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While the leaders of Silicon Valley like those of Palantir, Meta and Openai make headlines to exchange their Brunello Cucinelli vests for Army reserve uniformsA quieter transformation was underway in the American navy.
How? Well, the director of navy technology, Justin Fanelli, says that he has spent the last two and a half years focus on the administrative formalities cut and prolonged supply cycles that have once done work with the army a nightmare for startups. Efforts represent a less visible but potentially more significant overhaul, the one where the government moves faster and is more intelligent when it comes to dollars.
“We are more open to business and partnerships we have never been,” Fanelli told Techcrunch in a recent zoom interview. “We are humble and listen to more than before, and we recognize that if an organization shows us how we can do business differently, we want it to be a partnership.”
Currently, many of these partnerships are facilitated by what Fanelli calls the adoption kit of navy innovation, a series of frames and tools that aim to fill the so-called Death Valley, where promising technology dies on its way to production prototype. “Your grandfather’s government had a spaghetti painting to get to,,” he said. “Now, it’s a funnel, and we say, if you can show that you have disproportionate results, then we want to designate you as a company service.”
In a recent case, the navy has gone from a request for a proposal (RFP) to the deployment of pilot in less than six months with Via, a cybersecurity startup based in Somerville, Mass.sive, which helps large organizations to protect sensitive data and digital identities, in part, in part, which means that the data is not stored in a single central place which can be hacked. (Another via customers are the US Air Force.)
The new approach to the navy works on what Fanelli calls a “horizon” model, borrowed and adapted to the framework of McKinsey innovation. Companies are going through three phases: evaluation, structured management and development of business services. The main difference from traditional government contracts, says Fanelli, is that the navy now leads with problems rather than predetermined solutions.
“Instead of specifying:” Hey, we would like this problem solved in a way that we have always had it “, we simply say that we have a problem, which wants to solve this, and how will you solve it?” Said Fanelli.
Fanelli’s driving to revise naval technology is personal. Originally an Air Force scholarship studying electrical engineering, it was disqualified from military service due to a pulmonary problem. Determined to serve anyway, he chose the navy in the private sector over 20 years ago because “he wanted to be with people in uniform”. Since then, his career has concluded roles through defense, intelligence, Darpa and open source initiatives, before returning to the Marine Department.
The change he supervises is to open doors to companies that previously never considered the work of the government and that may have thought that it is trying. Fanelli points, for example, to a competition through the Defense Innovation Unit (DIU), in which the Navy expected a handful of bidders for a niche cybersecurity challenge but received nearly 100 responses – many companies that had never worked with DOD before but which already solved similar problems in the private sector.
Fanelli says that her team has completely documented dozens of successes, including one where a startup supported by a company used the automation of robotic processes to pass through a two -year bill in just a few weeks. Another example consisted in deploying network improvements to an aircraft carrier that saved 5,000 hours of sailor in only the first month.
“This has not only changed their availability, but it changed their morale, body spirit, how long they could spend other tasks,” said Fanelli, explaining that time saved is one of the five measures that the navy uses to measure the success of a pilot program. The other four are operational resilience, user cost, adaptability and user experience.
As for what the navy is currently looking for, Fanelli has described several high priority areas, including AI, where the service actively speaks with the teams. To begin with, the navy wishes to accelerate the adoption of AI beyond the cases of generative use of basic AI in more agentic applications for everything, from the integration and management of personnel to the processing of data on ships. He also cited the “alternative GPS”, explaining that the navy quickly adopts navigation and synchronization software of alternative precision, in particular for integration with unmanned systems. And he mentioned the “modernization of inherited systems”, saying that some of the aging technologies that the navy seek to modernize includes the air traffic control infrastructure and ships -based systems.
So how much money is they trying to work every year? Fanelli said that he was not free to provide specific budgetary breakdowns, but he said that the Navy is currently allocating percentages to a figure with emerging and commercial technologies compared to traditional defense entrepreneurs – a balance that he expects to evolve considerably while AI continues to move forward.
As for the most common reason that promising technologies fail when tested, he said that it was not necessarily because of the technical gaps. Instead, he said, the navy works on long budgetary cycles, and if a new solution does not replace or “deactivate” an existing system, funding becomes problematic.
“If we get advantages and measure this advantage, but there is no money [getting to the startup] In a year and a half – it’s a very bad story for their investors and our users, “said Fanelli.” Sometimes it’s a zero -sum game. Sometimes this is not the case. And if we will return the public-private sector for more private and set up this wave, we have a lot of technical debts on which we have to cut the anchor. »»
During our call, we also asked Fanelli if the “America First” policies of the Trump administration have an impact on these processes in any way. Fanelli replied that the current emphasis on national manufacturing aligns well with the objectives of the “resilience” of the navy (he underlined the digital twins, additive manufacturing and on -site production capacities which can reduce the dependencies of the supply chain).
In any case, the message of the Navy for entrepreneurs and investors is clearly that it is a real alternative to traditional trade markets, and it is a land that seems to gain ground in Silicon Valley, where there is an increasing receptivity to the partnership with the American government.
Meta’s Andrew Bosworth Recently observed during a recent Bloomberg event In San Francisco: “There is a much stronger patriotic sub-settlement than I think that people grant credit to Silicon Valley.”
As long -standing observers can testify, it is a marked change compared to the more skeptical position which characterized a large part of the valley from previous years.
Now, Fanelli hopes to attract more of this interest in the navy specifically. He told Techcrunch: “I would invite anyone who wishes to serve the greatest mission from the point of view of the solution to look and join us on this trip.”
If you are interested in hearing our complete conversation with Fanelli, you can check it here.
