In today’s rapidly evolving technological landscape, dual-use technologies, innovations that can be used in at least two sectors, are gaining attention for their strategic and economic advantages. Support for enterprises that operate across multiple industries is increasing as it can enhance resilience and expand potential market size. This versatility makes dual-use technologies particularly appealing not only for businesses but also for investors, including venture capitalists, who seek opportunities with broader commercialization potential and reduced dependency on a single industry. However, balancing regulatory requirements, resource allocation, and ethical considerations remains a key challenge. From existing dual-use technologies to their advantages and challenges, Addionics’ solution is prominent and designed to serve diverse sectors.
The Rise of Defense Tech
Global defense spending is surging, with budgets expected to exceed $2 trillion in 2024 as nations prioritize military modernization. While the U.S. Department of Defense has committed $1.1 billion to replicator drones, European defense spending is projected to reach €326 billion. A growing share of these budgets is directed toward emerging technologies like drones, satellites, and autonomous systems, all of which depend on high-performance energy storage solutions. In addition to this, Q2 2024, saw 13 private equity deals worth $1.3 billion in the aerospace and defense sectors, reflecting strong investor interest. As a result, this rapid influx of funding is driving advancements across defense technologies, making energy storage solutions like batteries a critical component of modern military systems.
Innovations Bridging Applications
Amidst the growing need for optimal energy storage, technologies that are used for EVs demonstrate their dual-use potential. For unmanned aerial vehicles, commonly referred to as drones, they have versatile applications across both defense and civilian sectors. Indeed, the U.S. Air Force’s Task Force 99 is in the process of acquiring new long-endurance drones to enhance intelligence, surveillance, and reconnaissance capabilities in the Middle East. In the civilian domain, drones are increasingly employed for infrastructure monitoring and disaster response. Nokia, in partnership with Swisscom, initiated the deployment of a network of 300 drones across Switzerland to enhance emergency response and facilitate infrastructure inspections.
Expanding Market Opportunities with Dual-Use Batteries
While these examples highlight dual-use across industries, the true advantage is when a company can develop a product that serves multiple sectors. This is especially relevant to the battery industry, where demand is skyrocketing due to both the EV revolution and the global shift toward renewable energy. Across industries from EVs to defense, to consumer electronics to large-scale energy storage, this ability broadens market opportunities at the same time as strengthening long-term viability, making dual-use innovation a powerful business strategy.
Batteries originally designed for EVs can also power defense applications. From reconnaissance drones to advanced weapons systems and off-grid military bases, this significantly expands their commercial potential, diversifying market opportunities and mitigating investment risks. Indeed, as defense budgets surge and governments prioritize technological advancements, dual-use battery companies can gain access to stable, high-value contracts that mitigate risks tied to economic fluctuations.
At the same time, the global energy transition is powering demand for grid-scale storage solutions, making batteries indispensable across both civilian and defense sectors. As such, companies that develop technologies capable of serving multiple industries will be best positioned to attract funding, secure partnerships with major corporations, and scale rapidly. In this evolving landscape, dual-use battery manufacturers are emerging as some of the most strategic and attractive investment opportunities.
Investment Potential and Strategic Growth
Dual-use technologies offer significant advantages by expanding market opportunities, attracting investment, and driving innovation across industries. Companies that develop solutions for both civilian and defense applications benefit from a broader customer base, reducing reliance on a single market and increasing resilience in changing economic conditions. Japan, for example, is actively encouraging small and medium-sized enterprises to explore military applications for their existing commercial products. Companies like Mitsufuji, known for its wearable technology, are adapting their innovations for defense purposes, allowing them to tap into new revenue streams while continuing to serve civilian markets.
Similarly, the dual-use approach also enhances a company’s attractiveness to investors by offering a diversified portfolio that mitigates risks associated with dependence on a single market. In 2024, venture capital investments in defense-related startups within NATO countries reached $3.9 billion, reflecting a growing interest in technologies applicable to both civilian and military domains. Indeed, Farsight Vision, a Ukrainian startup specializing in situational awareness software for drones, has secured funding to develop solutions that serve both defense needs and civilian industries including mining and logistics.
The Challenges of Dual-Use Technologies
Despite their advantages, dual-use technologies still present some challenges, particularly in navigating regulatory frameworks and managing resource allocation. Indeed, companies operating in this space must comply with evolving export controls, which can complicate international collaboration and limit market access. As such, in October 2024, China introduced new regulations governing the export of dual-use items, effective December 1, 2024. These regulations require exporters to disclose the ultimate user and intended use of goods, implement a permit system, and adhere to a list of restricted items. These measures aim to enhance transparency and control over exports with both civilian and military applications.
Furthermore, developing dual-use technologies requires significant resource allocation, as companies must meet the stringent requirements of two markets. Indeed, compliance with shifting regulatory landscapes, coupled with the need for rigorous testing and certification, can strain financial and human resources. The recent tightening of export controls in China has forced companies to establish comprehensive compliance programs, diverting investment from innovation to legal and administrative processes.
Moreover, businesses must invest in oversight mechanisms to prevent the misuse of their technologies, implementing governance structures that align with ethical standards and public trust. Indeed, the dual-use nature of many technologies presents ethical dilemmas when innovations intended for civilian applications find military uses. This duality necessitates the development of robust internal compliance programs to ensure that technological advancements do not inadvertently contribute to military conflicts or human rights violations.
Enhancing Dual-Use Potential with Addionics
Addionics technology is able to make significant advancements in two industries: EVs and defense. The innovative 3D Current Collectors can enhance energy storage solutions, improving the performance and efficiency of batteries in both EVs and a range of defense applications. This drop-in solution can be seamlessly integrated into any existing manufacturing line, providing a smooth transition for companies looking to enhance their battery performance without major operational disruptions. Already being utilized by top OEMs, Addionics’ technology offers a versatile and scalable approach to improving energy storage solutions. Its compatibility with all battery chemistries, whether established or emerging, ensures a flexibility that allows manufacturers to leverage the latest advancements in battery technology, regardless of their industry. Therefore, by serving diverse markets, Addionics is unlocking new opportunities for growth while addressing critical needs across both civilian and military domains. Additionally, Addionics’ ability to integrate cutting-edge technology into multiple industries highlights its potential to drive innovation in the years ahead.
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