Alex Kugajevsky, Principal on the NATO Innovation Fund’s adoption team, explores how NATO’s Task Force X (TFX) is advancing the integration of autonomous systems through the Eastern Flank Deterrence Line exercise in Lithuania.

With NIF portfolio companies ARX Robotics, Tekever and STARK participating, the pilot showcases how uncrewed technologies are shaping operational readiness, interoperability, and resilience across the Alliance, and how startups are positioned to maximize the impact of their innovations by rapidly incorporating feedback from end users in the field.

5 Key Takeaways

• Ukraine conflict catalyst: The war has accelerated mass adoption of small-medium autonomous systems due to their proven cost-effectiveness as force multipliers, with cheap, replaceable platforms changing battlefield calculus against larger, better-resourced enemies.
• Real-world NATO testing: Task Force X exercises in Lithuania and the Baltics are moving beyond strategy to actual operational integration, with NIF portfolio companies ARX Robotics and Tekever testing multi-domain autonomous capabilities alongside Allied forces.
• Next-generation integration: The breakthrough opportunity lies in coordinated manned-unmanned systems rather than simple replacement platforms, with initiatives like Future Combat Air System pointing toward exponential force multiplication through dynamic integration.
• Adoption success factors: Autonomous systems achieving rapid uptake must offer modular plug-and-play capabilities, seamless integration with existing command and control systems, and the ability to rapidly scale once military users experience their battlefield impact.
• Responsible innovation framework: NIF has established ethical guidelines aligned with NATO’s Principles of Responsible Use for AI and Autonomy, balancing rapid innovation demands with accountability, governance, and safety safeguards as companies scale.

Alex, why are autonomous systems becoming more prevalent in modern warfare, especially in Ukraine?

Alex Kugajevsky: The proliferation of autonomous systems has advanced rapidly since the 2022 invasion of Ukraine. Certainly, unmanned systems, particularly aerial vehicles, have been in operation for some time. However, these have largely tended towards larger and more costly platforms operating in an environment where air dominance has allowed for expansive employment.

The combat environment in Ukraine is pushing the evolution and adoption of autonomous systems, particularly in terms of the mass adoption of small- and medium-sized Unmanned Aerial Systems (UAS). We have seen rapid innovation, out of necessity, and the opportunity to employ new technologies in novel ways that are changing how we think about combat and the employment of autonomous systems.

One of the most compelling reasons to shift to more autonomy is seen in the economic comparisons of crewed versus uncrewed systems. Ukraine’s valiant and effective operations against a larger, better resourced enemy have in many ways been a result of rapid innovation and adaptation on the front lines, with cheap, numerous, and replaceable autonomous systems changing the calculus on the battlefield through their effectiveness. These unmanned systems are proven force multipliers – allowing smaller units to achieve greater impact, and force protectors, increasing the survivability of combatants and maintaining the resilience and combat capability of the force.

How is NATO accelerating the adoption and integration of autonomous and emerging defence technologies, and what roles do initiatives like the NIF and Task Force X (TFX) play in this process?

Alex Kugajevsky: To keep pace with battlefield innovation, NATO must adopt new technology faster and leverage a stronger, more agile defence system that emphasizes speed over perfection and uses and improves upon available technologies. The NIF plays a significant role in acting as a bridge in the ecosystem, connecting startups and emerging technologies to the demand for critical capabilities in support of defence, security, and resilience.

To translate this ambition into action, NATO is not only supporting innovation through investment and partnerships but also launching dedicated initiatives that put these technologies to the test in real operational environments. One such initiative is Task Force X (TFX) which exemplifies how NATO is moving from strategy to implementation by actively developing, testing, and integrating uncrewed and autonomous technologies to improve situational awareness, surveillance capabilities, and operational efficiency. Taking lessons and innovative approaches from Ukraine, this effort is about fostering a collaborative ecosystem that allows for rapid scaling of capabilities and showcases NATO’s ability to quickly adopt and integrate new technologies.

TFX Baltic represented the first step, in line with the recently released Rapid Adoption Action Plan (RAAP), for broader NATO efforts to rapidly acquire capabilities and to address gaps in an expedited, innovative manner. Demonstrating autonomous systems in a maritime environment, the NIF’s portfolio company Kraken Technology’s Unmanned Surface Vehicles (USVs) played a key role in the pilot, showing how autonomous systems enhanced the Alliance’s situational awareness and freed up limited crewed vessels for more critical priorities.

