Defense, security, and other hard technologies are attracting growing investor interest across CEE. In the first nine months of 2026, startups operating in these sectors across ten countries on the EU's eastern flank secured approximately €1.5B (CZK 37B) in investment, with the figure projected to reach €2.1B (CZK 51B) by the end of the year.
However, Czechia stands out for a different reason. According to data presented at the Engaged Investments 2026 conference in Prague, the country was the only market in the regional overview where startups in these sectors attracted no venture capital funding during the period.
The findings were among the topics discussed at the conference, organized by Czech investment group DEPO Ventures on October 21–22. The event brought together approximately 500 investors, founders, and technology executives from 27 countries to discuss the development of the CEE venture capital ecosystem.
Defense investment accelerates, but not evenly
According to an overview by the Defense Angels European Network (DAEN), an initiative involving DEPO Ventures, investment in so-called tough tech could more than double in 2026 compared with the previous year.
Since 2024, these sectors have accounted for nearly one-third of venture capital investment across the ten countries examined, compared with less than one-sixth in the rest of Europe. The data also points to the growing role of domestic capital, which accounted for approximately half of the investment recorded in the first nine months of 2026.
Finland leads the regional ranking, while Slovakia has emerged as the third-largest market, attracting more investment this year than in all previous years combined. Czechia, meanwhile, recorded no venture capital investment in the segment during the period covered. This does not mean Czech investors are absent from defense technology. Rather, some Czech capital is being deployed into companies outside the country.
CEE's next challenge: Turning capital into global companies
Beyond defense technology, discussions at Engaged Investments focused on the broader maturity of the region's venture capital ecosystem.
Speakers included representatives of the NATO Innovation Fund, European Investment Fund, NGP Capital, Warsaw Equity Group, Purple Ventures, and Silicon Gardens.
According to investors participating in the conference, CEE has moved from a shortage of venture capital towards a more developed funding environment over the past five years. In artificial intelligence alone, an estimated 50–60 funds are now investing across the region.
However, access to institutional capital, larger funding rounds, and exit opportunities remain important challenges.
"This year showed how far the region has come in the past few years. Investors from all over Europe came to Prague actively looking for opportunities, alongside founders who have built successful companies and are now helping others do the same," said Petr Šíma, Partner at DEPO Ventures and founder of Engaged Investments.
"The main question was no longer whether to invest in the region, but what to invest in and, above all, how to do it together," he added.
Šíma also highlighted the fragmentation of CEE's investment landscape, where relatively small national markets and funds can limit cross-border cooperation.
"If we as investors start treating it as one market and work together more across borders, we can build companies that matter at a European level."
Another development discussed was the growing number of successful founders becoming investors themselves. According to figures cited during one panel, as many as 90% of founders are also investing, although the scope and methodology behind this estimate were not specified.
Deep tech and regulatory readiness gain importance
Investors also identified deep tech as an increasingly important area for the region's future development.
As AI reduces the time and cost required to develop software products, technologies based on specialized scientific knowledge, intellectual property, and complex engineering could become more attractive to investors.
Universities and research institutions are expected to play a greater role in this transition, particularly as more programmes emerge to support commercialization and entrepreneurship.
However, technical capabilities alone are insufficient, particularly in highly regulated industries. "Founders who think about the legal and regulatory side from day one have a clear advantage with investors. Well-drafted contracts, IP protection and regulatory readiness save them time and money in later funding rounds," said Ivan Sagál, Partner at Bird & Bird.
"In defense and fintech this matters twice as much, because regulation is part of the product itself."
Fintech faces growing pressure to deliver more with less
The conference's second day focused on fintech and early-stage startups, with approximately 60 companies pitching to investors during the Startup Showcase.
The fintech programme, UnBundled, organised by The FinTechers in cooperation with Mastercard, brought together financial institutions, startups, and investors to examine challenges ranging from payment fraud liability to the changing economics of financial product development.
Capital efficiency emerged as a central theme. Investors are increasingly expecting fintech startups to demonstrate rapid execution, lean operations, and disciplined spending.
Member discussion