Shield AI’s Post

My colleague and our defense tech expert, Benjamin Lawrence just put together this amazing market map on the AI in defense tech space (link in comments) and it got me thinking... Whether it's investors like Andreessen Horowitz, Shield Capital, and IQT (In-Q-Tel) dedicating entire funds towards defense tech, established companies like L3Harris Technologies now actively embracing and collaborating with new entrants in the defense market, or that sweet sweet defense contract money companies can snatch up, there's no denying the sector is taking off 🚀 So how many new entrants are there? Well, by doing a quick filter in Ben's expert-curated defense tech folder, you can see that >10% of the companies were founded in 2021 or later. Pretty cool to see.

Building off of our last... Business Insiders Top 26 Def Tech VCs:  https://lnkd.in/e-ps5gD9 - Congrats to SVDG board members Chris Moran and Daniel Ateya for making the list among many of our other friends. Corporate VCs sometimes get a mixed rep in Silicon Valley but in defense, rare is the start-up that can make it far without partnering with an incumbent. They both funded, assisted, and to some degree enabled some of the news following below. The article also highlights how hot Defense VC is right now.  Before offering some historical data points, we ask ourselves, do we have Russia to thank? Prior to the Ukraine invasion (and the Great SaaS Freeze of 2021) that answer was… not so much. Though as the data shows, much better than 5-10 years ago. The article talks about $100B+ in funding for the category the last two years. Last year’s #NatSec100 report calculated the total 2018-22 funding at around $42B.  SVDG’s 2019 paper “DOD Tech Strategy from a VC Perspective” (forgive the horrible title, it was written for a DOD acquisition conference), noted that the 2014 amount was low single digit billions. Momentum, indeed. Ursa Major founder Joe Laurienti offered: “Companies like Ursa Major are able to offer completely new ways of tackling the challenges that face DoD’s need for constant innovation. There is power and excitement in starting with a blank sheet of paper, utilizing the latest innovations in design, testing, and manufacturing defense capabilities.” Over the past year, we have seen DoD’s growing momentum give such innovators the opportunity to show what they can do. On that note, huge shout out to PEO IWS… SVDG industry partner and good friend Ursa Major announced a Navy PEO Integrated Warfare System contract to build solid rocket motors for several Navy missile programs…some old (SM-3, 6) and some new (redacted). PEOs and VC-backed start-ups conducting business together? You have to love this “momentum.” And this is relatively new and exciting. The author of this post has been investing in defense tech in SV for way too long – the first 25 years we saw a total of one actual PEO exec out here in person. Now it’s raining PEOs. Several other SVDG friends were awarded similar contracts (to include friend and sponsor X-Bow Systems Inc. – congrats to the team on this critically important win!) We do know that this particular PEO had a vision of attracting new entrants to its old-school supply base (while adhering to all applicable DOD regs and lawyerly things, of course…). They appear to have begun executing on that vision. The rocket motor monopoly may not be long for this world…stay tuned for a forthcoming SVDG webinar on PEO-Led Innovation where you can hear more about PEO IWS' vision, among others.

Last week we shared a number of exciting ecosystem updates (below). This week and next we will get into some of the headlines, beginning with this one: New Entrants ‘Get Their Fair Shot’ on CCA...And it Pays Off Huge congratulations, again to, Anduril Industries and General Atomics on the United States Department of the Air Force's announcement to continue funding for the detailed designs, manufacture, and testing of production representative test articles under the Collaborative Combat Aircraft (#CCA) program.  Both private companies, they beat out several household name fighter jet primes. This seemingly changes everything and we hope it is the #signal that we have all been asking for - that the ecosystem is evolving, maturing..that we will be measuring our investments in terms of #missionimpactperdollar as our friend Justin Fanelli and the US Navy recently unveiled. The U.S. used to turn out a new aircraft design with hundreds of units in 12-24 months. Anduril is doing that again. Their design and bid cycle was probably measured in months here. If we are remembering correctly, the F-35 took a good 10-15 years of DOD-funded work to get to the Boeing/Lockheed down select...to say nothing of the 20+ years on the F-22. Anduril has long been a partner to us at the Silicon Valley Defense Group and when we reached out to congratulate them, this is what they had to say: "The Air Force’s selection of a non-traditional/new entrant for a flagship autonomous fighter jet program over traditional primes is a watershed moment for the Department, the Air Force, other new entrants, and for the country as a whole. For years, new entrants have been asking the Department for a fair shot to compete on major programs of record. Anduril’s selection is evidence of the growing belief that new entrants can actually develop and deliver large, advanced capability on a timeline and at scale that matters, and that they are in many cases better positioned to deliver this capability than the traditional, household name defense contractors.” We are looking forward to following how this decision and 'watershed moment' plays out over time. What the signal does for the rest of the Department and the defense innovation ecosystem and broader national security industrial base. Stay tuned for more and congratulations again to our friends at both Anduril and GA!

