Good morning Leigh,

Under pressure to cut public spending, UK finance minister Rachel Reeves found enough wiggle room to pledge £400m of investment to the country’s defence tech sector. 

Announcing her Spring Budget on Wednesday, Reeves said a minimum of 10% of the Ministry of Defence’s equipment budget would be spent on new and emerging technologies like drones and AI.

As part of the Labour government’s plan to turn Britain into a “defence industrial superpower,” Reeves also promised to reform the country’s procurement system, making it easier for startups in the sector to win public contracts.

Elsewhere...

• 10 German soonicorns to watch
• When his intimate photos leaked, this founder turned a devastating experience into an AI startup
• DeepMind and SoftBank alums raise $3.5m for AI-powered consultancy platform Ethos

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Accelerate is the BVCA’s dedicated event for venture capital investors. Join senior politicians including technology secretary Peter Kyle MP, business leaders, innovative entrepreneurs and experienced investors in central London on 8 May to understand the latest developments in VC.

🪖 The UK government has said it will invest £400m in defence tech and promised to reform the procurement process for startups in the sector.

🧠 Ethos, the AI-powered consultancy platform founded by a former DeepMind scientist and an ex-SoftBank manager, has raised a seed funding round backed by General Catalyst.

Sifted 100: UK & Ireland Leaderboard

Our regional ranking is back, spotlighting 100 startups scaling fast across the UK and Irish ecosystems based on revenue growth. Find out which companies are making waves and setting new benchmarks for growth and the investors backing them.

🦄 2024 wasn’t a fertile year for unicorns in Germany, but using Dealroom data, we identified 10 German startups on the road to a $1bn valuation. 

📵 When their intimate photos leaked online, this founder decided to turn their devastating experience into an AI startup dedicated to “ceartas” (the Irish word for justice). 

🔍 How to create an SEO strategy for AI search.

🔒 AI is “supercharging” fraud attempts on consumers and businesses: Here’s how to protect your startup. (Sponsored by Signicat)

Marseille, France-based Gravithy, which is an iron producer for the clean steel industry, raised €60m in funding. Japan Hydrogen Fund, Marcegaglia, Ecolab, Rio Tinto, Siemens, Engie New Ventures and InnoEnergy.

London-based Paid, which is a monetisation platform for AI agents, raised €10m in pre-seed funding. EQT Ventures, Sequoia Capital, GMTFund, Exceptional Capital, Alt Capital, SV Angel and Founders Co-op participated in the round. 

Cologne, Germany-based Specter Automation, a 3D model-based assistance system for construction site management, raised €5m in seed funding. Shilling VC, Almaz Capital, PAWAO, TechVision Fund, LBBW Venture Capital and Xdeck Ventures participated in the round.

London-based Rival, a 3D content platform, raised $4.2m in pre-seed funding. Speedinvest led the round and was joined by investors including New Renaissance Ventures.

Modena, Italy-based Novac, which builds components for electric vehicles, raised €3.5m in seed funding. Eureka! Venture led the round and was joined by investors including CDP Venture Capital SGR and Galaxia.

Munich, Germany-based Differential Bio, a biomanufacturing startup, raised €2m in pre-seed funding. Ananda Impact Ventures and ReGen Ventures led the round and was joined by investors including Carbon 13, Climate Capital, Better Ventures and CDTM Ventures.

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