French Drone Startup Harmattan AI Targets $1 Billion Valuation

Paris-based defense startup Harmattan AI is preparing to raise new funding at a valuation of at least $1 billion according to sources familiar with the matter.

Harmattan AI launched in 2024 and builds AI-powered drone systems for military applications. The company has already secured backing from Germany's Atlantic Labs and other investors. This fundraising push comes just months after early-stage funding, showing rapid momentum in a hot sector.

The company's product lineup includes three drone types: a training system, a surveillance drone and an interceptor designed to stop incoming threats. Harmattan emphasizes low-cost, high-volume manufacturing as a core strategy. 

The startup plans to build a French factory capable of producing 10,000 drones monthly. Additional facilities in Germany and the US should open by 2026.

The timing supports Harmattan's ambitious goals. European defense tech is attracting surging interest from investors and governments responding to geopolitical risks and supply chain vulnerabilities. The drone and autonomous systems sector shows particularly strong activity.

Significant challenges remain despite promising prospects. High-volume manufacturing requires heavy capital investment and operational expertise. Defense procurement involves regulatory complexity, certification requirements and export controls. 

Drone hardware alone may not provide lasting competitive advantages in a crowded European market. Analysts have cautioned that too many drone startups are chasing similar opportunities.