Washington-based Watchtower Labs has emerged from stealth with $35 million in seed funding to develop AI-powered planning software for military operations.
The round was co-led by Shield Capital and Conviction, with participation from Founders Fund and In-Q-Tel, according to reporting by GeekWire.
The company was incubated within Shield Capital and is led by co-founder and CEO Akhil Iyer, a former US Marine Corps infantry and special operations officer who later worked in defense technology investing.
Its other co-founders are Souren Aghajanyan and John Morman, former Microsoft engineering leaders with experience building large distributed software systems.
Watchtower is starting with one of the most complex problems in military operations: logistics.
Military forces depend on large networks responsible for moving personnel, fuel, spare parts, medical supplies and equipment across different regions.
A plan that appears feasible under normal conditions can become impossible when infrastructure is disrupted, transport capacity changes or supplies arrive late.
Traditional logistics planning often requires specialists to combine information from different systems and manually evaluate possible scenarios.
Watchtower is developing software that uses AI, simulation and mathematical optimization to help commanders evaluate potential decisions.
Its platform allows users to describe planning problems in natural language, then models possible outcomes under different operating assumptions.
The software can generate and compare hundreds of scenarios, taking into account constraints such as available transport, supplies, routes and timing.
Rather than only showing where resources are currently located, it aims to predict what could happen under different operational conditions.
The distinction is significant.
Many existing defense software systems focus on situational awareness, helping operators understand current conditions.
Watchtower is attempting to help decision-makers evaluate future scenarios and identify courses of action before problems materialize.
The company combines language models with mathematical optimization rather than relying on AI-generated responses alone.
Its systems are designed to expose assumptions and trade-offs, allowing human operators to review proposed plans and retain responsibility for decisions.
Watchtower has already secured defense contracts.
In January 2026, the US Defense Innovation Unit selected Watchtower and Air Space Intelligence for prototype contracts under its Joint Sustainment Decision Tool program.
The program aims to improve military logistics planning by forecasting critical supply requirements and supporting scenario analysis.
Its mission partners include US Indo-Pacific Command, US Northern Command and the Defense Logistics Agency.
Watchtower also collaborated with the Naval Postgraduate School during 2025 to inform product development using operational research and defense expertise.
The company employs approximately 30 people across offices in Washington state, California, Hawaii and the Washington, DC area.
The new capital will support recruitment, execution of existing contracts and expansion beyond logistics into broader operational planning.
The commercial opportunity is driven by the increasing complexity of military operations and growing interest in applying AI to national security.
However, military procurement differs from conventional enterprise software sales.
Products must operate in demanding environments, integrate with existing government systems and satisfy security, reliability and operational requirements.
Watchtower also faces competition from established defense contractors and newer software companies targeting military intelligence and operational planning.
Its differentiation will depend on whether it can provide decision support that is accurate, explainable and useful under real operational conditions.
The company has confirmed generating revenue but has not disclosed financial figures or contract values.
The next test will be successful deployment with military users and expansion from prototype contracts into recurring operational programs.