Defence & Security

US Defense Innovation Funds & Accelerator Programs

Published on
June 22, 2023


Innovation funds and accelerator programs for Defense & Security companies in the United States provide critical support to foster the development and implementation of cutting-edge technologies and solutions for national security and military applications. Through financial resources, collaboration, expertise and infrastructure, these initiatives accelerate technology development, facilitate commercialization, and enhance the capabilities of the defense and security sectors.

Similar to our popular list of UK 🇬🇧 Defence Innovation Funds guide, here is Karve’s pick of the best US 🇺🇸 innovation schemes in 2023 that if leveraged with a comprehensive multi-year strategy can help you get your technological innovations to the end users on time and within budget.

Top 11 US Defense Innovation Funds & Accelerator Programs

(1) Air Force Research Laboratory – AFRL

Air Force Research Laboratory (AFRL)

The AFRL is a scientific research organization within the United States Air Force (USAF). Its primary mission is to conduct leading-edge research and development in various scientific and technological areas to ensure the USAF's superiority in air, space, and cyberspace.

AFRL plays a crucial role in supporting tech innovation by:

Basic and Applied Research conducting both fundamental and applied research in various fields, such as aerospace technology, propulsion systems, materials science, electronics, information technology, and human performance.

Advanced Technology Development taking research findings and translating them into practical applications by developing advanced technologies and systems. This includes the design, prototyping, testing, and evaluation of cutting-edge aerospace and defense technologies.

Collaborative Partnerships when AFRL collaborates with industry, academia, and other government agencies to leverage collective expertise and resources. By working with external partners, AFRL can tap into diverse perspectives and access specialized knowledge, fostering collaboration and accelerating innovation.

Technology Transition, focussing on transitioning research and development projects into operational capabilities. It collaborates with acquisition agencies and industry partners to ensure the successful integration of new technologies into existing systems or the development of new systems altogether.

Test and Evaluation - AFRL operates various research facilities, testing ranges, and laboratories where advanced technologies are evaluated, validated, and refined. This helps to ensure that innovations meet performance requirements, safety standards, and operational needs.

Training and Education whereby AFRL contributes to the development of the future technical workforce by providing training and education programs, supporting scholarships, and promoting STEM (Science, Technology, Engineering, and Mathematics) initiatives. This helps to cultivate a skilled workforce capable of driving future tech innovation.

Through these activities, the AFRL supports tech innovation by conducting research, developing advanced technologies, fostering partnerships, transitioning innovations into practical applications, ensuring performance and safety, and investing in human capital. These efforts contribute to the USAF's technological superiority and help maintain national security.

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(2) Army Research Laboratory – ARL

Army Research Laboratory (ARL)

The ARL is the US Army's corporate research laboratory, conducting research in a wide range of scientific and engineering disciplines. It is the Army's premier research organization for basic and applied scientific research, operating under the U.S. Army Combat Capabilities Development Command (CCDC).

The ARL's primary mission is to discover, innovate, and transition science and technology to ensure the U.S. Army's dominance in land warfare and it allocates funding for innovative projects through various programs such as Broad Agency Announcements (BAAs) and Cooperative Research and Development Agreements (CRADAs).

The ARL plays a crucial role in advancing technology and innovation by conducting a wide range of research in various fields, including materials science, robotics, artificial intelligence, cyber defense, human sciences and advanced manufacturing. Through its extensive research efforts, the ARL aims to develop cutting-edge technologies and solutions to address the Army's current and future challenges.

The impact of the ARL on tech innovation is significant in several ways:

Technology Development: The ARL conducts fundamental and applied research to develop innovative technologies that enhance the Army's capabilities. This includes advancements in areas such as autonomous systems, advanced materials, sensors, communications, and energy technologies. These developments often have broader applications beyond the military and contribute to advancements in various industries.

Collaboration: The ARL collaborates with academic institutions, industry partners, and other government agencies to foster innovation. Through partnerships and cooperative agreements, the ARL leverages external expertise and resources to accelerate technology development. This collaborative approach promotes knowledge sharing, interdisciplinary research, and the transfer of technology between the military and civilian sectors.

Transition to Practice: A key aspect of the ARL's mission is to transition research findings into practical applications. This involves working closely with industry partners and technology transfer organizations to facilitate the transfer of technology and knowledge from the laboratory to commercial use. The ARL actively seeks opportunities to transfer its technology to the private sector for further development, leading to the creation of new products, services, and businesses.

