Opposites Attract (and Execute)

Introduction

The U.S. Department of Defense (DoD) in recent months has signaled interest in bringing new entrants into the defense industrial base (DIB), including venture-backed start-ups, and has taken meaningful steps to create a more diversified and supportive environment for them. In response, venture capitalists have made substantial investments in defense start-ups. But the path to winning military contracts can be long and hard. One option for start-ups is to form partnerships with defense prime contractors. This essay provides a few tips for successful matchmaking.

Key Takeaways

• Partnerships between primes and start-ups can be mutually beneficial, but as with any relationship, finding the right partner is key, both in terms of the company and the specific individuals who work there.
• Differing institutional cultures can be a barrier, but one that is surmountable if partners learn each other’s love languages.
• Start-ups shouldn’t give away their hearts too easily; they should take steps to ensure that their intellectual property (IP) is protected and that they retain control of the narrative on their performance.

Don’t Date Just Your Defaults

In November 2025, Secretary of War Pete Hegseth unveiled a new acquisition reform effort that highlighted the need to increase the number of companies in the DIB, stabilize demand signals, and boost private capital investments. At the same time, the DoD has made structural changes—such as consolidating the U.S. Navy’s four innovation offices into the Naval Rapid Capabilities Office, launching the Army’s $750 million FUZE initiative, and unifying six offices (including the Defense Advanced Research Projects Agency [DARPA], the Defense Innovation Unit, and the Chief Digital and Artificial Intelligence Office) under the Chief Technology Officer—to provide better demand signals, engage the private sector more effectively, and attract meaningful capital investments, ensuring U.S. warfighters have quick access to innovative, mission-critical solutions.

And the investment community has responded. Defense start-ups are drawing impressive venture capital participation. In fact, according to PitchBook, total venture dollars invested in defense tech more than doubled in the first three quarters of 2025, as compared to the same period in 2024 (an increase from $18 billion to almost $40 billion). Additionally, the 2025 NatSec100 from Silicon Valley Defense Group noted an incredible 34 new entrants on its list of the top 100 venture-backed dual-use and defense tech companies.

This surge could not come soon enough, as the range and sophistication of threats to America’s security demand bold ideas and fresh approaches. To maintain its competitive advantage over adversaries and win on tomorrow’s battlefields, the DoD must dominate in artificial intelligence, develop new platforms, and transform existing ones into software-defined systems that can be continuously improved. This is where defense start-ups can make an outsized contribution.

Love on the Rocks

Despite the value that venture-backed defense companies can bring to the U.S. military and recent DoD efforts to make the process easier, the road from innovation to adoption can be agonizingly slow. Founders may not have the expertise to navigate the DoD’s cumbersome and evolving contracting and resourcing process. And early-stage start-ups may not have the runway to wait for the customer to identify a requirement, execute a contract, or find the funding to support their projects. With the Small Business Innovation Research/Small Business Technology Transfer (SBIR/STTR) programs on pause, given the lack of reauthorization last year, start-ups are looking for alternative ways to bring their capabilities to the customer quickly.

In comparison, major defense primes have traditionally secured most of the larger defense contracts. For example, according to the defense acquisition software company Govini, defense primes accounted for 92 percent of Pentagon contracts in the first three quarters of 2025. Yet recent statements and actions from the administration, such as the January 7, 2026, Executive Order, “Prioritizing the Warfighter in Defense Contracting,” suggest the dominance of the primes will come under increased scrutiny, which may open the door to more creative partnerships and opportunities for start-ups.

A Match Made in the DIB

Given these factors, a promising strategy for defense start-ups is to work with a prime to overcome common contracting hurdles and connect with a DoD customer. Despite the very real potential that major prime contractors and defense start-ups may view each other as competitors or even adversaries, collaborations between them offer significant advantages to all parties . . . under the right circumstances. Start-ups bring agility, innovation, and risk-taking energy. Primes bring experience, resources, performance history, and contract vehicles. By working together and building a mutually beneficial relationship, their differences can become complementary strengths that will support DoD efforts to bring more entrants into the DIB and, ultimately, benefit the warfighter.

While opposites do attract, successful partnerships require humility, respect, and deliberate effort. Start-ups and primes must clearly understand and actively manage their differences to ensure effective collaboration and communication. Therefore, in the spirit of Valentine’s Day, here are six tips for building a healthy relationship between start-ups and primes.

Recommendations

1. Learn to speak each other’s love languages.

Primes and start-ups aren’t mismatched on outcomes; they are misaligned on signals. Primes and start-ups tend to express interest and build trust differently, which can lead to friction. While start-ups rely on traction and momentum, primes tend to build trust through consistency and process.

