Prepared by: Andrew Laton
Andrew Laton serves as Vice President for the firm’s Defense & Advanced Technology Practice. Prior to joining McAllister & Quinn, Andrew served for 16 years in the U.S. military, including 13 years on active duty as an F/A-18 Weapons Systems Officer. A graduate of the U.S. Navy Fighter Weapons School (TOPGUN), he served as an instructor at the Navy’s Strike Fighter Weapons School Atlantic, training Carrier Air Wings and helping develop mission-critical warfighting strategies, while supporting multiple combat operations and deployments.
Prepared by: Eli Goeltz
Eli Goeltz serves as a Business Development Research Analyst for the firm’s Advanced Technology Practice. In this role, he provides research and developmental support to the firm’s advanced technology clients. He works with managing directors and clients to strategically identify suitable Federal and foundation opportunities for clients to pursue, and assists the practice’s core team in assessing strategic needs.
US Navy looks to Venture Capital as a Key Aquisition Informant and Partner
With the increasing focus on military modernization and the rapid adoption of novel technologies, the US Department of the Navy is reevaluating how it sources innovation. Acquisition reform is no longer theoretical, but a trend that should act as a signal to VC investors and technology companies looking to capitalize on federal funds.
US Navy Strategically Accelerates Innovation and Acquisition through NRCO
In December of 2025, the Navy established the Rapid Capabilities Office (DoN RCO or NRCO) to fast-track technology to its warfighters within a shorter time period of 1-3 years. This new office operates under the authority of the Assistant Secretary of the Navy for Research, Development, and Acquisition (ASN RDA) Principal Military Deputy Vice Admiral Okano.
The NRCO is now the model organization for the redefinition of what doing business with the Navy will look like. Emphasis will be placed on the reduction of bureaucratic barriers and processes to provide rapid acquisition and development.“
“The NRCO’s establishment represents a shift in mindset from lengthy requirement generation for exquisite capabilities to the application of existing technology to meet demand signals. Speed is the name of the game; an 80% solution delivered today beats a 99% solution delivered too late. Understanding the Cost / Benefit Analysis as a means to inform smarter investments has led the Navy to take a serious look at how the private sector operates.”
Andrew Laton, Vice President, McAllister & Quinn
US Navy Acquisition Strategy focuses on Demand for Faster Innovation with VC Firms
With this new acquisition strategy, the Navy is using venture capital investments as enhanced market research and is targeting certain VC firms to identify companies to scale. However, this focus on VC partnering in the Navy is signal-based and is not to be identified as a shortcut. It reflects how the Navy scans the market for scalable capabilities, closely following VC investments.
Now more than ever, companies looking to do business with the Navy should focus on strategizing their engagement rather than purely focusing on perfecting their solutions. Advancing the technology to 100% often takes too long, leaving time for similar technology to enter Navy’s acquisition pathways first. Late solutions fail no matter how complete they are. This is why many successful acquisitions are taking place when the solution is at 80% readiness, not as a compromise but as a strategic choice based on speed and relevance to the mission. In the NRCO, timely capability always beats perfect capability.
A key theme in many strategic conversations in today’s defense industry is understanding demand signals as the driver for investments, both from the Navy and from Industry. The Navy is using these demand signals to inform procurement, and Industry needs to understand critical warfighting gaps to identify where they can contribute. Demand signals are focused on desired outcomes informed through operational feedback. This is a cooperative process where government needs to advertise operational needs and industry needs to innovate. This partnership of DoW and venture capital is where smart private investments can position industry to rapidly meet evolving demand signals.
Key takeaways for VC investors:
Knowledge of Best Practices is Key When Engaging with Federal Stakeholders
In today’s landscape, understanding federal pathways is a competitive advantage. Awareness of these pathways is often not enough either. To truly capitalize on this rapid intake from the Navy and the broader Department of War, it is crucial to have an understanding of best practices when it comes to engaging with federal stakeholders, while balancing this understanding against the speed of your engagement.
What is The Best Path to Engagement With the US Navy for Venture Capital?
Success with the Navy requires fluency across federal acquisition pathways and mission-driven demand signals. Of course, constant education and monitoring of these can be difficult to juggle internally while investing or innovating. This is where it is important to speak with a professional whose purpose is to condense these three pillars into a strategic playbook. If you are a venture capital firm looking to engage with the NRCO, an experienced expert can guide you through the process of integration. If you are an innovator, the right advisor/consultant can map out the most effective pathway for your technology or solution’s adoption.
Discover How We Can Help
McAllister and Quinn’s team of defense consulting experts is ready to support venture capitalists, private equity investors, and technology companies throughout the process. If you have questions, we can help. Contact us today for a free consultation.