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⚖️ US Navy Working With Startups
Liam Gill
June 24, 2025
The Navy Quietly Reinvents How It Works With Startups
The U.S. Navy has been undergoing an operational shift under Chief Technology Officer Justin Fanelli. Over the past two and a half years, Fanelli has focused on cutting through bureaucratic red tape to make the Navy more accessible to startups and emerging tech companies. Using a new “innovation adoption kit” and a McKinsey-inspired “horizon” model, the Navy has significantly shortened procurement timelines and opened the door to pilot programs with companies like Via, a cybersecurity startup that went from RFP to deployment in under six months. These efforts aim to move promising technologies from prototype to production without letting them die in the so-called “Valley of Death.”
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A Problem-First, Startup-Friendly Government Buyer Emerges
Fanelli’s biggest innovation may be cultural: replacing rigid, prescriptive RFPs with open-ended problem statements. The Navy now invites startups to solve real problems on their own terms, then scales the most effective solutions into enterprise-level services. This model has drawn companies that previously avoided federal contracts, including those in AI, cybersecurity, and process automation. Success is measured across five dimensions: time savings, operational resilience, cost per user, adaptability, and user experience — all metrics that startups already optimize for. The Navy’s approach isn’t just faster; it’s more aligned with how startups think and build. Notably, this model has drawn hundreds of new applicants to innovation challenges and produced tangible gains — like clearing a two-year invoice backlog in weeks or saving 5,000 sailor hours through network upgrades.
Don’t Ignore Defense — It’s Open for Startup Business
For startups solving hard technical problems, the Navy may now be one of the most attractive and underexplored customer segments. The barriers that once made government sales feel insurmountable — slow cycles, rigid specs, lack of engagement — are giving way to a more agile, partner-driven model. Founders in AI, autonomy, cybersecurity, and enterprise SaaS should take note of Fanelli’s signal: the Navy is serious about innovation and increasingly willing to fund and scale commercial solutions. That said, success still requires an understanding of budget cycles and the importance of replacing legacy systems. Build for resilience, not just flash. And if your solution can reduce technical debt while proving measurable value, you might just find the Navy’s door more open than ever before.
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