Before there was Oppenheimer there was Vannevar Bush

I just saw the movie Oppenheimer.  A wonderful movie on multiple levels.

But the Atomic Bomb story that starts at Los Alamos with Oppenheimer and General Grove misses the fact that from mid-1940 to mid-1942 it was Vannevar Bush (and his number 2, James Conant, the president of Harvard) who ran the U.S. atomic bomb program and laid the groundwork that made the Manhattan Project possible.

Here’s the story.


During World War II, the combatants (Germany, Britain, U.S. Japan, Italy, and the Soviet Union) made strategic decisions about what types of weapons to build (tanks, airplanes, ships, submarines, artillery, rockets), what was the right mix (aircraft carriers, fighter planes, bombers, light/ medium/ heavy tanks, etc.) and how many to build.

But only one country – the U.S. — succeeded in building nuclear reactors and nuclear weapons during the war, moving from atomic theory and lab experiments to actually deploying nuclear weapons in a remarkable 3 years.

Three reasons unique to the U.S. made this possible:

  1. Émigré and U.S. physicists who feared that the Nazis would have an atomic bomb led to passionate advocacy before the government became involved.
  2. A Presidential Science Advisor who created a civilian organization for building advanced weapons systems, funded and coordinated atomic research, then convinced the president to authorize an atomic bomb program and order the Army build it.
  3. The commitment of U.S. industrial capacity and manpower to the atomic bomb program as the No. 1 national priority.

The Atom Splits
In December 1938 scientists in Nazi Germany reported a new discovery – that the Uranium atom split (fissioned) when it hit with neutrons. Other scientists calculated that splitting the uranium atom released an enormous amount of energy.

Fear and Einstein
Once it became clear that in theory a single bomb with enormous destructive potential was possible, it’s hard to understate the existential dread, fear, and outright panic of U.S. and British emigre physicists – many of them Jewish refugees who had fled Germany and occupied Europe. In the 1920s and ‘30s, Germany was the world center of advanced physics and the home of many first-class scientists. After seeing firsthand the terror of Nazi conquest, the U.S. and British understood all too well what an atomic bomb in the hands of the Nazis would mean. They assumed that German scientists had the know-how and capacity to build an atomic bomb. This was so concerning that physicists convinced Albert Einstein in August 1939 to write to President Roosevelt pointing out the potential of an atomic weapon and the risk of the bomb in German hands.

Motivated by fear of a Nazi atomic bomb, for the next two years scientists in the U.S. lobbied, pushed and worked at a frantic speed to get the government engaged, believing they were in a race with Nazi Germany to build a bomb.

After Einstein’s letter, Roosevelt appointed an Advisory Committee on Uranium. In early 1940 the Committee recommended that the government fund limited research on Uranium isotope separation. It spent $6,000.

Vannevar Bush Takes Over – National Defense Research Committee (NRDC)
European émigré physicists (Einstein, Fermi, Szilard, and Teller) and Ernest Lawrence at Berkeley were frustrated at the pace the Advisory Committee on Uranium was moving. As theorists, they thought it was clear an atomic bomb could be built. They wanted the U.S. government to aggressively fund atomic research, so that the U.S. could build an atomic bomb before the Germans had one.

They weren’t alone in feeling frustrated about the U.S. approach to advanced weapons, not just atomic bombs.

In June 1940 Vannevar Bush, ex-MIT dean of engineering; and a group of the country’s top science and research administrators (Harvard President James Conant, Bell Labs President and head of the National Academy of Sciences Frank Jewett, and Richard Tolman Caltech Dean) all felt that there was a huge disconnect. The U.S. military had little idea of what science could provide in the event of war, and scientists were wholly in the dark as to what the military needed. As a result, they believed the U.S. was woefully unprepared and ill-equipped for a war driven by technology.

This group engineered a massive end run around the existing Army and Navy Research and Development labs. Bush and others believed that advanced weapons could be created better and faster if they could be designed by civilian scientists and engineers in universities and companies.

The scientists drafted a one-page plan for a National Defense Research Committee (NDRC). The NDRC would look for new technologies that the military labs weren’t working on (radar, proximity fuses, and anti-submarine warfare. (At first, atomic weapons weren’t even on their list.)

in June 1940 Bush got Roosevelt’s approval for the NDRC. In a masterful bureaucratic sleight of hand the NDRC sat in the newly created Executive Office of the President (EOP), where it got its funding and reported directly to the president. This meant that the NDRC didn’t need legislation or a presidential executive order. More importantly it could operate without congressional or military oversight.

Roosevelt’s decision gave the United States an 18-month head start for employing science in the war effort.

The NRDC was divided into five divisions and one committee, each run by a civilian director and each having a number of sections. (see diagram below.)

Bush became chairman of the NDRC and the first U.S. Presidential Science Advisor systematically applying science to develop advanced weapons. The U.S., alone among all the Axis powers and Allied nations, now had a science advisor who reported directly to the president and had the charter and budget to fund advanced weapon systems research – outside the confines of the Army or Navy.

NRDC was run by science administrators, who had managed university researchers as well as complex research and applied engineering projects science before. They took input from theorists, experimental physicists, and industrial contractors, and were able to weigh the advice they were receiving. They understood the risks, scale and resources needed to turn blackboard theory to deployed weapons. Equally important, they weren’t afraid to make multiple bets on a promising technology nor were they afraid to kill projects that seemed like dead ends for the war effort.

200+ contracts
Prior to mid 1940 research in U.S. universities was funded by private foundations or companies. There was no government funding. The NRDC changed that. With a budget of $10,000,000 to fund research proposed by the five section chairmen, the NDRC funded 200+ contracts for research in radar, physics, optics, chemical engineering, and atomic fission.

For the first time ever, U.S. university researchers were receiving funding from the U.S. government. (It would never stop.)

The Uranium Committee
In addition to the five NRDC divisions working on conventional weapons, the NRDC took over the moribund standalone Uranium Committee and made it a scientific advisory board reporting directly to Bush. The goal was to understand whether the theory of an atomic weapon could be turned into a practical weapon. Now the NRDC could directly fund research scientists to investigate ways to separate for U-235 to make a bomb.

What Didn’t Work at the NRDC?
After a year, it was clear to Bush that while the NDRC was funding advanced research, the military wasn’t integrating those inventions into weapons. The NRDC had no authority to build and acquire weapons. Bush decided what he needed was a way to bypass traditional Army and Navy procurement processes and get those advanced weapons built. 

Read the sidebars for background.

The Office of Scientific Research and Development Stands Up
In May 1941 Bush went back to President Roosevelt, this time with a more audacious request: Turn NRDC into an organization that not only funded research but built prototypes of new advanced weapons and had the budget and authority to write contracts to industry to build these weapons at scale. In June 1941 Roosevelt agreed and signed the Executive Order creating the Office of Scientific Research and Development (OSRD).  (It’s worth reading the Executive Order here to see the extraordinary authority he gave OSRD.)

OSRD expanded the National Defense Research Committee’s (NDRC) original five divisions into 19 weapons divisions, five research committees and a medical portfolio. Each division managed a broad portfolio of projects from research to production, and deployment. Its organization chart is shown below.

These divisions spearheaded the development of an impressive array of advanced weapons including radar, rockets, sonar, the proximity fuse, Napalm, the Bazooka and new drugs such as penicillin and cures for malaria.

The OSRD was a radical experiment. Instead of the military controlling weapons development Bush was now running an organization where civilian scientists designed and built advanced weapons systems. Nearly 10,000 scientists and engineers received draft deferments to work in these labs.

As a harbinger of much bigger things, the NRDC uranium committee was enlarged and renamed the S-1 Section on Uranium.

Throughout the next year the pace of atomic research picked up. And Bush’s involvement in launching the U.S. nuclear weapons program would grow larger.

 By the middle of 1941 Bush was beginning to believe that building an atomic bomb was possible. But he felt he did not have enough evidence to suggest to the president that the country commit to the massive engineering effort to build the bomb.

Then the MAUD report from the British arrived.

The British Nuclear Weapons Program codenamed “Tube Alloys” and the MAUD Report

Meanwhile in the UK, British nuclear physicists had not only concluded that building an atomic bomb was feasible, but they had calculated the size of the industrial effort needed.In March 1940 scientists had told UK Prime Minister Winston Churchill that nuclear weapons could be built.

In June 1940 the UK formed the MAUD Committee to study the possibility of developing a nuclear weapon. A year later they had their answer: the July 1941 the MAUD Committee report, “Use of Uranium for a Bomb,” said that it was possible to build a bomb from uranium using gaseous diffusion on a massive scale to produce uranium-235. It kick-started the UK’s own nuclear weapons program called Tube Alloys. (Read the MAUD report here.)

