Investing in Veterans with Craig Cummings

Craig Cummings, co-founder of Moonshots Capital, joins ACME General Corp to talk about investing in tech start-ups founded by military veteran entrepreneurs.

In addition to his work at Moonshots Capital, Craig is the Director of Military and Veteran Affairs for Capital Factory, Austin’s center of gravity for entrepreneurs in Texas.

Previously, Craig spent 17 years in the Army, most of that time as an Intelligence Officer serving in support of the National Security Agency.

ACME General: Welcome to Accelerate Defense, a podcast from ACME General Corp. I’m David Bonfili, co-founder and CEO at ACME, and host of this month’s episode. On Accelerate Defense, we’ll hear from political figures, military professionals, and other thought leaders about how innovation shapes our national security landscape. Our guest today. Craig Cummings is co-founder and general partner at Moonshots Capital, where he invests in technology startups largely founded by military veteran entrepreneurs. He also serves as the Director of Military and Veterans Affairs for Capital Factory in Austin, Texas, and before that spent 17 years in the Army, most of that time as an intelligence officer serving in support of the NSA. Craig, welcome to Accelerate Defense.

Craig Cummings: Thank you. David. Happy to be here.

ACME General: Excellent. Let’s dive in. It’s excellent to see you. And I thank you for making time. I suspect most of our audience is already familiar with Moonshots, but for those who aren’t, could you maybe tell us a little bit about the firm’s background, your mandate as investors, and about the nexus with companies working on problems in the national security space?

CC: Absolutely. So, Moonshots Capital is an early stage/seed stage venture capital firm. I co-founded Moonshots Capital with Kelly Perdue, who some of you may have watched Season Two of The Apprentice back in the day. Kelly won Season Two of The Apprentice, and that’s actually when we met. I had just done a PhD at Columbia. I was active duty, and I was headed back to West Point. I was teaching at West Point, and Kelly won that show in December 2004, and – David, you can appreciate, I got assigned additional duty to bring the winner of The Apprentice back to West Point. So Kelly and I met in January 2005. Fast forward, you know, we just had our 19th friendiversary. So Kelly and I met then and we had a great visit at West Point and became fast friends. And then I left the military my 17th year. I’m getting to what we do here, but Kelly worked for Donald Trump for a year, went back to LA and became one of LA’s super angels. He became an adviser to LinkedIn, Pandora, Scopely, and based on our friendship, you know, he started to share deals with me. I left the Army in my 17th year. All in good terms, just for the record, I just quit because I’m a quitter.

ACME General: And I have to actually ask about that, Craig. Because for people familiar with the military, you can retire at 20. So 17 is like running a lot of the race and then stopping while you’re pretty close to the end. What led to that decision?

CC: I just felt like I was ready to scratch the proverbial entrepreneurial itch. I mean, I was having a great career. I had it just off-ramped as the brigade operations officer at the NSA, for the Army’s NSA brigade, the 74th MI Brigade, but I’d seen other friends getting out, starting companies, and it really appealed to me. So the day that I got out was the actual day that the active duty service obligation – which, you may remember that from your days – expired. So I had to pay back my time for doing the PhD and that was the day I resigned. And I was just days away from putting on lieutenant colonel. So I got out, started entrepreneuring – I can talk about that maybe later – but doing angel investments. And then I would get deals and share with Kelly and next thing you know, he and I are sort of acting like a team. And for example, like, – Kelly and I brought many of the angel investors to And then in 2014, we said let’s grip hands in this and let’s start Moonshots Capital and let’s do SPVs, syndicates. So, you know, we would bundle up checks from angels and then write one check into the investment.

ACME General: Did you have at that time a sort of thesis on the types of companies you were looking for?

CC: It’s a great question, you know. We really didn’t at the time. We were generalist investors and – well, let me correct. I would say yes, that the thesis was the same. We invest in extraordinary leadership. We didn’t, you know, put that down as the thesis of the funds until a couple of years later. But I would say that was the thesis, that still is the thesis. Where my mind was going was like, well, we’ll probably end up in this conversation talking about dual-use defense tech, which we’re doing more of nowadays. But back then it was leadership and we had done about 10 million in investments with most of that money backing military veterans. And so what we were realizing is that these veterans were performing, right? They were performing especially well and we decided the time was right in 2017, let’s raise a fund. We were angel investors together. And then we did SPVs and then we did the fund. So our first fund is vintage fund one from 2017. And now we’re in our third fund.

