Happy 2024 from H4XLabs!
A Deep Tech Dual Use Parter That Accelerates Mission and Business Success
Happy New Year! Welcome back!
2023 saw the continuation of Russia’s war against Ukraine, renewed conflict between Israel and the militant group Hamas, and escalating tension between China and the Philippines. It also was one of the hottest years on record; as we all have emerged from the Covid shutdown, so have all the drivers of climate risk.
We see this as not changing in 2024 - except that the mission to accelerate capability - is more important than ever. H4XLabs is poised to enable companies building solutions for any and all of these problems.
For those of you looking for some more direction, the National Defense Authorization Act provides some clues. Finally, late last year, Dec 22 2023 that President Biden signed NDAA 2024 into law, approving a budget of $841.4 billion. The Act authorizes fiscal year appropriations for the Department of Defense, Department of Energy national security programs, Department of State, and the Intelligence Community. It’s a lengthy document. Many think tanks and law firms break down various aspects and develop summaries from various perspectives (from water contamination to climate initiatives). We found Georgetown’s Center of Security and Emerging Technologies (CSET) tool that tracks NDAA initiatives best positioned to help one find language that bolsters one’s mission; it allows for filtering by categories FY2024 NDAA Emerging Technology Provisions Tracker. But, we are not out of the woods yet. Appropriators still need to approve budget for specific programs outlined in the NDAA. (Authorized does not mean Appropriated). At present, a CR is in effect; next deadline for the Senate and House to agree is 1 February 2024. More here.
There is another $105B awaiting approval from in the Supplemental Budget request. Breaking Defense breaks down the Supplemental ask - which includes aid for Ukraine, Israel, Taiwan, and more money for re-building our industrial base.
We at H4XLabs are tracking certain areas- from funding for space tech programs to the Replicator, to what’s happening with the Office of Strategic Capital and Navy’s new Office of Strategic Assessment.
Connect with us here on Substack or by email to share out what you know about these areas and discuss areas of interest to you.
The Replicator - What’s the Word?
The overarching goal of Replicator is to mass-produce thousands upon thousands of attritable unmanned systems. As many in this dual use community knows- To achieve that goal, the Pentagon will partner with drone companies throughout the country to leverage all forms of commercial technology from robotics to AI.
And, it wants to achieve this in 18–24 months.
It’s such a high priority that Deputy Secretary of Defense Kathleen Hicks said she will personally oversee the effort, along with the vice chairman of the Joint Chiefs of Staff, Christopher Grady. Hicks has said attritable autonomy programs will eventually make up half a percent of the Pentagon budget, or about $4B.
Hicks has said the money for the initiative is already in programs across the services, although much of that money is reserved for RDT&E rather than procurement.
The first tranche for Replicator would be selected that month, though the systems may be classified.
The per-unit cost will range from the tens of thousands to the hundreds of thousands of dollars. Each system should be designed to last three to five years.
The Pentagon is working on a reprogramming request to help fund Replicator.
Then it aims to apply the lessons learned to more industries going forward.
That makes the drone effort “Replicator One” — the first in a potential series of initiatives to improve and expand America’s defense industrial complex. Last month the Army’s chief acquisition officer Doug Bush revealed that they submitted 3 systems for consideration. He didn’t name the systems but noted the three systems are “bigger than a quadcopter, but smaller than an MQ-1 and are ones that are in production rather than those requiring R&D.
Of course, it won’t be easy — and there are a few reasons why.
For one thing, while U.S. drone manufacturers could theoretically match China’s output, they won’t be able to match its prices. Plus the domestic supply of t-moto-like motors don’t really exist; time is needed to build up manufacturing lines.
Michael MacKay, national security advisor to Iowa Sen. Jodi Ernst noted:
The fact of the matter is we don’t have an industrial base to do this. If China shut off the hose tomorrow, we don’t have the carbon fibers; we don’t have the micro-electronics; we don’t have the chips; we don’t have the motors to be able at this point to provide thousands [of small drones] at scale.
We know that manufacturing power-houses are vying for attention to compete to be a part of this supply chain. We can look to our partners in Asia to bring their manufacturing engineering prowess and know-how to the United States and build up capability and capacity. In any case, as a matter of national security, the United States absolutely must forge its own drone supply chain — one that’s as efficient as China’s and yet wholly separate from it.
Regardless of the murkiness, the Defense Innovation Unit should announce the first Replicator program shortly.
