'Full speed' at DIUx, says chief

Shutterstock image: light bulb with gears. 

The 2017 National Defense Authorization Act put the brakes on the Defense Innovation Unit Experimental by restricting the amount of its budget that it can spend, but according to the head of DIUx, that has not slowed down the office's work.

During a conference call with reporters, DIUx managing partner Raj Shah said that since its May 2016 reboot, DIUx has signed 25 contracts worth $48 million for a range of commercial solutions for warfighter needs.

Of those contracts, 13 worth $12.3 million were awarded since the end of the fourth quarter of 2016.

The projects are in various prototype stages and include counter-unmanned aerial systems technology, autonomous indoor drone systems, non-invasive cooling technology for battlefield medicine and multifactor authentication for network access.

DIUx customers to date include the military services as well as the DOD chief information officer, special operations forces and the Combat Casualty Care Research Program. 

Shah said that of the 25 contracts, 22 were signed with non-traditional defense partners, and more than 350 companies have competed for DIUx contracts.

Right now, he said, DIUx has more demand than capacity, despite having grown to a staff of 45 across offices in Silicon Valley, Boston, Austin and the Pentagon.

Shah said DIUx has yet to feel the squeeze of the NDAA restrictions, which say the organization can spend only 75 percent of its operational budget and 25 percent of its program budget until Congress approves a mission statement and operational report submitted by DIUx.

For now, Shah said the lack of a formal federal budget means DIUx is able to continue operations, but the continuing resolution is extending the time to complete contracts.

DIUx does not rely entirely on its own budget, as its customers are investing $3 for every $1 that DIUx spends on projects. In addition, DIUx is indirectly benefitting from venture capital funding.

"If you look at the portfolio of companies that we are working with and have invested in, the private sector has invested over $1.5 billion of R&D in these companies," Shah said.

One company -- Shield AI, which is developing autonomous drone technology -- received $10.5 million in series-A funding from a venture capital firm after winning a DIUx contract.

"So here we are going to get full capability from this company, and they are only focused on the DOD market, yet we didn't have to pay for all of the R&D as they build out product for us," said Shah.

DIUx uses other transaction authority and the Commercial Solutions Opening vehicle from the 2016 NDAA to rapidly award contracts to prototype technical and cyber/IT solutions to warfighter needs. While Shah does not advocate for DIUx to become the acquisition wing of the DOD, he said that increasingly DOD customers are asking DIUx for training on how to use rapid contracting authorities.

Still, DIUx has faced strong opposition from members of the House, some of whom sought to kill funding for the organization last year. That led to the provisions in the 2017 NDAA essentially requiring DIUx to justify its value to Congress -- and could also be seen as motivation for DIUx to do public outreach to promote its work.

But Shah said he's seen no indication from the new administration or secretary of Defense that there is any change in store for DIUx.

"The guidance we've been given is to continue at the full speed that we've had," said Shah.

About the Author

Sean Carberry is an FCW staff writer covering defense, cybersecurity and intelligence. Prior to joining FCW, he was Kabul Correspondent for NPR, and also served as an international producer for NPR covering the war in Libya and the Arab Spring. He has reported from more than two-dozen countries including Iraq, Yemen, DRC, and South Sudan. In addition to numerous public radio programs, he has reported for Reuters, PBS NewsHour, The Diplomat, and The Atlantic.

Carberry earned a Master of Public Administration from the Harvard Kennedy School, and has a B.A. in Urban Studies from Lehigh University.

The Fed 100

Read the profiles of all this year's winners.


  • Then-presidential candidate Donald Trump at a 2016 campaign event. Image: Shutterstock

    'Buy American' order puts procurement in the spotlight

    Some IT contractors are worried that the "buy American" executive order from President Trump could squeeze key innovators out of the market.

  • OMB chief Mick Mulvaney, shown here in as a member of Congress in 2013. (Photo credit Gage Skidmore/Flickr)

    White House taps old policies for new government makeover

    New guidance from OMB advises agencies to use shared services, GWACs and federal schedules for acquisition, and to leverage IT wherever possible in restructuring plans.

  • Shutterstock image (by Everett Historical): aerial of the Pentagon.

    What DOD's next CIO will have to deal with

    It could be months before the Defense Department has a new CIO, and he or she will face a host of organizational and operational challenges from Day One

  • USAF Gen. John Hyten

    General: Cyber Command needs new platform before NSA split

    U.S. Cyber Command should be elevated to a full combatant command as soon as possible, the head of Strategic Command told Congress, but it cannot be separated from the NSA until it has its own cyber platform.

  • Image from Shutterstock.

    DLA goes virtual

    The Defense Logistics Agency is in the midst of an ambitious campaign to eliminate its IT infrastructure and transition to using exclusively shared, hosted and virtual services.

  • Fed 100 logo

    The 2017 Federal 100

    The women and men who make up this year's Fed 100 are proof positive of what one person can make possibile in federal IT. Read on to learn more about each and every winner's accomplishments.

Reader comments

Please post your comments here. Comments are moderated, so they may not appear immediately after submitting. We will not post comments that we consider abusive or off-topic.

Please type the letters/numbers you see above

More from 1105 Public Sector Media Group