The Business of War is the Business of Deterrence
The most common question I get when discussing Anduril with the media, potential investors, recruits and other external parties is whether or not we should be building weapons. This is an important topic that we take very seriously and have spent a lot of time discussing internally. The answer is yes — Anduril has made a conscious decision to build and supply weapons to the United States military, as well as our allies and partners abroad. And as our company and capabilities evolve in size, nature and complexity, it is important to take a moment to clarify what we build and why.
Since Russia invaded Ukraine in February 2022, the United States and allied countries have moved swiftly to supply the Ukrainians with the tools and weapons they need to defend their freedom and independence. But, if the Ukrainians had an arsenal of HIMARs, Howitzers, surface-to-air missiles, loitering munitions, and anti-radiation missiles in December of 2021, it is hard to believe the conflict would have even started. Putin invaded Ukraine because he believed he could win.
The Ukraine conflict is a useful reminder that hard power capabilities are critical to deterring adversarial aggression. A key purpose of defense departments is to provide military power strong enough to preserve peace by deterring war. This understanding is the driving force behind why Anduril and other defense-focused companies are willing to build weapons for the Department of Defense.
“Weapons,” in this context, is broader than merely “things that explode.” The DOD’s weapons systems are an interconnected battle network of capabilities, some that carry explosive payloads but many that do not, all of which together enable our men and women in uniform and those of our allies to rapidly understand threats, make decisions, and take military actions. Those systems can be made up of sensors to gather intelligence, understand an environment, or enable precision targeting; complex software to process data, automate processes, or aid in decision making; or vehicles, missiles, or other effects. From our first days, Anduril was founded to contribute advanced technology to every part of this complex web of capabilities.
Anduril’s founding was motivated by a belief that the U.S. technology community should play a central role in both the development of weapons and supporting capabilities for US and allied militaries. As discussed in my prior essay “The Ethics of Defense Technology: An Investor’s Perspective”, the key emerging technologies of the commercial tech industry — such as artificial intelligence, autonomy and machine learning — are forcing a shift in the way wars are initiated, waged, resolved, and deterred. These changes will provide asymmetric advantages to nations that invest in modern technology. And that modern technology, if developed properly, can make warfare more proportional, more precise, and less indiscriminate than it’s ever been before. These are ethical goods that have and will result in better and more peaceful outcomes globally.
These more peaceful outcomes are only achievable if we maintain our technological advantage in weapons systems — an advantage that we are, unfortunately, losing as we speak. While China, Iran, and Russia have conscripted their own commercial tech talent towards advanced weapons systems, the US tech community has largely sat on the sidelines, and the US DOD has done little to encourage its participation.
Meanwhile, the legacy defense industry — largely shipbuilders, aircraft makers, and car manufacturers from the past century — has shown that it is not capable of matching the pace of commercial innovation. This is not their fault. For better or for worse, the relevant talent base for technologies such as artificial intelligence and machine autonomy is currently working within the tech community rather than the traditional defense industry. The people we need to work on these strategic systems are more likely to be building ad optimization software at Google than they are to be in a concrete basement in the Midwest working for a defense prime like Lockheed Martin or Raytheon.
Nor can these legacy defense contractors be expected to move away from the low-growth, shareholder-dividends-driven business models that have served them for the past five decades. Time and time again, the department of defense has rewarded these companies with large contracts to build expensive and bespoke defense technology on a cost-plus basis, even in cases where leveraging existing commercial technologies, companies, and business models would achieve the same outcome faster and cheaper. This has resulted in seemingly never-ending cost and schedule overruns on almost every key DOD program.
The path to reducing the amount of money that we, as taxpayers, are spending on defense flows through the right people working on the right things with the right incentives. There is no industry better prepared to do that for the defense sector than the tech industry. Defense needs the type of Moore’s-Law-like innovation curve that we’ve seen across core technologies like semi-conductors, display tech transformation, optical systems, developer APIs, and battery science. The amortization of the research & development costs for these technologies across a variety of enterprise and consumer use cases not only allows for significant cost reduction over time, but also meaningfully decreases cycle time from one technology paradigm into the next. And it enables the type of compounding advances in technology that the department of defense needs to maintain its technological advantage over Xi’s China and Putin’s Russia.
For us, the business of war is the business of deterrence. Anduril was founded to transform US and allied military capability with advanced technology. In the current geopolitical and technological paradigm, for better or for worse, weapons systems are necessary to deter war and protect and defend sovereign nations from attacks, and technologically advanced weapons can improve military decision-making and help the US military in its mission to deter conflict. Until the day when this should no longer be required, the technology industry should not shy away from advancing this mission.
