news | 20 June 2024

DIU Announces Strategic Allocation of 2024 Budget and Plan To Scale Commercial Tech Adoption


Mountain View, CA (June 20, 2024) -- The Defense Innovation Unit (DIU) is pleased to announce it is beginning the strategic allocation of the $983M budget for fiscal year 2024, signed into law at the end of March. 

This spending plan is the result of a rapid, rigorous planning effort with partners across the Department of Defense (DoD), including the Services, Combatant Commands, Office of the Secretary of Defense, and the Joint Staff. The plan is designed to advance the “DIU 3.0” strategy directed by the Secretary of Defense—expanding and accelerating the delivery of commercial technology to the warfighter with the focus, speed, and scale required for strategic effect—in line with Congressional intent. The DIU team will continue close coordination with Congress during the execution of these funds.

“We are grateful for Congress’ confidence in our mission and are working closely with our partners across the Department to deliver on the imperative facing us to harness the very best of commercially derived technology for our strategic priorities,” said DIU Director Doug Beck. “DIU’s FY24 spending is concentrated on closing the U.S. military’s most critical operational capability gaps with the focus, speed, and scale required to help us deter major conflict or win if forced to fight.”

DIU’s budget will be allocated across four categories designed to:

  • Accelerate vital, ongoing projects: A major share of the budget, approximately 50%, will go towards expanding and accelerating our most strategic areas of project activity, such as uncrewed system initiatives (including the current all-domain attritable autonomous focus of the Replicator effort), contributions to the Joint Fires Network, critical initiatives in commercial space, cyber, energy, and human systems, and programs advancing operational logistics capability across contested areas.

  • Initiate new, critical lines of effort: Roughly 25% of the budget will support DIU's launch of new projects in strategic areas. These include counter-unmanned aerial systems, space transport, advanced manufacturing, and critically, cross-cutting software and other complementary capabilities. Such advancements will enable integrated and resilient operation of complex, heterogeneous, multidomain autonomous systems in highly challenging current and future battlefield environments.

  • Bolster strategic initiatives led by partners in the Defense Innovation Community of Entities (DICE): About 15% of spending will be used to help accelerate work pioneered by other members of the DoD’s innovation community and partnerships with other DoD teammates.

  • Break down systemic barriers to capability adoption at scale: About 10% of spending will be focused on efforts such as the expansion of regional outreach capabilities through the expanding network of Defense Innovation OnRamp Hubs across the country, increased portfolio and cybersecurity support for small and nontraditional vendors, and access to physical and digital ranges for testing and evaluation.     

While DIU has already begun putting the FY24 budget into action, with Congressional oversight, over the next few months, DIU expects to release more than a dozen solicitations for new projects, leveraging our Commercial Solutions Opening (CSO) process. Companies interested in competing for contract awards should monitor the DIU website and social media for new solicitations, or subscribe to our solicitation notification newsletter. 

Importantly, the FY24 budget will help DIU bolster the Department’s partnerships with tech-focused companies and investors, one of the pillars of its DIU 3.0 strategy. In addition to continuing to deepen the dual fluency talent that DIU deploys through its technology portfolios, this means expanding all aspects of our commercial operations.  Examples include clarifying the demand signal coming from the Department, removing barriers and enhancing support to portfolio company scaling, expanding support and resources for existing Defense Innovation OnRamp Hubs and new expansion sites; and bolstering the broad range of National Security Innovation Network initiatives to activate defense innovation ecosystems.

To lead this line of effort, DIU recently welcomed Liz Young McNally as the Deputy Director of Commercial Operations. McNally, a combat veteran and an accomplished senior executive with deep leadership experience in the private sector, is focused on helping DIU, and the Department as a whole, to build a more transparent and streamlined company experience that allows founders and funders to access opportunity in the areas their technology is needed most, and to better assess, price, take, and manage risk so they can deploy resources at a scale that meets the Department’s strategic needs and generates the positive returns necessary to support their businesses. 

“My first month at DIU has reinforced my conviction in the commercial tech sector’s strong appetite to partner with DIU and the broader DoD to support the nation’s strategic national security priorities,” said McNally. “I look forward to continuing our engagement with industry to get leading-edge technologies into the hands of our Service members.”

DIU, working with partners across the Department, will continue industry outreach through a variety of in-person and virtual engagements, providing informational content about how to work with DIU and, more broadly, how to better engage the DoD. These and other upcoming events are all part of a continuing effort to engage with industry and foster more advantageous opportunities to collaborate.

Since 2016, DIU has executed $1.7B in prototype contract awards and $5.5B in production contract awards to tech companies backed by more than $68B in private investment.  

With the growing importance of commercial technology, on Friday, June 21, 2024, the House Appropriations Committee - Defense will be holding a briefing on "Service Innovation Efforts to Field a Hedge Portfolio Before 2027" at DIU’s headquarters in Mountain View, CA. A link to the livestream for the briefing can be found here .

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