They delivered their report to Vannevar Bush in July 1941. And it changed everything.

Bush is Convinced by the MAUD Report
The MAUD Report finally pushed Bush over the edge. The British report showed how it was possible to build an atomic bomb. The fact that the British were independently saying what passionate advocates like Lawrence, Fermi, et al were saying convinced Bush that an atomic bomb program was worth investing in at the scale needed.

For a short period of time in 1941 the UK was ahead of the U.S. in thinking about how to weaponize uranium, but British officials dithered on approaching the U.S. for a full nuclear partnership with the U.S. By mid 1942, when the British realized their industrial capacity was stretched too thin and they couldn’t build the uranium separation plants and Bomb alone during the War, the Manhattan Project was scaling up and the U.S. had no need for the UK.

The UK would play a minor role in the Manhattan project.

Bush Tells Roosevelt – We Can Build an Atomic Bomb
In October 1941, Bush told the President about the British MAUD report conclusions: the bomb’s uranium core might weigh twenty-five pounds, its explosive power might equal eighteen hundred tons of TNT, but to separate the U-235 they would need to build a massive industrial facility. The President asked Bush to work with the Army Corps of Engineers to figure out what type of plant to build, how to build it and how much would it cost.

A month later, in November 1941 the U.S. National Academy of Sciences confirmed to Bush that the British MAUD report conclusions were correct.

Bush now had all the pieces lined up to support an all-out effort to develop an atomic bomb.

December 1941 – Let’s Build an Atomic Bomb
In December 1941, the day before the Japanese attack on Pearl Harbor, the atomic bomb program was placed under Vannevar Bush. He renamed the Uranium program as the S-1 Committee of OSRD.

In addition to overseeing the 19 Divisions of OSRD, Bush’s new responsibility was to coordinate all the moving parts of the atomic bomb program – the research, the lab experiments, and now the beginning of construction contracts.

With the Presidents support, Bush reorganized the program to take it from research to a weapons program. The goal now was to find the best ways to produce uranium-235 and Plutonium in large quantities. He appointed Harold Urey at Columbia to lead the gaseous diffusion and centrifuge methods and heavy-water studies. Ernest Lawrence at Berkeley took electromagnetic and plutonium responsibilities, and Arthur Compton at Chicago ran chain reaction and weapons theory programs. This team proposed to begin building pilot plants for all five methods of separating U-235 before they were proven. Bush and Conant agreed and sent the plan to the President, Vice President, and Secretary of War, suggesting the Army Corps of Engineers build these plants.

With U.S. now at war with Germany and Japan, the race to build the bomb was on.

In January 1942, Compton made Oppenheimer responsible for fast neutron research at Berkeley. This very small part of the atomic bomb program is the first time Oppenheimer was formally engaged in atomic bomb work.

Enter the Army
The Army began attending OSRD S-1 (the Atomic Bomb group) meetings in March 1942. Bush told the President that by the summer of 1942 the Army should be authorized to build full-scale plants.

Build the U-235 Separation and Plutonium Plants
By May 1942 it was still unclear which U-235 separation method would work and what was the right way to build a nuclear reactor to make Plutonium, so the S-1 committee recommended – build all of them. Build centrifuge, electromagnetic separation, and gaseous diffusion plants as fast as possible; build a heavy water plant for the nuclear reactors as an alternative to graphite; build reactors to produce plutonium; and start planning for large-scale production and select the site(s).  The S-1 Committee also recommended the Army be in charge of building the plants.

Meanwhile that same month, Oppenheimer was made the “Coordinator of Rapid Rupture.” He headed up a group of theorists working with experimentalists to calculate how many pounds of U-235 and Plutonium were needed for a bomb.

The Manhattan Engineering District – The Atomic Program Moves to the Army
In June 1942, the president approved Bush’s plan to hand building the bomb over to the Army.  The Manhattan Engineering District became the new name for the U.S. atomic bomb program. General Groves was appointed its head in September 1942.

To everyone’s surprise Groves selected Oppenheimer to administer the program. It was a surprise because up until then Oppenheimer was a theoretical physicist, not an experimentalist nor had he ever run or managed any programs.

Grove and Oppenheimer decided that in addition to the massive production facilities – U-235 in Oak Ridge, TN, and Plutonium in Hanford, WA – they would need a central laboratory to design the bomb itself. This would become Los Alamos. And Oppenheimer would head that lab bringing together a diverse set of theorists, experimental physicists, explosive experts, chemistry, and metallurgists.

Bush, Conant and Grove at Plutonium production site at Hanford -July 1945

At its peak in mid-1944 130,000 people were working on the Manhattan Project; 5,000 of them worked at Los Alamos.

Vannevar Bush would be present at the test of the Plutonium weapon at the Trinity test site in July 1945.

The OSRD would be the organization that made the U.S. the leader in 20th century research. At the end of World War II, Bush laid out his vision for future U.S. support of research in an article called “Science the Endless Frontier.” OSRD was disbanded in 1947, but after a long debate it was resurrected in pieces. Out of it came the National Science Foundation, the National Institute of Health, the Atomic Energy Commission and ultimately NASA and DARPA – all would all spring from its roots.

50 years before it happened Bush would describe what would become the internet in a 1945 article called As We May Think.

Summary

  • By the time Oppenheimer and Grove took over the Atomic Bomb program, Vannevar Bush had been running it for two years
  • The U.S. atomic bomb program was the sum of multiple small decisions guided by OSRD and a Presidential science advisor – Vannevar Bush
  • Bush’s organizations kick-started the program. The NDRC invested (in 2023 dollars) $10M in nuclear research, OSRD put in another $250M for nuclear experiments
  • The Manhattan project would ultimately cost ~$40 billion to build the two bombs.
  • As the country was in a crisis – decisions were made in days/weeks by small groups with the authority to move with speed and urgency.
  • Large-scale federal funding for science research in U.S. universities started with the Office of Scientific Research and Development (OSRD) – more to come in subsequent posts

Reorganizing the DoD to Deter China and Win in the Ukraine – A Road Map for Congress

This article previously appeared in Defense News. It was co-written with Joe Felter, and Pete Newell.

Today, the U.S. is supporting a proxy war with Russia while simultaneously attempting to deter a China cross-strait invasion of Taiwan. Both are wakeup calls that victory and deterrence in modern war will be determined by a state’s ability to both use traditional weapons systems and simultaneously rapidly acquire, deploy, and integrate commercial technologies (drones, satellites, targeting software, et al) into operations at every level.

Ukraine’s military is not burdened with the DoD’s 65-year-old acquisition process and 20th-century operational concepts. It is learning and adapting on the fly. China has made the leap to a “whole of nation” approach. This has allowed the Peoples Liberation Army (PLA) to integrate private capital and commercial technology and use them as a force multiplier to dominate the South China Sea and prepare for a cross-strait invasion of Taiwan.

The DoD has not done either of these. It is currently organized and oriented to execute traditional weapons systems and operational concepts with its traditional vendors and research centers but is woefully unprepared to integrate commercial technologies and private capital at scale.

Copying SecDef Ash Carter’s 2015 strategy, China has been engaged in Civil/Military Fusion employing a whole of government coordinated effort to harness these disruptive commercial technologies for its national security needs. To fuel the development of technologies critical for defense, China has tapped into $900 billion of private capital in Civil/Military Guidance (Investment) Funds and has taken public state owned enterprises to fund their new shipyards, aircraft, and avionics.  Worse, China will learn from and apply the lessons from Russia’s failures in the Ukraine at an ever increasing pace.

But unlike America’s arch strategic rival, the US to date has been unwilling and unable to adapt and adopt new models of systems and operational concepts at the speed of our adversaries. These include attritable systems, autonomous systems, swarms, and other emerging new defense platforms threaten legacy systems, incumbent vendors, organizations, and cultures. (Until today, the U.S. effort was still-born with its half-hearted support of its own Defense Innovation Unit and history of lost capabilities like those that were inherent the US Army’s Rapid Equipping Force.)

Viewing the DoD budget as a zero-sum game has turned the major defense primes and K-street lobbyists into saboteurs for DoD organizational innovation that threaten their business models. Using private capital could be a force multiplier by adding 100’s of billions of dollars outside the DoD budget. Today, private capital is disincented to participate in national security and incentives are aligned to ensure the U.S. military is organized and configured to fight and win the wars of the last century.  The U.S. is on a collision course to experience catastrophic failure in a future conflict because of it. Only Congress can alter this equation.