ACME General: So, Craig, across those three funds, how’s the size of the fund changed? What sort of check sizes? What sort of fund sizes have you been focused on?

CC: Sure. So our fund one was 20 million, just north of 20. Fund two was 36. And fund three, we’re targeting 100 million. And we’re in the throes of fund three right now. The check sizes have moved to the right, gotten bigger, as you might suspect. In fund one, they were sort of 750 to a million. We pop up to a million five, I think once or twice. And fund two, we were more sort of million to two. Fund three, we’re more million to two and a half. But our general approach is we try to get a 10% ownership by in leading the seed round. So, you know, we’re looking at companies with post-money in the 10 to 25 million range. 

ACME General: Got it.

CC: Now, we are opportunistic. I mean, Kelly and I have invested in 114 companies. We have 250 million, roughly, assets under management. And so if we see, for example, raising a B round or a C round or a D round, we will opportunistically invest because we have access. So if we do see a 10x potential in a later stage, we’ll make some exceptions. Though we try to stick to leading seats.

ACME General: Let me ask about something you mentioned earlier, which is sort of the focus on veterans as being often characteristic of extraordinary leaders. I don’t think Moonshots was there, but early on in the Army Futures Command and the Army Applications Lab days, we were asked to host a VC dinner here in New York to bring people in to hear about the Army’s plans for expanding access to VC-backed companies. And we had a group of people around the table and one of the folks there, another West Point grad, said, ‘I love investing in veteran-led companies as long as they have no intention of doing anything with the military.’ So I’m curious whether you two thought that, whether you still think that, or whether you never did and why.

CC: That’s something we would never say. You know, we look at the leadership. We look at the domain expertise. We look at the whole team, we look at the market opportunity, and then we look at our networks and then we say, can we create a proverbial unfair advantage. So I suspect that that individual, whoever that was changed her or his mind because you would not want to take off the table the power of relationships, experience, domain expertise in the defense space. What do you think, David? Throw that one right back at you.

ACME General: It’s a fair question. Look, I think that the department is trying very hard to figure out how to get right the idea of accessing nontraditional, often VC-backed companies. But I think it’s hard and I’m not sure that they’ve totally cracked the code yet on how to be a good customer. There are a lot of barriers to doing that, from how requirements are written to who acquires solutions and at what scale. And I think it’s a work in progress, though there are some hopeful signs on the horizon which hopefully we can talk to you about. And I guess maybe on that note, one of the phrases that you hear in this space often is this idea of dual-use, referring often not so much to the potential of a technology to have commercial and national security applications, but to a company pursuing both commercial and defense markets. And I’m curious to get your perspective on that as an early-stage investor, because one argument might be that while the technology could be dual-use, that having a dual focus as an early-stage company on different markets like commercial and defense is quite challenging.

CC: I fully agree with you, David, in that regard. I think it can be massively distracting trying to do both. So we do like dual-use, but we also like single-use, right? I mean, at the end of the day, again, is it an extraordinary leader? Is the market opportunity large? And if you take – for example, in our fund one, we have a company called Red Six that I suspect you’re familiar with Red Six who does the augmented reality largely focused on Air Force pilots. We knew that there was an outside defense use case for this technology with commercial airlines, but even beyond and in gaming and recreation and – but we needed and the CEO wanted to focus on the Air Force exclusively because the opportunity inside the Air Force was massive. So to this day, it’s still out there, still a touch point, the conversations have moved forward with commercial customers, but the center of gravity for Red Six is still the US Air Force. So I think we just don’t paint ourselves into any corners in this regard. And I have heard – I was at an event a week ago and I heard a Bay Area dual-use investor say ‘it has to be dual use.’ And if you look at our most recent investment, like the last few weeks – and we haven’t even announced it yet, so you’re hearing it first, David.

ACME General: Perfect, breaking news here on Accelerate Defense.

