Quantum Systems Series C: €160M to scale European drone output

Quantum Systems has secured €160 million in Series C funding which it plans to use to scale production of its drones to 15,000 units per year by 2027, the company CEO, Florian Seibel, the company’s co-founder and co-CEO told Calibre Defence on the 7th May. 

“The idea of this raise was to double down and expedite our growth as we go into adjacent fields,” Florian explained from his office on the outskirts of Munich, adding that the company also has plans to further its development and expertise in software and AI. “We need to be, and will be more like Tesla, defining our great hardware with great software on it. We are moving from a company like BMW with great hardware, to a Tesla-like company with great software,” Florian said. “With Quantum we have a strong hardware foundation, with a lot of software in the back, but the customer doesn’t really see it…It took us ten years to get hardware right, and get quality technology in the supply chain,” he explained. 

Quantum Systems produces a range of uncrewed aerial systems like the Vector AI ISR platform, which is in use in Ukraine, as well as offering ISR as a service to government and commercial customers. To date, the company has focused on providing high quality hardware and nourishing its supply chain enabling it to scale production when needed. 

The supply chain is now key to Quantum’s future growth plans. Florian explained, “we produced 2,000 drones last year and we are planning to top that this year, and double it next year. But it takes time to scale production and get the tooling and parts right. We have enabled our suppliers to scale with us, so we can be sure that we will meet our target.” 

A strong ecosystem

The company’s growth plan is about more than further revenue, however, “We have great defence companies in Europe but the problem is volume and therefore price. But the mechanisms we have built make us better but not faster,” Florian said, before adding that “we need a strong defence ecosystem in Europe. I believe in competition and that competition produces the best products.” The company’s drive to increase drone production volume will necessarily develop this ecosystem, especially following its determined move away from Chinese components. 

“We started to source every part outside of China two years ago. That took a while, the parts from China are brilliantly engineered and they are hard to beat in terms of quality and volume, but we are there now.” This move was driven in part by advice from Quantum’s US CEO, where the use of Chinese components in drones has become a hot topic. As a result of this effort, much more of the Quantum Systems supply chain now sits in Europe, “we have datalinks in the US and gimbals in Israel, but maybe I need to found tier one suppliers in Europe to address those needs closer to home,” Florian wondered aloud. 

There are also plans to use the funding to support the Quantum Systems presence in the UK. “We have acquired a small UK company, which is now essentially a sales office, but I want to expand into the UK and have development and production there. We need each other, Europe and the UK, there are synergies that could benefit all of us.” The UK already has a growing drone sector with companies like Hydra Drones and Tekever providing a range of capabilities, however, additional competition may help drive innovation.

Looking ahead: Quantum Systems in Ukraine

Quantum Systems already has a team of 100 in Kyiv, supporting its drones that are deployed there. But Florian sees Ukraine as key to Europe’s defence, as well as a rich source of talent, suggesting that “for Europe to be able to ramp up and face an adversary on European soil, we will be dependent upon Ukraine.” The Series C funding will be used to establish deeper roots throughout Europe, including Ukraine. 

“The idea is to have centres of excellence in Germany, the US, and Kyiv. We are going to double from 100 to 200 people in Kyiv. There is great software and tech capability there; I can have better performing, better motivated people in Kyiv and I don’t have to pay them half a million,” Florian explained, referring to the very large salaries often paid and offered by Silicon Valley companies. 

“My experience is that Eastern European engineering is at the level, if not better than the engineering from the US,” he added. Growth in Ukraine will help further the company’s software and AI development. The Vector AI drone already deploys a suite of autonomous capabilities including GNSS free navigation and target detection, but the future is “about breaking the one drone, one operator paradigm,” in Florian’s words. “It’s about integrating other drones into our operating system. It’s about fleets of drones, and swarming, and autonomy in GNSS denied environments,” he continued, including ideas such as pre-selecting missions and allowing drones to fly them autonomously, before dumping the gathered data if a secure link is established at any given point. 

Florian sees room for more robotics on the battlefield, removing humans from combat, and also hopes that doing so will create spillover products that benefit everyday life. 

Investor profile: Balderton Capital

The Series C funding round followed a year of 100% growth in Quantum Systems’ revenue, as well as the acquisition of Nordic Unmanned UK and AirRobot. The funding round was led by Balderton Capital, a UK investment firm that specialises in early stage technology startups offering support from seed stage to IPO. Over the past two decades, Balderton Capital has invested in Revolut, the banking app, as well Darktrace and GoCardless. Balderton has raised a fund of $5.7 billion (€5.02 billion/£4.05 billion) in the past 20 years and invested in more than 250 companies. 

Other investors in the Quantum Systems Series C include Hensoldt, Airbus Defense and Space, Bullhound Capital, LP&E AG and existing investors, including HV Capital, Project A, Peter Thiel, DTCP, Omnes Capital, Airbus Ventures, Porsche SE and Notion. The funding brings the total financing raised by Quantum to €310 million ($352.16 million/£250.17 million). The funding round was not essential for Quantum, the company has experienced organic growth and had earnings before interest and taxes of €50 million in 2024. 

Calibre comment

Scaling drone production in Europe, using European supply chains as far as possible, would become critical in the event of a major war with Russia. Russia is relatively capable in terms of its electronic warfare and air defence capabilities, which would likely lead to heavy attrition of long-range reconnaissance drones. This means that NATO states would require a healthy pipeline of replacements to keep them competitive in the battle for ISTAR dominance. Under the current paradigm, reconnaissance drones are much closer to a munition than they are a platform. This essentially means that they should be expected to be lost and replaced at pace. 

By Sam Cranny-Evans, published on 9th May, 2025.