Contested Logistics - Navy’s First Open Topic
The U.S. Navy kicked off its first SBIR Open Topic efforts back in July and has already selected 43 companies to receive awards to develop technologies and capabilities in the Contested Logistics realm.
Phase I will run for four months and focus on approaches to adapt commercial products and services to improve performance, modernize an existing capability or fill a capability gap. The Navy will then make competitive selections based on Phase I results and the initial Phase II proposal and award contracts to transition technology from the development to the production phase. The funding construct is to allow for Phase II selections before Phase I is over, enabling continuous funding for companies who deliver what’s needed. Note that the going in criteria was for technologies to be at TRL 8 or above; the thought would be to adapt technology for Navy’s use.
Topics range from improving the launch and recovery of air, sea, surface and unmanned underwater vehicles from naval vessels to enhancing the mission capabilities of UUV systems.
You can see them listed here - and a high level map of where they are located. Not shown is one in Hawaii (lucky to be located in Hawaii!)
For those of you who have won a Navy Open Topic, connect with us - we are working with the Navy to assist the whole cohort- from linking to the right test facilities to networking with mission partners (to include customers) and fund raising for those companies looking to fund raise - tapping into the Defense Investors Network. We;ve already talked with a few of you - we’ll be reaching out soon to let you know more- and learn from you what you need. Or, just come chat with us (email us at h4xlabs@bmnt.com).
Startup Corner:
I. Why Business Models Matter: The Importance of establishing and proving out your Business Model.
Last month H4XLabs ran a virtual forum on business models that looked to not only explain what a business model is (it’s not a revenue model) but also why it’s important for deep tech/ dual use companies to understand the baseline government business model so that they can innovate to obtain more value. Getting into a program of record (POR) is not the only way to work with the government (only the DoD has the notion of a POR).
Most companies view the revenue model as their business model and are not thinking about how to capture a customer more holistically
Steve Kiser (Veteran Ventures) articulated the challenge of being a commercially oriented company while also selling to the government. The Government taxes companies with compliance requirements that make doing business with the government much more expensive; even so, profits are capped, unless a company can sell based on a fixed price.
Most companies have simple single revenue source business models which could limit the market they can capture (see this business case study).
Being a startup, especially a deep tech/dual use startup, the business model can be especially complex. On the one hand, many nascent companies are looking to use government non-dilutive funding to buy down technology development (product roadmap) costs. On the other, they are looking to capture other government customers. And, on the 3rd hand they are looking to get commercial customers, and often times not thinking through the complexity of doing all of this at once. There is a lot to balance.
Companies should have a vision and think through a plan of attack that can be articulated to themselves, their team, and more importantly customers and investors.
At present, we are working with a company that is looking to commercialize mmw technology. The company is at once pursuing licensing of AI models and software, but is also developing a hardware chipset which they hope to sell. This, all the while while gaining traction on SBIR funding.
The challenge they are having is explaining their business model. Why do they want to be? How will they sell, against the target market that they profess to be focused on? How will they move beyond SBIR funding (and the answer “by getting a Phase III” is not a real answer).
Does this example of complexity resonate?
As develop a vision about your value proposition, think about how the market is evolving and how your customers will want to buy (you may have to interview a few potential customers to understand this aspect). What makes it not only easy for them to buy will enable your sales and market entry.
And, if you intend to roll out a complex business model (meaning more than one revenue stream at a time), you might consider staging the activities, or, at the very least, craft a visual representation of how revenues might come in - and how your technology/product roadmap supports your go to market strategy. Get your explanation down to 2-3 sentences so that customers and/or investors understand what you are trying to do.
II. Your Digital Presence - It Matters! Customers and Investors are looking!
Recently, we did an audit of over 10 companies’ digital presence. These companies were technology first engineering oriented companies. Most of the companies failed to have a LinkedIn page and their websites didn’t say anything about themselves.
In today's digital-first world, a strong online presence is a make-or-break factor for any startup. Just like a physical store, your website and social media channels need regular checkups to ensure they're attracting customers, converting leads, and reflecting your brand accurately.
You may want to do a quick digital audit on yourself. Think of it as a deep dive into your online ecosystem. It uncovers blind spots you might miss in the daily grind, like broken links, outdated content, or confusing user journeys. It also evaluates how effectively your online channels are supporting your goals, whether it's generating leads, boosting brand awareness, or driving sales.
Beyond technical glitches, an audit reveals deeper truths about your brand messaging. Are you attracting the right audience? Does your online persona align with your core values? Are you engaging with your community in a meaningful way? Unearthing these insights allows you to refine your strategy, build deeper customer connections, and stand out in the crowded online space.
