Shield AI raises $2 billion, acquires Aechelon Technology

US deep tech defence company Shield AI has announced it is raising USD 1.5 billion in Series G funding at a USD 12.7 billion post-money valuation and USD 500 million in fixed-return preferred equity financing. 

The Series G is led by Advent International and co-led by the Strategic Investment Group of JPMorganChase’s Security and Resiliency Initiative, with participation from existing investors Snowpoint Ventures, InnovationX, Riot Ventures, Disruptive, Apandion, and others, Shield AI said in a press release.

Funds managed by Blackstone are investing USD 500 million of preferred equity financing, as well as committing an additional USD 250 million delayed draw facility to support future growth. Advent’s Chairman David Mussafer will join Shield AI’s Board of Directors and JPMorganChase’s Todd Combs will join as a Board Observer. 

A portion of the proceeds will help fund the company’s planned acquisition of Aechelon Technology, a Sagewind Capital portfolio company, the press release said. 

Aechelon is a defense software company known for its high-fidelity simulation, physics-based sensors, and synthetic reality applications. 

Aechelon’s technology is used by the US military and allies to train pilots and test advanced aircraft and autonomous systems before live flight, and supports a range of critical national security platforms, including the Pentagon’s Joint Simulation Environment (JSE).   

“The acquisition of Aechelon will accelerate the work we are doing with Hivemind, particularly in simulation like the Department of War’s JSE. It’s an incredible company with a fantastic team and a leading technology that plays a role in how we think about the AI pilot development lifecycle,” said Shield AI CEO Gary Steele. “It will also help advance our Hivemind Foundation Model for Defense, which is trained in simulation and continuously refined through real-world operations.” 

“Shield AI is a rare asset with the potential to deliver strong growth over the coming years. V-BAT is rapidly scaling and delivering outcomes for militaries around the world,” said Advent’s David Mussafer. “X-BAT is a huge opportunity to redefine air power in the fighter jet market. Hivemind is one of the most experienced and proven AI pilots in the world. We couldn’t be more excited to partner with the Shield AI team.”   

“Through our Security and Resiliency Initiative, we are investing in generational companies who are poised to accelerate innovation, reinforce the defense industrial base, and help advance and scale mission-critical solutions,” said Todd Combs, Head of the Strategic Investment Group for JPMorganChase’s Security and Resiliency Initiative. “JPMorganChase is proud to support the AI pilots and next-generation autonomous aircraft that will strengthen global resilience and national security.” 

“We’re thrilled to continue our work and serve our customers under Shield AI,” said Nacho Sanz-Pastor, Co-founder and CEO, Aechelon. “Their vision of a future filled with autonomous systems protecting service members and civilians, and deterring conflict, is inspirational.”