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Carter: $65 Million in DIUx Contracts in Pipeline

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WASHINGTON — Secretary of Defense Ash Carter today officially launched the third outpost of his Defense Innovation Unit-Experimental (DIUx) program, opening the doors to an office in Austin, Texas – and announced that the office has around $65 million in contracts that will be awarded soon.

Austin joins Silicon Valley and Boston, Mass., as tech hubs that Carter hopes will provide a flow of ideas and technology from the commercial sector to the Pentagon.

“The ‘Silicon Hills’ of central Texas have long been a hotbed of scientific and technological innovation – from the garage inventors and dorm room entrepreneurs who follow in Michael Dell’s footsteps; to the startups nurtured in incubators like Capital Factory; to the researchers and grad students breaking new ground on campus at UT,” Carter said in prepared remarks.

In addition, Carter highlighted that Texas is home to both a significant military population and a number of top defense companies, including the production facility for the Lockheed Martin F-35 joint strike fighter. And because so many bases are located in Texas, Carter said he expects this to be a hub for the DIUx’s national reserve element.

The Austin office will be led by Christine Abizaid, until recently deputy assistant secretary of defense for Afghanistan, Pakistan, and Central Asia.

Carter first announced the creation of DIUx in mid-2015, with the doors opening in the fall of that year. But following a slow start and complaints that the program was not connecting with the commercial industry, DIUx was “rebooted” in May of this year, with new leadership and an expansion.

Carter said the turnaround has reaped early benefits, with five deals closed in the last three months for a total of $3.5 million.

“It took an average of just over 50 days after they first interacted with a company to award these funds – that’s light-speed for the Department of Defense, and appropriately so,” Carter said. “And they have another 22 more projects in the pipeline, for an additional $65 million – in areas like network defense, autonomous seafaring drones, and virtual war-gaming.”

At the end of his speech, Carter emphasized that the outside-the-box attitude that Austin has cultivated is something he hopes will bleed into the Pentagon.

“I want to close by saying that I know many in this city take pride in keeping Austin weird. So let me assure you, I not only want to keep Austin weird; I’m counting on it,” Carter said. “Because the creative thinking that happens in places like Austin is part of what makes our country so innovative and our economy so vibrant and strong. And I know that with DIUx in town, it’ll also help keep our military the best in the world.”