Ultimately, a digital presence audit is an investment in your startup's future growth. It helps you optimize your online experience, avoid costly mistakes, and maximize the return on your digital marketing efforts. It's like polishing your virtual storefront, ensuring it shines bright and attracts the right customers for lasting success. So, don't wait for your online performance to dim, embrace the audit and watch your startup's digital world flourish! Here is a link to a post so you can guide yourself. Of course, you can get friends/friendly partners to also help provide feedback.
Funding Opportunities -
SBIR
DoD: DoD has 3 SBIR cycles a year. There is 1 more month for the DoD SBIR 24-1 cycle. You should go to each services website, but this DoD link aggregates all opportunities (and is the main portal for submission)
NASA’s Mainline SBIR cycle opens in January. Check back at this website- and set up a google alert for information to be pushed to you. NASA’s SBIRs are not for space companies only. They look for robotics, automation, autonomy, sensing solutions.
NASA’s SBIR Ignite cycle will open middle of the year- currently projected for around the June timeframe. However, you can talk to NASA now. SBIR Ignite Catalysts are organized opportunities to talk to topic authors. We will be hosting 2 hybrid and 3-4 virtual sessions around topics such as ISAM/ADR, Propulsion, Weather/Environment, and other areas. You are welcome to propose your area of interest (email us).
The first catalyst will be on 1 Feb. We had sent out an email and linkedin posts to notify the community of the application link. If you missed the application deadline- contact us at h4xlabs@bmnt.com. Sign up here to continue to get updates. Follow our Linkedin Page too!
What follows are some interesting new opportunities put forth by AFWERX and SpaceWERX
AFWERX
SpaceWERX, in partnership with United States Space Force’s (USSF) Space Systems Command, is seeking cutting-edge ideas to rapidly advance US and Allied warfighter Positioning, Navigation, & Timing (PNT) capabilities with new sensors, data sources, and processing techniques to greatly improve PNT resilience.
The Space Force also has a Request for Information out on Space Mobility due in early - mid January, let by Assured Access to Space, looking for information to help shape the FY26 budget and provide a foundation for a program of record.
Army - SBIR Open Topic -
Yuma Test Center Full Load Cooling - Electronic Power Train Cooling - due 1/23/2024.
Through the Yuma Test Center Full Load Cooling solicitation, the Army seeks to develop modernized data processing techniques — including performance limiting controls (e.g., engine derating) — that can assess the cooling capabilities of automotive platforms with electronically controlled powertrains.
Terrain Shaping - due 1/17/2024
The Army uses "terrain shaping" to impede enemy movement or operations. Cannon-fired or air-dropped anti-tank mines shape the deep maneuver area of the battlefield, which is 70km+ beyond the frontline — also called the forward line of troops (FLOT).
And, one opening January 9 2024: Medical Resupply to Forward Units . Blood delivery, medical resupply, and casualty evacuation (CASEVAC) are conducted by convoys of crewed vehicles, and if those convoys cannot reach frontline troops or are delayed, Soldiers won't be treated for potentially life-threatening injuries. None of the Army's current systems offer a heavy-lift, modular mission payload that can autonomously resupply blood and perform CASEVAC.
SOCOM RFI on ISR and Tactical Communications due 8 January.
From Lisa Sanders, S&T Director: Come experiment with us! The USSOCOM Science and Technology Directorate’s Technical Experimentation team will conduct the Technical Experimentation Event 24-2 at the Avon Park Air Force Range near Sebring, FL, from 1-5 April 2024. The theme for the event is Intelligence, Surveillance, Reconnaissance (ISR) and Tactical Communications Integration. The deadline for submissions is 1200 EST, 8 January 2024.
Here is the link to the RFI (Higher Gov has a more user friendly interface than SAM.gov).
Come chat with us for advise on how to position for each of these agencies, as each approach funding research differently (connect with Ellen Chang - or email her/the team at h4xlabs@bmnt.com)
Our Events - Where Will We Be? Tag us or email us to get involved!
January 24/25 WeWork Roselyn, Washington DC Area: Private Capital Session with a reception on the 24th.
January 30 - February 1 (Orlando FL) SpaceCOM Conference with SpaceWERX and NASA
4 April WeWork Roselyn, Washington DC Area Navy Launch Kickoff
8-10 April - Colorado Springs Space Symposium and Washington DC Sea Air Space Conference