Watchtower Labs exits stealth with $35M for AI military planning tools
Watchtower Labs has emerged from stealth with $35 million in seed financing led by Shield Capital and Conviction, with participation from Founders Fund. The Seattle-based company is building AI-native applications that help military planners anticipate what happens next and evaluate options while there is still time to act.
- Watchtower Labs emerged from stealth with $35 million in seed financing led by Shield Capital and Conviction, with Founders Fund participating.
- The first focus is military logistics planning, covering transport, spare parts, fuel, munitions, routes and time.
- The system models hundreds of possible futures and shows the assumptions and tradeoffs behind each option, according to the company.
- The Defense Innovation Unit selected Watchtower in January 2026 under the Joint Sustainment Decision Tool program.
- Funds will go to team growth, more applications and testing, with plans to move into broader operational planning.
Starting with logistics planning
Watchtower is beginning with logistics planning, where, according to the company, transport, spare parts, fuel, munitions, routes and time can determine whether a mission is executable. The company says conditions in operations can change faster than traditional planning processes can keep up with.
"These conditions can change faster than traditional planning processes can keep pace, forcing staff to continually reassess plans under increasing time pressure," said Akhil Iyer, Co-Founder and Chief Executive Officer of Watchtower Labs.
How the system works
According to the company, Watchtower models hundreds of possible futures against real-world operational constraints, generates executable options, and shows the assumptions and tradeoffs behind each one. Its AI-native decision environment combines simulation, optimization and AI. Planners can ask questions in plain language, while decision makers remain in control of what happens next.
The company says the software is meant to help teams generate and stress-test executable courses of action and adapt as conditions change.
Defense ties and founding team
In 2025, Watchtower Labs partnered with the Naval Postgraduate School to inform development through operations research, operationally relevant data, and collaboration with defense practitioners. In January 2026, the Defense Innovation Unit selected Watchtower under the Joint Sustainment Decision Tool program, which is designed to support operational and joint commands with advanced decision-support capabilities.
Watchtower Labs was incubated within Shield Capital. It was co-founded by Iyer, a former Marine special operations officer and Shield Capital investor, together with Souren Aghajanyan and John Morman, whom the company describes as seasoned Microsoft engineering leaders who spent years building large-scale distributed systems.
Raj Shah, Founder and Managing Partner at Shield Capital and Chairman of Watchtower Labs, said: "An entire generation of companies is being built from scratch on what AI can now do, against the most challenging geopolitical environment in decades."
Investor view and use of funds
Sarah Guo, Founder of Conviction, said AI's impact in national security is "still nascent" but "will be decisive." She added that "Logistics is the backbone of our military's power, and yet we're stuck in the Stone Age."
The financing will support team growth, an expanding set of applications built on Watchtower's core platform, and continued testing and deployment. According to the company, the technology will extend beyond sustainment into broader operational planning, and Watchtower is expanding across high-stakes operations where conditions change quickly and resources are constrained.
