Global Resilience

Building Globally Resilient Systems for a New World Order

Investing in Modern Defense & Intelligence
Published
March 1, 2023
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#
min read

There is a new world order defined by great power competition and increased nationalism that will require building more dynamic, resilient systems across our most critical industries, from healthcare and financial services, to energy and education, to industrial and defense.  Doing so will help keep the world safer, healthier, more sustainable, and productive…but will also require more capital, more patience, and greater levels of collaboration than ever before.  One renewed area of focus for General Catalyst is modern defense and intelligence where there is an urgent (long overdue) need, proven innovation playbooks and the opportunity to create enduring global defense and intelligence companies with responsible innovation at their core – in the service of deterring aggression and promoting freer, more democratic societies everywhere.

*   *   *   *   *   *   

In early February, Hemant and journalist Fareed Zakaria published a piece in Harvard Business Review entitled ‘Geopolitics Are Changing: Venture Must Too’; in it they describe the end of globalization and the new market dynamics that will bring dramatic changes–geopolitical, economic, social, cultural and technological– to every corner of the world economy.  These include: 

  • The end of American hegemony and the return of great power competition
  • The accelerating unpredictability and impact of exogenous shocks (pandemics, energy crises, acts of aggression, cyber attacks, climate change, supply chain disruption), all happening with greater velocity and virality due to our dynamic, globalized world.  
  • A new realignment and re-globalization whereby countries will seek to leverage the benefits of globalization while at the same time, build greater independence and resiliency for their most complex and systemically important industries.   

There are profound implications for this new world order when it comes to technology and innovation.  Companies and countries alike will look beyond global efficiency (long the holy grail of the globalization era) and start to re-prioritize a new critical factor:  global resilience.  It will have a meaningful impact across every industry and will result in new winners and losers on the world stage–as well as the need for new kinds of public and private partnership.  

Global resilience is our term for these new dynamics at play–where countries and companies deprioritize efficiency, openness and highly interconnected systems in favor of safety, stability and greater control for enterprise (or national) benefit, especially for the most critical operations and sectors.  Building independence and resilience in key global industries like healthcare, defense, energy, manufacturing, and financial services will require a new model of venture capital.  These industries are our most societally important and they are giant, complex and highly interconnected sectors of the global economy; reimagining these areas through the global resilience lens will require new (longer) time horizons, different business models, more significant depth of governance and a more cooperative approach between venture capital, innovators and government.  You need to look no further than the global semiconductor industry–where the US last year announced a $280 billion investment plan to revamp its domestic production capabilities and re-think that supply chain end-to-end.  We believe this means a complete re-architecture of an incredibly complex industry–from R&D to component materials and manufacturing, all the way through distribution and trade, that requires huge amounts of capital, a renewed commitment to fundamental innovation and public sector cooperation.  

Much of our current work in healthcare at General Catalyst has paved the way for how to think about investing in global resilience in this new world order.  Our health assurance thesis is about creating a more accessible, proactive, and affordable system of care and making the healthcare system more resilient in the face of future pandemics and other inevitable global crises.  We have taken a systemic approach, investing in innovation across the entire ecosystem.  Our approach has always been one of ‘radical collaboration’ -- we work with more than a dozen top health systems in the US to understand each of their unique challenges and requirements in order to develop scaled systems (versus today’s proliferating point solutions) that work for all, and we are extending this overseas.  This new type of partnership (as opposed to disruption) model is a blueprint for how we work in close proximity with the industry to drive transformation.  We believe that such intentional collaboration will be critical in achieving our goals to transform certain industries and is a key pillar of our belief in the need to “transcend” the current venture capital model.

Global resilience is about investing in the systems that form the bedrock of society.  A renewed area of focus for us within the global resilience thesis is modern defense and intelligence where we see a pressing need to invest in modern and more resilient systems for the benefit of our nation and our allies.  At General Catalyst, we have history in this critical market, having acquired DARPA R&D pioneer BBN and selling it to Raytheon in 2009.  BBN is most famous for having implemented ARPANET, the precursor to the Internet, and then pioneering email.  It was also well-known for inventing the Boomerang gunfire detection system, which saved countless lives during the Global War on Terror.  A few years later, we invested in OGSystems, a leader in geospatial analytics for the intelligence community, and in 2019, sold the company to Parsons, a major defense engineering firm.  In 2017, we also invested in the seed round of Anduril, whose mission is to build a modern defense prime contractor to transform US and allied military capability with advanced technology.  Beyond just the deals, we have tremendous respect and admiration for the work that the men and women serving our country are doing and we feel the obligation to support them fully.  Over the years, we have spent time with some of the most elite men and women serving in the US military, special operations and intelligence communities and when you have the opportunity to understand the level of commitment to their mission, their sacrifice and the challenges they are facing, it becomes clear that we must do more for them from a technology and capability standpoint.  As we have immersed ourselves in the defense and intelligence market, we now see even more opportunities to innovate new solutions to keep the world safer, more secure, and more prepared.  What’s driving this thesis is as follows:

