Dual-use startups (those building technologies with both civilian and defense/security applications) are getting increasing attention in Europe, especially with the rise of NATO DIANA, the EU Defence Innovation Scheme (EUDIS), and the European Defence Fund (EDF). Dual-use startups are now seen as strategic assets. With NATO DIANA and EU initiatives aligning, Europe is building a more favorable environment, but cultural, financial, and bureaucratic barriers remain. The strongest opinion is that startups who manage to leverage both civil markets for scale and defense for credibility & funding will have the best chances to succeed.
Dual-use startups often operate at the intersection of deep tech and critical infrastructure: AI, robotics, quantum, space, cyber, energy systems, and advanced materials. These solutions have enormous civilian markets (e.g., logistics, agriculture, climate monitoring) but also immediate defense relevance (e.g., situational awareness, secure communications, autonomous systems).
This article explores this interesting topic of Dual-Use. We will explain what it is and we will share different opinions about it.
What’s a Dual-Use Tech Startup Anyway?
Consider a business that creates incredibly intelligent drones. During the day, it helps farmers manage irrigation, maps farmland, and even allows children to fly it for fun. The same drone is ruggedized, encrypted, and sent out to monitor borders or support search and rescue operations at night or when national security demands it. Dual-use technology refers to the same fundamental invention that powers both routine civilian uses and defense requirements.
Source : Lemur Legal
The best aspects of both technologies are combined in dual-use technology. On the one hand, civilian markets offer rapid reaction, scale, and widespread acceptability. On the other hand, defense contracts offer certification, reliability criteria, and steady, long-term revenue. Together, they create a strong and durable business model.
Let's look at how prominent organizations describe this concept and how it affects the startup environment.
NATO’s View on Dual-Use Technology
Dual-use technology is viewed as a strategic frontier by NATO. in the field of developing technologies, such as biotechnology, quantum, and artificial intelligence. The distinction between military and civilian applications is becoming more and more hazy. NATO stresses that many breakthroughs can advance security and scientific research, but it also warns of the dangers that arise when these technologies end up in the wrong hands. There is a chance that this technology will be abused for evil or harmful ends.
Source: Lemur Legal
NATO established DIANA (Defence Innovation Accelerator for the North Atlantic), an accelerator network that brings together governments, test facilities, companies, and academic institutions around the alliance, in order to promote innovation. It is driven by the €1 billion NATO Innovation Fund, which aims to accelerate dual-use inventions in fields such as secure communications, energy resilience, and sensing.
EU Regulation: What Counts as Dual-Use?
In the European Union, dual-use refers to goods, software, or technology that can be used for both peaceful and military ends, including the design or production of weapons like nuclear, chemical, or biological ones. That definition comes from the EU dual-use regulation (EC No 428/2009), which governs export control and licensing.
These goods are meticulously categorized, for instance, they include advanced electronics, navigation systems, encryption software, and sensors. So regulators know what needs special attention and control.
EUDIS and the EDF: Fueling Dual-Use Innovation
The European Defence Fund (EDF) play a major role in boosting dual-use development:
EUDIS (EU Defence Innovation Scheme) is a component of EDF designed especially for startups and SMEs. It provides access to funding, hackathons, accelerator programs, “spin-in” calls (to bring civilian innovation into defense), cascade funding, business coaching, and equity instruments tailored to dual-use projects.
The EDF itself is a broader R&D fund (budgeted in the billions through 2027) that supports strategic technology development in AI, cybersecurity, space, and more. Often, projects funded by the EDF have dual-use dimensions,even if focused on defense, they can also strengthen civilian sectors.
The EU also lists tools like the European Innovation Council (EIC), the HEDI hub within the European Defence Agency, and the Strategic Technologies for Europe Platform (STEP) as additional instruments supporting dual-use innovation across civil and defense domains.
U.S. Definitions of “Dual-Use”
In the United States, legal definitions of dual-use are embedded in federal statutes and regulatory frameworks:
50 U.S. Code § 4801 defines a dual-use item as one that has civilian applications and military, terrorism, WMD, or law-enforcement-related applications.
10 U.S. Code § 4801 uses a similar phrasing: dual-use products, services, or processes must be capable of meeting requirements for both military and nonmilitary applications.
AFCEA (U.S. Department of Defense) states that dual-use technology refers to R&D with potential for both defense and commercial use, including products like GPS, medical equipment, or navigation systems. Dual-use processes may also include manufacturing methods used in both sectors.
Why Dual-Use Startups Matter and How They Thrive
Dual-use startups are the super-smart chameleons of the tech world. They scale fast, thanks to civilian demand, and gain credibility, thanks to defense adoption. They tap into a wider spectrum of funding, from venture capital to EDF grants and NATO accelerators.
But it’s not just about money. It's also about building trust in two very different worlds. Civilian markets demand usability, UX, and cost efficiency. Defense markets demand reliability, security, and compliance. Startups that master both are rare, and consider this their competitive advantage