According to two people familiar with the progress of this round of financing, Castelion, a nearly four-year-old hypersonic missile research and development company, plans to launch a new round of financing with a post-investment target valuation of no less than US$120 billion. The company is targeting a valuation of at least four times its last funding round in December. The successful listing of SpaceX has greatly ignited investors' enthusiasm for investing in defense technology start-ups, and market funds have increased their attention to such companies significantly. Castellion’s three co-founders all worked for SpaceX.
At present, the leading investor in this round of financing and the total scale of fundraising have not been disclosed, and there is still room for adjustment in the final valuation. One of the people familiar with the matter said the company plans to complete this round of financing next month.
Before the start of this financing negotiation, Castellion had successively won multiple procurement contracts from the U.S. Department of Defense, and its operating performance had achieved a major breakthrough. On Tuesday, the U.S. Navy awarded the company a purchase order of approximately $23 million for 50 prototype Blackbeard hypersonic missiles. This type of weapon can fly at more than five times the speed of sound. This is also the first mass production order the company has received since its establishment. Castellion plans to complete the delivery of the weapon to the U.S. Navy next year.
The U.S. Department of Defense recently stated that it urgently needs weapons systems that can be mass-produced quickly. On the one hand, drones are widely used in battlefields such as Ukraine. On the other hand, the war in Iran has consumed a large amount of the country's advanced weapons inventory. The U.S. defense appropriations bill for fiscal year 2027 is currently under review by Congress. The bill proposes to allocate nearly $500 million in special funds to purchase low-cost hypersonic strike weapon systems for the U.S. Army and Navy.
This year Castellion also won two other large-scale contracts from the U.S. Navy to adapt and integrate the "Blackbeard" missile into a variety of naval fighter jets. One of the contracts disclosed in April was worth as much as $105 million.
The company, headquartered in Torrance, California, has started construction of a 1,000-acre hypersonic weapons production industrial park in New Mexico in late 2025.
The founding team are all from SpaceX
Anduril and SpaceX have achieved successive commercial successes, allowing capital to see high returns on investment from asset-heavy defense companies, and Castellion took advantage of the situation to open a new round of financing. Data from market research firm PitchBook shows that global venture capital institutions invested nearly $50 billion in defense technology startups last year, compared with only about $27 billion the year before.
SpaceX set a record IPO financing of US$86 billion, bringing huge returns to investors such as Founders Fund and Valle Equity Partners. The market expects this to further increase capital investment enthusiasm in the defense track, especially favoring start-ups with SpaceX background.
The company's CEO and co-founder Brian Haggis was formerly SpaceX's senior director of government sales; co-founder and chief financial officer Andrew Kleitz was previously responsible for finance at SpaceX; co-founder and chief operating officer Sean Pitt served as SpaceX's head of commercial sales in Europe.
Castellion is one of several startups developing missile products for governments. Anduril Industries' pre-money valuation reached US$56 billion this spring, and it specializes in various types of autonomous drones and ammunition products. Earlier this month, defense technology company Mach Industries had a pre-money valuation of US$1.5 billion. The company recently acquired rocket manufacturer Exquadram, which independently develops hypersonic missiles.
Castellion raised $350 million in funding in December last year, led by Lightspeed Venture Partners and Altimit Capital, valuing the company at $28 billion.