Blogs
February 4, 2025
10 Min
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Crossing the Chasm: Five Angles for Transforming Defense Innovation

We occasionally hear dazzling stories of startups “making it” in defense—securing multimillion-dollar awards, defying bureaucratic odds, and emerging as capability providers overnight. These narratives shine like beacons of possibility, suggesting that if you only knock on the right door, your technology can seamlessly move from a half-formed prototype into a major acquisition program. Yet, as many who’ve tried can attest, there’s more to it than a single handshake or well-placed demo. Way, way more.

A recent Defense Innovation Board (DIB)  report, Scaling Nontraditional Defense Innovation, underscores that meaningful change isn’t just about adding more competition or “innovation” branding. It requires deeper, structural realignment—bridging timing gaps, clarifying pathways, and coordinating stakeholders in ways that aren’t always intuitive. Below, we explore five key angles for rethinking how to move fresh technologies into the defense industrial base—and do so in a way that consistently delivers favorable outcomes.

1. Hard-to-Track Success: Making Metrics Matter

In large-scale innovation programs, “success” can seem elusive. A transition from SBIR Phase II to a production contract might materialize years after the first signs of traction. Even if companies only see “small wins” today, those incremental achievements can accumulate and suddenly propel them into breakout success—appearing almost 'overnight' to outside observers. And so, the real question is: Are we measuring what truly matters?

At FedTech, we’ve learned that transition data—contracts signed, total follow-on funding, prime-sub relationships—rarely emerges from a single source or metric, or at a single moment. Instead, it’s often pieced together over time. While each program’s structure can vary, we’ve developed frameworks that allow us to document a startup’s forward progress at every step—whether it’s a series of private investor meetings or a pitch to a major prime’s capture team. Capturing these leading indicators, and keeping them visible to all stakeholders, helps ensure early successes don’t evaporate into the ether. The DIB’s caution that many programs fall into “innovation theater” without real metrics is a sobering reminder: We can quantify progress, but it takes active intention.

2. Timing: The Invisible Rhythm of Acquisition

Time isn’t just a variable in the defense world; it’s the defining force. Imagine a promising startup perfecting a subsystem that could fit neatly into a next-generation unmanned vehicle—only to discover that the prime contractor responsible for integrating said subsystem closed the re-compete window months ago. Or a government office that loves the new tech but can’t buy for another two funding cycles.

Too often, we see entrepreneurs laser-focused on impressing a government sponsor, when in truth, the real gatekeeper might be a prime’s capture manager orchestrating the stack of subsystem partners. Knowing who shapes the RFP—and exactly when—often matters more than a broad endorsement from the “end-user.” Programs that fail to teach participants about these scheduling nuances risk leaving them stranded, no matter how revolutionary their technology is. The real magic lies in matching your readiness stage to the precise window for a re-bid or platform update.

3. A Place for Everyone (Sometimes That Means ‘Not Yet’)

One overlooked truth is that some ventures simply aren’t ready for DoD. A PhD researcher with only a bench prototype shouldn’t have the same path as a Series B startup with commercial traction. In our own programs, we’ve seen that a multi-tiered intake approach works best: after a series of targeted intake questions, we can gauge which track—if any—makes sense for each participant. Some need immediate exposure to program offices; others do better delaying defense pursuits until they mature commercially.

Embracing this mindset—that it’s okay to step out or wait—prevents wasted time on either side. It also acknowledges that the defense ecosystem can be a tough proving ground. By giving companies permission to redirect or temporarily pause DoD efforts, we preserve their potential value for when they have the right offering at the right moment.

4. The Missing Mediator in Regional Hubs

Across the country, we see regions brimming with puzzle pieces: a well-funded university lab, a dedicated small business office, a local OEM presence, and maybe even a state-backed economic development fund. Yet these pieces often remain uncoordinated—sometimes fueled by brand or budget restraints. The result? Fragmented programs that duplicate efforts or leave key resources on the table.

Time and again, we’ve learned that a neutral “process arbiter” makes all the difference. Someone (or some entity) that can define each stakeholder’s role—ensuring labs feed top-tier IP into local ESO / incubators / accelerators, or state programs align with defense timeframes, and so on. This role is about facilitation, not ownership. By convening everyone around shared outcomes (e.g., “two new technologies integrated into existing defense platforms this year”), territorial friction tends to subside in favor of tangible wins.

5. Tapping Primes for That Coveted Program of Record

There’s a romanticized notion that if you impress the right government champion, you’ll glide into a major programs. In truth, the big integrators (primes) often hold the crucial keys, especially if the system’s re-compete is already underway. Navigating those prime relationships means learning how they map subcontractor solutions, how to handle IP negotiations, and how to align your technology roadmap with their platform cycles.

We’ve found nearly all entrepreneurs lack this specialized skill set—unless they come from the Defense Industrial Base (DIB), why would they have it? As a result, unless they’re fortunate enough to stumble on a well-connected mentor/sherpa, they languish. By structuring accelerators or transition programs that actively walk companies through prime-sub relationships, we demystify a fundamental barrier. This approach might seem mundane compared to, say, a “killer pitch deck,” but in the defense world, these behind-the-scenes details can mean the difference between a partnership that lifts you into a multi-year opportunity and one that fizzles before it starts.

Seeing the Whole Picture

Like any complex system, defense innovation can’t be transformed by simply funding a few new pilots or holding bigger conferences. It requires a deeper shift—one where success metrics are intentionally captured, timing is a strategic consideration, innovation programs adapt to each venture’s maturity, local ecosystems align, and prime contractors become core allies rather than distant gatekeepers.

Across FedTech’s deep tech commercialization efforts with the US Army, Navy, DARPA, major primes, and others, these five angles repeatedly emerge as crucial for getting critical technology into the hands of the warfighter.. The DIB’s latest assessments are clear: We must connect these dots methodically. Done well, we create pipelines that move tech efficiently from the lab to the battlefield. Done poorly, we risk squandering resources with no tangible return. If you’re looking to improve your organization’s process for defense transition,  align your region’s innovation and development hubs, navigate complex prime re-competes, or simply determine whether your startup is ready for the DoD, let’s connect. With the right frameworks and clear-eyed collaboration, crossing the defense valley of death becomes not just possible, but repeatable.

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