CC: Breaking news. We invested in a company called Ghostdog, co-founded by Shawn Lane and Carlton Bubba Fox, and what they are building is basically a new browser for the classified web. And that is a single-use technology with massive market opportunity. I’m sure it could be dual-use. But there’s enough upside across the intel community, defense, other government agencies, allies that, you know, we’re not concerned that we limit ourselves in any way. And I don’t know, David, would you say Anduril has limited themselves with their focus?

ACME General: Yeah, you know, it’s interesting, Craig, I think when you’re looking at Anduril or a company like Red Six, what it calls to mind for me is, in the same way that there’s a difference between dual-use and dual-focus, there’s a difference between defense only and defense first. It’s a question of how you sort of sequence your go to market.

CC: I think you’re spot on. And I think the dual-focus is probably the trickiest of them all there. And we want our CEOs – like you – dual-focused.

ACME General: Well, let me ask a sort of question that’s related to that, but I think it gets asked less often. But you’re in a really almost unique position to answer as an investor in so many companies, which is whether or not a company is capable of pursuing commercial and national defense markets at the same time. When you look at it from the perspective of an investor in the cap table of a company, do you think that it is possible to reconcile having investors in the cap table who are specifically focused on commercial markets with investors who are specifically focused on national security markets, given the different timelines and arguably – and feel free to push back here if you disagree – but the different return profiles of those two markets.

CC: You know, I actually think that’s a case of a one plus one could equal three with the domain expertise across industries. And I think at the end of the day, the CEO manages the board and the CEO racks and stacks priorities and it gets to what you’re saying, whether it’s defense first or commercial first. And so I think you can bring all that domain expertise to bear, even if it is defense first, that commercial – let’s say the commercial VC, is going to have massively strong insights used in the commercial space that I think would benefit the company’s work inside defense. So if anything, it’s probably better to have those two as long as they grip hands and play together well. I mean, I do believe that VC is a team sport. You know, even in – back to Ghostdog, Sean Lane’s last company. He had investors: Khosla, Sequoia, Drive Capital, Dragoneer, SVB Capital. And what I witnessed Shawn experience with all of those is, some of them are taking the whole round, right? It’s like, I want all of it. And when we did this most recent round with Ghostdog, we said we’re going to lead it, right? We’re going to hit our ownership target. But we’re going to show it to our friends at 8VC. And guess what they said? ‘We’re in.’ And then we showed it to Shield Capital. Guess what they said? ‘We’re in.’ And then Chris Darby, who’s now with Cerberus Capital with the new fund that they have focused on defense, said ‘we’re in.’ And you know me well enough to know of course I showed it to the Capital Factory and they said, ‘we’re in.’ And so we built it. Now these are world class dual-use investors right, that we put there. So 8VC just as an example is going to bring the domain expertise from the commercial and the defense space, so we’re excited about having them as a co-investor with us in Ghostdog.

ACME General: I want to come back to – you mentioned Capital Factory, I want to come back to that in just a second. But before I do, you talked about some of the larger bluechip, well-known VCs that are starting increasingly to invest in the national security space. The Sequoias, the A16Zs, and so on. One of the concerns that has been raised looking at national security, VC investing in the last few years is that, as the larger players have come in, the valuations have started to get maybe a little frothy on those rounds, particularly in the sort of B round plus or minus. Is that something that you’re seeing or not really?

CC: We’re definitely seeing it. I think there’s so much excitement about the space that it does lead to valuations that are higher than they should be. We’re seeing it in the seed rounds, seeing these huge seed rounds. 

ACME General: Wow, okay.

CC: And we just say, ‘we’re out. It’s too big a round.’ I mean, we’re trying to stick to our knitting, which is get the initial tough work foundation laid with that seed round and then of course we’ll like the larger rounds later. But you know an 80 to 100 million seed round, we won’t even look at that deal. And so, yes, it’s happening at the seed, A, and the B. It’ll correct. It’ll correct. It’ll find its way to correction.

ACME General: Well, that’s that’s the concern, right? It’s nice to get a nice valuation. But when it seems like it’s maybe out ahead of where the company is in its growth and development, you worry about how they’re going to do the next round, when they need to, at a valuation that still makes sense.