For the U.S. to deter and prevail against China the DoD must create both a strategy and a redesigned organization to embrace those untapped external resources – private capital and commercial innovation. Currently the DoD lacks a coherent plan and an organization with the budget and authority to do so.

A reorganized and refocused DoD could acquire traditional weapons systems while simultaneously rapidly acquiring, deploying, and integrating commercial technologies. It would create a national industrial policy that incentivizes the development of 21st-century shipyards, drone and satellite factories and a new industrial base along the lines of the CHIPS and Innovation and Competition acts.

Congress must act to identify and implement changes within the DoD needed to optimize its organization and structure. These include:

  1. Create a new defense ecosystem that uses the external commercial innovation ecosystem and private capital as a force multiplier. Leverage the expertise of prime contractors as integrators of advanced technology and complex systems, refocus Federally Funded Research and Development Centers (FFRDCs) on areas not covered by commercial tech (kinetics, energetics, nuclear and hypersonics).
  2. Reorganize DoD Research and Engineering. Allocate its budget and resources equally between traditional sources of innovation and new commercial sources of innovation and capital. Split the OSD R&E organization in half. Keep the current organization focused on the status quo. Create a peer organization – the Under Secretary of Defense for Commercial Innovation and Private Capital.
  3. Scale up the new Office of Strategic Capital (OSC) and the Defense Innovation Unit (DIU) to be the lead agencies in this new organization. Give them the budget and authority to do so and provide the services the means to do the same.
  4. Reorganize DoD Acquisition and Sustainment. Allocate its budget and resources equally between traditional sources of production and the creation of new from 21st-century arsenals – new shipyards, drone manufacturers, etc. – that can make 1,000s of low-cost, attritable systems.
  5. Coordinate with Allies. Expand the National Security Innovation Base (NSIB) to an Allied Security Innovation Base. Source commercial technology from allies.

Why Is It Up To Congress?

National power is ephemeral. Nations decline when they lose allies, economic power, interest in global affairs, experience internal/civil conflicts, or miss disruptive technology transitions and new operational concepts.

The case can be made that all of these have or are happening to the U.S.

There is historical precedent for Congressional action to ensure the DoD is organized to fight and win our wars. The 1986 Goldwater/Nichols Act laid the foundation for conducting coordinated and effective joint operations by reorganizing the roles of the military services, and the Joint Chiefs, and creating the Joint Staff and the combatant commands. US Congress must take Ukraine and China’s dominance in the South China Sea as call for action and immediately establish a commission to determine what reforms and changes are needed to ensure the U.S. can fight and win our future wars.

While parts of the DoD understand we’re in a crisis to deter, or if that fails, win a war in the South China Sea, the DoD as a whole shows little urgency and misses a crucial point: China will not defer solving the Taiwan issue on our schedule. Russia will not defer its future plans for aggression to meet our dates.  We need to act now.

We fail to do so at our peril and the peril of all those who depend on U.S. security to survive.

National Industrial Policy – Private Capital and The America’s Frontier Fund Steps Up

This article previously appeared in The National Interest.

Last month the U.S. passed the CHIPS and Science Act, one of the first pieces of national industrial policy – government planning and intervention in a specific industry — in the last 50 years, in this case for semiconductors. After the celebratory champagne has been drunk and the confetti floats to the ground it’s helpful to put the CHIPS Act in context and understand the work that government and private capital have left to do.

Today the United States is in great power competition with China. It’s a contest over which nation’s diplomatic, information, military and economic system will lead the world in the 21st century. And the result is whether we face a Chinese dystopian future or a democratic one, where individuals and nations get to make their own choices. At the heart of this contest is leadership in emerging and disruptive technologies – running the gamut from semiconductors and supercomputers to biotech and blockchain and everything in between.

National Industrial Policy – U.S. versus China
Unlike the U.S., China manages its industrial policy via top-down 5-year plans. Their overall goal is to turn China into a technologically advanced and militarily powerful state that can challenge U.S. commercial and military leadership. Unlike the U.S., China has embraced the idea that national security is inexorably intertwined with commercial technology (semiconductors, drones, AI, machine learning, autonomy, biotech, cyber, semiconductors, quantum, high-performance computing, commercial access to space, et al.)  They’ve made what they call military/civil fusion – building a dual-use ecosystem by tightly coupling their commercial technology companies with their defense ecosystem.

China has used its last three 5-year plans to invest in critical technologies (semiconductors, supercomputers, Al/ML, quantum, access to space, biotech.) as a national priority. They have built a sophisticated public/private financing ecosystem to support these plans. The Chinese technology funding ecosystem includes regional investment funds that exceed 700 billion dollars (what they call their Civil/Military Guidance Funds). These are investment vehicles in which central and local government agencies make investments that are combined with private venture capital and State-Owned Enterprises in areas of strategic importance. They are tightly coupling critical civilian companies to their defense ecosystem to help them develop military weapons and strategic surprises. (Tai Ming Cheung’s book is the best description of the system.)

The U.S. has nothing comparable.

In contrast, for the last several decades, planning in the U.S. economy was left to “the market.” Driven by economic theory from the Chicago School of Economics, its premise is that free markets best allocate resources in an economy and that minimal, or even no, government intervention is best for economic prosperity. We ran our economy on this theory as a bipartisan experiment in the U.S. for the last several decades. Optimizing profit above else led to wholesale offshoring of manufacturing and entire industries in order to lower costs. Investors shifted to making massive investments in industries with the quickest and greatest returns without long-term capital investments (e.g. social media, ecommerce, gaming) instead of in hardware, semiconductors, advanced manufacturing, transportation infrastructure, etc. The result was that by default, private equity and venture capital were the de facto decision makers of U.S. industrial policy.

With the demise of the Soviet Union and the U.S. as the sole superpower, this “profits first” strategy was “good enough” as there was no other nation that could match our technical superiority. That changed when we weren’t paying attention.

China’s Ambition and Strategic Surprises
In the first two decades of the 21st century, while the U.S. was focused on combating non-nation states (ISIS, Al-Qaeda…) U.S. policymakers failed to understand China’s size, scale, ambition, and national commitment to surpass the U.S. as the global leader in technology. Not just in “a” technology but in all of those that are critical to both our national and economic security in this century.

China’s top-down national industrial policy means we are being out-planned, outmanned, and outspent. By some estimates, China could be the leader in a number of critical technology areas sooner than we think. While Chinese investment in technology at times has been redundant and wasteful, the sum of these tech investments has resulted in a series of strategic surprises to the U.S.– hypersonics, ballistic missiles with maneuverable warheads as aircraft carrier killers, fractional orbital bombardment systems, rapid advances in space, semiconductors, supercomputers, and biotech …with more surprises likely – all with the goal to gain superiority over the U.S. both commercially and militarily.

Limits and Obstacles to China’s Dominance
However, America has advantages that China lacks: capital markets that can be incented not coerced, untapped innovation talent willing to help, labor markets that can be upskilled, university and corporate research that still excels, etc. At the same time, a few cracks are showing in China’s march to technology supremacy; their detention of some of their most successful entrepreneurs and investors, a crackdown on “superfluous” tech (gaming, online tutoring) and a slowdown of listings on the China’s version of NASDAQ, the Shanghai Stock Exchange’s STAR Market – may signal that the party is reining in its “anything goes” approach to pass the U.S.  Simultaneously the U.S. Commerce department has begun to prohibit export of critical equipment and components that China has needed to build their tech ecosystem.

Billionaires and Venture Capital Funding Defense Innovation
In the U.S. DoD’s traditional suppliers of defense tools, technologies, and weapons – the prime contractors and federal labs – are no longer the leaders in many of these emerging and disruptive  technologies.  And while the Department of Defense has world-class people and organizations it’s for a world that no longer exists. (Its inability to rapidly acquire and deploy commercial systems requires an organizational redesign on the scale of Goldwater/Nichols Act, not a reform.)

Technology innovation in many areas now falls to commercial companies. In lieu of a coherent U.S. national investment strategy across emerging and disruptive technologies (think of the CHIPS Act times ten), billionaires in the U.S. have started their own initiatives – Elon Musk – SpaceX and Starlink (reusable rockets and space-based broadband internet), Palmer Lucky –  Anduril (AI and Machine Learning for defense), Peter Theil – Palantir (data analytics). And in the last few years a series of defense-focused venture funds – Shield Capital, Lux Capital, and others – have emerged.

