Every defense startup wants to be the next Anduril. Here's what one of its earliest backers is looking for now.

Equity

TechCrunch

Entrepreneurship, Business News, News, Business, Technology

4.2 • 372 Ratings

🗓️ 3 June 2026

⏱️ 38 minutes

🔗️ Recording | iTunes | RSS

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Summary

Defense tech is red hot right now, with a proposed 40% increase to the federal defense budget, Anduril doubling its valuation to $61 billion, and a wave of startups chasing government contracts. But according to Ross Fubini, the venture investor who wrote Anduril's first check, most of them won't make it. The valley of death between a prototype contract and a real production deal is about to claim a lot of companies. On this episode of TechCrunch's Equity podcast, Rebecca Bellan asks Fubini — the founder and managing partner of XYZ Venture Capital, built on the Palantir alumni network and now approaching $2B AUM — what separates the survivors from the rest. Listen to the full episode to hear: Why Ukraine and Iran have become live testing grounds for US defense startups, and which companies are getting in the field How other countries are building their own defense tech ecosystems, and what that means for where startups build and sell The sustainment problem nobody wants to talk about, and why autonomous logistics is the real moat Where Fubini is writing checks next, from AI-driven US manufacturing to government software for health and human services Subscribe to Equity on YouTube, Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:29.1	Hello, and welcome back to Equity TechCrunch's flagship podcast about the business of
0:33.2	startups. I'm Rebecca Boulon, and this is the episode where we bring on industry experts to help
0:37.9	us explore a trend in the tech world and dive deep. Regular listeners will know that defense is
0:42.6	red-hot right now, and it's been that way since the start of the Ukraine war when Silicon Valley
0:46.8	began to embrace the need for speed and innovation. Agentic warfare, logistic systems, and dual-use
0:52.4	tech like next-gen satellites are dominating the space.
0:55.9	And no one knows that more than today's guest, Ross Fubini, founder and managing partner of XYZ venture capital.
1:02.3	He built a VC firm off the back of his network with Palantir alums and investors.
1:07.1	He wrote the first check to Andruil, and now he's managing a portfolio at the intersection of defense, enterprise, software, and AI.
1:20.9	Ross, welcome to the show.
1:22.8	Rebecca, thanks for having me. Always good to see you.
1:24.9	Yeah, good to see you too. So you've had a pretty cool
1:27.5	history in Silicon Valley. You were trained as a computer scientist and engineer. You were at
1:32.3	Netscape. Now you're doing XYZ Venture Capital, which you founded in 2017, right? What was the founding
1:38.7	mission behind that? Thank you again for having me on the show. It's interesting. Maybe there's two parts of it.
1:46.8	One was to go back to your comment.
1:49.5	Really, you know, I was an engineer and a founder and executive.
	...

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