It has been a big few weeks in the defense tech ecosystem! As we wrap up an incredible week of activity and connection from the RSA Conference where a number of significant announcements were made, to United States Geospatial Intelligence Foundation (USGIF)'s #GEOINT Symposium to USSOCOM's always anticipated #SOFWEEK, to the Special Competitive Studies Project - SCSP's phenomenal #AI Expo and all of the Annual General Meetings in between (h/t Playground Global for a great one this week, featuring recent SVDG special guests Chris Miller and Steve Blank!) we want to take a moment to highlight a few big wins and celebrate the momentum that is so palpable. In a beautiful way, there are too many to list (given character limits!) in a single post so we'll do a few posts over the next few hours. The BLUF? Defense Tech activity of all sorts is heating up. Andreessen Horowitz raised $600M for #AmericanDynamism. Congress appropriated a massive increase of almost $2B dollars to the the combined DOD #innovation arms. Anduril Industries and General Atomics beat out a handful of well-positioned Primes on the #CCA down-select. xAI raised $6B to build a LLM GigaDataCenter and race towards “Real World AI Agents.” The U.S. Department of Homeland Security stood up a new AI Safety advisory board, tapping some of the foremost experts from the tech sector. The US Navy awarded contracts to a handful of VC-backed companies for its Standard Missile Program.  The Australian government ‘picked a winner’ and made a big bet on a VC-backed US #quantumcomputing startup. Funding, entrepreneurship, DOD customer engagement, and political support for the NatSec Emerging Tech community has never been higher. Stay tuned for our thoughts on some of the past few weeks' highlights in subsequent posts and get ready for our comprehensive ecosystem analysis for 2024, in our soon-to-be-released, 2nd annual eedition of the SVDG #NatSec100 Report! Oh, we almost forgot…the word “Gundo” entered the NatSec lexicon… for better or worse…

Voyager Space and Palantir Technologies have partnered to bring artificial intelligence tools to space innovation. Using Palantir’s existing AI technology, Voyager will be integrating those capabilities into their defense solutions. Voyager will also utilize the Palantir Artificial Intelligence Platform (AIP) for its in-house payload management system for International Space Station customers and, in the future, onboard the Starlab space station. Read more about the partnership in the press release linked below. Voyager Space is a holding in The Private Shares Fund as of 6/30/24. To view the full portfolio and learn more about The Private Shares Fund, please visit https://lnkd.in/gTeAzvq8 #AIinSpace #artificialintelligence #spaceeconomy

Opportunity for Space and Defense Innovators I’m a judge for the upcoming Space and Defense Innovation (SDI) Showcase and Ignite Awards, held during SXSW in Austin, TX, and wanted to share the opportunity! The competition is designed to celebrate technologies that could help advance and protect our nation and/or make lives better for service members. From established primes to novel startups, the Ignite Awards aims to recognize the innovation happening in the industry –celebrating those who are making an impact. Companies can apply by submitting a five-minute video by January 10, 2024, telling the story of their unique innovation and its impact. Companies will compete based on company size and sector, resulting in two finalists from each category being selected by judges from throughout the industry, facing off in a live demo competition in front of acquisition and innovation leaders, industry media, investors, and industry leaders. Apply or learn more on the SDI website: https://lnkd.in/gU6eWkkb #SDI2024 #Space #Defense #Innovation #AI #RenewableEnergy Distinctive Edge Partners Foundation for the Future, Valid Evaluation

Maintaining a high-level of accuracy in a Detection-to-Response rate will be the challenge indeed. 💨 Hypersonic computing 😉 …and the legal challenges in kinetic/non-kinetic response? I did read a recent article identifying the need for a United States Space Force JAG…and this effort in particular should initiate some dialogue in favor of a #USSF JAG, to ensure ‘hypersonic’ legal response 😏 to defend/counter such threats. United States Strategic Command United States Department of Defense U.S. Cyber Command U.S. Air Force JAG Corps #hypersonic #hypersonics #spacedefense #space #spaceindustry #articialintelligence #spaceforce #spaceinnovation #spacenews #spacetechnology #spaceplanning #strategicleadership

For years I have been championing the virtues of software-only companies like EpiSci and others. However, I've watched repeatedly as most DOD software companies quickly shift to focus more and more on hardware as soon as they begin to gain success. And who can blame them? Since antiquity that is what militaries have rewarded. From the English Longbow in 1415 to the F-22, in order to get a new capability we had to physically build something new. Not anymore. At EpiSci we're betting on the concept that while others fixate on hardware we're doubling down on our unique form of software. It is already paying off. I have been convinced for decades that the math and algorithms are independent of the application, allowing them to be quickly applied to new environments. We are all familiar with this in our domestic lives, so why shouldn't it be possible in DOD too? I am convinced this idea will help us regain the adaptability and temporal advantage not possible with sluggish hardware projects. Tempo and adaptation are increasingly important to counter an aggressive, creative, and capable strategic adversary. The insight we believe in at EpiSci is that trusted AI techniques for one application can be readily applied to what often appear to be completely unrelated environments. We are also finding that our hybrid, modular philosophy designed to create trusted AI solutions for collaborative air combat is extremely extensible to a variety of other domains. From apertures and subsystems, to vehicle maneuvers and even Battle Management Command and Control (BMC2), this approach is already showing fitness at many levels. This small Space Development Agency effort offers a brief, unclassified peek into our rapidly growing list of Space applications of #TacticalAI. For anyone watching EpiSci from a distance you can expect a lot more great news to come. Finally, if you are interested projects like this, or if you know of anyone who might be, please visit our job listings (https://lnkd.in/ehcdf2pT). We are growing rapidly and need motivated young software and AI engineers to help us deliver trusted autonomy for a secure future! https://lnkd.in/ewcSQa-j

Silicon Valley Defense Group does it again! I love reading this annual report. Check out the 2024 Edition of the NATSEC 100 to see the ranked list of leading venture backed, national security-focused / dual-use companies. Really interesting seeing the expanded framework and 44 new entrants. #build4defense #buildfordefense #nationaldefense #defenseinnovation #defenseinvesting #defensetechnology #defensetech #nationalsecurity #DoDx #nationalsecurity #defenseventure #defenseventures #defensefunding https://natsec100.org/

Disruptive #defense #innovation no longer originates and incubates inside DoD or large Defense Primes. Instead, disruptive innovation starts inside small companies taking risks and pushing the envelope, then grows quickly under leverage from Private Equity. The New York Times called out the talented team assembled by Red Cell Partners and DEFCON AI to support this new ecosystem of disruptive defense innovation. https://lnkd.in/gh36pf4U