Mr. Seibel, in its defensive war against Russia, Ukraine has developed the ability to achieve effective hits deep in the hinterland, and recently even demonstrated this on the sidelines of Putin’s economic forum in St. Petersburg. Russia, in turn, is hitting Ukrainian cities with its harshest missile and drone attacks in a long time. Are we currently experiencing the next level of escalation?
Yes, this is another escalation. But this time the reason is that Ukraine can put great pressure on the enemy’s supply chains. The Russians realize that if this continues for a while, they may actually lose the war. Fuel is already being rationed in Crimea. I see this as a kind of desperate act by the Russians.
But it is all the harder because modern hypersonic weapons are increasingly being used. There is little they and their Ukrainian partners can do about this with their drone defense systems.
Of course, Ukraine can only defend itself with what is made available to it or what it has built for itself. They have the slower swarms of Shahed drones very well under control. But of course the country was unable to develop its own alternative to the Patriot system so quickly during the war. That’s why Ukraine now actually needs the right answers from the West, but again they are not providing them sufficiently.
The suffering is great. How long can the country endure this?
Good question. What matters is the Russian arsenal of such weapons. Does Putin have hundreds or many thousands of these missiles? This is probably a very well-kept secret. But if Ukraine continues to push its needle, Putin may come under pressure at home and have to move. At the moment it is once again a difficult situation for Ukraine, but not a hopeless one.
Tensions are increasing in neighboring NATO countries: the Polish air force has been alerted, and a Russian drone has struck Romania.
The question will be whether the West will find a unified response to this attack on Romania, whether it was intentional or not. In any case, Putin would immediately use such an incident as an invitation to escalate. NATO would have to check whether this does not constitute an alliance under Article 5. You don’t have to send ground troops straight away, but closing Ukrainian airspace would be a clear signal.
A decent order from the European Union’s SAFE program for Romania went to Quantum Systems. What exactly does this include?
We will deliver additional drone systems for around 30 million euros. Through various options, this can later turn into a three-digit million volume. Romania now has to close its gaps. We are currently building a factory in Romania where we will produce some of our systems.
Quantum Systems has to build up a lot of production capacity anyway just to fulfill the order for 15,000 Strila drones for Ukraine from the spring.
The volume has now been expanded to 25,000. Part of the factory in Ukraine is finished and the first two and a half thousand drones have been delivered. Thousands more are added every month.
This is an impressive development. Nevertheless, effective drone defense requires ten times as much volume.
Yes, but we are not the only supplier to Ukraine. Together we can already deliver 200,000 to 300,000 drones.
The technical development on the battlefield is extremely high. What does effective drone defense currently look like?
The development is moving towards automated drone batteries, similar to Patriot missiles. Then each drone is no longer started by hand, but from a kind of container that then contains 50 or 100 drones. These container solutions are easier to position, for example on known entry routes. The reliability of the systems will also increase. Currently, a lot of control is done by hand; in the future, artificial intelligence will take over more and thus increase the probability of hits. Depending on the system, we are currently intercepting between 50 and 80 percent of attackers, and in the future we should be moving towards 90 percent. Then the Shahed drones will hopefully become ineffective.
Given the pace of development, how do you stay up to date with attackers?
Social media is a real treasure trove for this. Everything can be found there, from construction instructions to manuals for the latest product variants. You also often come across attack drones that have landed in a grain field because they ran out of fuel or didn’t detonate on impact. A lot can be extracted from there.
Sensitive data about weapons systems, which were previously targeted by armies of spies, is now freely shared online?
Yes, that is also the Ukrainians’ strategy. They specifically feed their industry all the data in order to accelerate innovations. There are no secrets between each other, and it works well. When it comes to survival, economic interests take a back seat.
Rheinmetall boss Armin Papperger recently received a lot of criticism because he spoke of housewives and Lego bricks when assessing the innovative strength of the Ukrainian defense industry. What do you think about that?
In a nutshell, Ukrainians have a high rate of innovation. Lots of quick iterations – that’s a mindset. They don’t strive for the perfect gold-edged solution that will never be finished, but instead rely on very fast, decentralized further developments. I assume that this is what Mr. Papperger meant when he expressed himself in such an unhappy and derogatory way.
These are almost conciliatory tones against the top dog Rheinmetall, which they otherwise like to criticize.