Workforce Development: The ARL invests in the development of a skilled scientific and engineering workforce. By providing opportunities for researchers to conduct cutting-edge research, collaborate with experts, and access state-of-the-art facilities, the ARL helps cultivate a talent pool capable of driving technological advancements and innovation in various sectors.

Influence on Standards and Regulations: As the ARL develops new technologies and capabilities, it often has a role in shaping standards and regulations related to those technologies. This influence helps establish guidelines for safety, security, and ethical use, ensuring responsible innovation and deployment.

Overall, the ARL serves as a vital hub for technology innovation, driving advancements in various fields and facilitating the transfer of military-developed technologies to the broader society, thereby contributing to overall technological progress.

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(3) Defense Advanced Research Projects Agency – DARPA

Defense Advanced Research Projects Agency (DARPA)

The DARPA is an agency of the United States Department of Defense responsible for developing advanced technologies and capabilities for national security purposes. DARPA's mission is to make pivotal investments in breakthrough technologies that have the potential to enhance the military's technological edge and address critical national security challenges.

DARPA plays a crucial role in driving tech innovation by pursuing high-risk, high-reward research and development projects. Unlike other government agencies or private organizations, DARPA is known for its willingness to take on ambitious and visionary projects that may seem far-fetched or unconventional at first. It focuses on cutting-edge areas of research and often takes a multidisciplinary approach, bringing together experts from various fields to tackle complex problems.

DARPA's contribution to tech innovation can be seen in several ways:

Advancing Key Technologies: DARPA invests in foundational research that can lead to major technological advancements. It has played a significant role in the development of technologies such as the internet, GPS, artificial intelligence, advanced robotics, and advanced materials.

Pushing the Boundaries: DARPA encourages researchers to think beyond the current state-of-the-art and explore radical new concepts. By funding high-risk, high-reward projects, DARPA enables scientists and engineers to push the boundaries of what is considered possible, leading to breakthrough innovations.

Collaborative Research: DARPA actively collaborates with academic institutions, industry partners, and other government agencies to leverage expertise and resources. This collaboration fosters cross-pollination of ideas and accelerates the development of cutting-edge technologies.

Rapid Prototyping and Demonstration: DARPA emphasizes the development of functional prototypes and demonstrations to validate the feasibility and potential of new technologies. By showcasing tangible results, DARPA helps attract further investment and adoption of promising innovations.

Technology Transfer: DARPA works to transition successful research outcomes into practical applications. It facilitates the transfer of technologies developed within its programs to industry, where they can be further developed, commercialized, and integrated into various sectors.

DARPA's approach to fostering tech innovation has had a significant impact not only on defense capabilities but also on a wide range of industries. Many technologies originally developed by DARPA have found their way into civilian applications, transforming fields such as communications, computing, healthcare, transportation, and more.

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(4) Defense Innovation Unit

Defense Innovation Unit (DIU)

The DIU is an organization within the United States Department of Defense (DoD) that aims to accelerate the adoption of commercial technology and innovation for national defense. It was established in 2015 as an experimental unit to bridge the gap between the DoD and the private sector, particularly with non-traditional defense contractors and startups.

The primary goal of the DIU is to identify and leverage cutting-edge commercial technologies that have the potential to enhance military capabilities and address national security challenges. By engaging with the private sector, DIU helps the DoD access innovative solutions that may not be available through traditional defense procurement channels.

DIU operates through a network of offices located in various innovation hubs across the United States. These offices actively scout for emerging technologies and startup companies that align with the DoD's needs. When a technology or solution is identified, DIU acts as an intermediary between the DoD and the company, facilitating the acquisition process and supporting the integration of the technology into military systems.

In terms of government innovation funding, DIU plays a crucial role in helping the DoD allocate funding to innovative projects and companies. It seeks out opportunities for public-private partnerships, where the DoD can fund and collaborate with commercial entities to develop and deploy cutting-edge technologies. DIU assists in identifying and evaluating proposals, conducting prototype contracts, and supporting the transition of successful projects into production.

By leveraging its streamlined acquisition processes and expertise in emerging technologies, DIU helps the DoD take advantage of the agility and innovation found in the private sector. It helps government innovation funding by fostering collaboration with non-traditional defense suppliers, enabling more efficient and effective use of resources, and promoting the infusion of new technologies into defense capabilities.

