Purpose There are strong political ambitions to integrate civilian start-ups and dual-use technologies into defence capability development. In practice, start-ups face significant difficulties in accessing military end-users, while the Swedish Armed Forces (SwAF) encounter challenges in absorbing and operationalising emerging technologies. This study examines why these misalignments exist, with focus on defence procurement procedures, institutional barriers, and the role of innovation incubators. Method The study adopts an inductive approach based on semi-structured interviews with SwAF officers, start-ups founders and representatives from civilian and defence-oriented incubators. The empirical material is complemented by observations and participation in relevant conferences and innovation events. Data were collected during 2024-2026 and analysed using thematic coding. Findings Despite strong political ambitions to integrate start-ups, the Swedish defence innovation system remains dominated by incumbent actors and demonstrates limited capacity to absorb start-up–driven innovation. Procurement procedures, designed to ensure reliability, regulatory compliance, secrecy, and lifecycle support, constrain early-stage engagement with small firms. Civilian incubators, which are optimised for open markets, rapid scaling, and venture financing, are poorly aligned with defence requirements related to target customers, arms laws, secrecy, and long acquisition cycles. In contrast, defence-oriented incubators, such as NATO’s DIANA, are better adapted to the specific conditions of military innovation. The Armed Forces have not been equipped to evaluate new initiatives. Research implications The study contributes to the literature on dual-use defence innovation by advancing the understanding of innovation intermediation in security-sensitive contexts. Practical implications The findings provide insights for policymakers on how intermediary structures and procurement models can be adapted to improve start-up accessibility, while maintaining operational requirements and technological sovereignty. Originality This article offers a novel, empirically grounded contribution by demonstrating how institutional inertia constrains the adoption of dual-use technologies within defence systems.