It is simply logical that production is less threatened by a hundred housewives than in a large factory. If I have many providers of drone defense systems, then they compete with each other, learn from each other, and you reach your goal faster than with one Rheinmetall that is responsible for everything.
This is called competition.
Even. The Americans have shown how it can’t be done. The industry there was merged at the end of the 1990s for strategic pricing reasons, and the result was that prices went up, quality went down and there were also major delays in delivery. We also make the same mistake when we provide Rheinmetall with an order cushion of 70, 80 or even 100 billion euros and thus, above all, support their share price. Instead of spending the money from the huge debt program where it is currently needed. And anything that cannot be delivered in two years will not be ordered at all. This is how you force speed and innovation.
The Bundestag’s budget committee recently stopped a few projects.
Yes, that’s true, but they would have to stop a lot more. In principle, everything would have to be put to the test. So far, this is just a small grind in the gears of the lobbyists from Rheinmetall and the other established players. There is a desperate need to equip the one brigade in Lithuania, and we are prepared to spend billions on this. For example, we buy new digital radios that obviously have technical problems instead of buying a few thousand units on the market that already work.
Time is of the essence, and it seems to be less risky for the Bundeswehr to buy from an established full-range supplier like Rheinmetall than from start-ups that still have to set up their production at the same time.
But Rheinmetall does not shine through delivery reliability. The 30 Sky Ranger systems for the Bundeswehr are already 16 months behind schedule, and nobody knows how long it will actually take in the end. I stand by the fact that 20 to 30 percent of the billions in defense should be invested in new providers and not just spend it all. This means we remain flexible.
Shouldn’t Quantum Systems and the other new companies try to grow even faster and reach a relevant size instead of pulling the “help the start-ups” card?
We don’t pull this card. We impress with functional products that can also be delivered. It is clear that the European defense industry cannot consist of 1,000 start-ups and three or four large players. But there is something in between, a middle class of companies with perhaps 5,000 employees. We want to get there. To achieve this, we want to double our sales from 300 million euros last year in 2026 and increase them again to around 1.2 billion euros next year. We are on track.
Ahead of the ILA aerospace trade fair in Berlin this week, they are showing snippets of their new Pulse P19 multi-purpose drone that can be armed. What exactly will you present?
P19 is our answer to rapidly changing requirements. An aircraft in the four to five ton class that can optionally also fly unmanned. Like all of our products, it combines many capabilities in one system. We will offer P19 in the roles of trainer, anti-drone, reconnaissance and also as a light attack aircraft. The first flight is already scheduled for 2027. At the ILA we are already talking to the first customers who can expect influx from 2028.
They communicate a lot on platforms anyway, most recently about their ambitions to break the speed record for drones of more than 700 kilometers per hour. Is this marketing, or does it also have a serious background?
You can call it marketing. This enables us to get people excited about working with us. We want to push the limits of what is possible and learn from them quickly. It’s similar to Formula 1 and the car industry. If the attack drones get faster and faster, we have to too.
When will you close your next round of financing, which is reportedly worth up to 800 million euros, and what will you do with the money?
We are on the home stretch. It’s still a few days away. This gives us the opportunity to further expand our production and also make strategic purchases.
There has been speculation in the financial center for some time about an IPO for Quantum Systems, especially since investors’ interest in defense is currently high. What is the reason for their reluctance?
There have been a lot of rumors since we did a sort of “health check” for an IPO. So we are ready at any time. Now let’s see what comes out of the financing round.
Florian Seibel With his company Quantum Systems, he is already part of the establishment of new German defense companies. In 2015, the engineer founded the company together with partners, which initially developed drones for agriculture. It later pivoted to defense and offered reconnaissance systems. Since then, the former Bundeswehr officer Seibel has been expanding the product range together with co-boss Sven Kruck and is driving development forward, primarily through partnerships in Ukraine. In addition to interceptor drones, the company just outside Munich also offers a ground vehicle and will present its own combat aircraft at the ILA. The goal: Quantum Systems should become a complete system provider (multi-domain). In debates, the 46-year-old Seibel does not shy away from clear words, neither about competition nor about what he sees as inefficient defense spending. Quantum Systems is currently close to completing a financing round that, with a valuation of at least six billion euros, should make it the second most valuable German start-up in the defense sector behind Helsing.
