By Blaise Zandoli, Army SBIR|STTR, and Christina Alfonso, Council on Global Competition and Innovation – CGCI
This article comes from members of two organizations operating at the intersection of military and commercial technologies (i.e., “dual-use”). While the views expressed are their own, together they offer a perspective on the opportunities and risks inherent in developing technologies for military application.
In today’s era of rapid technological advancement and strategic competition, the boundaries between defense and commercial innovation continue to blur—a welcome development for both sectors’ long-term benefit. The United States’ ability to maintain its security and economic leadership hinges on how effectively it translates scientific breakthroughs into both battlefield advantage and commercial prosperity.
America’s Army Small Business Innovation Research and Small Business Technology Transfer (SBIR|STTR) Program ranks among the most valuable mechanisms for transitioning commercial technologies to the military. This program catalyzes dual-use development by channeling small business ingenuity toward urgent Army needs and broader private market opportunities. In parallel, the Council on Global Competition and Innovation (CGCI) acts as a convener and strategic catalyst—mobilizing investment, promoting cross-border partnerships, and uniting leaders from industry, academia, and government to advance policies and collaborative frameworks that strengthen the innovation infrastructure and global competitiveness of the United States and its allies.
For the technology and financial sectors, these programs represent more than policy alignment—they serve as powerful engines for de-risking early-stage innovation and surfacing new investment opportunities. In 2020, the Army SBIR|STTR Program restructured its internal organization, shifting away from platform-centric funding to create five portfolios centered on platform-agnostic priority technological areas (e.g., Artificial Intelligence (AI) and Machine Learning (ML), Sensors, etc.). This organizational shift enabled the creation of multi-organizational, multidisciplinary teams around each priority area, with the goal of identifying Army-relevant commercial technologies and drawing in Army talent from technical, acquisition, and, increasingly, operational users.
The intent is to build a capital allocation system that functions across the full SBIR|STTR funding lifecycle (typically four to five years), based on active participation from all necessary stakeholders—from technology development through fielding. This structure fosters stronger alignment among Army developers, buyers, and users, helping focus limited resources on the highest-value, best use of SBIR|STTR dollars. While technical, funding and transition planning are essential, they are only a means for the range of stakeholders to mitigate risks and exploit opportunities as they arise dynamically over the investment lifecycle. It also helps companies navigate the “valley of death”—the gap between research and development (R&D) and larger-dollar procurement contracts. Army SBIRSTTR awarded companies should know they can and should engage with all essential Army stakeholders to support the successful transition of their efforts from R&D to procurement. These business level benefits give investors and corporate strategists alike earlier visibility into scalable technologies and emerging procurement trends.
Together, organizations like Army SBIR|STTR and CGCI demonstrate how targeted technology pipelines and cross-sector policy leadership can accelerate the transition of breakthrough solutions from lab to battlefield to market. In the face of increasingly capable competition, these efforts help ensure American innovation remains a driving force for both economic growth and national security.
The Dual-Use Imperative
Echoing the era of the 1940s to 1960s—when America also faced existential risk from a global competitor—dual-use technologies, which serve both military and civilian purposes, have become the linchpin of modern innovation strategy. The Army SBIR|STTR Program taps into the ingenuity of America’s small businesses, guiding promising concepts through a phased but highly dynamic, non-linear process from proof-of-concept to prototype and, ultimately, to fielding and commercialization. This pipeline ensures solutions remain relevant to the warfighter while proving attractive to private markets.
For investors, this phased approach acts as a validation engine: government funding and technical vetting significantly reduce the risk profile of early-stage ventures, making them more attractive for follow-on private capital. In fiscal year (FY) 2023, the Army SBIR|STTR Program cut average contract action times to about 30 days, allowing startups and their backers to move quickly in a competitive landscape. The non-dilutive nature of these funds adds a compelling business dimension for entrepreneurs and their private capital providers.
While this approach improves information efficiency in an information-scarce environment, it becomes essential as adversaries seek to exploit global and domestic technology flows. By investing in dual-use innovation, the U.S. ensures taxpayer-funded research delivers both security dividends and economic returns—reinforcing the nation’s technological and industrial base. The value proposition is clear for both the Army and taxpayer. Even if few seek complete de-coupling from adversarial economies, it behooves the private sector to recognize the opportunities in trends like “on-shoring” and “friend-shoring.” Geography matters again—not just for production cost reasons but for the communities where employees live and maybe send children to school.
Aligning Strategic Priorities
The Army SBIR|STTR Program’s five technology focus areas—AI/ML, Contested Logistics, Sensors, Energy Resiliency, and Immersive Systems—closely align with CGCI’s sector-based investment priorities.
- Artificial Intelligence & Cybersecurity: In FY2024, the Army invested $104 million in ongoing AI projects, supporting around 75 small businesses. These initiatives range from predictive maintenance for military vehicles to autonomous decision-making systems, with direct commercial applications in logistics, manufacturing, and critical infrastructure protection.
- Critical Minerals & Infrastructure: A secure supply of critical minerals and resilient infrastructure underpins both defense and economic competitiveness. SBIR|STTR investments in advanced battery materials, microgrid technologies, and next-generation manufacturing are already gaining commercial traction, supporting military readiness and industrial resilience.