Start-ups must demonstrate to primes that they have both style and substance. Primes are putting their reputations on the line, so start-ups must deliver and show early on that they can handle the practical parts of a relationship by being reliable (and compliant). Start-ups should not sacrifice their speed but instead be mindful that speed without structure can read as recklessness, not ambition, to primes.

But partnerships are a two-way street. Long review cycles without visible forward motion by a prime can come across to a start-up as disinterest. Primes must set expectations and communicate clearly (such as by signing letters of interest)—especially with founders who have not worked with a prime or on a DoD contract before—to signal that they are not disengaging or disinterested, just moving through their internal processes.

2. Matchmaker, matchmaker make me a match.

It can be difficult for start-ups to find the right partner in the vast corridors of a major defense prime’s organization. It helps to find a trusted agent who understands both the start-up’s and the prime’s respective interests and can serve as a matchmaker.

One approach that start-ups can use is to build a relationship with the prime’s venture group, especially one that focuses on investing in early-stage defense and aerospace start-ups that support the prime’s mission. These venture groups can make key introductions and promote or even fund short-term pilot programs that are low cost/low risk for the prime’s teams.

This approach also allows start-ups to gain key experiences that will help them become better vendors for DoD customers. It could also attract private investment from the prime itself.

3. Don’t date the prime, date the person.

Although it is easy to see defense primes as monoliths, they are, in fact, large, complex organizations with their own bureaucracies, internal struggles, and stovepipes.

Start-ups must focus on building strong relationships with the individual or team they will be working with, not the entire company.

Finding an internal champion is critical to a successful collaboration with a large organization—and to avoid being seen as a competitor, or worse, a fall guy, if things go wrong with the customer.

4. IP protection: the prenup for partnerships.

Intellectual property is often called the crown jewel of start-ups because it’s what drives their value and sets them apart from others. That’s why IP accounts must be protected to ensure long-term growth and viability.

Ultimately, a relationship is a partnership. So, when starting one with a prime, start-ups must have strong agreements—much like prenups—in place to safeguard their IPs and protect what makes them stand out from competitors. Simply put, IP protection is not a signal of distrust; it is an act of self-respect and self-preservation.

5. Complete them, don’t compete with them.

Start-ups must sell their value without making a prime defensive. Primes are rightfully wary of helping grow competitors that could take their market share in the future. Start-ups should, therefore, enter a partnership where both parties can genuinely complement each other’s strengths.

The fastest way to earn serious interest from a prime is to come to the table with a capability or insight the prime doesn’t already have. Make sure it moves their priorities forward.

6. Don’t let the prime control the narrative.

Because primes own the DoD customer relationship, they have the power to control the narrative—and scapegoat start-ups when things go wrong. This can seriously damage early-stage companies and their ability to generate future business.

While start-ups may not always have a direct seat at the customer table, they should not rely on primes to represent their value, progress, and work. The relationship should be collaborative, not extractive. If start-ups feel used rather than supported, that’s a red flag. Start-ups shouldn’t dilute their value for proximity to a prime. Set boundaries early on, establish clear expectations, and ensure responsibility—and credit—is shared.

Conclusion

These are just a few practical tips that can help start-ups navigate burgeoning relationships with defense primes. Although not a complete playbook, they’re a good place to start to avoid friction, misunderstandings, and disappointment. Just as important, they reflect the broader reality: Primes aren’t going anywhere. They are, after all, the anchors of the DIB. Still, the move to expand the DIB to include more defense start-ups means there’s now room for diverse players, which promises to shape a new era for a defense ecosystem that is more competitive, more innovative, and, ultimately, more resilient.

Of course, not every start-up/prime relationship is meant to be. Sometimes the incentives, timelines, or priorities simply don’t align. That’s not a failure of the concept—it just means the two are not compatible. But in a field where relationships can make all the difference, the key is for start-ups to keep at it until they find the right prime with which to partner and build the state-of-the-art solutions that increase the effectiveness and lethality of our warfighters—the individuals to whom we all should be raising our glasses and toasting this Valentine’s Day.

About the Authors

Veronica Daigle is partner and president of the National Security Practice at Red Cell Partners. Prior to joining Red Cell, she served as an executive director within The Boeing Company’s Government Operations group and as the Senate-confirmed assistant secretary of defense for readiness within the Department of Defense.

Grace Newsom is a senior associate at Red Cell Partners.

About the New American Industrial Base Series

This essay series, The New American Industrial Base, features expert practitioners with experience in government, industry, and finance writing on the most pressing challenges in defense acquisition today. For more in this series, click here.

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