  1. Investing in modern defense and intelligence is urgently needed, and long overdue.  We are returning to an era of great power competition, with the rise of China and the return of Russia.  Against this backdrop, the US finds itself woefully behind on investment, modernization and innovation, with many of our signature defense and intelligence assets celebrating their half-century birthdays.  China’s annual spending on defense will soon exceed that of the US with all their spend going towards innovating new platforms, systems, AI and software.  In comparison, the bulk of the Pentagon’s nearly $1 trillion annual spend goes towards maintaining existing systems.  Only a third of that $1Tn budget goes to new innovation and nearly half of that spend goes to six companies that were, on average, founded over 75 years ago.  More pointedly, we believe the historical model of defense procurement where systems were designed and procured over decade-long horizons does not work in today’s world where technology capabilities change in real-time.  Niall Ferguson’s recent op-ed piece in Bloomberg explains how “The US Domain Awareness Gap Goes Way Beyond Balloons” and the current limitations of our military-industrial manufacturing base to supply ordnance for an extended, conventional war, as evidenced by Ukraine.  To compound matters, we believe the nature of modern defense is changing.  As we see it, modern conflict takes place not just on the physical battlefield but across multiple domains.  This new global battlefield extends to cyber and information security, economic warfare, industrial manufacturing and energy, politics and culture, and outer space.  We believe there is a need for new, multifaceted technologies for integrated deterrence, the ability to defend against attacks across multiple-domains, all of which will require the most advanced software and hardware-enabled innovation.  Having the most advanced capabilities in irregular warfare (the ability to win over and influence populations) will be key.  Modern defense is not just about who has the greatest kinetic capabilities; it’s about how to ensure access to the future of semiconductor technology or food and energy supplies, or who can preserve the democratic process from disinformation campaigns.  At every level of this multi-dimensional battlefield, where battles will occur without bullets being fired, we need capability and resilience, enabled through deep innovation.
  1. There are proven (and more accelerated) playbooks for how to build and scale impactful companies in this space.  From our perspective, it wasn’t very long ago that investing in defense tech was seen as the least interesting market for a venture capitalist due to perceived challenges in scaling.  At General Catalyst, we’ve been fortunate to partner at the earliest stages with companies like Anduril, Applied Intuition, and Vannevar Labs, which have all become impactful companies selling to the DoD at scale.  Each of them has created their own “playbook” for how to engage and scale in this market, namely, having an incredibly deep understanding of the user’s mission needs, building both product and go-to-market capabilities in parallel, and being able to prototype / show value fast while simultaneously being long-term patient and skilled in navigating the idiosyncrasies of the DoD procurement process.  What’s most exciting to us is that these companies have been able to quickly build solutions that deliver critical impact for our nation, in different ways.  We’ve observed early innovators like SpaceX and Palantir have indeed scaled large businesses selling to the government, albeit with large sources of capital and a decade-long horizon.  In comparison, within just 5 years of its founding, Anduril has been able to build multiple software-defined and hardware-enabled solutions and deploy those into the field to solve missions.  Anduril has won multiple large programs of record from the DoD as well as our allies, and proven that its model of recruiting the best technical talent, funding R&D privately with venture capital and then partnering closely with the DoD, works to bring modern technology quickly into the hands of our military and allies.  Also within 5 years of its founding, Applied Intuition’s dual-use simulation and testing platforms for autonomous vehicles, used by 17 of the top 20 global automotive OEMs, was chosen by the DoD for the Army’s Robotic Combat Vehicle and pioneered a new two-track procurement process that separates software purchasing from hardware.  And Vannevar Labs, within just 3 years of its founding, has been able to find significant customer adoption within the intelligence community and grow to $25mm in revenue while achieving profitability, with a product-led growth motion.  By leveraging different playbooks, these companies have all found product market fit relatively quickly in their company lifecycles and delivered mission impact.  One commonality we see is that each of them have had the ability to both innovate and iterate solutions in the short-term while maintaining a long-term culture and patience around product strategy and adoption.  
