US Military Taps into Innovations in Startup Tech World

May 16, 2017

This may look like just another Silicon Valley company, with people coding at their desk. But Capella Space has a unique customer: the U.S. military.

“We like to work with the government because we think we can help the government save money, bring a capability that doesn't exist, and through that hopefully save some lives,” said Payam Banazadeh, co-founder and chief executive officer of Capella Space.

An immigrant from Iran, Payam Banazadeh now builds a special kind of satellite that is a bit bigger than a shoebox.

“In fact, this is a military type technology. The problem is the satellites that the military uses are massive,” Banazadeh explained.

Capella can build satellites smaller, cheaper and faster than traditional military satellites. Now, the U.S. military can be a customers of Capella Satellite data quickly through a new Defense Department group, called Defense Innovation Unit Experimental, or DIUx.

“The Department of Defense is the world's largest bureaucracy. There are some things that are of a secret nature and must be protected. And of course, everything that our soldiers touch could have life or death implications,” explained Shah.

As a result, the military tends to be risk averse, and in many cases, will only adopt technology when it is perfect. But by then, the technology may be outdated.

The tech startup culture is the opposite, where risk and speed drives innovation.

“Have this minimal viable product that you launch really quickly into the market and learn about it and iterate and try to do this as quickly as possible,” said Banazadeh.

At the Milken Institute Gobal Conference recently, Silicon Valley experts emphasized the importance of keeping up with technology.

“As a broad statement,  government systems are not using the latest forms of operating systems, encryptions and mechanisms,” said Eric Schmidt, executive chairman of Google's parent company, Alphabet.

As the most recent global cyber attack proves, it is a constant race to stay ahead of threats.

Housed in this building in the middle of Silicon Valley, the mission of DIUx is to bridge the different cultures of tech startups and the U.S. military to meet national security needs.

“Technology is always changing and if you have only legacy equipment, that actually gives the bad guys more time to figure out what the vulnerabilities are. If we're constantly evolving, it's a cat and mouse game between attackers and defenders and we want to be on the winning side of that,” said Shah.

That starts with DIUx doing away with much of the paperwork and bureaucracy traditionally involved with having the military as a customer. Since its inception 18 months ago, DIUx has worked with more than 30 tech companies across the U.S. and the world. Capella Space plans to launch its satellite in about six months.