Hypersonic Weapons startup Castelion is raising a $350 million Series B led by Lightspeed Venture Partners and Altimeter Capital, according to sources and documents viewed by TechCrunch.
The round, which values a billion-person company, is expected to close in a few weeks. The term sheet has been signed. The new round comes just after $100 million in Series A funding, which closed in January. The round consisted of approximately $70 million in equity and $30 million in debt. LightSpeed also led the round.
Castelion declined to comment.
While it is notoriously difficult for non-traditional players to infiltrate a significant number of government defense markets, Castelion has made significant progress since its emergence from stealth in late 2023.
Despite the large US Department of Defense budget, military leaders have warned about China’s ability to develop quickly and perform field hypersonics. These weapons move beyond the Mach 5 – and China’s capabilities are beginning to surpass the US.
Castelion suggests a solution. This business takes a similar approach to SpaceX. Building quickly, testing frequently, and vertically integrate to reduce costs. It has already received grants and awards from a series of DOD offices, including the Air Force Research Institute and Naval Aviation Systems Command. The company tested its first high-sonic vehicle in the Mojave Desert in March. This is because the government is trying to prove that it can equip low-cost polar missiles on a large scale.
Castelion appeared in the US Army’s 2026 budget request, which was released in June. In the budget, the military sector will demand $25 million based on an initiative called Project HX3 and support the development and testing of “affordable, mass-produced high-sonic weapons” called Blackbeard Ground Launch (GL). As the document explains, the Blackbeard GL has approximately 80% of the capabilities of the long-range hemp-term weapon variant currently being developed by aerospace primes. However, through the contract, the Army says it is willing to trade a little speed and range with low-cost products.
The upcoming contract, essentially a deal made after President Trump signed the law in the budget, has two phases. The first can be seen first providing a “proof of concept of prototypes” to demonstrate in early 2026. BlackBeard is designed to be compatible with new launcher systems with autonomous features.
All of Castelion’s previous victory in DOD is Pitense compared to the potential that comes from the lucrative hypersonic weapons market. If the Army’s field testing goes well, Castelion could enter into a larger contract in early 2028 and begin offering black bear bone missiles.
Lockheed Martin, Raytheon and Northrop Grumman may want to see their backs.
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