Pentagon shifts weapons buying toward startups under Pete Hegseth
The Pentagon is changing up how it buys weapons, with Defense Secretary Pete Hegseth pushing more funding toward tech startups, even as big contractors still dominate.
Spending on the top 15 defense-tech startups tripled from 2022 to the last fiscal year, but they still make up less than 1% of all military contracts.
Congress isn't totally sold, though: lawmakers are questioning Hegseth's $1.5 trillion budget request and worrying about rising startup valuations.
Nontraditional defense firms won $122 billion
About 10,000 new defense firms have launched in just two years, and nontraditional companies scored $122 billion in contracts for fiscal 2025, double what they got 10 years ago.
Still, traditional contractors remain the heavyweights with $372 billion in spending during this period.
Upcoming congressional votes on projects like autonomous warfare could decide whether these fresh innovators get a bigger slice of the pie.