Hypersonic Missiles Startup Raises $100 Million for “Non-Nuclear Deterrent”
The startup promises to fill a void in one area where US military research and development has been caught flat-footed.

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Hypersonic refers to speeds that are five times faster than the speed of sound— or Mach 5, a.k.a. 3,836 miles per hour. In short: fast. It also represents an area where US military research and development has been caught flat-footed.
Defense startup Castelion, a developer of hypersonic missile systems, announced a $100 million fundraising round on Wednesday that will ideally help engineer a solution.
Playing Catch-Up
Beijing has led the world in the development of hypersonic missiles, Pentagon officials have warned. Russian President Vladimir Putin called a national television address in November to boast about the first use of his country’s hypersonic “Oreshnik” missile in its ongoing invasion of Ukraine.
But where there’s an R&D gap in America, a handful of Silicon Valley startups trying to bridge it are almost certain to follow — backed by venture capital, of course. Hypersonic aircraft company Hermeus and propulsion company Ursa Major are among those to emerge as hundreds of millions in investments have poured into the space.
Castelion is unique among the bunch because it’s developing a complete weapons system, including the aircraft, replete with “affordable, mass-produced hypersonic long-range strike weapons.” It is also considering building the warheads used by this “non-nuclear deterrent.” With the science a known, and the situation now a matter of playing catchup, its biggest hurdle may be overcoming a slow-to-adjust culture in the federal bureaucracy:
- Funders have opened their doors: VCs were predicted to pour $3.9 billion into defense tech startups in NATO countries last year, quadrupling the amount in 2019, according to Dealroom data. Over the past five years, 83% of NATO defense tech funding has come from US venture capital firms.
- The Pentagon has kept its doors closed: Venture-backed defense companies have received only about 1% of the more than $400 billion contracts awarded by the Department of Defense for every year, according to defense industry data company Govini. Almost all of the money goes to a small circle of mega-sized defense contractors that includes Lockheed Martin, Northrop Grumman, and General Dynamics.
Another Round: Castelion raised a mix of debt and equity, including $30 million in debt from Silicon Valley Bank, which is now a subsidiary of First Citizens after its 2023 collapse. Lead investor Lightspeed was joined by Andreessen Horowitz, also known as a16z and already an investor in naval tech firm Saronic and autonomous defense systems developer Anduril.