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China and Russia’s technological investments and the uncertainty surrounding future applications have fundamentally altered the geopolitical environment.
This view, which has become a point of consensus in the United States, has also sparked another widely and correctly perceived imperative: the need for creating enduring public-private relationships between the Defense Department and defense-oriented companies.
If the nation is to address this burgeoning threat, the country must foster a culture of innovation and integration of various critical technologies into the military. Private investment and venture capital, which provide funding to companies making advancements within critical technology areas that are key to defense, play an integral part in this high-stakes competition for fielding innovative capabilities such as artificial intelligence, directed energy, quantum science applications and autonomy.
As recommended by the Silicon Valley Defense Group, one way to increase the amount of private capital interest in funding companies working with the department is to align the acquisition and procurement processes to the startup growth model. More concretely, priorities, metrics and processes must be tailored to the specific incentives venture-backed companies face at each stage in the growth cycle.
In this way, private capital funds could see the clear path from prototyping to testing to programs of record — and to the exit ramp. This would be a significant improvement to the current relationship. Not only will venture firms be far more aware of how their capital can achieve desired returns and lead to a greater interest in investing in defense-oriented companies, but the department will also be positioned in the best way possible to acquire critical technologies.
