Founders: Ryan Tseng, Brandon Tseng, Andrew Reiter
CEO: Gary Steele
Launched: 2015
Headquarters: San Diego, California
Funding: $3.5 billion
Valuation: $12.7 billion
Key Technologies: Artificial intelligence, autonomous vehicles, edge computing, machine learning, robotics
Industry: Defense
Previous appearances on Disruptor 50 list: 1 (No. 38 in 2025)
Defense tech startup Shield AI hopes to break through next with the launch of its X-BAT, an AI-piloted, vertical takeoff and landing (VTOL) jet-powered fighter, with the San Diego-based company planning to build the prototype aircraft at a facility in Frisco, Texas. With a 2,000 mile range, and able to fly up to 50,000 feet, the vertical takeoff and landing technology is seen as ideal for remote location landings and takeoffs from places like ships in the middle of the ocean.
As demand for AI-powered defense systems rises globally, Shield AI is viewed not just as a drone company but as an infrastructure player in the next generation of autonomous warfare and national security technology.
Software with AI pilots, autonomous systems, and continuous updates is reshaping military power, fueled by significantly increased spending. The Trump administration has requested a $1.5 trillion defense budget for fiscal year 2027, a 40% increase, and a large jump to $55 billion for autonomous warfighting systems.
In March, Shield AI landed $1.5 billion from investors at a $12.7 billion valuation, more than double the $5.6 billion valuation in 2025 for the autonomous military aircraft maker. At the time of that deal, Shield AI acquired defense software company Aechelon Technology, a supplier of simulation testing for the Pentagon.
Last year, Shield AI began working with Ukrainian armed forces to train unmanned systems after its technology was tested in the conflict that began in 2022. In addition to opening an office in Ukraine last year, the startup opened offices in Oslo, Norway, to deepen collaboration with NATO allies and in Taiwan to strengthen the local drone and aerospace industry.
The startup's existing smaller V-BAT drone, which focuses on intelligence, surveillance, and reconnaissance (ISR), has won contracts with Japan's Navy, the Netherlands Ministry of Defense, and the European Border and Coast Guard Agency. Additionally, the defense tech startup began construction of an advanced production hub in Hyderabad, India, to manufacture, assemble and test its V-BAT drones for the Indian Armed Forces and global markets.
The company recently announced that V-BAT is in the running for as much as $800 million in Navy contracts for ISR, alongside other defense vendors.
The company also partnered with Singapore to supply its Hiveman Enterprise testing and development software to the Republic of Singapore Air Force. The V-BAT drone and Hiveman software have picked up additional customers in Asia, Europe and the Middle East.
"The software is a cornerstone and foundation for everything we do," Shield AI CEO Gary Steele told CNBC last October. "It will ultimately be the long-term growth driver of this business because it enables the development of this next-generation aircraft."
On Monday, Shield AI announced a deal with the Pentagon for Hivemind software to power low-cost uncrewed combat attack systems, or LUCAS drones.
It is also working with fellow Disruptor Anduril on software for the U.S. Air Force, with Hivemind pairing with Anduril's Fury aircraft within the Air Force's Collaborative Combat Aircraft program.
Spearheading this growth is Steele, who was appointed CEO in May 2025. He previously was a top marketing and sales executive at Cisco, which he joined in 2024 after selling cybersecurity and analytics company Splunk, where he was CEO, to the tech giant for $28 billion.
Steele told CNBC's Julia Boorstin and Morgan Brennan in an interview on Wednesday that Shield AI's technology has been able to prove itself in conflicts, in particular in Ukraine, by operating in environments without GPS or other forms of communication and still deliver the outcomes that allies need, and "we're able to take that to other conflicts around the globe for the U.S. military and allied militaries."
"What we see is this move from manned to unmanned, to move to less expensive systems ... this world of autonomy that we are living in is one where we think we can have a material effect on the battlefield and that's what we are seeing every day," Steele said. "It's the combination of the aircraft we deliver with the advanced AI software that allows us to fly autonomously and do mission autonomy ... all the swarming, teaming, all the those kinds of capabilities critical to the warfighter," he said.
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Correction: X-BAT, an AI-piloted, vertical takeoff and landing (VTOL) jet-powered fighter, will have a prototype aircraft built at a facility in Frisco, Texas. An earlier version of this article misstated the location.
