The Pentagon’s new startup focus is pushing established companies to try new strategies

Decades-old defense contractors are leaning into the Pentagon’s new focus on startups, entwining themselves with emerging companies that have the technologies or even the contracts they seek.

“We're making bets in advance on specific capabilities and then going back to the market to say, ‘Who are the founders, and who are taking novel approaches to building something that is unique and different and can be applied within a military context?’” said Brian McCarthy, Booz Allen Hamilton’s managing partner of ventures .

The trend reflects the Pentagon’s new urgency—after years of pleading by commanders, lawmakers, and even defense officials—to expand the military’s industrial base and bring in more tech companies. A series of recent directives from Defense Secretary Pete Hegseth and other ad