However, depending on billionaires interested in defense is not a sustainable strategy, and venture capital invests in businesses that can become profitable in 10 years or less. This means that technologies that might take decades to mature (fusion, activities in space, new industrial processes, …) get caught up and die in a “Valley of Death.” Attempts to bridge this Valley of Death often find technology companies relying on Government capital. These programs (DIU, In-Q-Tel, AFWERX, et al), are limited in scope, time and success at scale. These government investment programs have largely failed to scale these emerging and disruptive technologies for four reasons:

  • Government agencies have limited access to top investment talent to help them make sophisticated technical investment decisions
  • Government agencies lack the commercialization skills to help founders turn technical ideas into commercial ventures.
  • While the Dept of Defense has encouraged starting new ventures, it has failed to match it with the acquisition dollars to scale them. There’s no DoD coherent/committed strategy to create a new generation of prime contractors around these emerging and disruptive technologies.
  • No private or government funds operates as “patient capital” – investing in critical deep technologies that may take more than a decade to mature and scale

America’s Frontier Fund
Today one private capital fund is attempting to solve this problem. Gilman Louie, the founder of In-Q-Tel, has started America’s Frontier Fund (AFF.) This new fund will invest in key critical deep technologies to help the U.S. keep pace with the Chinese onslaught of capital focused on this area. AFF plans to raise one billion dollars in “patient private capital” from both public and private sources and to be entirely focused on identifying critical technologies and strategic investing. Setting up their fund as a non-profit allows them to focus on long-term investments for the country, not just what’s expedient to maximize profits. It will ensure these investments grow into large commercial and dual-use companies focused on the national interest.

They’ve built an extraordinary team of experienced venture capitalists (I’ve known Gilman Louie and Steve Weinstein for decades), a world-class chief scientist, a startup incubation team, and they come with a unique and deep understanding of the intersection of national security and emerging and disruptive technologies.

AFF is the most promising effort I have seen in tackling the long-term challenges of funding and scaling emerging and disruptive technologies head-on.

At stake is whether the rest of the 21st century will be determined by an authoritarian government wiling to impose a dystopian future on the world, or free nations able to determine their own future.

These are tough problems to solve, and no single fund is can take on the massive investments China is making, but it’s possible that the AFF’s market driven approach, when combined with the government’s halting steps reengaging in industrial policy, can tip the scale back in our favor.

Here’s hoping they succeed.

These Five Principles Will Accelerate Innovation

As Director of the U.S. Army’s Rapid Equipping Force Pete Newell delivered innovation at speed and scale in the Department of Defense. Pete is now CEO of BMNT, a company that delivers innovation solutions and processes for governments.

Here are Pete’s 5 principles that will accelerate innovation.


To help a large Defense organization wrestle with how to increase the velocity of innovation in their ranks Steve Blank and I spent the better part of last week with our heads together reviewing everything we learned in the five years since we merged the concepts of problem curation and Lean while launching the innovation pipeline.

The original Innovation Pipeline sketch – 2016

I spent yesterday sifting through the most recent lessons learned and results from a series of accelerators BMNT is running for the intelligence community. Then last night I watched the final presentations from the inaugural Hacking for National Security course in Australia before jumping over to teach Stanford’s Hacking for Defense® (H4D) class.

Looking back on the week I’m blown away by how far we’ve come since we merged the two methodologies five years ago and by how fast we are discovering the pathways toward solving incredibly hard problems. Some examples:

  • In less than six weeks a Stanford H4D team has redefined a problem related to security vetting and radicalization while also describing the pathway a solution could follow to deployment within the Department of Defense and the Intelligence Community.
  • A Navy team recently sourced 80 problems, then curated down to one priority problem to solve. In less than 60 days they created 26 MVPs while interviewing over two dozen companies. They then incubated and delivered a solution that will help get large vessels back to sea faster, potentially saving the Navy $20M-$30M a year.
  • In just three weeks, the DIA MARS team sourced 100 problems from nearly 400 people, then curated and selected five priority problems to focus on. In eight weeks, five teams conducted more than 125 interviews (across 53 stakeholder organizations) and 12 experiments to deliver five validated proofs-of-concept and the evidence needed to confidently invest resources to prototype three of the five based on their user desirability, technical feasibility and organizational viability.

What I observed from the week’s deep dive: Whether it is an agency cross-functional team or a university-based “Hacking for” team we are accelerating, five key concepts drive the foundation for this increasing pace of learning and solution delivery. They are

  1. The power of Lean Methodology is supercharged when discovery begins with a well-curated and prioritized problem. Getting to one well-curated problem requires access to a source of hundreds of them.   
  2. Problem curation doesn’t stop until discovery is complete — the process of trying to discover the solution to a problem helps define the actual problem (and for .gov folks the actual requirement for the future solution).
  3. Stakeholder mapping and nailing the value propositions for beneficiaries, buyers, supporters, advocates and potential saboteurs are critical to building a pathway through the phases of the innovation pipeline and transitioning a solution to deployment. 
  4. The key to understanding value propositions is in building interviews that are based on a set of hypotheses (about the problem, the stakeholder and potential solutions to be explored) and data to be captured while using minimum viable products (just enough “product” to increase the efficacy of a conversation and increase the speed of learning).
  5. Innovation happens because of people and it takes a village. Whether academic-based like our Hacking for Defense teams or internal organizational Integrated Product or Cross-Functional Teams (IPTs/CFTs), accelerator teams perform best when supported by:
    1. Teachers – who can ground teams in a common framework and language for the discipline of innovation and entrepreneurship.
    2. Coaches – who can walk teams through the practical application of innovation tools in context with the problem they are trying to solve.
    3. Mentors – who will provide relentlessly direct feedback to teams and challenge them on the quality of the hypotheses, MVPs and the analysis of what they’ve learned, while driving them through each pivot rather than letting them get bogged down in “analysis paralysis.”
    4. Advisors – who will provide alternative viewpoints that will enable teams to see clearer pathways through bureaucracies.
    5. Connectors – who will help teams rapidly grow their networks to gain new insights from unique partners not yet discovered.

If your organization is running innovation activities or an accelerator and these five principles aren’t part of their program they are likely wasting your organization’s time and resources, and contributing to Innovation Theater instead of deploying solutions to real problems.

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Next up we’ll dig into how the innovation pipeline serves a parallel process for managing innovation

Enterprise Innovation for the 21st Century

Today’s environment requires separate systems for innovation and execution that operate with parallel and sometimes overlapping processes


Why Defense Could Now Be a Market for Startups

The U.S. Department of Defense is coming to grips with the idea that the technologies it needs to keep the country safe and secure are no longer exclusively owned by the military or its prime contractors. AI, machine learning, autonomy, cyber, quantum, access to space, semiconductors, biotech are all being driven by commercial companies.  At the front-end of these innovations are startups – organizations the Department of Defense hasn’t previously dealt with at scale.

They’re now learning how.

Mrinal Menon is one of my Hacking for Defense students at Stanford where he’s currently in the MBA program. He’s a former U.S. Navy Surface Warfare Officer. Jeff Decker is a co-instructor of the Hacking for Defense class and the Stanford program director. Jeff is an Army Second Ranger Battalion veteran.

Mrinal and Jeff’s article below explains how startups can adapt and thrive while working with the Defense Department. And how the Department of Defense is learning to work with startups.



This article previously appeared in Fast Company.

At a time when young companies struggle to find technology sectors not dominated by Silicon Valley’s giants, most startups remain oblivious to one of the largest markets in the world, the U.S. Defense Department. The military awarded $445 billion in contracts in 2020. By comparison, last year’s global market for software-as-a-service, one of the hottest sectors for startup creation and investment, was estimated at $104 billion.

There’s a willing market here, too. The Pentagon is eager for help from the nation’s innovators. The military is clamoring for cutting-edge technologies in areas like artificial intelligence, machine learning, and autonomy. To attract interest the Defense Department is handing out unprecedented numbers of small contracts and in 2020 seeded 1,635 firms with more than $1.5 billion in early funding. Dozens of outreach programs across the military now offer quick revenue to early-stage companies. A startup could land a contract worth up to $3 million within months of entering the defense market.

This emerging opportunity reflects the urgency of keeping pace with rivals like China and Russia, who are furiously integratingcommercial technologies like AI, quantum computing, and unmanned systems into their armed forces. If former Google CEO Eric Schmidt’s prediction about China overtaking the United States in AI comes to pass, the People’s Liberation Army could be better prepared than the U.S. military for future conflicts in which cyberattacks and drone swarms play a larger role than warships and fighter jets. Without adopting cutting-edge commercial technologies, the U.S. military may be rendered obsolete.