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(5) Department of Defense Innovation Ecosystem – DoD

Department of Defense Innovation Ecosystem  – DoD

The Department of Defense (DoD) innovation ecosystem provides a collection of many organizations seeking to enhance the innovation and entrepreneurial activities of individuals and companies working on projects of interest to the United States' national security.

The DoD innovation ecosystems include organizations working within and in partnership with the following military, governmental, and private organizations: Air Force, Army, Navy, and other Defense Agencies.

Organizations participating within the Department of Defense Innovation Ecosystem can be categorized into several categories based on their purposes, such as accelerators and incubators, contest and competition organizations, federally funded research and development centers, funding providers, government contracting authorities, partnership intermediary agreements, and OTA consortiums.

DoD-funded incubators and accelerators are structured, focused, and time-sensitive programs where start-ups or ideas receive mentorship, education, and networking resources from industry experts. Contest and competition organizations arrange innovation contests and competitions to solve military problems. The winner of the contest or competition will be provided with funding and support resources to further develop prototyping solutions that may end up being used within the DoD.

DoD front door resources exist to provide resources and connections to start-up companies. These organizations may host conferences or networking events where industry professionals gather to discuss, and potentially collaborate, ideas with one another.

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(6) Defence Innovation Accelerator for the North Atlantic – DIANA

Defence Innovation Accelerator for the North Atlantic – DIANA

DIANA is a NATO initiative launched in 2022 looking towards supporting the development of innovative projects aimed at improving the Alliance’s technological edge. It provides deep tech and dual-use innovators with access to NATO resources including grant funding, acceleration services, and pathways to adapt their solutions for defence and security needs.

DIANA's goal is to enhance and accelerate trans-Atlantic cooperation on critical technologies, and help NATO work more closely with private-sector entities, academia and other non-governmental entities. DIANA has main offices in both Europe and North America, and coordinates with existing test and innovation centers throughout NATO. The initiative is building and managing a network to help start-ups and non-traditional companies better support western technology requirements.

DIANA focusses on nine key emerging technologies, artificial intelligence, data, quantum-enabled technologies, autonomy, biotechnology, hypersonics, novel materials and manufacturing, energy and propulsion, and space. Selected innovators participating in DIANA may have the opportunity to be candidates for the NATO Innovation Fund, which will invest €1 billion into dual-use technology startups.

DIANA is responsible for a Rapid Adoption Service to support the development and rapid adoption of DIANA solutions by Allies and NATO, and a Trusted Capital Database to facilitate and/or connect certified innovators and certified investors.

DIANA offers a support package that includes:

– Financing, to cover costs during the incubation program.

– Mentoring and training, with a view to advising on the development of solutions in order to meet the requirements of end users and in order to assist in the adoption phase and acquisition process.

– Trial and test opportunities, with access to a network of over 60 test centres within the Alliance, alongside associated cost support.

– Connection to investors, through the promotion of the entities among trusted investors within the Alliance.

– Access to 30 markets, corresponding to the 30 members of NATO.

The main function of this initiative is to promote the security and defence challenges indicated by the Armed Forces, so that innovative entities can develop quick adoption solutions that correspond to the designated requirements.

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(7) Joint Rapid Acquisition Cell

The purpose of the Joint Rapid Acquisition Cell is to assist in resolving issues impeding the urgent materiel and logistics requirements that the Combatant Commands certify as operationally critical and the Joint Staff validates as an urgent Warfighter need.

Because Joint Urgent Operational Needs (JUONs) can occur at any time and need quick resolution to meet military missions or reduce fatalities, DoD needed flexibility to move money around more quickly. The FY 2003 NDAA allowed the Secretary of Defense to waive any law or regulation to make sure such an urgent requirement gets put onto contract within 15 days, including reprogramming authority up to $100 million (so long as Congress is notified within 15 days). This is often referred to as “rapid acquisition authority” found in Section 806 of the FY2003 NDAA.

In 2004, the Deputy Secretary of Defense issued a memo that established the Joint Rapid Acquisition Cell (JRAC) which coordinate JUONs, work through solutions, and assigned procurement activities to the services. Most often, these JRAC-funded solutions were about $15 million, but could range up to $75 million or more. In 2006, the first year of significant JUONs totaling $620 million, the JRAC funded $155 million worth of actions.

