Beyond the Battlefield: How Private Equity Can Fortify the Future of National Security
By Adam Barsky
Adam Barsky is Chairman of Investments at AEye Capital Partners, a private equity firm focused on acquiring and financing companies central to national security, aerospace, defense, and critical infrastructure. He also serves as Executive Vice President and Chief Financial Officer of the New York Power Authority, the largest state public power organization in the U.S. With over 30 years of leadership across finance, public policy, and infrastructure development, Barsky has held senior roles in some of New York’s most influential agencies. His expertise spans capital markets, budget strategy, and institutional planning, bridging the public and private sectors in support of high-impact investments.
We no longer live in an era defined by short-lived military engagements or isolated conflicts. The Russia-Ukraine war, the Israel-Hamas conflict, simmering tensions between India and Pakistan, and Syria’s unending civil war all signal a harsher geopolitical truth: conflict is stretching into decades, not months. These aren’t brief clashes or isolated flare-ups; they are structural shifts that will leave a lasting impact on markets and power politics for a generation.
From proxy wars to gray-zone cyber strikes, today’s conflicts are both deeply regional and globally disruptive. Supply chains, rare-earth minerals, fiber-optic cables, and capital flows now count as battlegrounds. Great-power rivalry is back, and it runs straight through the world’s commercial arteries.
A World Requiring Long-Term Capital Thinking
This new security landscape demands more than ad-hoc defense budgets and hurried procurement spikes. It calls for patient, multi-year funding: standing production lines, secured sub-tier suppliers, and perpetual R&D cycles. Private equity—armed with flexible, long-dated capital and a playbook for operational change—fits that brief.
Defense spending already reflects the shift, topping two-trillion dollars last year with the sharpest annual rise since the financial crisis. Those numbers signal more than reaction; they mark a strategic reset.
Why Private Equity Can’t Sit on the Sidelines
Private equity firms are increasingly recognizing the strategic importance of defense investment. In early 2025, investors poured fresh capital into aerospace tooling, cyber-hardening software, dual-use AI, and unmanned systems. Capital has flowed into mid-market defense manufacturers, unmanned systems, and next-generation logistics platforms demonstrating private equity’s unique ability to scale operations rapidly where state procurement processes lag behind.
Looking ahead, dominance on the battlefield alone won’t define geopolitical strength. Real power will rest with those who control the essential systems industrial capacity, energy autonomy, secure logistics, and digital sovereignty. These critical areas are where governments depend increasingly on outside support, but they can’t build or scale them on their own. Long-term private capital, aligned with mission-focused execution, is not just helpful. It’s essential.
The Cost of Leaving It to Governments Alone
Public coffers are vulnerable to election cycles and slow appropriations. In Ukraine, long lags in replenishing artillery shells laid bare the danger of thin supply chains. Private equity answers that gap with speed, governance discipline, and the freedom to reposition capital as threats evolve.
Blended Finance: A Force Multiplier
To mobilize capital at the scale required, governments should embrace blended finance models that combine public funds with private investments. The model has proved its worth in infrastructure and can do the same for defense, hard-tech manufacturing, and critical-mineral processing. By mitigating downside risk, it unlocks pools of institutional capital that would otherwise remain untapped.
A Global Opportunity Set
This is not a U.S.-only thesis. Germany has earmarked €100 billion for its Bundeswehr overhaul. The United Kingdom plans to lift defense spending to 3.5 percent of GDP within a decade. From the Gulf to the Indo-Pacific, nations are racing to on-shore production and secure supply chains. For globally minded general partners, the map is wide open.
Track Record in the Making
Specialist funds have already stitched together aerospace suppliers, cyber-defense platforms, and advanced-manufacturing assets—quietly building the scaffolding of tomorrow’s military readiness. These investments pay twice: they deliver competitive returns and strengthen national resilience.
The Call to Engage
The private-equity franchises that will define the coming decade won’t merely beat benchmarks; they will help design a safer world. Governments cannot shoulder today’s systemic security burdens alone. Private capital must lean in-shaping strategy, sharing risk, and scaling the industrial engines of deterrence.
This isn’t about militarizing portfolios. It is about recognizing that, in an era where peace feels temporary and threats feel permanent, strategic capital is mission-critical.