🇺🇸 🚀 How the Trump administration can fuel defense tech & cut red tape
The incoming administration has an unconventional pick for secretary of defense and several opportunities to carry forward critical programs underway in the Defense Department.
Welcome back to the Nexus Newsletter, Applied Intuition Defense’s newsletter covering the latest in national security, autonomy, and software-defined warfare.
In today’s edition, we highlight opportunities for the incoming Trump administration and Congress.
When the Trump administration settles into the White House in January, it will be entering an era in the Pentagon marked by a focus on U.S. competitiveness and advances in emerging technologies — an encouraging sign for defense tech startups.
Late last night, President-elect Donald Trump announced he would nominate Fox News host and veteran Pete Hegseth to be the next secretary of defense. An unconventional pick, Hegseth’s untraditional background in media and communications for someone chosen to be the highest ranking official in the DOD can work to its favor. This includes marshaling a united response among the American people to our nation’s challenges, including a moribund defense industrial base, a historically low recruitment, and revitalizing the defense tech sector.
Below, we’ve laid out some recommendations for the next administration and Congress, and a few things we want to see.
Boosting defense tech: We hope the Trump administration carries forward critical initiatives and programs already underway in the Pentagon. We urge the administration to increase investments into emerging and advanced technologies, ensuring the U.S. remains a global leader in defense innovation. The incoming administration has a chance to continue fostering a climate that encourages technological growth. At the same time, it can work to reduce barriers to entry for new companies and overhaul inefficient bureaucratic processes that have long stifled modernization efforts.
One effort that deserves continued support is the Replicator initiative focused on rapidly deploying thousands of autonomous systems. Deputy Defense Secretary Kathleen Hicks launched Replicator last year, demonstrating a shift toward more scalable, cost-effective, and quickly deployable solutions. The Trump administration can leave its mark on this initiative by shifting focus to the most challenging part of developing, fielding, and sustaining autonomous systems at scale – software. Hicks has designated the Chief Digital and Artificial Intelligence Office as the data and AI hub for the initiative, where it’s tasked with providing an autonomy enterprise platform for software sustainment, something we believe is crucial to the success of Replicator.
We also hope to see continued support for the Defense Innovation Unit, which is embarking on a new chapter in its nine-year existence. DIU Director Doug Beck deserves applause for launching DIU ‘3.0,’ which he called a “pretty significant shift” for the agency. Under DIU 3.0, Beck says the organization has moved beyond demonstrating the value of autonomous systems, and is focused on scaling them across domains.
The incoming Trump administration should support funding increases for DIU in order to make sure it can deliver on its mission to scale commercial technologies for broad military use under this new chapter. DIU received a significant bump in funding last year from Congress thanks to House Defense Appropriations Subcommittee Chairman Rep. Ken Calvert and others, and we hope to see that trend continue.
DIU is key to bridging the gap between DOD and the private sector’s technology solutions, and startups in the defense tech space need more support from DOD. As The Wall Street Journal reported, “venture-backed defense companies were awarded less than 1% of the $411 billion Defense Department contracts awarded in” the last fiscal year.
The next administration should prioritize partnering with nontraditional defense firms and incentivize more robust participation in the defense ecosystem through streamlined contracting and simplified prototyping opportunities. Along with increased support and funding, the Trump Administration, known for its aversion to unnecessary regulation, should prioritize cutting red tape, getting rid of bureaucratic processes, and holding to account the “frozen middle” that hinders innovation.
In September, Applied Intuition Co-founder and Chief Technology Officer Peter Ludwig testified before the House Armed Services Committee (HASC), emphasizing the need to get rid of bureaucracy within DOD:
“Bureaucratic delays consume time and lead to increased costs, including opportunity costs yielded to one’s competitors. The same is true for DOD, its programs, and those of our adversaries. The success of DOD programs should be measured by the speed at which they are able to bring capability onto contract.” - Peter Ludwig
This leads us to another recommendation: Accelerate change in the Pentagon by working with Congress. The incoming administration has an opportunity to send a clear message to DOD, Congress, and allies that defense modernization and innovation are above partisan politics and instead rooted in national security imperatives. As such, we welcome topline increases in the defense budget that prioritize innovation. But Congress also has the opportunity to scale commercially-proven solutions while getting rid of wasteful programs within existing defense toplines.
As the 119th Congress convenes, we would like to express our gratitude to all of the returning lawmakers who recently visited our offices and worked to champion the importance of software-defined capabilities and defense autonomy. We would especially like to thank HASC Chairman Mike Rogers and Ranking Member Adam Smith for their leadership in holding the first HASC Hearing in decades — and choosing Silicon Valley as their preferred site. Applied was honored to testify.
We would also like to congratulate all lawmakers of the 119th Congress and extend an invite to them (and their staffs) to come and visit us in the near future.
That’s all for today’s newsletter. See you next time!