  1. Public sector partnership is key.   Much has been written about the historically synergistic relationship between the technology industry and the government over the past half century, and how that relationship has broken down over the past few decades.  We, as a society, have benefited greatly from so many government innovations and fundamental breakthroughs in the fields of communications, computing, energy and healthcare.  We now have an obligation and responsibility to give back and invest into the public sector and contribute to the flywheel of technology innovation that our government catalyzed.  Partnership with the public sector will be critical to solve our large-scale challenges, whether semiconductors, defense, or energy.  By working together, we can rekindle a renewed cycle of private and public sector innovation.  We have long railed against the ‘disruption’ mindset that pervades Silicon Valley, instead favoring collaboration and partnership with the ecosystem to accelerate digital transformation, as demonstrated by our approach in healthcare. Credit needs to be given toward the government for changing their procurement processes and establishing a number of initiatives to accelerate innovation (e.g. Office of Strategic Capital); the CHIPS Act is another incredible step forward.  Silicon Valley needs to embrace a new era of partnership, both with the public sector and existing defense contractor ecosystem, which will be key.  This will require greater relationship-building and mutual trust from both sides, deeper understanding from Silicon Valley around mission needs and patience with navigating the DoD, greater transparency from the DoD on their needs, and deeper appreciation from the DoD on what it takes to support startups and innovation to create truly sustained impact, especially against other great powers.  
  1. Investing in modern defense transcends a pure business opportunity.  At General Catalyst, our core mission is Responsible Innovation and how we can intentionally invest in growth and good, to enable positive, powerful change that endures.  Our initial seed investment in Anduril spurred spirited and necessary debate inside GC on how to reconcile investing in defense tech with that mission.  Trae Stephens at Anduril has written eloquently about the “Ethics of Investing in Defense Tech” and the “Business of War is the Business of Deterrence”.  For us as technologists, we believe we have a moral responsibility to our nation, allies, and troops to enable them with the best innovation to support their missions, which they do not have today.  There is an element around efficiency as well given that tax-payers are funding this $1Tn market and anything we can do to deliver better capabilities at lower cost, benefits all stakeholders.  Our investing focus at GC is on software and solutions that will help modernize our defense and intelligence capabilities, and help level the playing field against our great power competitors.  The intent is to increase our capabilities to deter conflict and be much more precise in how we take actions.  We are not investing–and will not invest–in ‘day one’ offensive systems used to take first action but rather the capabilities for improving defense and intelligence across the new multi-dimensional battlefield of physical battlefield, cyberwarfare, information warfare, industrial, and supply-chain disruption, energy shocks, and political mis-information domains.   
  1. We are committed to building these companies responsibly.   We acknowledge that the defense and intelligence sector is not without controversy, as human lives are on the line, and we work closely with our portfolio companies to consider second and third order impacts and avoid unintended consequences.  A core tenet of General Catalyst’s responsible innovation framework is to promote a fairer and healthy society.  We are determined to create next-generation defense and intelligence companies with responsible innovation at their core – in the service of deterring aggression and promoting freer, more democratic societies everywhere.  The stakes of getting it wrong are unthinkably high (especially with the advent of AI) but so are the stakes of inaction or falling behind.  The country that wins the war sets moral and ethical standards.  Over the past 50 years, American hegemony ushered in democracy.  What happens if authoritarian states win the next war?  

