I was on a conference call the other day that included defense contractor representatives and a federal lab employee who is an expert at social and predictive modeling and who is planning on starting his own company as soon as he chooses an application that he thinks has the best chance of launching his company Because he has worked for the government for a long time, a viable option is having his first customer be a government entity or a defense contractor or both as this has become such a gray area. I am helping this aspiring entrepreneur because I currently am in the business of building web applications and know quite a bit about what not to do when starting a new company.

This particular defense contractor has a team of match-makers who are looking for research and ideas outside of its own large R&D group. Why? Over the past two-plus decades technology breakthroughs have been bolstered by scientific discoveries from the 50s, 60s and 70s. In the 1980s the prevailing thinking was that the private sector should invest in research and the government should not compete with them. What was not realized was that research funded by the private sector would be very applied and research supported by the government had been necessary basic building blocks that the private sector would never fund. There is a renewed interest for corporations now to explore research work in institutions that still have government-funded basic research in some form to find fresh opportunities.

During the conference call several potential applications for the defense contractor were discussed: supply chain optimization, improved flight rerouting tools, maintenance schedule management, etc. But then the conversation took a sharp turn after the aspiring entrepreneur talked about his work of modeling Afghani drug lords that showed who, where and what kind of relationships drove that industry. He then realized that the same model techniques could be applied to US government leaders as he modeled how work got done at a national laboratory. One of the defense contractor match-makers quickly asked whether he could develop a model to identify advantages whilst going after “drying-up defense funding.” The answer was “yes” with both of us rolling our eyes.

After the conference call we grabbed a couple of sandwiches, binoculars and went to a canyon edge in hopes of seeing a falcon family of three fly around. We talked about about the continuing defense contractor business cycle of marketing threat, getting government funds and marketing an expanded threat. Then we discussed application opportunities that have absolutely no value to anyone in the business of defense.

This morning the lab scientist sent me “As Defense Industry Lobbies Against Cuts, Rhetoric Overshoots Reality” illustrating how much countries spend annually on defense with the US of A topping the chart with $698B, “threatening” China second at $119B and Britain in the bronze position at $60B. All I could do was roll my eyes.