These focus areas reflect some of the fastest-growing segments in the global tech economy. In FY2023, the Army’s AI/ML portfolio generated 96 awards and $67.25 million in funding, with commercial sectors rapidly gaining traction alongside defense applications. Market trends suggest even greater integration in 2024, as fields like computer vision, explainable AI, and natural language processing continue to attract public and private sector interest.
Case Studies in Cross-Sector Success
Each of the following examples showcases not only technical achievement but also market traction and investment potential:
1. AI-Enabled Imaging for Defense and Industry
A recent Army SBIR|STTR project focused on AI-driven image processing for Soldier-borne thermal imagers illustrates the dual-use model in action. By using advances in embedded hardware and computer vision, small businesses developed lightweight, energy-efficient solutions that reduce cognitive load for Soldiers. These same technologies now support commercial applications in industrial inspection, autonomous vehicles, and public safety—demonstrating how defense-driven innovation can spark broader economic activity.
Market and Investment Impact: These technologies have attracted interest from industrial automation and automotive investors, with several SBIR|STTR alumni securing follow-on venture funding and commercial contracts post-prototype.
2. The Army Tech Marketplace
The Army Tech Marketplace, an online platform developed through SBIR|STTR funding and partnerships, exemplifies how digital tools foster cross-sector collaboration. By connecting Army, Joint Service, and commercial stakeholders, the Marketplace will accelerate the integration of disruptive technologies, streamlines contracting, and enables shared learning—lowering barriers for nontraditional entrants and speeding the path from lab to market.
Market and Investment Impact: The Marketplace will offer a pipeline of validated startups and technologies, giving investors and corporate partners early access to emerging solutions with demonstrated government interest.
3. xTech Prize Competitions
The Army’s xTech Program seeks small businesses to pitch novel dual-use solutions, offering prize funding, accelerator support, and pathways to funding opportunities such as SBIR|STTR contracts, Other Transaction Agreements, or even Procurement contracts. This model not only surfaces cutting-edge technologies but also builds a pipeline for rapid transition from prototype to field deployment and commercial adoption. Recent competitions have advanced capabilities in logistics, energy efficiency, and AI-driven decision support, with participating companies securing both defense contracts and private investment.
Market and Investment Impact: xTech alumni such as Compound Eye, LiquidPiston, and TRX Systems have raised significant private capital. Adranos, an xTech Search 1 winner was acquired by Anduril while Anti-Rotational Technologies was acquired by Vita Inclanata—validating the competitions as a launchpad for scalable, investable ventures.
Strategies for Scaling Collaboration
To unlock the full potential of dual-use innovation, several strategies stand out:
- Accelerate Transition Pathways: Expand the horizontally managed, portfolio-based approach adopted by Army SBIR|STTR to Army acquisitions organizations. Aligning portfolio management across the Army would shift away from the success or failure of a dedicated platform to better leverage rapidly changing technologies with many applications. Seize opportunities as they arise. Avoid anchoring to fixed programs susceptible to sunk cost fallacies.
- Leverage Data-Driven Technology Scouting: Apply advanced analytics to identify high-impact opportunities where Army needs and commercial demand intersect, ensuring efficient resource allocation. The Army must better operationalize the value of its internal knowledge, much of which remains siloed and underutilized.
- Deepen Public-Private Partnerships: Foster joint ventures, co-investment, and shared R&D infrastructure, building on models like the Army Tech Marketplace and CGCI’s convening capabilities.
- Safeguard Intellectual Property and Supply Chains: Strengthen protections to prevent foreign exploitation of critical innovations, ensuring U.S. investments yield both security and economic returns.
- Improve Connectivity with Private Capital: As the Army increasingly leverages emerging talent and improves transition potential, the need for—and appeal of—private capital grows. While some areas and companies may never attract venture financing, the intersection of “Army applicable” and “investable” continues to expand rapidly.
Taken together, these strategies show how the evolving landscape of dual-use innovation is creating new touchpoints for investors and technology leaders. This alignment not only accelerates the maturation of high-impact technologies but also fosters a more dynamic ecosystem where public and private investment reinforce each other—ultimately broadening the pipeline of solutions that serve both national security and market needs.
Toward a New Era of Innovation Leadership
The intersection of the Army SBIR|STTR Program and the Council on Global Competition and Innovation offers a powerful model for how targeted investment, cross-sector collaboration, and a focus on dual-use technologies can drive both national security and economic vitality. The convergence of commercial and military innovation is not merely a matter of efficiency—it is a strategic imperative for both America and for businesses that operate in the U.S.
As global competition intensifies and the pace of technological change accelerates, the United States must ensure its innovation ecosystem remains agile, expansive, and scalable. By breaking down silos between government and industry—and by creating clear pathways from discovery to real-world deployment—we can ensure that America’s most promising technologies are not only invented here, but also developed, fielded, and commercialized at scale. This approach will be essential not only for meeting today’s urgent challenges—whether on the battlefield or in the marketplace—but also for building the foundation for long-term prosperity and security.



