Great technology doesn’t win wars, people win wars. But the technology certainly helps. Now more than ever, commercial capital investors, intentionally or not, are filling an innovation gap by accelerating the design and realization of critical battlefield solutions before war breaks out.

Conflicts abroad, specifically in Ukraine and increasingly in other parts of the world, have shown us that private support for defense innovation has unquestionable value. There are ways government procurers can make low-stakes enhancements to accelerate this relationship.

Anecdotally in Ukraine, the demand from small troop units involved in heavy fighting is for equipment that shows up in regular technology commerce. They want expendable intelligence, surveillance, and reconnaissance (ISR) drones that can be purchased online. They glean intelligence on logistics and personnel movement from civilian ride-share platforms and vital medical information from social media.

America should learn from the success of technologies born from private financing for commercial needs and deployed abroad for high-stakes and routine military operations. This is a promising trend in innovation that we should seek to optimize. The future of defense technology will be in commercial technologies that have private sector capital at their core.

This is a radical transformation from the top-down command and control methodologies of traditional defense procurement.

The US government’s bureaucracy, coupled with a lack of specialized tools and expert personnel in niche areas, dissuades many companies from working with the government if they intend to scale at commercial speed with investments from other sources.

Several trends from modern wars of the last 12 months are now pushing us to reevaluate this paradigm.

• Service members are extremely attuned to the needs of their area of responsibility and mission, and those needs are diverse and varied even against the same enemy.
• The solution these soldiers want often exists, but they are more intimately familiar with their own operation than a separate acquisition system that isn’t immersed in the same situation.
• There is more than enough private and public money to fund defense technology that can meet the military’s needs in theaters of war and deterrence.

We are increasingly seeing companies conceived and funded by private industry long before a government-use case for their products has emerged or the incentives for agency purchase are built into the traditional procurement processes. Well-known examples are Anduril, Aalyria, Shield AI.

These companies and others have taken the initiative to build solutions backed by private-sector dollars before any explicit government purchase of the company’s technology emerges. Additionally, many of these companies’ products have been swiftly activated in conflicts before a government mechanism to buy them is in place. They were able to quickly move thanks to private-sector dollars.

It’s heartening to see companies that weren’t intended to service military uses being called on to provide defense solutions and responding with vigor. One example is Skydio, which shed its entire consumer business in favor of servicing the US government. Another is Oura Ring, a fitness wearable popular in Silicon Valley now being used to monitor Space Force guardians for unit readiness. There’s Icon, an Austin, Texas 3D-printed housing company which now contracts to build structures in austere conditions—most notably coming soon, the moon.

All well-prosecuted wars are fought iteratively. In the battle of bureaucracy we should consistently refine our acquisitions processes. Many changes should be considered, but three stand out as a starting point if the US is to repeatedly see success in collaborating with nimble private-sector companies in conflicts:

• Enable procurement at the lowest unit level: There should be a discretionary budget for small units to purchase commercial equipment. They know what they need better than anyone and should be able to rapidly acquire it with a defined budget and without bureaucratic overhead. We already do this with special operations units, and we should trust that our conventional forces will make a good-faith effort to do the same. Accompanying this would be an acknowledgment that not every unit will get it right all the time.
• Create aligned organizational budgets: It’s a well-known phenomenon that US spending spikes in September at the end of the fiscal year. If departments don’t spend their budget, they won’t get the same money next year, and decisions are often made with this in mind. As such, there should be more incentives to trade money across units for small purchases. If one platoon has a piece of equipment that’s working well, officials at higher levels should be able to easily borrow from other budgets to buy more for other platoons. It should be considered a good thing to share purchasing power that by extension spreads technology best practices around the military.
• Reduce friction for companies: Just signing up to be a US government vendor is an insufferable barrier. Once that’s done, the company must deploy several safety mechanisms that are often unnecessary to deliver value. It’s true that some products can be dangerous on the battlefield in unexpected ways, predominantly with regards to physical safety or cybersecurity, but such challenges are addressable. A lot of good can come from streamlining the first procurement steps for certain products. Tacit wisdom will emerge in units when they’re empowered to self-regulate and begin to share best practices. More companies will be excited to work with the government if the barriers to entry are lowered. Correspondingly, small troop units will become more sophisticated about the components they’re buying. The wisdom of the crowds should accelerate the development.

The money is there to finance these products. Venture capital dollars in companies currently working with the Defense Department increased five-fold from 2021 to 2022. You’d be hard-pressed to find any investor without some kind of empathy towards serving the vertical.

Moreover, hardened deployments can serve as the ultimate sign of product-market fit, give global exposure to small companies, and expose value that some companies were unaware of.

There is an increasingly excited audience looking to put their money toward defending the free world. More importantly, there is an increasingly excited user base in the modern warrior that wants these solutions today.

The US government should take note of the acquisition opportunities we see abroad, enabled by private capital, so we can help ourselves at home.

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