TFX Eastern Flank Deterrence Line (EFDL), which took place this September in Lithuania, builds on TFX Baltic’s success and learnings to focus on Unmanned Ground Systems (UGVs) capabilities and interoperability with German and Lithuanian forces as part of the EFDL’s multi-domain defence and deterrence network. The proliferation of unmanned systems across all domains has made integration, information-sharing, and operational coordination more complex. The insertion of this innovative pilot into the broader Grand Eagle exercise marks a significant step to addressing some of the major challenges with the adoption of new technologies.

Once again, NIF portfolio companies are playing a key role in the TFX model and RAAP framework, with ARX Robotics and Tekever pulled into early planning efforts and providing land and air platforms to test and validate integrated capabilities of ISR, logistics resupply, and strike capabilities in a realistic setting. Beyond simply demonstrating their effectiveness and driving new tactics of employment, these companies are helping to build trust in these new, emerging technologies and build towards improved operational readiness and cooperation, and connections between national efforts and priorities across the Alliance.

Correspondingly, ARX and Tekever will gain greater understanding of the problem and feedback to improve their products and enhance the capabilities being delivered to meet NATO demand signals.

Does the NIF target specific domains or applications for autonomy/autonomous systems when evaluating investment opportunities? If so, what are these and why?

Alex Kugajevsky: The NIF looks across domains: land, sea, air, and even space. The most developed area for autonomous systems has been UAVs. However, as operations in Ukraine are proving – such as Ukraine’s extremely effective use of maritime drones to inflict strategic losses on Russian naval capability – the importance of sea and land domains is rapidly increasing.

While large platforms and programs will remain key pieces of military capability, the mass adoption of small- and medium-sized UAS and the rapid iteration around technology development and changing tactics are opening opportunities in new areas in the autonomous space. Additionally, Counter-UAS and counter measures against existing unmanned capabilities – one great example being the development of fiber optic-controlled drones to counter electronic jamming – is another area seeing high demand signals.

How much of a role does dual-use play in the autonomy space?

Alex Kugajevsky: Autonomous systems are certainly not limited to the military. The concept of using a drone to deliver an Amazon package carries over to a UGV delivering ammunition to the front line. So, dual-use is absolutely applicable to autonomy. Now, the capability demands and operating environment are different for the military customer, meaning that in some cases the dual-use application becomes a more far-reaching endeavour. However, these dual-use capabilities are easily transferable across defence, security, and resilience (DSR) needs. Great examples of drone use in support of resilience include wildfire detection and response, search and rescue, and climate monitoring. One of the other benefits of dual-use for autonomous platforms is the resilient and scalable nature of the supply chains. By drawing on standard automotive parts, they avoid some of the challenges we find with exquisite components from which our “traditional” platforms are built.

How does adoption in the automation domain differ from adoption in other areas? What are the biggest challenges when it comes to automation adoption?

Alex Kugajevsky: Often adoption of autonomous systems requires new operational concepts and tactics beyond simply the replacement of a UxV for some other manned platform. Testing, piloting, and validating these technologies provide the means to encourage experimentation and innovation at the organizational level, leading to corresponding enhancements to the technology itself and boosting the demand signal for the capability as the benefits become clear. Another rapidly emerging challenge concerns the integration of lethality into autonomous systems – specifically, how much human involvement should be retained, if any, as these technologies advance and adversaries adapt. Some important debate and decisions will center on this aspect of autonomy.

What are the key criteria that distinguish automation solutions likely to achieve both rapid adoption and long-term impact within the Alliance?

Alex Kugajevsky: Autonomous systems must prove their worth in terms of cost savings, operational effectiveness, and ease of use. Accordingly, adoption efforts focus on getting UxVs into the hands of users through testing, pilots, and exercises that build trust with the user, achieve learnings to improve the platforms, and push organizations to adopt new methods of employment to maximize the effect these systems can have on the battlefield.

What is a technology that has not yet made it even though you believe it is needed?

Alex Kugajevsky: The potential to form a joint manned and unmanned system is on the horizon and represents a step function in UxV capability. Currently, unmanned systems largely replace manned capability. Think of a First Person View (FPV) drone acting as a remote surveillance platform in place of an on-foot patrol or a UGV replacing a crewed ambulance for medical evacuation. The impact of a coordinated and integrated manned and unmanned platform would be significant in terms of operational employment and tactics. The force multiplier effect would increase exponentially once a UxV could operate dynamically with its manned counterpart. We are seeing initial steps towards this with the Future Combat Air System (FCAS) and the Manned Unmanned System for HElicopteR (MUSHER) to develop interoperability between manned and unmanned systems, with the potential for UxVs to play similar roles across other domains.