We see tremendous opportunity in building modern, resilient systems for the most essential parts of our economy and society in order to compete and win in this new world order.  We have started that work in healthcare, fintech and education, and are now focused on modern defense and intelligence.  Our goal is not to invest in hundreds of defense companies but rather the dozen companies that can deliver impact at scale.  Anduril, Applied Intuition and Vannevar Labs are well down that journey in their markets and we are excited to partner with the next-generation of companies that are helping modernize our defense, intelligence, and industrial capabilities. We believe the new businesses that are created in response to solving global resilience –if done right– will have a tremendous positive impact on society and could generate even larger returns than what we’ve seen in the previous decades of venture capital.

*   *   *   *   *   *   

Source materials and additional information:
https://www.mckinsey.com/industries/public-and-social-sector/our-insights/the-chips-and-science-act-heres-whats-in-it

https://en.wikipedia.org/wiki/ARPANET

https://www.voanews.com/a/experts-warn-us-is-falling-behind-china-in-key-technologies/6751392.html

https://www.globalsecurity.org/military/world/china/budget.htm

https://www.usgovernmentspending.com/defense_spending

https://stacker.com/business-economy/50-inventions-you-might-not-know-were-funded-us-government

Published
March 1, 2023
Share
#
min read

There is a new world order defined by great power competition and increased nationalism that will require building more dynamic, resilient systems across our most critical industries, from healthcare and financial services, to energy and education, to industrial and defense.  Doing so will help keep the world safer, healthier, more sustainable, and productive…but will also require more capital, more patience, and greater levels of collaboration than ever before.  One renewed area of focus for General Catalyst is modern defense and intelligence where there is an urgent (long overdue) need, proven innovation playbooks and the opportunity to create enduring global defense and intelligence companies with responsible innovation at their core – in the service of deterring aggression and promoting freer, more democratic societies everywhere.

*   *   *   *   *   *   

In early February, Hemant and journalist Fareed Zakaria published a piece in Harvard Business Review entitled ‘Geopolitics Are Changing: Venture Must Too’; in it they describe the end of globalization and the new market dynamics that will bring dramatic changes–geopolitical, economic, social, cultural and technological– to every corner of the world economy.  These include: 

  • The end of American hegemony and the return of great power competition
  • The accelerating unpredictability and impact of exogenous shocks (pandemics, energy crises, acts of aggression, cyber attacks, climate change, supply chain disruption), all happening with greater velocity and virality due to our dynamic, globalized world.  
  • A new realignment and re-globalization whereby countries will seek to leverage the benefits of globalization while at the same time, build greater independence and resiliency for their most complex and systemically important industries.   

There are profound implications for this new world order when it comes to technology and innovation.  Companies and countries alike will look beyond global efficiency (long the holy grail of the globalization era) and start to re-prioritize a new critical factor:  global resilience.  It will have a meaningful impact across every industry and will result in new winners and losers on the world stage–as well as the need for new kinds of public and private partnership.  

Global resilience is our term for these new dynamics at play–where countries and companies deprioritize efficiency, openness and highly interconnected systems in favor of safety, stability and greater control for enterprise (or national) benefit, especially for the most critical operations and sectors.  Building independence and resilience in key global industries like healthcare, defense, energy, manufacturing, and financial services will require a new model of venture capital.  These industries are our most societally important and they are giant, complex and highly interconnected sectors of the global economy; reimagining these areas through the global resilience lens will require new (longer) time horizons, different business models, more significant depth of governance and a more cooperative approach between venture capital, innovators and government.  You need to look no further than the global semiconductor industry–where the US last year announced a $280 billion investment plan to revamp its domestic production capabilities and re-think that supply chain end-to-end.  We believe this means a complete re-architecture of an incredibly complex industry–from R&D to component materials and manufacturing, all the way through distribution and trade, that requires huge amounts of capital, a renewed commitment to fundamental innovation and public sector cooperation.  

Much of our current work in healthcare at General Catalyst has paved the way for how to think about investing in global resilience in this new world order.  Our health assurance thesis is about creating a more accessible, proactive, and affordable system of care and making the healthcare system more resilient in the face of future pandemics and other inevitable global crises.  We have taken a systemic approach, investing in innovation across the entire ecosystem.  Our approach has always been one of ‘radical collaboration’ -- we work with more than a dozen top health systems in the US to understand each of their unique challenges and requirements in order to develop scaled systems (versus today’s proliferating point solutions) that work for all, and we are extending this overseas.  This new type of partnership (as opposed to disruption) model is a blueprint for how we work in close proximity with the industry to drive transformation.  We believe that such intentional collaboration will be critical in achieving our goals to transform certain industries and is a key pillar of our belief in the need to “transcend” the current venture capital model.

Global resilience is about investing in the systems that form the bedrock of society.  A renewed area of focus for us within the global resilience thesis is modern defense and intelligence where we see a pressing need to invest in modern and more resilient systems for the benefit of our nation and our allies.  At General Catalyst, we have history in this critical market, having acquired DARPA R&D pioneer BBN and selling it to Raytheon in 2009.  BBN is most famous for having implemented ARPANET, the precursor to the Internet, and then pioneering email.  It was also well-known for inventing the Boomerang gunfire detection system, which saved countless lives during the Global War on Terror.  A few years later, we invested in OGSystems, a leader in geospatial analytics for the intelligence community, and in 2019, sold the company to Parsons, a major defense engineering firm.  In 2017, we also invested in the seed round of Anduril, whose mission is to build a modern defense prime contractor to transform US and allied military capability with advanced technology.  Beyond just the deals, we have tremendous respect and admiration for the work that the men and women serving our country are doing and we feel the obligation to support them fully.  Over the years, we have spent time with some of the most elite men and women serving in the US military, special operations and intelligence communities and when you have the opportunity to understand the level of commitment to their mission, their sacrifice and the challenges they are facing, it becomes clear that we must do more for them from a technology and capability standpoint.  As we have immersed ourselves in the defense and intelligence market, we now see even more opportunities to innovate new solutions to keep the world safer, more secure, and more prepared.  What’s driving this thesis is as follows:

