If 2022 has shown us anything, it’s that defense has never stopped being important – even if it felt like it for a while.
With the Russian invasion of Ukraine dragging on for over 100 days and U.S.-China and Iran-Israel tensions ratcheting up, national defense is once again top-of-mind for our leaders and military planners.
For decades the United States enjoyed a huge technological edge against our adversaries. We have invested hundreds of billions of dollars every year to continue to build on and deepen that edge.
I’ve seen what some of these amazing technology platforms look like first hand in the 10 years I spent in the California National Guard. While there I commanded 120 personnel and supervised over $400 million in cutting-edge equipment, including being fully responsible for the supply-chain for a battalion of UH-60 Blackhawk helicopters.
One vivid memory is being on the training ground one hot morning in California. As soldiers, we’re always training and making sure we stay sharp. Suddenly I got a radio call from the commander of the exercise telling everyone to freeze. Don’t move for 5 minutes. Some equipment was passing through.
To our surprise, an autonomous army vehicle drove past us through the field. This was still early days for self-driving cars, which is why we needed to be so still. The technology wasn’t advanced enough yet to avoid obstacles.
This experience sparked my love of technology, automation, and artificial intelligence. And it’s these three sectors I pay close attention to when hunting for startups that my New Wave Syndicate subscribers can invest in.
However, the military technological edge we’ve enjoyed for decades is eroding. Increasingly it looks like we’re behind our adversaries in some warfighting domains. One of the clearest areas where we’re at least a few years behind is hypersonic flight and missile technology.
Hypersonic tech is the ability to fly a plane or missile at Mach 5. That’s five times the speed of sound.
Unlike other missiles, hypersonic ones are designed to “bob and weave” to avoid missile defense systems – a huge advantage.
For decades military theorists and technologists hypothesized about the potential of hypersonic technology, but it was a long way from reality. Today it’s reality and a pressing one.
Russia recently flexed its military muscles by testing its Kinzhal hypersonic missile in Ukraine.
In the summer of 2021, China tested its own hypersonic missile that traveled all the way around the world and then hit a target in China.
We’re in a hypersonic arms race between the global military powers… and the U.S. is behind the curve.
Recently, in mid-March, the U.S. military completed its first test of a Lockheed Martin hypersonic missile system.
We need to do better. We need to accelerate our rate of technological development so we don’t fall out of this race entirely.
While Lockheed Martin has been a valuable defense contractor for decades, the truth is these large corporate enterprises are just not designed to innovate rapidly. That’s why they need to embrace defense startups as a key plank of our military innovation strategy.
Startups embody flexibility and urgency, hyper-driving innovation.
I’ve seen the military’s attitude to startups changing directly in my own portfolio. Relativity Space – one of the companies I’m most heavily invested in – won a major contract from the Defense Innovation Unit of the Department of Defense (DOD) in 2021 to be a launch service provider to the U.S. military.
It’s time for the us to embrace startups broadly as a key source of innovation to keep us ahead of our adversaries.
Silicon Valley’s association with the military is as old as the Valley itself.
In fact, the first IPO that came out of Silicon Valley was in 1956 for a company called Varian, which sold microwave tubes for military applications.
There are dozens of other companies like Varian that need to be built today to provide our military with the best tools to keep us safe.