Dual Use, Defence, and Disaster Investing - What Do They Mean for Venture Impact Investors?

Impact VC
Nov 12
5 min read

Conference season has been busy - and when the topic isn’t AI, it’s dual-use, defence, and resilience tech. Headlines include things like “Guns or Climate”, “Is dual-use climate 2.0?”, “Climate VCs investing in defence should stop.” You’ve seen the panels, the hot takes, the LinkedIn jibes.

But beneath the noise is a real question for impact investors, and generalist funds who are thinking more about impact: What should our role be in a world where resilience, security, defence and adaptation are increasingly becoming part of our pipeline, and sometimes, portfolios.

We brought ImpactVC members together with Amy Rennison (Co-Founder Earth Set, Climate and Impact Investor, VC Advisor), Luke Charbonnier-Bevan (Manager, Zinc), and Sareta Ashraph, (Barrister; Senior Legal Adviser, Center for Justice and Accountability) at our partner’s Morgan Lewis to unpack what dual use, defence, and disaster investing means for impact focused investors.

Let’s start with some definitions

Before diving into the why or how, we started with what we mean by:

Dual use technologies that can be applied in both civilian and military applications. Spans areas from nuclear materials, artificial intelligence, biotechnology, aerospace, materials science, and cyber technologies. It is increasingly less about the inherent characteristics of a technology (what a technology is) and more about the contexts and intentions behind its deployment (who uses it and how).
- The war in Ukraine has accelerated this discussion, revealing how cyber, drone, and earth-observation innovations originally conceived for military or civilian domains can be rapidly repurposed for both. For example, drone technologies initially intended for agriculture or environmental monitoring have been adapted for battlefield reconnaissance and artillery targeting, as well as humanitarian logistics and aid delivery in conflict zones.
Defence tech covers direct security and military innovations. Includes things like weapons systems, aircraft and drones, surveillance, cyber, robotics, space technologies, advanced materials, and more.
Disaster investing, sometimes reframed as investing in resilience, widens the lends further: energy security, food systems, supply-chain integrity, and infrastructure preparedness. It entails preventing negative outcomes and making systems robust to negative outcomes – from predicting big weather events, analysing soil health, or improving grid stability.

From Climate to Conflict: The Expanding Resilience Agenda

Resilience, or disaster investing, overlaps heavily with climate adaptation, which has long been overlooked relative to climate mitigation investing. There’s growing recognition that adaptation deserves more attention from investors, with increasing opportunities emerging in nature-based solutions (e.g. mangroves and biodiversity), despite these solutions often facing place-specific limitations.

Beyond nature-based approaches, there’s also significant innovation in data tools and information management products designed to help manage uncertainty around critical resources like water, food, and financial risk. Predictive technologies are especially relevant for disaster scenarios, from assessing tropical storm paths to ensuring targeted funding for preparation along those routes; meanwhile, more speculative solutions like geoengineering are still niche.

An advantage of dual use technologies is their ability to move innovations developed for military contexts into mainstream ethical debate - turning them from specialised tools into common mechanisms for both security and humanitarian objectives. For instance, space-based earth observation, once reserved for military applications, now tracks climate impacts like desertification; another example can be seen where AI-driven robotics are used as de-mining tools to protect civilians and groups harmed by conflict.

What are the risks of dual use, and what should investors consider?

Dual use carries risks where products and technologies can be used for unintended outcomes and consequences, for example, facial recognition technology can be used for documenting abuses but can also enable authoritarian surveillance. A great resource to help navigate this question is Finding the Good in Dual-use Technology: ESG for Dual-Use Venture Capital Investments from Reframe Venture (2024).

In the session, we discussed investment considerations such as:

Founder intent: ensuring the original mission aligns with intended social and environmental outcomes
Ethical guidelines and transparency: Be explicit about intended use cases and track how technologies are deployed. Planet Labs sets a strong precedent here, reporting on both humanitarian and defence applications.
Independent ethics boards: Ongoing oversight helps navigate grey areas, especially in fast-moving areas like AI.
Ethical exit strategies: Include clauses in investment documents that ensure responsible transitions if ownership or applications shift. More on how to navigate responsible exits here.
Impact licensing: was raised as a potentially useful tool - restricting technology use to specific, ethical applications. More on impact licensing here.

Should impact investors engage more in these areas?

This question sparked lively debate. This technology will be invested in - the question is by whom. We want good actors in the room, with processes for reflection and critique.

Many agreed that pure defence investing sits outside the mandate and comfort zone of most impact funds.
Adaptation and resilience, however, are squarely within scope and are underfunded. There are some specialists investing in this; however, more education and frameworks are needed across the ecosystem (we’ve included a few at the bottom of this piece).
There was a point made that investors should consider dual-use less as a technology class and more as a strategy. Many resources, from advanced materials to satellite data, have both civilian and defence potential. However, the commercial logic isn’t always straightforward.

Ultimately, conversations like this reveal just how entangled our global challenges have become. Dual-use, defence, and disaster investing are no longer niche, they’re becoming a bigger part of the European venture ecosystem.

As we left the session, some questions remained:

Where did this new climate resilience framing come from - and will it last?
How can we measure impact when success means preventing harm?
And what does responsible investing look like when the boundaries between defence, development, and disaster response are dissolving?
Is there a better way to think about impact when it comes to climate adaptation, and are there any go-to frameworks you use? We’ve shared a few frameworks below, but we’d really value your input if you know of others.