  1. Investing in modern defense and intelligence is urgently needed, and long overdue.  We are returning to an era of great power competition, with the rise of China and the return of Russia.  Against this backdrop, the US finds itself woefully behind on investment, modernization and innovation, with many of our signature defense and intelligence assets celebrating their half-century birthdays.  China’s annual spending on defense will soon exceed that of the US with all their spend going towards innovating new platforms, systems, AI and software.  In comparison, the bulk of the Pentagon’s nearly $1 trillion annual spend goes towards maintaining existing systems.  Only a third of that $1Tn budget goes to new innovation and nearly half of that spend goes to six companies that were, on average, founded over 75 years ago.  More pointedly, we believe the historical model of defense procurement where systems were designed and procured over decade-long horizons does not work in today’s world where technology capabilities change in real-time.  Niall Ferguson’s recent op-ed piece in Bloomberg explains how “The US Domain Awareness Gap Goes Way Beyond Balloons” and the current limitations of our military-industrial manufacturing base to supply ordnance for an extended, conventional war, as evidenced by Ukraine.  To compound matters, we believe the nature of modern defense is changing.  As we see it, modern conflict takes place not just on the physical battlefield but across multiple domains.  This new global battlefield extends to cyber and information security, economic warfare, industrial manufacturing and energy, politics and culture, and outer space.  We believe there is a need for new, multifaceted technologies for integrated deterrence, the ability to defend against attacks across multiple-domains, all of which will require the most advanced software and hardware-enabled innovation.  Having the most advanced capabilities in irregular warfare (the ability to win over and influence populations) will be key.  Modern defense is not just about who has the greatest kinetic capabilities; it’s about how to ensure access to the future of semiconductor technology or food and energy supplies, or who can preserve the democratic process from disinformation campaigns.  At every level of this multi-dimensional battlefield, where battles will occur without bullets being fired, we need capability and resilience, enabled through deep innovation.
  1. There are proven (and more accelerated) playbooks for how to build and scale impactful companies in this space.  From our perspective, it wasn’t very long ago that investing in defense tech was seen as the least interesting market for a venture capitalist due to perceived challenges in scaling.  At General Catalyst, we’ve been fortunate to partner at the earliest stages with companies like Anduril, Applied Intuition, and Vannevar Labs, which have all become impactful companies selling to the DoD at scale.  Each of them has created their own “playbook” for how to engage and scale in this market, namely, having an incredibly deep understanding of the user’s mission needs, building both product and go-to-market capabilities in parallel, and being able to prototype / show value fast while simultaneously being long-term patient and skilled in navigating the idiosyncrasies of the DoD procurement process.  What’s most exciting to us is that these companies have been able to quickly build solutions that deliver critical impact for our nation, in different ways.  We’ve observed early innovators like SpaceX and Palantir have indeed scaled large businesses selling to the government, albeit with large sources of capital and a decade-long horizon.  In comparison, within just 5 years of its founding, Anduril has been able to build multiple software-defined and hardware-enabled solutions and deploy those into the field to solve missions.  Anduril has won multiple large programs of record from the DoD as well as our allies, and proven that its model of recruiting the best technical talent, funding R&D privately with venture capital and then partnering closely with the DoD, works to bring modern technology quickly into the hands of our military and allies.  Also within 5 years of its founding, Applied Intuition’s dual-use simulation and testing platforms for autonomous vehicles, used by 17 of the top 20 global automotive OEMs, was chosen by the DoD for the Army’s Robotic Combat Vehicle and pioneered a new two-track procurement process that separates software purchasing from hardware.  And Vannevar Labs, within just 3 years of its founding, has been able to find significant customer adoption within the intelligence community and grow to $25mm in revenue while achieving profitability, with a product-led growth motion.  By leveraging different playbooks, these companies have all found product market fit relatively quickly in their company lifecycles and delivered mission impact.  One commonality we see is that each of them have had the ability to both innovate and iterate solutions in the short-term while maintaining a long-term culture and patience around product strategy and adoption.  
