Predictions for 2023: DefenceTech keeps growing

Siim Alatalu, CR14’s CEO shares professional insights from the frontlines of defence tech - with continued funding and growth predicted for 2023. On January 27, CR14 is taking the stage at Estonian Startup Awards to present the Defence and Security Tech of the Year award.

Estonian Startup Awards

Our #cyberrangers are backed up by 11 years of military cyber range experience, and until now, the focus has been on G2G partners and #NATO. In 2022, with Enterprise Estonia and Norwegian Grants, we started with the #OpenCyberRange (OCR) project aimed at the private sector and specifically #startups. We hope it creates a launchpad for new products to emerge and promotes security thinking and #cybersecurity educational activities. OCR will also be one of the test bases for NATO - Defence Innovation Accelerator for the North Atlantic (DIANA).

With continued importance, growth and funding predicted for the defence tech, we are honoured to support the Estonian Startup award for The Defence and Security Tech of 2022.

Here you will find the full interview by Lift99 & Estonian Startup Awards made with Siim Alatalu:

Before we dive into the past, present, and future - how are you doing? How was 2022 for CR14? It was a busy year for our #cyberrrangers. We built new partnerships and delivered commitments to NATO and other major clients. We empowered the world’s biggest cyber exercises to support what could potentially be life-saving training, like mobilising national cyber reserves to support hospitals under cyber-attack. Rough calculations say that 3500 + cyber experts got trained on our cyber range in 2022.   Of course, since February 24, the defence sector has become more important for all NATO allies. Estonia has provided Ukraine with military aid worth over 255 million euros, but it is no secret that Russia’s war on Ukraine also includes cyberspace. Ukraine has fended off Russian cyberattacks thanks to having invested in its own cyber resilience and working with Allies – which is essentially also our mission, to offer cyber exercises and training to be prepared. It is, therefore, essential that we help Ukraine in the field of cyber defence. Either it is by sending our servers to Ukraine to help them win the cyber war by building the necessary resources and/or helping them with some training.  

What was the most impactful startup-related move for CR14 in 2022? How was it significant? In 2022, we launched an Open Cyber Range (OCR) project with EAS and Norwegian grants. Previously, our cyber ranges focused on G2G, but now we are building a capability that is aimed at the private sector and specifically for startups. OCR is a virtual environment for cybersecurity training, testing, and development, and it will include tools and products not part of standard cloud service. We hope it creates a launchpad for new products to emerge and promotes security thinking and cybersecurity educational activities. OCR will also be one of the test bases for NATO DIANA (Defence Innovation Accelerator for the North Atlantic).  

Tell us about an exciting trend that you see coming up in 2023. What kind of change could it bring along for our startup sector?  The direction of a NATO innovation accelerator for 2023 focuses on energy resilience, secure information sharing and sensing, and surveillance — priorities that likely reflect lessons from the current war. 2023 will be an interesting year where an innovator would not ask what national security can do for him – but vice versa.  The defence sector expects a mega boost in this year’s allocation, with a critical focus on electronic warfare and cybersecurity. Only in Europe, EDA’s (European Defence Agency) 2022 budget amounted to €38 million to invest in defence innovation and research. NATO’s €1B venture fund also aims to invest in early-stage dual-use defence tech companies. Not to mention the expenditures on national defence. For the startup world, it would mean more government funding and international cooperation while working with the public sector. But it will also mean more pressure, responsibility and understanding of the importance of the sector to us all.

Name a challenge that you see the Estonian startup ecosystem struggling with currently. What could be a solution? From a (cyber) defence point of view, the Russian attack has created enormous demand for defence-related equipment, and the workforce shortage is affecting the defence sector’s response to new orders and increasing costs. Business agility and digital transformation will be vital to staying ahead, which is for sure not news for the Estonian startup ecosystem. For me, this means a call to action – collaborating, joining forces, and leading the way with pragmatic and smart solutions.

If you could pick any Estonian startup to become a major global success overnight, who would it be and why? The deep tech sector is on its way up and becoming more and more important daily! So, it is hard to bring out only one. But to challenge you with an idea - the one Estonian startup to become a major global success overnight will be the one that will solve the riddle of bridging usability with security. Cyber security as a business is all about trust. On the one hand, you would want to trust the technology and, at the same time, be trustworthy - yourself - for the technology.

At The Estonian Startup Awards 2022, you are giving over the award for The Defence and Security Tech of 2022. How does this category resonate with you? Can you drop a little teaser on how you will sum up the movements in this category in the past year?

In our latitude, security thinking should be natural, and the same applies to cybersecurity. Thus I, of course, appreciate this category. Bluntly said, we have seen evidently how David can match and thwart Goliath if it has the proper defence and security technology. It is a lesson that the governments of all other Davids and Goliaths are learning, too, thus increasing their investments to have the best technology at hand.

Eventually – when everything else is equal - the one with the best AI wins. Until then, however, the most cybersecurity-aware can sleep the best.

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