Bessemer Bets on War Worries in Europe

The name of Bessemer Venture Partners is tied closely with the cloud software boom of the 2010s. The backer of Twilio, Shopify and Zoom even created its own Nasdaq index of cloud software companies, which I look at often to track the ups and downs of the market.

But it’s not a good time to be a software investor. That index of cloud stocks has badly lagged the overall market as corporate customers spend more on AI and less on older software. Where there’s a growing pile of money for startups is in government military agencies, particularly in Europe, which doesn’t have a government shutdown to worry about. That’s one reason Bessemer is ramping up defense startup deals on the continent.

Alex Ferrara, a Bessemer partner who made one of the first investments in Shopify, wrote in a report Thursday that the defense sector represents the “single largest growth opportunity in Europe today—and is on track to become Europe’s largest sector.”