Yet, for every newly minted success like Palantir or Anduril, thousands of companies struggle to find follow-on opportunities after receiving early innovation contracts. Historically, more than 80% of new entrants exit the defense market before they have a chance to see recurring revenue. Anduril founder Palmer Luckey has sardonically noted that the only defense companies to reach unicorn status in the past 30 years have all been founded by billionaires able to endure long gaps in funding. To truly compete with technologically advanced rivals, the Defense Department will ultimately need to enable a broad pool of innovative founders to succeed. Until this ecosystem materializes, however, building a successful defense business is likely to take years of grueling effort. Before committing to work with the military, startups must look past the allure of early money and carefully assess whether the defense market is right for them.

The Key Questions For Startup
Despite the Pentagon’s newfound enthusiasm for innovation, startups in the defense market continue to encounter longstanding obstacles. Most companies face uncertainty when trying to bridge prototyping awards with more permanent follow-on contracts. Startups that successfully fulfill innovation contracts don’t automatically scale. Instead, their solutions must still compete for funding in a formal budgeting and acquisition process before being eligible for widespread adoption . This ordeal takes two years or more, during which startups should anticipate little or no revenue as they try to push their product through the bureaucracy.

While earning the first $1 million in the defense market can be relatively easy, landing the next $10 million is extremely difficult. Before committing to work with the military, startups should carefully consider whether the defense market is right for them by asking three questions.

Is there strong interest for the product?
Those that offer solutions to high-priority problems have the best chance of sourcing funding and follow-on awards. Startups should assess how well their technologies align with the needs outlined in the defense budget, various modernization strategies, and problems posed by defense innovation hubs. For example, “flying taxi” startup Joby Aviation aligned its electric vertical takeoff and landing aircraft with the Air Force’s stated interest in advancing the market for air mobility vehicles. The 3D mapping company Hivemapper found traction with the Army by targeting its need to autonomously resupply field artillery units.

Is the company prepared to endure revenue gaps?
As noted, companies may go years without defense revenue while trying to bridge early contracts with larger opportunities. During this period, startups will need to sustain business development activities and may incur additional regulatory and compliance costs to ensure their product is usable by the military. Investors are also likely to express impatience with the long timelines of defense sales. The best prepared companies can either raise sufficient funds to keep operating or count on revenue from other sources. Palmer Luckey’s Anduril has aggressively pursued financingto sustain growth. Recently public enterprise-AI firm C3.ai entered the defense market having already built a successful commercial business in the energy vertical. Similarly, 3D-printing homebuilder Icon’s technologies have applications that extend well beyond national security use cases to commercial housing markets.

Can I balance the needs of my defense and commercial customers?
The best-positioned startups solve fundamentally similar problems for both military and commercial users. Satellite imagery firm Orbital Insight’s Go platform, for example, automates imagery analysis for defense analysts, investors, and agribusiness alike. Some amount of customization is inevitable given that military users often have specific mission requirements or technical constraints. However, companies that can serve military customers without fundamentally altering their existing product roadmap are likely to be most successful.

Incidents like Google’s withdrawal from Project Maven have highlighted the potential for conflict when commercial companies decide to work with the military. This tension tends to be lower at startups where an early team willingly signs on to pursue defense business. Regardless, companies should be mindful of the reputational impacts working with the DoD could have on their existing business.

The Case for Optimism
Companies eyeing the defense market have reason to be optimistic. There are a growing number of efforts to remove obstacles to partnerships between high-tech startups and the military. For example, the Air Force last year created the Strategic Financing (STRATFI) program. STRATFI provides the Air Force’s most promising commercial innovators, a list which includes Icon and Orbital Insight, quick access to large contracts worth up to $15M. Another positive sign is President Biden’s nomination of former Symantec CEO Mike Brown to oversee the Pentagon’s purchases of new technologies. As director of the Defense Innovation Unit (DIU), Brown has spearheaded investments in commercial technologies and helped C3.ai, Joby Aviation, and other Silicon Valley standouts navigate funding gaps. If confirmed, Brown could accelerate much needed reforms to military acquisition processes.

A startup that makes it through the hurdles may find a massive market with a stable set of customers eager for better technology solutions. The U.S. government pays its bills on time, defense budgets are shielded from short-term volatility, and contracts may be guaranteed for multiple years. Once onboarded, military users can quickly become long-term customers given the challenges involved with switching to another product.

E Pluribus Unum – A Rallying Cry for National Service

This post previously appeared in Real Clear Defense.

 

The Latin phrase E Pluribus Unum – Out of Many, One – is our de facto national motto. It was a rallying cry of our founders as they built a single unified nation from a collection of states. It’s a good reminder of where we need to go.

Today as our country struggles to find the common threads that bind us, we need unifying, cohesive, collective, and shared national experiences to bring the country together again.

Here’s what we’ve done to get started.

And why I did it.

————-

Pete Newell, Joe Felter and I met over coffee in 2016 to discuss our common goal – how to get students in research universities who would never consider working on national security problems engaged in keeping the country safe and secure.

Today, our contribution to national service, Hacking for Defense, turned five years old. In this class, students learn about the nation’s emerging threats and security challenges while working with innovators inside the Department of Defense.

The result? The class teaches students entrepreneurship while they engage in what amounts to national public service. From our single class at Stanford, Hacking for Defense is now taught at 47 U.S. universities having graduated 500 teams and 2,000+ students.

Why Serve?
My interest in starting Hacking for Defense was rooted in my long belief in service – not just paying taxes or voting, but actual service. I had a great career as an entrepreneur, but always believed that at some point in your life you need to serve others – whether it’s God, country, community, or family. And I did so in my stints in the military and public service and as an educator.

Disconnection
Looking back it’s clear that our country was far more cohesive when millions of us had to physically share space and live and work with others who didn’t think like us or talk like us. The Air Force turned out to be the first melting pot I would encounter (Silicon Valley the next) where individuals from different classes and culture had the opportunity to share a common goal and move beyond the environment they grew up in. At each base I was stationed in, I hung out with a group that tutored each other, read books together, went on adventures together and learned together. And while most of us came from totally different backgrounds (before the Air Force, I never knew you put salt on watermelon, that Spam was food or muffuletta was a sandwich), as far as the military was concerned, we were all the same.

But a half-century ago, the country started to disconnect from each other and our government when we eliminated national service. In 1973, near the end of the Vietnam War, the U.S. ended compulsory military service and has since depended on an all-volunteer military.

One result of this experiment: the risk for the sons and daughters being sent into harm’s way is no longer evenly distributed across all segments of society. Many American families no longer have a personal vested interest in our nation’s decisions about foreign policy.

The unintended consequence of this decoupling is seemingly perpetual wars (we’ve been in Afghanistan for two decades). And with our country focused for two decades on fighting non-nation states – Al-Qaida and Isis – Russia re-armed and China has built weapons that have negated our strengths, matched our military, and threaten democracy around the world.

Even more corrosive to the nation is that without any type of mandatory national or public service – not just military service – we eliminated any unifying, cohesive, collective, shared national experience, or shared values.

Values
Instead our values are shaped by what we read on social media, where we find an echo-chamber of others who think like we do. Technology that was supposed to bring us together has instead sold out the country for partisanship and division, for profit over national interest. Others found it politically and/or financially profitable to create distrust in the government institutions that protect and bind us. The result is that we’re easy targets for disinformation by adversaries intent on undermining our government and its institutions.

The world isn’t a benign place. Our freedoms and values need to be defended. Throughout history the capacity of human beings to think up new ways to kill one another has proved endless. My parents, along with millions of others, lost parents, siblings, and extended family in Nazi-occupied Europe. Volunteering for national service for me was a partial payback for the country that welcomed them, sheltered them, adopted them, and allowed them to become Americans. And as much as we wish it and try, we will not eradicate violent conflict in our lifetimes or even in our children’s lifetimes. Today, the struggle for freedom and human rights continues across the globe. Ask the Uighurs, or the people in Hong Kong or Tibet what happens when their freedom is extinguished.

A Contribution to National Service
Five years ago, listening to Pete and Joe talk about the problems the Department of Defense (DoD) faced reminded me of what I noticed inside the parts of the government where I was now spending time. While there were smart, dedicated people serving their country, few of students from the schools I was teaching at were there. Few of my students knew what the DoD or other branches of government did. It just wasn’t part of their lives.

It dawned on us that building on the last national curriculum I created – the National Science Foundation I-Corps, we could hit the ground running and create our own version of a national service. We envisioned a national Hacking for Defense program across 50 universities.

It’s taken five years, but I’m proud we’ve accomplished just that. The class is now adding 1,000+ students a year, many of them choosing to change career paths to work in national service or the public sector after graduation.

Still, there’s much more we can and must do.

While my entrepreneurial career allowed me to work with people who built great products and companies, my national and public service careers connected me to those who’ve dedicated their lives to serving others. And I’ve concluded that a life lived in full measure will do both.