Under the authority, direction, and operational control of the Deputy Secretary of Defense, the JRAC oversees (with the Joint Staff (JS), J-8), the implementation of Joint Urgent Operational Needs (JUON) and Joint Emergent Operational Needs (JEON).

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(8) Navy Rapid Innovation Fund – RIF

Navy Rapid Innovation Fund (RIF)

The Rapid Innovation Fund (RIF) is made to accelerate the time it takes to get new technologies deployed for field use by the United States military. The organization offers a merit-based and competitive program administered by the Under Secretary of Defense Research and Engineering (USD(R&E)) Small Business and Technology Partnerships program.  

Projects supported by RIF are required to cost less than $3 million and have a project completion date under two years after receiving funding. RIF focuses on identifying and announcing research topics and technology areas they are seeking to support annually in their RIF Broad Agency Announcement. Most RIF supported projects have a Technology Readiness Level (TRL) between 6 and 9. Projects with TRLs between 4 and 5 are also considered by RIF if they can potentially offer a significant improvement in the capability or operational procedures of the U.S. military, the cost of the project is expected to be neutral for the RIF acquisition program, and the project can be accommodated easily within the RIF program schedule.

The RIF program has a publicly stated selection preference for small businesses interested in participating. It allows participation from organizations that are not small businesses only under the conditions that the approval authority of RIF deems the organization's offer is superior to all other offers received by small businesses.

The RIF program uses the following two standards to determine what is a small business and what is not: 541715: Research and Development in Physical, Engineering, and Life Sciences and 541714: Research and Development in Biotechnology. Foreign participants are also eligible for RIF programs as long as their projects are limited to U.S. persons as defined in International Traffic in Arms Regulations (ITAR).

The RIF covers the following innovation areas:

  • Cyber security  
  • Power and energy - generation/storage
  • Data/comms interoperability - Internet of Things
  • Information management - Big Data
  • Position, navigation, timing - Instrumentation & Controls
  • Sensors - acoustics, optics, etc.
  • Autonomy - unmanned systems, robotics.

The RIF program is essentially a point of entry for small businesses to win research and acquisition contracts with the DoN. RIF refines technology from military science and technology investments and adapts commercially available technology, funding the final maturation, testing, certification and/or integration needed to ensure that the products successfully make it to operational users.

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(9) National Security Innovation Capital – NSIC

National Security Innovation Capital – NSIC

The NSIC enables dual-use hardware startup companies to advance their product’s transition to market by addressing the shortfall of private investment from trusted sources. NSIC awards Other Transaction (OT) agreements to accelerate commercialization efforts. Their technology focus in on next-generation hardware for application to connected mobile and edge systems for operations in land, sea, air, and space domains.

The NSIC seeks to work with U.S. startups which span early stage (at least proof of concept-TRL3 or higher) to late stage (pre-production). Awards will range between $500K and $3M. Performance periods will range between 12-18 months. NSIC funds may be combined with other Government funding and private sources as long as they are all U.S.-based public or private sources.

Though it acts like a VC with its focus on start-ups, NSIC differs in two ways. First, it is exclusively focused on early funding — often in the pre-seed or seed rounds — as opposed to larger, later-stage deals that many VCs specialize in. Second, its authorizing legislation prevents it from making equity investments or issuing loans; funding instead comes in the form of prototype development contracts.

Since its founding, NSIC has funded 12 companies, which are developing technologies ranging from advanced batteries to lunar mining equipment. Some of these companies and their technologies:

Advanced Materials Manufacturing – makes composite metal foam, which is lighter, stronger, and more durable than current alternatives.

Anthro Energy – manufactures flexible batteries that can bend and be shaped according to the product’s design needs and can be used in equipment such as AR/VR headsets and tactical gear.

Lunar Resources – makes space manufacturing and resource extraction technologies such as satellite repair and non-binding 3D printing equipment.

Maybell – designs and manufactures smaller, easier-to-use ultra-cold refrigerators needed for the superconductors on which quantum computers rely.

New Frontier Aerospace – aims to deliver cargo and passengers anywhere on Earth within two hours using shuttles.

Companies are allowed to subcontract some work since this is often needed for hardware startups (specialized manufacturing, etc). NSIC had several portfolio companies do this. However, subcontracting should not be the majority of the product development we are funding (the majority should be performed by in-house talent). NSIC looks at companies on a case-by-case basis.