CC: I mean, I think, David, the counter argument, if you had, like, the team at Epirus on this podcast and we were talking about their B round and if they open the kimono and talked about the revenue and the valuation they achieved on the revenue, most people would say like, ‘does not compute.’ Like how do you get north of $1 billion with those sort of revenues? And I don’t want to talk about any revenue numbers, because I don’t know them specifically, but -ish from when they were doing the round, they would say, ‘but look at the potential here and look at the pipeline and look at this technology,’ it’s so cutting edge that they’re capturing future value in that current round. And then you have Anduril that’s continuing to be successful and raise a lot of money and so it’s like, well, it’s happening with Anduril. So it provides a little bit of support for those higher valuations.

ACME General: Well, it’s a good question though, I think, because our friend Trae Stephens at Founders has been fond historically of saying, ‘to succeed in this space, like the thing you actually need is a billionaire founder who can raise unlimited amounts of capital and hire lawyers and lobbyists to talk to the Hill and sue their clients.’ And if you’re looking at the great success cases to date, the SpaceXs, the Palantirs, arguably the Andurils, like they all have that in common. Let’s see if we can prove Trae wrong. What are the success stories that you would point to of companies that are demonstrating that those frothy valuations maybe made sense? 

CC: I mean, I don’t want to be cliche or broken record, but I think if you look at extraordinary leaders like Dan Robinson of Red Six, I mean, we invested when it was the proverbial three guys – not in a garage, it was a townhouse, but it was like a MacGyver townhouse. But we could clearly see he was a special founder, CEO, human being. And what we did is we kind of partnered with the Air Force in that regard. We’re like, okay, this is a big idea. And then they had to do a ground test. And if they passed the ground test, they got our first tranche of the seed. And then if they passed the air test, they got the second one. And so in that way, it was like big technology didn’t need a ton of dollars, they just had do some early proof points. And then the next thing you know that, you know, Red Six starts to take off, it starts moonshoting. And if you look at, Blake Hall, again a founder who iss a force of nature. Blake Hall – if you were in the room back in the day, David, whatever Blake was selling, you were buying. It didn’t matter if it was a candle, a flower, or the original idea, which was Craigslist on military bases, you were in. So there was no billionaire. It took a while, I mean, Blake had a couple of pivots to get from TroopSwap to And then along comes a massive contract from the US Treasury Department, as they become sort of the gateways that –

ACME General: Craig, let me drill down on that.

CC: Oh, yeah.

ACME General: When you say it took long for, how long did it take?

CC: Well, I think was founded in 2010. We became engaged with the company, particularly Kelly, in 2011. So it was a proverbial overnight success ten years in the making, it really started to pop three years ago. And so the billionaire in that case was the United States government in the non dilutive contract they got. So that’s the billionaire you really want.

ACME General: Well so, if we look at that case, that investment presumably, if I’ve got the timeline correct, predated your first fund. That was like a SPV investment, is that correct?

CC: We were, Kelly and I were angels all the way from the very beginning. Kelly was on the board since the very beginning. Then we did SPVs, then we’ve invested in multiple SPVs. We just wrapped up in SPV a couple of weeks ago. And we’ve invested out of fund two and three in We have massive conviction on

ACME General: Got it. So it gets to sort of an interesting technical question I think as investors though. If you look at the typical VC fund from investment period through harvest, fund life is what, start to finish maybe ten years?

CC: Yep. 

ACME General: So if you had a vintage 2011 fund that invested in, how would that investment have worked out for the fund?

CC: Well, I think it would work out remarkably well. Look, as long as the company’s still growing and winning, then the investors can be patient. I mean, it’s an air quote ‘ten years,’ right? It’s an ish. It took Uber longer than ten years to go public and I think their investors were just fine waiting for that day. And will go public when the public markets open up in the next couple of years is what Blake expects. And I think the investors have the patience to wait. But yeah, I mean, it can be tricky as a fund manager when you’re pointing to markups, but not DPI, not cash back to the investor. So I mean it’s a valid point. And I think with respect to dual-use companies, some of these are – it is going to take some more patient capital. You know, it takes some time to build relationships in DoD. You’re right, I mean, like, dual-use funds, you could say ten years, but don’t be surprised if it’s 15.

