The Defense Department’s Office of Strategic Capital (OSC) last Friday released its first Investment Strategy, which identifies the priority technologies areas and the framework for selecting these technologies.
The priority areas are nanomaterials and metamaterials, bioenergetics and synthetic biology, Open RAN, sensor hardware, assembly, testing, and packaging related to microelectronics, materials also related to microelectronics, quantum computing, quantum security, and quantum sensing, battery storage, and space-enabled services and equipment.
The priorities for investment are key components and processes within the supply chain that do not typically benefit from direct procurement and “lack sufficient access to capital,” and therefore require “strategic capital,” says the 24-page Investment Strategy for the Office of Strategic Capital.
“Without access to sufficient capital in the near future, many of these technologies may fail to mature or, worse, fall into the hands of global adversaries and competitors,” the strategy says. “Attracting private capital in strategically critical markets—or “strategic capital”—is needed.”
Through government loans and loan guarantees, which are expected to be repaid to limit taxpayer costs, the OSC said these investments will be bolstered by attracting private capital. The investments will be managed through the SBA’s decades-old Small Business Innovation Company program, which requires an equal funding match from private investors.
The priority areas for investment fall within eight larger critical technology areas, including advanced materials, biotechnology, future generation wireless technology, integrated network system-of-systems, microelectronics, quantum science, renewable energy generation and storage, and space technology. These critical technology areas were previously identified by the Office of the Undersecretary of Defense for Research and Engineering as areas of emerging opportunity for seed funding.
DoD’s list of critical technology areas also includes trusted AI and autonomy, advanced computing and software, human-machine interfaces, directed energy, and hypersonics.