We need to scale the existing national and public service initiatives –AmeriCorps, YouthBuild, PeaceCorps,U.S. Digital Service, Defense Digital Service, and conservation corps– that today only reach 100,000 people. We need to offer every high school and college graduate – all 4 million of them – a shared national experience.

In the face of forces working to tear us apart, we must remember that we are stronger together, more resilient together, more successful together, than we are apart. Our challenge is to bring unity back to a nation that is built on different backgrounds and beliefs. E Pluribus Unum – Out of Many, One.

Hacking for Defense is our contribution to what hopefully will be a much larger effort to help unify the country.

Lessons Learned

  • E Pluribus Unum– Out of Many, One
  • We need to find the common threads that bind us
  • We need unifying, cohesive, collective, and shared national experiences and values will help bring the country together again
  • Hacking for Defense is our contribution

Software Once Led Us to the Precipice of Nuclear War. What Will AI Do?

A version of this story previously appeared in Defense One.

The story of RYAN and Able Archer is an oft-told lesson of a U.S. intelligence failure, miscalculation, and two superpowers unaware they were on the brink of an accidental nuclear war — all because the Soviet Union relied on a software program to make predictions that were based on false assumptions.

As more of our weapons systems and analytical and predictive systems become enabled by AI and Machine Learning, the lessons of RYAN and Able Archer is a cautionary tale for the DoD.


In 1983, the world’s superpowers drew near to accidental nuclear war, largely because the Soviet Union relied on software to make predictions that were based on false assumptions. Today, as the Pentagon moves to infuse artificial-intelligence tools into just about every aspect of its workings, it’s worth remembering the lessons of RYAN and Able Archer.

Two years earlier, the Soviet Union had deployed a software program dubbed RYAN, for Raketno Yadernoye Napadenie, or sudden nuclear missile attack. Massive for its time, RYAN sought to compute the relative power of the two superpowers by modeling 40,000 military, political, and economic factors, including 292 “indicators” reported from agents (spies) abroad. It was run by the KGB, which employed more than 200 people just to input the data.

The Soviets built RYAN to warn them when their country’s relative strength had declined to a point that the U.S. might launch a preemptive first strike on the Soviet Union. Leaders decided that if Soviet power was at least 70 percent of that of the United States the balance of power was stable. As the months went by, this number plummeted. By 1983, RYAN reported that Soviet power had declined to just 45 percent of that of the United States.

This amplified Soviet leaders’ paranoia. After 25 years of back-and-forth in the nuclear arms race, the Peacekeeper ICBM and the Trident SLBM were tipping the balance in favor of the United States. Responding to the Soviet introduction of SS-20 intermediate-range ballistic missiles to Eastern Europe in 1983, the U.S. deployed Pershing II and Ground Launched Cruise Missiles missiles to Western Europe, which reduced warning time of attack on Moscow to less than eight minutes. And in March 1983, President Reagan announced the Strategic Defense Initiative – “Star Wars” – to intercept Soviet ICBMs, then piled on just weeks later by publicly labeling the Soviet Union “the Evil Empire.” And to cap off a very bad year in the Cold War, in September 1983 the Soviets accidentally shot down a civilian 747 airliner—KAL 007—killing all 269 aboard.

By 1983, Soviet political and military leaders truly believed a nuclear war was coming. The RYAN program took on even greater importance. To feed RYAN, the KGB made its top priority to collect indicators of anything that might precede a potential surprise nuclear missile attack. They were looking for direct indicators—had the U.S. Continuity of Government program (doomsday planes) been activated? Had the U.S. given advance warning to launch our strategic nuclear forces? They also collected secondary indicators. Their agents inside the U.S. and allied countries watched for heightened activities in and around Washington offices (White House, Pentagon, State Dept, CIA, etc.), including the White House parking lot, places of evacuation and shelter, the level of blood held in blood banks, observation of where nuclear weapons were stored, etc. Some of the indicators were based on a mirror-image of how the Warsaw Pact would prepare for war. Soviet case officers were instructed to look for deviations in the behavior of people in possession of classified information suddenly moving into specially equipped secure accommodations.

While most of the KGB station chiefs and case officers thought Moscow was being paranoid, they dutifully reported what they thought their leaders wanted to hear.

By November 1983, Soviet military and political leaders had convinced themselves that a nuclear first strike from the United States was probable. The RYAN program told them that the odds favored the U.S., and the war indicators in Moscow were flashing red.

That month, NATO ran a highly realistic set of wargames in Europe called Able Archer 83. These included an airlift of 19,000 U.S. soldiers in 170 aircraft under radio silence to Europe, the shifting of commands from Permanent War Headquarters to the Alternate War Headquarters, and practicing nuclear weapons release procedures.

In reaction, the Chief of the Soviet Air Forces ordered all units of the Soviet 4th Air Army on alert which included preparations for immediate use of nuclear weapons. It appears that at least some Soviet forces were preparing to preempt or counterattack a NATO strike launched under cover of Able Archer.

Luckily, no one overreacted. The Able Archer 83 exercise passed.

For years, the U.S had no idea that the Soviet Union had believed the exercise was a cover to launch a nuclear first strike. The Berlin Wall had fallen by the time information from a defector and an end-of-tour letter from the U.S. general responsible for Air Force Intelligence in Europe prompted presidential intelligence board to revisit what the Soviets had thought. In hindsight, RYAN and Able Archer took the Cold War to the brink of Armageddon.

Even when RYAN was reporting that the U.S. had a decisive military advantage, what made the Soviets believe that we would launch a first-nuclear strike? No one knows. However, given Nazi Germany’s surprise attack on the Soviet Union in WWII, resulting in 25 million dead and the extreme devastation inflicted on their country, the Soviet Union had reason to be paranoid. Some have suggested that the Soviets had interpreted President Carter’s 1980 Presidential Directive 59 Nuclear Weapon Employment Policy as preparation for a nuclear first strike. Perhaps the Soviet Union ascribed their own plans for a first strike on the U.S. to their Cold War enemy. Or perhaps the U.S. actually did have a first-strike option in one of our operational plans that the Soviets discovered via espionage.

Why were the Soviets convinced that a war would start with a war game? Several months after Able Archer, the Soviet Minister of Defense publicly acknowledged his country’s inability to tell a big NATO exercise from an actual attack: “It was difficult to catch the difference between working out training questions and actual preparation of large-scale aggression.” It’s quite likely that the Soviets’ own plans for launching a war in Europe would have been as part of a war game.

Certainly the Soviets, believing the signals of the RYAN alert system, were primed to assume a U.S. attack. In attempting to automate military policy and potential actions, the Soviets had amplified their existing paranoia. (A movie called War Games came out that year with some of the same themes.)

A Cautionary Tale for Automating Policy and Prediction
Forty years ago RYAN attempted to automate military policy and potential actions. But in the end, RYAN failed in actually predicting U.S. intent. Instead, RYAN reinforced existing fears, and accidently created its own paranoia.

While the intelligence lessons of RYAN and Able Archer have been rehashed for decades, as our own AI initiatives scale no one is asking what lessons RYAN/Able Archer should have taught us about building predictive models and what happens when our adversaries rely on them.

Which leads to the question: What could happen when we start using Artificial Intelligence and Machine Learning to shape policy?

  • What could happen when we start using artificial intelligence and machine learning to shape policy?
  • Will AI/ML actually predict human intent?
  • What happens when the machines start seeing patterns that aren’t there?
  • How do we ensure that unintentional bias doesn’t creep into the model?
  • How much will we depend on an AI that can’t explain how it reached its decision?
  • How do we deconflict and deescalate machine-driven conclusions? Where and when should the humans be in the loop?
  • How do we ensure foreign actors can’t pollute the datasets and sensors used to drive the model and/or steal the model and look for its vulnerabilities?
  • How do we ensure that those with a specific agenda (i.e. Andropov, chairman of the KGB) don’t bias the data?
  • How do we ensure we aren’t using a software program that misleads our own leaders?

The somewhat-comforting news is that others have been thinking about these problems for a while. In 2020, the Defense Department formally adopted five AI ethical principles recommended by the Defense Innovation Board for the development of artificial intelligence capabilities: AI projects need to be Responsible, Equitable, Traceable, Reliable and Governable. The Joint Artificial Intelligence Center appointed a head of ethics policy to translate these principles into practice. Under JAIC’s 2.0 mission, they are no longer the sole developer of AI projects, but instead providing services and common software platforms. Now it’s up to the JAIC ethics front office to ensure that the hundreds of mission areas and contractors across the DoD adhere to these standards.

Here’s hoping they all remember the lessons of RYAN.