ACME General: Well, so the question maybe then is, it seems like – and there’s not a lot of creativity when you’re launching, if you’re a new manager, launching a new fund, you’re basically taking docs from someone else’s fund and like doing find and replace on them because you can’t afford to pay the lawyers to write new ones, right? But maybe it’s the case in the space that borrowing this structure for a typical VC fund that has worked in commercial markets isn’t the best thing to do. And maybe we need a different fund structure for investments that may have longer time horizons for liquidity, events and markups.

CC: You know, I don’t know if we need a different – I feel like the funds will be okay. But I think you do have to have those opportunities like secondaries, where employees and other investors do have the opportunity to take some chips off the table and realize some gains. I don’t know, what do you think? Do you have something in mind in that regard? Like something that might be a better fit?

ACME General: I don’t think there’s one clear answer, but I think that there probably needs to be a set of arrows in the quiver that allow you to adapt structure to structural realities of the market that you’re in. And that involves probably finding ways to increase duration and increase liquidity in a way that accounts for the fact that you have most likely longer cycles with more significant shifts when you find your gear. But, you know, maybe what we’re talking about are these structural issues. I wonder when you’re investing in companies that do work in the national security space, do you have a view going in on contract type for those companies? There’s been a lot of coverage in the last week or two about traditional defense industrial based companies just losing their shirts on what are called firm-fixed-price contracts, which is sort of a fancy government word for like what a contract everywhere else looks like, which is you say what it’s going to cost to do something and then you do it and you get that amount of money, versus a cost-plus contract where you pass through all of your costs and you get a fixed profit margin on the top. The defense industrial base here now is basically saying they’ll only do cost-plus contracts going forward because they’ve lost too much money trying to do firm-fixed-price contracts. When you look at this from the perspective of a venture investor, if a company that you’re investing in is pursuing cost-plus contracts, can you make the return targets that you need to see as an investor? And if they’re not pursuing cost-plus contracts, can they succeed at scale in the Department of Defense as it exists today?

CC: You know, I don’t know how much cost-plus we’re seeing on the product side versus the services side. Do you have a sense of the split there? If you had a pie, would you say what percentage service versus product on cost-plus? I’ll get to the answer, but I’m just curious what you believe to be the –

ACME General: I don’t.

CC: Because that’s like my government service brains is there, and I’m not seeing as much of it in the product side, but I would say if the long term value is inside the cost-plus box, it’s not going to be super interesting for us, right? But if, along the way, there’s these smaller contracts that are cost-plus that, basically the government is sort of paying you to do your MVP, you know, and then you can live with it, right? Because you know there’s a hockey stick to the right of that cost-plus contract. I mean, I do think the point you’re making is an important one. I think investors are waiting to see some contract wins, right? It derisks the non dilutive funds. I think the way we think about it is – take Outpost Space, right? So Outpost Space was our first actual space investment, even though our name is Moonshots Capital. And we had repeat founders, right? They had sold their last company in space. They had this big idea of returning satellites. Let that sink in for a minute, returning satellites. So catch a rideshare to space. Start mission, redeploy, deploy heat shield, enter atmosphere, deploy paraglide solution, and precision landed. And so at the time, they pointed to exactly zero contract wins. But you had two founders, extraordinary leaders. There were actually three, three co-founders at the time. But the CEO knows exactly what he’s doing in the space space. And we believed the contracts are out there. They just are. On the U.S. Space Force and the Air Force side and on the commercial side. And this is where our experience in the government, you know, blended with actual knowledge, people like you who actually know the requirements. But the massive returns live inside these early investments and so we made the bet on the team. Who has then gone on to win almost every contract they submit for, so, you know.

ACME General: Well, maybe following up on that, let me ask, do you think that there are specific either problem sets or technology focus areas within the national security space where it is more likely that a venture-backed company is going to be able to succeed at scale than others? People sometimes talk about the traction in commercial space, for example. But I’m curious if you have a sense of areas that seem more promising than others and if so, what those are.

