May 11, 2016

CNAS Press Note: DIUx, Silicon Valley, and Innovation at the Pentagon

Washington, May 11 – With Secretary of Defense Ashton Carter’s announcement of the of the Defense Innovation Unit Experimental (DIUx), Center for a New American Security (CNAS) Technology and National Security Program Director Ben FitzGerald and CNAS Deputy Director of Studies and Leon E. Panetta Senior Fellow Loren DeJonge Schulmanhave written a new Press Note on what this development tells us about the future of innovation at the Pentagon.
The full Press Note, entitled “DIUx, Silicon Valley, and Innovation at the Pentagon,” is below:
This morning, Secretary of Defense Ashton Carter announced he was rebooting and expanding the Defense Innovation Unit Experimental (DIUx), his high-profile Silicon Valley outpost launched last year. This announcement should be viewed as an affirmation of the secretary’s commitment to his innovation agenda and a positive development for the DIUx.
Since his speech at Stanford University in April 2015 in which he unveiled his innovation agenda and announced the establishment of the DIUx, the secretary has spoken frequently about the need for the DoD to experiment even at the risk of failure. The DIUx, as its name implies, was at the forefront of this philosophy. By taking early, corrective action and demonstrating how the DoD can learn from such a pilot, Carter is sending a strong message to the DoD by using his own initiatives as an example for others.
Despite these changes, the DIUx should not be viewed as a failure, and this announcement should not be interpreted as a wavering of the secretary’s commitment to innovation or external outreach. In fact, it should be seen as doubling down on this commitment in an unprecedented way. In the last year, the DIUx has:

  • Demonstrated that the DoD can move quickly to establish new organizations as current trends require;
  • Served as a focal point for the Department’s outreach to Silicon Valley;
  • Created a funding pipeline between startups and military customers;
  • Provided a platform for innovations like the Hacking for Defense course developed by BMNT Partners, now running at Stanford University;
  • Laid the groundwork necessary to support future outreach to Silicon Valley; and
  • Helped identify key DoD reforms required to sustain the innovations agenda, many of which Carter is launching today.

However, with its small size and steep learning curve, the DIUx could not overcome the weight of expectations from a high profile launch or easily cut through Pentagon red tape. As with many startups, the DIUx suffered from an overly broad purpose and associated high demands; unlike other startups, it missed the opportunity to operate in “stealth mode” to address these issues early. Indeed, the DIUx had multiple missions, depending on who one spoke to, including within the DIUx itself: leading and coordinating outreach to Silicon Valley, technology scouting, contracting with startups, and serving as a general conduit for “innovation” into the Pentagon.
By re-focusing the DIUx now, the secretary is setting the organization up for success while showing the rest of the DoD precisely how to take risk and innovate.  And by empowering the DIUx to be a test-bed for new kinds of contracting, he’s demonstrating that DoD can serve as an agile partner to the startup community.

FitzGerald and DeJonge Schulman have written a thorough report on innovation at the Pentagon, which is available here:
FitzGerald and DeJonge Schulman are available for interviews. To arrange one, please contact Neal Urwitz at or 202-457-9409.


  • Ben FitzGerald

    Adjunct Senior Fellow, Defense Program

    Ben FitzGerald is a partner at Lupa, a private investment firm, and an adjunct senior fellow at the Center for a New American Security (CNAS). At Lupa he leads the firm’s inve...

  • Loren DeJonge Schulman

    Former Adjunct Senior Fellow

    Loren DeJonge Schulman is a Former Adjunct Senior Fellow at the Center for a New American Security (CNAS). Previously, she served as the Deputy Director of Studies and the Leo...