Valarian versus Palantir: Who will win the Game of Europe's thrones?

[Also read our original news story here]

Max Buchan has an explanation for the surge in demand at Valarian, the sovereign infrastructure company he cofounded in London in 2020.

Referring to a recent article in the FT about the “price” of Palantir’s political stance, he says: “That view that the companies that are viewed by the market as being an extension of the Trump administration has permeated, and I think, especially in Europe, it's created, I don't want to say animosity, but it has created concern.” 

In other words, he thinks Trump might be Valarian’s best salesperson.

And he might have a point.

European governments and companies have spent decades moving their data, software and institutional knowledge onto infrastructure controlled largely by American technology companies. Donald Trump’s return to the White House, growing tension between the US and Europe, Russia’s invasion of Ukraine and the prospect of future geopolitical ruptures have turned that dependency from what was once a mere technical issue, a simple flourish of a pen on a cloud hosting contract, into a strategic one.

Valarian is betting that governments will increasingly want the benefits of cloud computing and advanced AI without surrendering control of the applications, data and models running on top of them.

The company has now raised a $50 million Series A led by New Enterprise Associates, taking its total funding to $70 million. The round is NEA’s first European investment in defence and dual-use technology and will be used largely to expand Valarian’s engineering team and clear a backlog of deployments. Valarian says its systems are already operating across four continents.

But Buchan’s ambition now extends beyond providing a secure infrastructure layer. Customers are pulling Valarian further up the technology stack, he says, into data integration, sensor fusion and the “ontology” systems that connect information from multiple sources. That brings it directly into the territory occupied by Palantir and its Foundry platform.

“I do think there is some sensationalist commentary around [Palantir]. This is not just me being biased to Valerian, which of course I am,” he says, noting that much of their messaging is “either they're here or everyone in the NHS dies.”

“The idea that there's only one provider… just makes me nervous, and the reason that makes me nervous is I don't think it's good for the taxpayer if you don't have optionality.”

Meanwhile, Valarian and Palantir can at least chuckle about their relationship to fantasy fiction. While a “palantír” is one of several indestructible crystal balls from J. R. R. Tolkien's epic fantasy novel The Lord of the Rings, the Valyrian Freehold in “Game of Thrones” played host to several “Dragonlords”.

Buchan’s interest in sovereignty grew out of his previous job at CoinShares, the digital asset investment business where he was its first employee.

CoinShares expanded across London, Stockholm, Paris, New York and Jersey as the cryptocurrency market grew. The experience exposed Buchan to the practical difficulties of operating a regulated business across multiple jurisdictions, each with different expectations about where data could be stored, who could access it and how it could move across borders.

Brexit had already demonstrated that longstanding political and commercial arrangements could be altered abruptly. Russia had annexed Crimea. Relations between China and the West were deteriorating. Buchan began to believe that a world becoming more protective of its physical borders would inevitably become more protective of its digital ones.

He left CoinShares and founded Valarian in 2020, eventually raising Seed rounds from the likes of Artis Ventures, Scout Ventures, Molten Ventures, IQ Capital and Playfair Capital.

His co-founder, Josh McLaughlin, brought a different perspective. McLaughlin served in the US Army, part of it in the Special Forces, before spending more than a decade at Palantir, including opening its office in Doha. Valarian’s chairman, Nick Trim, as a co-founder and former chief operating officer of Darktrace and previously spent 15 years working in the UK’s cyber-defence community.

The mixture of financial regulation, military operations and cybersecurity experience shaped Valarian’s initial product.

So you can easily imagine the kinds of customers it’s picking up. 

Valarian’s core technology, ACRA, is built around Kubernetes, the open-source system widely used to manage applications running across cloud infrastructure.

Kubernetes was designed to orchestrate large numbers of software workloads. Valarian adds a layer intended to control the identity, permissions, network access and behaviour of each workload.

The resulting environment is an ‘enclave’, or isolated space, in which an organisation can run an AI model, communications system or other sensitive application. Each enclave has its own access policies, credentials and audit trail, preventing one workload from freely reaching into another.