CC: Well, I think if you look at what’s happening in the world, right, let’s just talk about the proverbial elephant in the room, right? China. Pick your technology that defeats China and that’s where there’s interest. What does that include? Drones. Drones in the air. Drones in the sea. As you’re seeing Dino and Saronic do with 8VC. AI, you know, writ large. But AI even like as the brains of the drone. You layer in Russia and Ukraine and you see like missiles are hot again, are vogue. And so I think there’s the technology component, sort of where the puck’s going, but in the dual-use space, it’s like, where’s the world going? And what does the US need to maintain its dominance and then investing in those areas. So you know we have Ghostdog, directly relevant to the intelligence community and Department of Defense. In fact, Ghostdog won an award in Schofield Barracks. There were 600 entrants and they won like ‘most powerful tool against China.’ I didn’t get it exactly right, but that was basically the award they won, Ghostdog did. And so I joke with founders, it’s joking, not joking, like in your series A and B deck, don’t forget to mention China, you know. So there’s that.

ACME General: Well, speaking of things that I wanted to make sure we didn’t forget to mention, you brought up Capital Factory briefly and have been Director of Military and Veterans Affairs there for many years. For folks who aren’t familiar with Capital Factory already, could you just tell us a little bit about that and the importance of places like Capital Factory in developing this national security innovation ecosystem and helping companies find success?

CC: I mean, absolutely. I appreciate you asking the question. Capital Factory in Austin, the tagline is very real. It’s the center of gravity for entrepreneurship in central Texas. So it is a space where startups co-work. It is a space where startups become member companies of Capital Factory and then access over 200 mentors, all the expertise of that team, all the access to the VIPs, which you know, David, are always cycling through there. What Capital Factory is not is it’s not Techstars. It is not a program – three month, you know, week one, week two, week three. What I say about Capital Factory: it is a massive muscle, but it must be flexed, right? You have to understand, like what kind of help do I need? Do I need go to market help, do I need marketing? And then they have all that expertise lives there through the staff and the extended mentor network. And my story is interesting, it gets to your question. I alongside Joseph Kopser – sold my last company with Joseph to Mercedes-Benz. And I moved to Austin, and Joseph and I were scrappy vets that liked to hang out at the Capital Factory. And then Josh put his arm around me one day and said, ‘hey, I’m getting more people from the military here. Can you kind of be a Sherpa, a whisperer, translator for me?’ And this was in 2015 ish, and I said, ‘absolutely, Josh.’ This is not paid, although I do get a parking spot there. But not paid. So we’re getting visitors, and then DIU, as you know, boom, puts a flag in the ground and then later NGA does and then National Guard does. And the amount of traffic, it was like once a month someone from, let’s just say the Pentagon, the DoD would come. And then it was like once every three weeks, once every two weeks, once every week. I’m like, ‘Josh, this is kind of becoming a full time job to help you host all these people.’ And then now the team is grown, by the way, the military advisors – Kevin Landrieu, Paul Norwood, Joseph Kopser. So now it’s become a team, and that’s really what it requires. But it has become – this is a true statement and, I should before I say it, say – you know, Army Futures Command chose Austin for its new headquarters because of Capital Factory. I mean, ask Ryan McCarthy and Eric Wesley, Lieutenant General. They were the two principals who led the effort on the new headquarters. And it was Josh Baer saying, ‘what better place to slam into innovation and entrepreneurs than right here?’ And so that is what won the day when Army Futures Command came. So fast forward to today, it has become a center of gravity for national security innovation. Now you have DIU there, you have AFWERX there. You know, South by Southwest has become a must attend dual-use event. And all that activity is at the Capital Factory. And even stepping away from dual-use for a second, part of the reason that Austin has become Austin is because of the Capital Factory. It’s a long list with, you know, Willie Nelson and Michael Dell and the late culture and barbecue and Tito and more and more and more. But the fact that in our city, we have a single place where if you want to go see the startup ecosystem, that’s where you go. If you want to host the tech event, that’s where you host it. Basically, you get the network effects in that building at Capital Factory. And you think about New York, where do you go to do that? DC, where do you go to do that? Maybe Y Combinator, but there’s no place like it and it’s super special that we have it. And Josh Baer, you know, there’s a reason he got the mayor – last mayor presented him with a key to the city. He’s had that much of an impact on Austin.