Lessons Learned

  • RYAN amplified the paranoia the Soviet leadership already had
  • The assumptions and beliefs of people who create the software shape the outcomes
  • Using data to model an adversary’s potential actions is limited by your ability to model its leaderships intent
  • Your planning and world view are almost guaranteed not to be the same as those of your adversary
  • Having an overwhelming military advantage may force an adversary into a corner. They may act in ways that seem irrational
  • Responsible, Equitable, Traceable, Reliable and Governable are great aspirational goals

Hacking for Allies

During the Cold War U.S. diplomatic and military alliances existed to defend freedom around the world. Today, these alliances are being reshaped to respond to Russian threats to the Baltics and Eastern Europe and to China’s economic, military, and technological influence worldwide.

Hacking for Allies
The U.S. Department of Defense works with our allies to expand their industrial base. We benefit because it helps the North Atlantic Treaty Organization (NATO) standardize on equipment and our allies’ industrial capacity, capability and workforce can complement those of the United States. Allied countries benefit under the Global Capabilities Program which offers allies opportunities to partner on research and development, with the goal to build prototypes and eventually co-produce systems.

The goal of Hacking for Allies, (which will launch a second cohort next week,) is to connect dual-use startups (those that sell to companies and government agencies) in allied nations to the U.S. defense ecosystem.

Startup ecosystems in many of the smaller NATO countries don’t enjoy the long-established expertise or funding opportunities we have in Silicon Valley or other innovation clusters. For example, today it takes 7 to 10 years for a company in Norway to sell into the U.S. defense market. To shorten that time, we wanted to teach them the best practices of Hacking for Defense/Lean Startup/I-Corps (customer discovery, MVPs, pivots, business model canvas, etc.) And give them a roadmap for how to play in the U.S. defense market.

Hacking for Allies – Norway Edition
Norway is a founding member of the NATO and they are NATO’s bulwark against Russian incursion in the strategically critical “High North” region. Norway has experienced Russian simulated air attacks on Norwegian targets and jamming of GPS signals that threaten civilian aviation. Last fall, Russia conducted a cyberattack on the Norwegian parliament.

The Norwegian Defence Research Establishment, Innovation Norway, and H4XLabs (BMNT’s early stage tech accelerator) just ran the first Hacking for Allies cohort of Norwegian companies. The teams were guided using the “player-coach” approach. The program conducted weekly deep dives with each company working through their challenges. It combined this with sourcing outside experts for all cohort topics of interest. These topics included: Raising funds as a European company, what it takes to work with the DoD, customer discovery for adjacent markets, and more.

85 startups applied for this first cohort. They were down-selected to a few promising teams. Some of the teams included:

  • Alva Industries – making 3D printed electric motor stators 20% more efficient. That means more battery life and/or power for unmanned aerial vehicles.

  • Excitus: a medical device to clear blocked airways in the battlefield. Their device replaces existing suction pumps with the equivalent of a handheld vacuum cleaner with a sterile disposable cup.

  • Fieldmade: An additive manufacturing microfactory with a library of certified printable 3D parts, which radically reduces parts inventory.

  • Ubiq Aerospace: started as de-icing for drones but potentially pivoting to sensor data fusion.

The teams launched out of the program talked to tons of people in the U.S. they never would have connected with (“it would have taken us years to make these connections”), made pivots, built new product suites and capabilities around their core services – all of which made them attractive to wider markets — and raised additional funding.

Now a new cohort of the program is getting under way. Innovation offices from NATO countries and other allies who want to teach their dual-use startups how to work with the U.S. government should attend the Hacking for Allies webinar February 23rd at 8 am Pacific, 11 am Eastern.

Register here.

When National Security Falls Between the Cracks

A version of this article – co-authored with Raj Shah and Joe Felter – previously appeared in War On The Rocks.

After hearing from 20+ guest speakers, including two Secretaries of Defense, Generals, Admirals and Policy makers in our Technology, Innovation and Modern War class – the direction of technology and the future of national security came into sharper focus. This series of articles will offer suggestions to transform the DoD to face the challenges ahead.


As it is currently organized, the U.S. government is ill-equipped to deal with the growing number of national security challenges that exist at the intersection of commercial and defense technology. Innovation opportunities are slipping between Washington’s organizational gaps, and America’s enemies are too.

President Joe Biden has already taken several steps that suggest he recognizes the gravity of this problem. He has elevated the science adviser to a Cabinet-level position, appointed a number of talented individuals to high-level cyber security posts, and created a national security adviser for cyber and emerging technology. But more changes are needed. Most importantly, Biden should create a deputy national security adviser with sufficient staff and authority to coordinate innovation and technology policies across the entire government.

Blurred Lines
From artificial intelligence to biotechnology, U.S. national security is inexorably and increasingly intertwined with commercial technology. Unlike in the Cold War, advancements in areas with important national security implications come from private sector research labs and are driven by consumer demand rather than government directives. Yet it remains unclear who in the government now sets policy for — or has final say over — issues that cross the boundaries between academia, defense, commerce, and diplomacy. In addition to the National Security Council, bureaucratic contenders currently include the Commerce Department, Federal Communications Commission, Federal Aviation Administration, Council of Economic Advisers, Treasury Department, the Office of Science and Technology Policy, and the Office of Management and Budget.

In theory it is the National Security Council that should coordinate a “whole of government” response that brings together tools from different agencies to address emerging threats. Indeed, this was the purpose for which the council was created in 1947. However, Cabinet members who are responsible for vertical portfolios still manage the government’s large functional agencies, and there continues to be significant overlap between those who handle commercial, defense, and diplomatic policy. It is this organizational design that creates blurred bureaucratic lines and weakens U.S. national security. 

There are a number of specific areas where these blurred lines led to subpar policies that undermined America’s technological competitiveness and left the country weaker against adversaries like Russia and China. Consider four recent examples: semiconductors, drones, the SolarWinds hack, and SpaceX’s Starship.

In the absence of a coordinated technology and industrial policy, the United States has become dangerously reliant on computer chips produced in a handful of countries for all its defense and commercial needs. Originally, all of America’s computer chips were produced in Silicon Valley. Today, none are made there. The United States is dependent on two companies, Taiwan Semiconductor Manufacturing Co. in Taiwan and Samsung in Korea, for the chips used to build a substantive part of its defense electronics. Around 60 percent of the chips Taiwan Semiconductor Manufacturing Co. makes are for American companies. Even Intel, the supplier of most of the central processing units used in desktop computers and data centers, will be outsourcing manufacturing of its next generation of chips to Taiwan. Taiwan Semiconductor Manufacturing Co. has announced that it will build a chip factory in the United States, but even when complete it will produce less than 3 percent of the company’s capacity in Taiwan.

In the case of drones, the U.S. government also missed an opportunity to maintain the country’s competitive edge. Where there was once a nascent U.S. commercial drone industry, the Chinese company DJI now controls 69 percent of the global market. Not only is DJI at the cutting edge of such crucial drone technologies as motors, speed controllers, radio modules, cameras, and artificial intelligence, but it has also allegedly used its hobby drones to map U.S. military installations. As a result, the former assistant secretary of the Air Force for acquisition, technology, and logistics lamented that the lack of Defense Department support for American drone startups was a critical missed opportunity.

In some cases, the danger is more immediate. The SolarWinds cyber attacks revealed how the failure to secure commercial software can compromise even well-secured government networks. In this case, the Russian government exploited commonly used civilian network management software in order to infiltrate the Treasury, State, and Defense departments. By adding malicious code to the SolarWinds update tool, hackers gained access to the data of 18,000 customers — including many in the U.S. government.

Efforts to harden government agencies and protect sensitive information against infiltration will fail so long as adversaries can circumvent them through commercial companies. Private companies have lobbied Congress against requirements that would mandate expensive investments to secure their systems. Furthermore, financial penalties for large-scale breaches of commercial companies are trivial. SolarWinds received national attention because it was an attack on the government, but cyber attacks on private companies continue unabated.

Finally, the fate of the SpaceX Starship offers an example of how government oversight agencies can stifle innovation when they are unable to keep pace with the speed of contemporary technological development. In temporarily halting test launches of the SpaceX Starship, the Federal Aviation Administration sought a lengthy investigatory period that put unnecessary roadblocks in the way of a company that is transforming access to space. In innovation, failure is part of the process. Test rockets blow up, test airplanes may crash. If you do not push the envelope and discover the limits of your design you are not innovating fast or far enough. It goes without saying that you strive to minimize loss of life and property, but the rules governing innovation programs should recognize a heightened need for speed. The U.S government appreciated this when developing rockets and experimental aircraft in the 1950s and 1960s — better organization could help it apply this understanding again today.

