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Defense technology startup Blue Halo was founded five years ago by Gold Star Brother Jonathan Moneymaker.
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High-energy laser systems are now officially deployed overseas by the Army to shoot down unmanned aerial vehicles.
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Moneymaker tells BI why being successful in defense technology isn’t just about having the most groundbreaking solution.
“Our job is to keep the men and women who put themselves in danger safe and bring them home.”
This is the kind of patriotic mission statement echoed by many aspiring youth advocacy startups. But for Blue Halo CEO Jonathan Moneymaker, this is personal.
“I’m a gold star brother, which means my brother was killed in the Navy,” Moneymaker told Business Insider. “Technology could have saved his life. And part of that is making sure others have that opportunity.”
It’s been five years since Moneymaker ran Blue Halo. During this time, he designed, tested and fielded the Army’s first major laser weapon system with support from private equity firm Arlington Capital Partners. This is a rapid turnaround rate practically unknown to larger, more established defense contractors.
After securing a $1 billion contract from the Pentagon this year, Blue Halo is delivering its Tracked High Energy Laser (P-HEL) system to the Army, allowing them to launch AI-powered drones out of the sky with pinpoint accuracy.
But it’s not just lasers. Blue Halo also produces autonomous systems, anti-drone technologies, space technology and cyber warfare solutions, all powered by its own machine learning software, Metis.
“If you look at our focus and our offerings, there are very few [competitors] It can rival us in this integrity,” CEO Jonathan Moneymaker told BI.
The Virginia-based startup isn’t on the level of defense tech unicorns like Shield AI, Anduril, or Epirus — which are increasingly trailing defense pioneers — but after a merger with Eqlipse Technologies this year, Blue Halo is fast approaching $1 billion in revenue and has 2,400 employees in 11 states. .
And the contracts keep coming. This week, it signed a $95.4 million contract with the Space and Missile Defense Command (SMDC) to develop a prototype directed energy (DE) solutions.
As the Department of Defense (DoD) slowly approaches the idea that it should purchase commercial military technology, numerous tech startups are hoping to follow suit, offering solutions for U.S. national security and capturing a share of $842 billion. defense budget.
Industry experts have warned that grappling with the legendary complexity of the defense industry makes it different from entering any other growing market.
“Primes are not particularly innovative because they specialize in the purchasing process rather than the technology process. But startups are lacking in a few things,” Steve Blank, professor of Defense technology innovation at Stanford and creator of the Lean Startup method, told BI.
Blank said they often lack a go-to-market strategy and fail to understand the complexities of getting orders from the Department of Defense.
The DoD buys to meet what’s called a requirement, where someone specifically requests something. Blank explained that writing this requirement is a long process that often helps them. Startups are often ignorant about this process and completely out of the loop.
Then comes the actual procurement process, which can take two or three years to even appear in the budget; This is a problem if you are a startup that needs orders and cash flow to satisfy your investors.
“If you don’t understand this process, then primes tend to win,” Blank told BI.
Unlike Silicon Valley tech companies that focus on defense, Blue Halo’s roots are on the other side; Moneymaker has spent the last 25 years in the defense industrial base.
Blue Halo says it’s the insider knowledge combined with the operational speeds typical of the tech world that has led to success.
“We have the experience, knowledge and sophistication of some of the traditional pioneers in our field, but we also have the entrepreneurial and innovative pace and spirit of some of the new entrants.”
What’s critical is not just understanding what the military needs, Moneymaker said, but also how to gain the trust of defense officials and navigate the procurement process to get it into their hands.
He noted that Silicon Valley faces “some learning curves” in this regard.
Oftentimes, tech companies will have excellent breakthrough technology, but it’s not actually what the military needs, or it will be incredibly difficult to field, he told BI.
“It’s incredibly important to know where it applies and where it doesn’t apply. Frankly, if you haven’t grown up in that environment, sometimes it takes a little bit longer to get used to it,” Moneymaker said. “We listen better than most of our competitors.”
Another factor that Moneymaker sees as an advantage is that Blue Halo lacks the Silicon Valley ego.
“We lead without ego,” said Blue Halo CEO. “We’ve all done exciting things in our careers, but this is about being part of something bigger.”
But despite its industry knowledge and its Arlington base, Blue Halo still has some aspects it shares with traditional technology — like the company’s somewhat embarrassing collective name: Halo Nation.
Then, like any successful startup, it plans its path to an IPO, hoping to be ready within a year. If all goes as planned, the “ring of protection” that Moneymaker says the Blue Halo represents will gradually grow larger.
Read the original article on Business Insider