ACME General: Yeah, look, I think you’re absolutely right. And I’m glad you mentioned New York because it is something that hopefully will get addressed here at some point. You have some number of places around the country like Capital Factory. You have DIU now through their onramp centers, formerly Mission Acceleration centers, establishing these hubs in more and more locations. But it does seem like an oversight that in the city with the highest concentration of capital and one of the highest concentration of startups in the country, which is New York, that you have some number of events run by people like us or other people in the ecosystem, but you don’t have a physical space that serves as that same center of gravity that you have in Austin. One thing you mentioned when you were talking about the value of Capital Factory, where all of the innovation x DoD innovation x organizations that have moved in, DIU and the Army Applications Lab and NGA and AFWERX and so on – I guess that the Navy is sort of late to the party, but we’ll get there eventually – speaking of those organizations, they are sometimes subjected to the criticism that programming is as much about innovation theater as it is about driving impactful results. Are there examples across the DoD x ecosystem that you can point to of new programs, new initiatives that these organizations are doing that are having a real impact from your perspective as an investor on improving the prospects, easing entry for the companies in your portfolio?

CC: I think my wavetop answer is that AFWERX has been so aggressive in hacking the acquisition process that they’ve been a clear leader in getting dollars to innovative companies the fastest and under contract. And from a programming perspective, what you have at Capital Factory, is you have Army Futures Command there and AAL – Army Applications Lab, as you well know – right? And then they’re like sharing notes, they’re having lunch, they’re getting coffee together and they’re like, ‘well how did you get that contract through in 60 days? Because that’s just not happening in the Army.’ And then you have someone like Stoiky – well, he’s now DIU. But, you know, AFWERKS like, ‘well, here’s how you do it.’ And so you have that cross talk of DIU, AFWERX, Army and then your others, your NavalXs and I think these organizations are acting the way we do when we’re downrange, right? How do we do it downrange? We sit State next to Treasury, next to CIA. Of course, CIA’s in the back corner, so not really, but kind of. Next to all these organizations, right? And then they’re cross talking. And that is what you see in that Capital Factory environment, is you see a one plus one plus one equals like 20. So there’s probably some theater, but what I’m seeing is like serious intent and I do think the China threat has made everybody sit up a little bit straighter and focus.

ACME General: It’s a great point. Often, I think, from the outside looking in, people look at the Army or the Air Force or the Navy, and they see some sort of, like, monolithic organization and assume some like coordination of effort, both within the services and across the services and DoD more broadly. And anyone who’s worked on the inside realizes these are large, massive, distributed organizations that are very complex and where it’s very hard to align stakeholders even within a service, much less across different services. And having these sort of physical spaces where government stakeholders from across different constituencies can convene is almost as important as having these physical spaces where entrepreneurs and innovators and mentors can find each other as well. Well, it has been –

CC: That’s why we’re here. Let me just say, before we wrap I just want to say props to you and your team. Because you guys are part of the success story at Capital Factory, at Army Futures Command, across these X teams of the services, because you’ve put the right people in the right positions, where you’ve been asked and tasked to do so, that have helped bring this back together. I mean, just make sure the viewers know that ACME is part of the foundational glue. I know it’s beyond Capital Factory, but I’m just saying at Capital Factory and Army Futures Command, I just wanted to make sure I got the 30 second commercial on what you’ve done there.

ACME General: I appreciate that on behalf of the firm. As you appreciate well, it’s an important problem set for the country to figure out how to get right, and it’s one that we maybe don’t have the luxury of a lot of time to make progress on, so it’s a privilege to be able to work on it every day with folks like you. Craig, thank you very much for joining Accelerate Defense today. Appreciate you making the time.

CC: I really enjoyed it, David.

ACME General: Thanks again to Craig for joining us on this month’s episode of Accelerate Defense.

If you enjoyed today’s episode, please rate and review Accelerate Defense on Apple Podcasts – it really helps other listeners find the show. And subscribe to the series today wherever you get your podcasts, so you get each episode in your feed when they come out every month.

Accelerate Defense is a monthly podcast from ACME General Corp. Our producer is Isabel Robertson. Audio engineer is Sean Rule-Hoffman. I’m David Bonfili, and this is Accelerate Defense. Thanks for listening.

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