  1. Public sector partnership is key.   Much has been written about the historically synergistic relationship between the technology industry and the government over the past half century, and how that relationship has broken down over the past few decades.  We, as a society, have benefited greatly from so many government innovations and fundamental breakthroughs in the fields of communications, computing, energy and healthcare.  We now have an obligation and responsibility to give back and invest into the public sector and contribute to the flywheel of technology innovation that our government catalyzed.  Partnership with the public sector will be critical to solve our large-scale challenges, whether semiconductors, defense, or energy.  By working together, we can rekindle a renewed cycle of private and public sector innovation.  We have long railed against the ‘disruption’ mindset that pervades Silicon Valley, instead favoring collaboration and partnership with the ecosystem to accelerate digital transformation, as demonstrated by our approach in healthcare. Credit needs to be given toward the government for changing their procurement processes and establishing a number of initiatives to accelerate innovation (e.g. Office of Strategic Capital); the CHIPS Act is another incredible step forward.  Silicon Valley needs to embrace a new era of partnership, both with the public sector and existing defense contractor ecosystem, which will be key.  This will require greater relationship-building and mutual trust from both sides, deeper understanding from Silicon Valley around mission needs and patience with navigating the DoD, greater transparency from the DoD on their needs, and deeper appreciation from the DoD on what it takes to support startups and innovation to create truly sustained impact, especially against other great powers.  
  1. Investing in modern defense transcends a pure business opportunity.  At General Catalyst, our core mission is Responsible Innovation and how we can intentionally invest in growth and good, to enable positive, powerful change that endures.  Our initial seed investment in Anduril spurred spirited and necessary debate inside GC on how to reconcile investing in defense tech with that mission.  Trae Stephens at Anduril has written eloquently about the “Ethics of Investing in Defense Tech” and the “Business of War is the Business of Deterrence”.  For us as technologists, we believe we have a moral responsibility to our nation, allies, and troops to enable them with the best innovation to support their missions, which they do not have today.  There is an element around efficiency as well given that tax-payers are funding this $1Tn market and anything we can do to deliver better capabilities at lower cost, benefits all stakeholders.  Our investing focus at GC is on software and solutions that will help modernize our defense and intelligence capabilities, and help level the playing field against our great power competitors.  The intent is to increase our capabilities to deter conflict and be much more precise in how we take actions.  We are not investing–and will not invest–in ‘day one’ offensive systems used to take first action but rather the capabilities for improving defense and intelligence across the new multi-dimensional battlefield of physical battlefield, cyberwarfare, information warfare, industrial, and supply-chain disruption, energy shocks, and political mis-information domains.   
  1. We are committed to building these companies responsibly.   We acknowledge that the defense and intelligence sector is not without controversy, as human lives are on the line, and we work closely with our portfolio companies to consider second and third order impacts and avoid unintended consequences.  A core tenet of General Catalyst’s responsible innovation framework is to promote a fairer and healthy society.  We are determined to create next-generation defense and intelligence companies with responsible innovation at their core – in the service of deterring aggression and promoting freer, more democratic societies everywhere.  The stakes of getting it wrong are unthinkably high (especially with the advent of AI) but so are the stakes of inaction or falling behind.  The country that wins the war sets moral and ethical standards.  Over the past 50 years, American hegemony ushered in democracy.  What happens if authoritarian states win the next war?  

We see tremendous opportunity in building modern, resilient systems for the most essential parts of our economy and society in order to compete and win in this new world order.  We have started that work in healthcare, fintech and education, and are now focused on modern defense and intelligence.  Our goal is not to invest in hundreds of defense companies but rather the dozen companies that can deliver impact at scale.  Anduril, Applied Intuition and Vannevar Labs are well down that journey in their markets and we are excited to partner with the next-generation of companies that are helping modernize our defense, intelligence, and industrial capabilities. We believe the new businesses that are created in response to solving global resilience –if done right– will have a tremendous positive impact on society and could generate even larger returns than what we’ve seen in the previous decades of venture capital.

*   *   *   *   *   *   

Source materials and additional information:
https://www.mckinsey.com/industries/public-and-social-sector/our-insights/the-chips-and-science-act-heres-whats-in-it

https://en.wikipedia.org/wiki/ARPANET

https://www.voanews.com/a/experts-warn-us-is-falling-behind-china-in-key-technologies/6751392.html

https://www.globalsecurity.org/military/world/china/budget.htm

https://www.usgovernmentspending.com/defense_spending

https://stacker.com/business-economy/50-inventions-you-might-not-know-were-funded-us-government