What have been the most significant lessons learned from NIF’s early automation adoption initiatives, and how are these shaping your broader capability-driven investment strategy?

Alex Kugajevsky: Some key takeaways from what we have seen with the adoption of autonomous systems is that they absolutely must offer a modular platform for plug and play capabilities – be it a sensor package, strike capability, or something else. Additionally, these systems do not operate in a vacuum and must connect and interface with existing command and control systems. And importantly, once the military users experience what unmanned systems can bring to the table, demand skyrockets. So, a company must also be able to rapidly scale, to deliver against sharp increases in demand.

With rising demand for automation across land, sea, and air domains, what insights has NIF gained about where the greatest adoption gaps or opportunities lie?

Alex Kugajevsky: As autonomous systems proliferate, new ideas around their employment crop up across the board. So, we are confident that adoption gaps will persist for quite some time. That said, UAVs represent the most mature segment in the unmanned space, with UGVs and USVs quickly catching up. Additionally, countering these systems (C-UAS for aerial threats) is also seeing increasing demand signals as the threat-counter threat cycle accelerates as systems adapt quickly on the battlefield.

How is NIF leveraging its portfolio to help NATO and its members rapidly scale promising automation capabilities to meet operational needs?

Alex Kugajevsky: TFX Baltic and TFX EFDL are shining examples of the close relationship the NIF’s adoption team has with NATO and the ability to deliver needed capabilities against pressing operational needs. Kraken played an integral role in TFX Baltic’s maritime experimentation, and ARX and Tekever in last week’s TFX EFDL.

How does NIF actively foster partnerships and knowledge-sharing among portfolio companies such as Kraken, ARX, and Tekever to accelerate automation adoption? Are there specific examples where cross-learning has led to tangible results?

Alex Kugajevsky: The adoption team constantly works alongside the investment team to identify opportunities to foster partnerships and knowledge-sharing across the portfolio. TFX EFDL represents a great example where the NIF was able to work with NATO to bring in Tekever’s UAV platform to participate alongside ARX’s UGV, expanding the ground-focused pilot to a broader multi-domain testing opportunity.

Similarly, the modular approaches our portfolio companies have to their platforms offer ample space for collaboration, for example the incorporation of a loitering airborne capability launched from a plug-and-play ground platform is being tested.

How does NIF incorporate feedback from NATO stakeholders on automation capability needs into both its investment decisions and its strategy for supporting dual-use innovation and industrial revitalization across Europe?

Alex Kugajevsky: The NIF is establishing regular touchpoints with NATO stakeholders to gain a better understanding of demand signals and capability gaps at the NATO and member nation level. This includes coordination with planning and policy leaders on priorities derived from NATO’s Defence Planning Process and a close working relationship with NATO’s DIANA on finding and accelerating dual-use companies and technologies. The RAAP has been a transformational initiative that has provided an excellent framework to accelerate those organizational ties and information flows.

Additionally, exercises and pilots such as TFX EFDL provide unmatched opportunities to expose the military user to new technologies and for NIF portfolio companies to better understand the problem set and capability gaps their technologies can meet.

Automation in defence raises complex ethical questions. Has the NIF established any ethical guidelines for its automation investment approach?

Alex Kugajevsky: The responsible use and safety of autonomous platforms is fundamental to NIF’s investment decision making and portfolio support. Technology is rapidly developing, which poses ample opportunities and equally presents amply risks, ethical and safety concerns. NIF has created a Responsible Use Framework aligned with NATO’s Principles of Responsible Use (PRUs). NATO developed the PRUs for AI and Autonomy to ensure that the development and use of these technologies align with the common values and principles of the Alliance and are in accordance with international law. NIF’s approach balances innovation with principles and safety. The Fund’s framework analyses whether: 1) technologies are designed and deployed with the PRUs and can be trustworthy to both operators and the public; 2) a company has adequate accountability and governance; 3) risks are mitigated through appropriate safeguards; and 4) companies are monitored and guided as they scale and innovate to ensure continuity. NIF supports companies post-investment to implement responsible use into their AI systems and governance.

(More of our approach to responsible investing can be found here)