You’re a small business owner.
You find yourself in front of a panel of investors.
You have 15 minutes to pitch your business idea.
You’ll know then and there whether you get the contract.
This was the idea behind a “Pitch Day” the United States Air Force recently held. It was a success, with $3.5 million in contracts handed to small businesses by the time it was over.
That amount of money is pocket change in the grand scheme of the Air Force’s operations. But it signifies a shift in the way things will be done when it comes to the creation of the tools and technology our military branches use.
Rapid Decision Making for a Rapidly Changing World
In all, 51 companies walked away with small contracts awarded by the USAF. These initial awards were no larger than around $158,000, but that’s the kind of money that can act as the spark for the idea that has the potential for big future payouts.
Think about household-name companies today — companies like Apple and Amazon — and the familiar origin story of the hungry entrepreneur toiling away in a garage. Those humble beginnings that eventually lead to innovative, money-making ideas are at the core of what Pitch Day is about.
“Industry days happen when we think we know what we need,” Will Roper, Air Force assistant secretary for acquisition, technology and logistics, told reporters. “There were a lot of moments we looked at the companies at Pitch Day and said ‘I can’t believe we don’t already have that.’ Chemicals that let us find downed pilots, medical devices that stabilize, small radars that let us find people breaching a perimeter at an airbase.”
That’s the thing about innovation: You can never be sure where it’s going to come from or what form it’s going to take. By connecting with these small companies, the USAF is able to take advantage of fresh ideas as they come. From there, they can move quickly on getting them onto the constantly-changing battlefield of 21st-century warfare.
These were only phase 1 contracts, which is basically the initial seed funding. A company that further establishes itself as a potential partner for the USAF would move on to phase 2 funding from there. That would involve more investment and development that leads to the prototyping stage.
This method can complement the more traditional ways of research and development that you find with bigger, established defense companies. It allows that important work to continue while also making it possible for newer ideas to grow and become reality.
Modern Solutions for Modern Problems
Big money is pumped into military spending every year. After all, 2019’s defense budget topped $716 billion. The majority of that money, of course, goes to companies like Lockheed Martin, General Dynamics, and Raytheon. But the thing about those companies is their scale makes it so that the weapons and systems they develop often take years, and billions of dollars, before anything even reaches the prototype stage, never mind actual production.
This can work against us in an environment where enemy nations are constantly developing the means to counter those weapons. They create their own solutions that make ours obsolete within months of deployment.
The Air Force sees this as the problem that it is, and wants to work with big-name defense companies to change the way they think about their ideas. But that change takes time. Calling up small, nimble companies that are working on tomorrow’s problems is a good way to always have options available when it comes to the mission.
This is a mindset that can be especially useful as the U.S. moves ahead with the proposed United States Space Force, which would be a branch of the Department of the Air Force.
In fact, one company whose origin is similar to Pitch Day’s companies rose from humble beginnings to become a star player in the defense industry.
It was started by a small group of pioneers nearly 80 years ago. Since then, its revolutionary ideas became responsible for the United States winning the original Space Race.
Now, its sights are set on winning the new Space Race.
Keep your eyes open,
Ryan Stancil
Outsider Club, Contributing Editor
