As the UK marked Small Business Saturday, the Ministry of Defence highlighted how dedicated innovation funding is enabling small firms across the country to turn early-stage ideas into deployable military technologies – while generating jobs and wider economic value.
Since July 2024, the Defence and Security Accelerator (DASA) has invested £35 million in projects led by small and medium-sized enterprises (SMEs). Many of the innovations funded have dual-use potential, with applications in healthcare, transport and telecommunications as well as defence.
The work sits alongside the creation of the new UK Defence Innovation (UKDI) organisation under the Strategic Defence Review, with a ringfenced annual budget of at least £400 million to support commercial innovation and novel technologies.
From concept to deployment
DASA, supported by scientific expertise from the Defence Science and Technology Laboratory, says recent funding rounds have helped a range of companies move technology from concept to pilot use and, in some cases, into service. Examples include:
• Scotland – QuickBlock: A modular block system originally designed for civilian use has been adapted for ballistic and blast protection.
• Wales – Trauma Simulation: A Swansea University spin-out developing full-body medical training models now used to train Combat Medics and Medical Emergency Response Teams.
• South West England – Sentinel Photonics: Laser-shielding attachments for rifle optics, developed by a start-up of former Dstl scientists, have been integrated into the KS1 rifles entering service. The firm has grown from a founder-led team to around 20 staff.
A recent analysis found that companies funded by DASA have generated nearly £1 billion in economic value and created around 1,800 jobs across the UK. In 2024 alone, DASA-funded firms raised £174 million in investment despite wider market pressures.
Defence as an engine for growth
Minister for Defence Readiness and Industry Luke Pollard MP said the government aims to back small firms that “create good jobs across the regions” while strengthening national security. He highlighted work ranging from satellite systems development in Oxford to ballistic protection advances in Scotland.
The Defence Industrial Strategy includes a target to increase MOD spending with SMEs by £2.5 billion by 2028, supported by a new Defence Office for Small Business Growth. The Strategic Defence Review also commits to spending 10% of the MOD’s equipment procurement budget on novel technologies each year.
Nationwide innovation ecosystem
DASA head Anita Friend said the organisation is committed to supporting innovation “in every corner of the UK,” recognising the value of regional expertise and industrial heritage.
The approach reflects a broader aim to ensure defence investment boosts both capability and local economies, with innovations emerging from tech clusters, rural communities, industrial hubs and universities alike.
The MOD notes that the number of small businesses in the UK has grown for the first time since 2020, rising to 5.64 million – a trend it hopes continued defence investment will help sustain.
