, a German developer of reconnaissance, attack and interceptor drones, established an early commercial foothold in the United States with assistance from U.S. investors linked to the Central Intelligence Agency, its co-CEO said.
Sven Kruck told Reuters that investors, among them In-Q-Tel - often referred to by its initials IQT - helped open doors in Washington and contributed to winning work with the Central Intelligence Agency and the Federal Bureau of Investigation. Those connections, Kruck said, lowered barriers to entry in the U.S. market and helped position Quantum as a credible supplier to American intelligence customers.
"It made it easier to get started in the U.S. with clients CIA and FBI," Kruck said. "There were routes that opened up. That’s how we found the way to the USA. We were stronger in the U.S. early on, where the German customer was much weaker."
Kruck added that the business stemming from a reconnaissance contract with U.S. intelligence agencies was modest in financial terms but significant for the company’s reputation. The contract, he said, helped Quantum establish credibility in a market where early validation from influential buyers can be decisive.
Investor ties and market access
The company’s experience highlights how U.S. capital and networks remain influential for European defence startups. In-Q-Tel, a venture capital firm formed by U.S. intelligence officials to identify and invest in technologies relevant to national security, has been active in backing firms working on technologies spanning cybersecurity, energy, satellites and defence. IQT holds stakes in several companies, including the German defence firm Stark, and has previously invested in data analytics and defence technology companies such as Palantir Technologies and Anduril.
IQT’s investments are typically modest in dollar terms - often less than $3 million, according to a person familiar with its operations quoted in the reporting - but the firm’s value, this person and others argue, lies in its ability to connect portfolio companies with U.S. defence buyers, which are among the sector’s largest spenders.
Jennifer Nelson, executive vice president international at IQT, responded to questions noting Europe’s deep-tech ecosystem as a critical source of mission-relevant innovation. "Germany is a particularly important innovation partner and strategic ally," she said, calling Germany a "cornerstone of Europe’s defence ecosystem" and saying IQT continues to expand investments in German dual-use innovators so allied government teams can evaluate and adopt breakthrough capabilities faster.
Strategic concerns and regulatory constraints
The involvement of a U.S. intelligence-linked investor in European defence firms has prompted concerns among some politicians and policymakers that strategically important technologies could become linked to U.S. interests through investment stakes, observation rights, development and licence deals, and access to government contracts.
Marie-Agnes Strack-Zimmermann, chair of the European Parliament’s security and defence committee, said IQT should be viewed differently from a conventional investor because of its ties to U.S. intelligence agencies. "In-Q-Tel is not a purely financial investor but has a mandate to secure access to the best technologies for the U.S. intelligence services," she said. "There can be strategic influence beyond the business with the United States through investment stakes, observation rights, development and licence deals as well as the access to government contracts."
The case also illustrates legal and contractual limits: technology developed in the United States cannot be sold by foreign suppliers to other countries without U.S. approval. That constraint shapes how European defence firms structure operations, partnerships and supply chains when U.S. capital or work is involved.
Germany’s defence ambitions and market realities
Germany is pursuing a strengthening of its military capabilities after concerns about U.S. policy under President Donald Trump. But Kruck and others emphasise the difficulty of rebuilding long-neglected defence capacity without access to U.S. capital and defence markets. For companies such as Quantum, engaging with American investors and buyers has required local presence: "That is why we have factories in the USA and staff there," Kruck said, pointing to Washington’s requirement that foreign defence suppliers establish local operations in the U.S.
Germany’s defence ministry said it takes investor influence in the defence sector seriously and that shareholders should not interfere with a company’s operations, technology or research.
Kruck noted that other investors beyond IQT also supported the company and that every investor brings networks that can be useful. "Every investor ... has a network behind it and, logically, you try to use this," he said. "At the end of the day, your products have to be convincing. But for sure, American investors ... know the administration that rules and make it possible to open up communication." He added that IQT had not sent him a "proactive email" in the past two years.
Broader implications
The Quantum case underscores the practical ways in which U.S. investment and institutional links can accelerate the market entry of European defence technologies into the U.S. system, while also exposing tensions as European governments seek to diversify their defence supply chains and financing. IQT has signalled increased focus on Europe as spending on military capabilities rises across the continent; its stated intent is to help allied government teams identify and adopt breakthrough capabilities faster.
U.S. intelligence itself has indicated a renewed emphasis on collaborating with the private sector. Earlier this year, CIA Director John Ratcliffe said the agency was "optimizing our approach to working with the private sector." The CIA declined to comment for this reporting.
Quantum Systems, now described as one of Europe’s largest defence startups with a valuation around $8 billion, sells reconnaissance, attack and interceptor drones to customers that include Ukraine and Germany. The company’s experience reflects both the opportunities and constraints that arise when European defence innovators engage with U.S.-linked investors and buyers.
Summary
Quantum Systems credited connections to In-Q-Tel and other U.S. investors for helping it access U.S. intelligence customers, a relationship that provided modest contracts but considerable reputational benefit. The episode illustrates how U.S. capital and networks can shape the trajectory of European defence startups even as European governments aim for greater strategic independence.