The European peace dividend: Why defense investment is vital for NATO and the EU
Lieutenant Colonel (Retired), Jennifer “JJ” Snow, The United States Air Force
Reawakening Europe’s innovation heritage
In the shadow of renewed European conflict, venture capital across Europe and NATO allies is rediscovering a powerful and sometimes uncomfortable origin: defense technology. Startups have long been synonymous with fintech, e-commerce, and green tech. But 2024’s reality proves that such consumer-centric innovation is possible only when peace, security, and sovereignty are assured. For the EU and NATO, investing in defense technologies is both a pragmatic necessity and a return to a forgotten regional strength.
Growing up in a family where both of my grandfathers served in World War II and one aunt was a radio operator in the Women’s Army Corps, I was always reminded of where we came from: Scotland, Ireland, Poland, Germany, and the Netherlands. As kids, we were taught to deeply respect the freedoms and responsibilities that came with being American including standing against authoritarian regimes and supporting our European allies, often our relatives. These lessons rooted a lifelong call to service and shaped my career. This is also why I felt called to write this particular article for IoT Tribe.
Europe’s greatest postwar industrial advances including Airbus, ArianeGroup, and the early microelectronics sector, were born from robust defense contracts and dual-use innovation. Western Europe’s economic development in the latter twentieth century, like Silicon Valley’s growth, was seeded by governments determined never to be strategically vulnerable again.
Russia’s invasion of Ukraine shattered long-held illusions about permanent continental peace. European capitals confronted not only the true cost of defense but also its opportunity. Fairchild Semiconductor’s story in Silicon Valley finds echoes across Europe in companies like Saab (Sweden), Leonardo (Italy), and MBDA (France/UK). Europe’s prosperity and values have long been built atop a willingness to invest in peace through strength.
A new moral framework: democratic defense
Over my twenty years as an intelligence officer, my family’s foundational values stayed with me, informing both my approach to security and respect for the deep ties linking the U.S. and Europe. Standing alongside our allies is deeply personal: their fight for regional security is also a struggle for our collective futures.
For NATO and the EU, this choice is as much moral as economic. Decades emphasizing “soft power” fostered discomfort with anything resembling militarization. Yet responsible defense investment is about credibility, deterrence, and protecting civilians, not aggression.
Both the EU and NATO have articulated clear ethical guidelines. The EU’s Coordinated Annual Review on Defence (CARD) and Strategic Compass stress dual-use technology and prioritize defensive, de-escalatory capabilities. NATO’s Innovation Fund supports precise systems that reduce civilian harm and empower de-escalation. These frameworks allow investors and innovators to set moral boundaries prioritizing human rights while refusing to cede technological dominance to authoritarian regimes.
European ethical traditions emphasizing proportionality, subsidiarity, and responsible force are now codified for modern battlefields. Startups like Helsing, focusing on AI for electronic warfare, and U-Blox, securing positioning technologies, exemplify this balance by delivering military utility with civilian benefits.
The dual-use dividend for security and economy
Europe best exemplifies the dual-use dividend: technologies designed for defense find civilian applications that boost broader societal resilience. GPS may have started as an American military system, but Galileo, Europe’s own global navigation satellite system, was deliberately designed for civilian and defense use. Quantum encryption technologies serve military command networks and the financial sector alike. Secure 5G communications protect government institutions and commercial logistics.
This overlap attracts venture capital and public-private partnerships. The European Defence Fund (EDF) actively co-invests in next-generation capabilities from AI-based cyber defense to renewable fuels for military logistics. Innovations conceived for NATO use rapidly adapt for climate resilience, supply chains, and crisis response in civilian contexts.
Geopolitics: Europe’s new strategic imperative
Europe is witnessing the re-militarization of its own backyard. Poland’s defense budget jumped 31% in 2023. Finland and Sweden’s accession to NATO brought new urgency to Scandinavian and Baltic security investments. Germany’s historic €100 billion “Zeitenwende” fund marked a turning point in rearmament.
Private investment is cautiously but steadily following. After decades barring defense-related funding, the European Investment Bank (EIB) has revised its criteria, signaling readiness to support firms enhancing European defense sovereignty especially when civilian benefits are clear.
Meanwhile, transatlantic competition and NATO interoperability concerns dominate summits, pushing the EU toward smarter, faster defense investment. The focus is not on “more spending,” but on innovation, efficiency, and leveraging Europe’s well-trained talent and engineering expertise.
Building Europe’s future defense innovation ecosystem
NATO and the EU operate expanding innovation hubs including DIANA (NATO’s Defence Innovation Accelerator for the North Atlantic) and the EU Agency for the Space Programme which are designed to link established primes, agile startups, and pioneering academic labs. Regulatory barriers are falling, and pan-European cross-border projects are becoming easier.
The most successful venture investors will combine a nuanced understanding of both Brussels and battlefield requirements. Bridging this gap ensures startups meet procurement needs, align with ethical frameworks, and scale impactfully.
Conclusion: The peace dividend, reimagined for Europe
Looking ahead to the security challenges facing NATO and the EU, there is a profound debt of gratitude owed to the nations, friends and relatives alike, that have stood shoulder to shoulder with us time and again, resisting terrorism, tyranny, and dictatorship. Renewing commitment through investment and partnership is more than strategy; it embodies shared history and sacrifice. I hope that we as Americans can contribute to Europe’s security strategy in meaningful ways that show how much we value their steadfastness and friendship.
Europe’s greatest peace dividend lies in harnessing the region’s extraordinary talent, capital, and purpose to innovate technologies that deter conflict, empower sovereignty, and foster security and prosperity. For the EU and NATO, embracing defense and dual-use investments is the engine of a secure, innovative, and values-driven Europe. The new peace dividend means readiness, resilience, and economic vitality born from capabilities, both weapons and technologies, that keep Europe safe and free.
This is a generational opportunity demanding vision, humility, and renewed commitment to postwar ideals. The future belongs to those who invest in both security and progress, ensuring the peace dividend endures for generations to come.
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