The customer holds the encryption keys. Valarian says it cannot enter the environment after deployment, while the system can operate on AWS, Microsoft Azure or Google Cloud, as well as private clouds, on-premise data centres and air-gapped systems.

This allows an organisation, for example, to run an open-weight AI model against sensitive internal information without sending that data to the model developer. It can also change the underlying model or cloud provider without having to redesign all its security controls.

Ironically, this is also Palantir’s Alex Karp’s recent argument against enterprises using AI models directly inside the enterprise. 

For Buchan, this is not necessarily about eliminating American technology from the stack, which, at this stage in the game, would be almost impossible. Europe and the UK do not have the capital or capacity to reproduce every chip, cloud service and AI model from scratch. Instead, it’s better to retain the ability to choose suppliers, impose rules on their systems and replace them when necessary.

Valarian’s first customers are governments running highly classified workloads. But now, Pathfounders understands Valarian is getting incoming calls from banks, healthcare companies, pharmaceutical groups and airlines. 

The same architecture is also being deployed at the edge, where compute systems process information close to its source rather than sending everything back to a central cloud. In defence, that could include radar, acoustic and radio-frequency data gathered from different sensors and combined into a common operational picture.

Palantir’s Foundry software connects databases and operational systems, organising information into an ontology that represents the relationships between people, equipment, organisations and events. Customers can then use that common data layer to build applications, dashboards and AI tools.

Valarian says it goes deeper, securing the infrastructure on which applications run. But, of course, this means customers are likely to take them further up the stack from the virtualised infrastructure layer into things like ontology, to directly compete with Palantir.

Buchan won’t be drawn into direct comparisons, but the implications are there for all to see.

And after all, Palantir is a large, publicly traded US company deeply embedded in Western defence, intelligence and government. Valarian remains a relatively small, if well-funded, British startup.

Buchan nevertheless argues that the idea that European companies cannot build technology of comparable sophistication has become self-defeating.

“The pessimism that you can't build stuff in the UK, that you can't build tier one technologies… we are deployed on four continents around the world… I know our technology works… so this idea that we can't build stuff in the UK really annoys me,” he says.

The political dimension of Valarian’s strategy is particularly visible in Britain, where Palantir has won contracts across defence, policing and healthcare.

One of the biggest prizes in the UK is the NHS Federated Data Platform, a system designed to connect information across NHS organisations. A consortium led by Palantir, which includes Accenture, PWC, Carnall Farrar and NECS, was awarded the contract to deliver the NHS Federated Data Platform in November 2023, and will run over a seven-year period. 

The contract could be worth up to £330 million and will enter its first extension decision in 2027.

Two parliamentary committees have since urged the government to consider replacing Palantir, citing public mistrust, questions about the evidence used to demonstrate the system’s benefits and the availability of potential alternatives. Palantir and the government say the platform has helped the NHS carry out more operations, reduce discharge delays and accelerate some cancer diagnoses.

Valarian is understood to be gunning to be one of the British alternatives considered.

Buchan’s criticism is not simply that Palantir is American. It is that British technology companies are not given the chance to compete.

“I really care a lot about this, and I think this idea that we cannot build here and there is no option in the UK is just complete nonsense,” he says.

Valarian’s new financing gives it considerably more capacity to pursue that argument. The company had previously raised a Seed round led by Scout Ventures and Artis Ventures. The NEA round also included XTX Markets and Palo Alto Networks chief executive Nikesh Arora as a personal investor.

The irony of raising money from Silicon Valley to build a European sovereign-technology company is not lost on Buchan. He argues that sovereignty does not mean refusing foreign investment any more than it means refusing foreign cloud services. The question is where the company is built, where its intellectual property sits and whether control remains in Britain.

“One of the fundamental problems in Europe is that I struggled to find the growth capital we needed that wasn’t in Silicon Valley,” he said. “NEA was a balance for us because it was founded in the US but also has a full European fund. From an ownership perspective, the company remains overwhelmingly British-owned, so we are comfortable about control.”

The immediate objective is simple: hire engineers, complete deployments, and compete for larger government and enterprise contracts.

But the company is also turning itself into the test of a much broader proposition, of whether Britain and the rest of Europe can create a strategically important software company, fund it to international scale and persuade its own institutions to buy from it.