Reorganize to Win
To solve these problems, the White House needs to ensure there is a single organization that has stewardship of all the issues that cross existing lines between national security, commerce, and technology. 

An effective way to do this would be to create a new deputy national security adviser. Armed with sufficient resources and influence, this position would be given real responsibility to help shape the budget, trade policy, and alliance strategy. This adviser would ideally sit on both the National Security Council and National Economic Council, where they could coordinate policies covering a range of technological and scientific issues. These would include the fields of artificial intelligence, machine learning, biotech, hypersonics, and microelectronics, to name just a few. This position would also be responsible for building a civil-military alliance for protecting civilian assets and incentivizing private companies to do work with a national security payoff. The reach of the new deputy national security adviser could also be enhanced by putting appointees in key agencies such as the Department of Defense, the Office of Management and Budget, and the Office of Science and Technology Policy who would be responsible for leading and coordinating innovation policy across the government.

The Biden administration may opt for a different form of reorganization. Several plausible alternatives have been proposed. Regardless of the approach, the important thing is for Washington to recognize and close the organizational gaps its adversaries have exploited.

Regaining America’s Technological Edge: Build a Civil-Military Alliance

A version of this article – co-authored with Raj Shah and Joe Felter – previously appeared in The National Interest.

After hearing from 20+ guest speakers, including two Secretaries of Defense, Generals, Admirals and Policy makers in our Technology, Innovation and Modern War class – the direction of technology and the future of national security came into sharper focus. This series of articles will offer suggestions to transform the DoD to face the challenges ahead.

“We need to couple the $150 billion a year U.S. Venture capitalists (VCs) spend to fund new ventures with the speed and urgency that the DOD now requires.”


We stand at a crossroads of history. The decisions this new administration makes about how to engage, incite, and rally the full force of American capitalism will determine whether we stand in the backwash of China’s exhaust or we continue to lead.

In the twenty-first century our country’s military and economic power will rely on the rapid development and deployment of new technologies—5G, microelectronics, cyber, AI, autonomy, robotics, access to space, drones, biotech, quantum computing, energy storage, and others yet to be invented.

The technologies we employed to prevail in the Cold War and the War on Terror were largely developed by big defense primes and U.S. government labs, but today most of the advances come from commercial vendors—many of them Chinese. For the first time in the history of modern civilization most of the technologies needed for the military are driven by consumer demand and the potential for profit—not government directives.

China is executing a plan to win with new technologies through its strategy of Military-Civil Fusion—they’ve torn down the barriers between Chinese companies and academia and its military. Its purpose is to improve China’s military technology by integrating Chinese industry and academia so it can develop the Peoples Liberation Army into a world-class military equal or superior to the U.S. Meanwhile, its Orwellian National Intelligence Law mandates that citizens and companies must cooperate with state defense and intelligence work. (Yes you, Apple and DJI.) Simultaneously, the Chinese Communist Party is integrating party leadership in both state-owned companies and private businesses (which account for 60 percent of the country’s output).

The takedown of Jack Ma, founder of Alibaba and Ant Group, is a warning shot to every Chinese CEO that regardless of a company’s size, the party and government are back in control.

China’s Military-Civil Fusion and National Intelligence Law stacks the deck against every U.S. and Western company. You’re not competing against an individual Chinese company; you’re competing against the Chinese government.

What it means for the U.S. military is that our national security is now inexorably intertwined with our success in leading in commercial technology. Developing, maintaining and safeguarding our technological edge will be key to prevailing in great power competition.

Today, the DOD requirements and acquisition systems are driven by a sixty-year-old model predicated on 1) predicting the future (both threats and technology), 2) delivering solutions decades out optimized for lifecycle costs and 3) assuming that government labs and incumbent prime contractors drive technological innovation. Every one of those assumptions are no longer true.

Maintaining our technology leadership will require the DOD to understand that delivering new/disruptive innovation versus execution of existing technologies happen at different speeds, with different people, organizations, culture and incentives. Buying the next incremental version of a gun, tank, plane, ship, means you can (hope to) predict its lifecycle cost, delivery schedule, etc. And you can assume that with enough dollars it will appear.  That’s not how innovation actually happens. And we are living in that new world where innovation is happening continually. We don’t need to abandon our methods of buying incremental improvements, but we must have a parallel set of activities—at scale—to keep up with our adversaries who already understand this.

How can we effectively compete? One of the reasons the United States prevailed in the Cold War with the Soviet Union was that total government control of innovation is an inherent weakness. When the Soviets launched ideological purges of their best and brightest and jailed their dissidents, they throttled innovation at scale. There were no Soviet Steve Jobs or Bill Gates. Meanwhile in the U.S., venture capital was funding startups led by iconoclasts, troublemakers and dissidents. The result has been a half-century of continuous and extremely profitable disruptive innovation.

The U.S. military must now invest in new capabilities and concepts to reimagine how it fights. It needs to use rapid/agile innovation, disposable systems that take advantage of innovations in the commercial technology base. We need to couple the $150 billion a year U.S. Venture capitalists (VCs) spend to fund new ventures with the speed and urgency that the DOD now requires. We need to leverage the inherent advantages of a capitalist democracy and align public and private sector incentives to drive technology advances.

We need a Civil-Military Alliance. One that’s driven by incentives, not coercion. By public-private partnerships, not government control. Private industry, from primes to startups incentivized at scale, will ensure our leadership in science, in industry, and in new technologies.

A few suggestions:

For a Civil-Military Alliance the DOD needs new sources of disruptive innovation and ideas. Not as replacements for the valuable prime contractors we have but as complementary partners who are agile, can attract the best and brightest, and are willing to bet their company on new ideas.

In the 20th century most military contractor-built hardware, and software was an add-on. When an upgrade was required, a new contract was needed, which took years. The new generation of military systems will be built around software with hardware as the add-on. Upgrades can happen over the air in weeks not years.

Today, the world’s innovation ecosystem for new technologies are VCs and startups. To make Civil-Military Alliance work the DOD needs to understand that no investor wants a new startup to spend three years going through the existing DOD requirements and acquisition process when there’s a viable alternative in a commercial market.  (Today, even if a startup gets an early DOD award of a million dollars it’s not enough to incent the technologies they need.)

Few inside the department of defense understand how the commercial venture capital/startup innovation ecosystem works. Going forward, inside every service acquisition arm there needs to be a deputy who can go to a whiteboard and draw how private investors make money. And more importantly work with them to get the best and brightest of their portfolio companies engaged.

One solution is that the DOD needs to pick new entrants as winners at scale. Today, no DOD acquisition chief wants to be in front of Congress explaining to a committee chair why the incumbent vendor in their district lost. That will happen unless both the DOD and Congress clearly articulate that the process for picking winners for existing incremental changes is different from disruptive ones. And that the default ought to be new vendors. Each service should pick 1-2 startup/scale-up winners and buy heavily.

As part of the Civil-Military Alliance, the U.S. needs to massively reinvest in critical technologies. China has invested over $100 billion in moving its manufacturing base from making low-tech products to rapidly developing ten high-tech industries including electric cars, next-generation computing, telecommunications, robotics, artificial intelligence, and advanced chips. They’ve raised over $50 billion just for building an indigenous semiconductor industry.  We need to pick critical industries and do the same at scale. Not only the incumbents but with new entrants.

Another part of a U.S. Civil-Military Alliance would be transforming our existing government R&D Labs. The U.S. spends $15 billion a year on forty-two Federally Funded Research and Development Centers (FFRDCs)—twenty-six R&D labs, ten study and analysis centers, and six system engineering and integration centers. Set up in WWII and scaled during the Cold War, the truth is that most of them are no longer the country’s cutting edge. We need to radically reorient their relationship with the new centers of innovation.

Finally, the existing prime contractors have sat out the innovation game. While many have a token VC arm, today they are not leading in disruptive technology, particularly if the profit incentives are to continue to lobby and build the status quo and get a new contract every time a system needs an upgrade. We need serious incentives to have primes get into the disruptive innovation game. They need to actively invest in and buy startups—at startup multiples—with billions, not millions. Their CFOs need to tell us what incentives (tax write-offs, acquisition preferences, etc.) can be tied to rapid delivery and deployment—not demos—of new technologies and systems.

This is a critical time for our nation. Our adversaries aren’t waiting. The Biden administration can choose business as usual and let U.S. leadership in technology disappear and the country founder in the backwash of the coming China age. Or it can choose to build a Civil-Military Alliance ensuring our leadership in science and in industry, while maintain our core values. Our hopes for peace, security, and self-determination around the world, require us to make this effort.

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