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(10) National Security Innovation Network – NSIN

National Security Innovation Network (NSIN)

The NSIN is a United States Department of Defense (DoD) program focused on fostering innovation and collaboration between the DoD, academia, and the private sector. NSIN's primary goal is to connect the DoD with non-traditional partners, such as universities, startups, and industry experts, to solve national security challenges and enhance technological innovation.

NSIN plays a role in impacting tech innovation funding by providing various opportunities and resources to support the development and commercialization of cutting-edge technologies, including:

Grant Programs: NSIN offers grants and funding opportunities to universities, startups, and entrepreneurs working on projects related to national security. These grants can help researchers and innovators accelerate their work and attract additional investment.

Collaborative Projects: NSIN facilitates collaborations between the DoD and external partners to work on specific technical challenges. By connecting funding from the DoD with innovators in academia and industry, NSIN encourages the development of innovative solutions that can address national security needs.

Accelerator Programs: NSIN operates accelerator programs that provide funding, mentorship, and resources to early-stage technology companies working on defense-related projects. These programs help startups refine their technologies, secure additional funding, and connect with potential customers within the defense sector.

Workshops and Events: NSIN organizes workshops, hackathons, and other events to bring together stakeholders from academia, industry, and the military. These gatherings provide opportunities for networking, knowledge sharing, and potential funding connections.

Technology Transfer: NSIN supports technology transfer efforts by helping researchers and inventors transition their innovations from academic or laboratory settings to commercial applications. This can involve facilitating partnerships with industry, connecting innovators with potential investors, or providing guidance on intellectual property and licensing.

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(11) Small Business Innovation Research & Small Business Technology Transfer

Small Business Innovation Research (SBIR) & Small Business Technology Transfer (STTR)

The SBIR and STTR Programs are government-wide initiatives that provide funding opportunities to small businesses for research and development projects with potential defense applications. Multiple defense agencies, including the DoD, participate in these programs, providing substantial funding for innovative technologies.

The SBIR program is a competitive federal funding program in the United States that encourages small businesses to engage in research and development (R&D) with the goal of commercializing innovative technologies. The program is administered by various federal agencies, including the National Science Foundation (NSF), the Department of Defense (DoD), the Department of Energy (DOE), and the National Aeronautics and Space Administration (NASA), among others.

The SBIR program operates in three phases:

Phase I
Small businesses can receive funding to explore the scientific, technical, and commercial feasibility of their innovative ideas. Phase I grants are typically smaller, and their purpose is to provide proof of concept. If a Phase I project demonstrates promise, small businesses can compete for Phase II funding.

Phase II
Funding is provided for further R&D efforts to develop prototypes or refine existing technologies. Phase II grants are larger and provide more substantial support to advance the innovation towards commercialization.

Phase III
Small businesses are expected to pursue commercialization of the technology using non-SBIR funds. Phase III does not involve direct funding from the SBIR program but rather encourages the use of private sector or other government agency funding to bring the technology to the market.

The impact of the SBIR program on tech innovation funding is significant. By providing early-stage funding to small businesses, the program helps bridge the funding gap that often hinders the development and commercialization of innovative technologies. This support enables small businesses to conduct R&D, explore new ideas, and take risks that they might not have been able to afford otherwise.

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The STTR Program is a federal initiative in the United States that aims to facilitate the transfer of technology from research institutions, such as universities and federal laboratories, to small businesses. The program is administered by various federal agencies, including the National Institutes of Health (NIH), the National Science Foundation (NSF), the Department of Defense (DoD), and others.

The STTR Program is similar to the Small Business Innovation Research (SBIR) Program but has a distinct focus on fostering collaboration between small businesses and research institutions. It requires small businesses to partner with a research institution to conduct a significant portion of the research and development (R&D) work. This collaboration promotes the utilization of scientific and technological innovation generated in research institutions and helps drive commercialization through small businesses.

The impact of the STTR Program on tech innovation funding is significant. By providing funding to small businesses engaged in R&D, the program helps stimulate innovation in various technological fields. It supports early-stage research, which might otherwise struggle to secure adequate funding from private sources. The program encourages collaboration between academia and industry, fostering knowledge transfer and commercialization of cutting-edge technologies.

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National Security Director
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