Treat DoD as Micro Markets
Scott Sanders, Chief Growth Officer at Forterra, on autonomy for every vehicle
The real bottleneck for defense startups is not surviving a dead zone between prototype and scale, it is learning how to sell into many small buying pockets inside the Pentagon at once. Forterra’s point is that companies avoid the revenue air pocket by treating the DoD as a collection of micro markets, then using one core autonomy product across several programs, services, and commercial buyers instead of waiting for one giant contract to rescue the business.
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Forterra says the winning motion is to line up multiple buyers, PMs, and acquisition pathways around one product. In practice, that means small pilots, user feedback, and parallel program work can stack into steady revenue before a formal program of record arrives.
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This is the same product centric playbook that helped Anduril move from an early $12.5M Marine Corps contract to an estimated $1B of revenue in 2024. The common pattern is self funded R&D, a ready to ship system, and fixed price product sales instead of waiting for cost plus development work.
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The broader defense autonomy market is reinforcing this model. New companies in drones, vessels, and autonomy are increasingly winning by reusing one core stack across defense and commercial use cases, which smooths budget timing risk and gives startups more than one path to scale.
Going forward, the defense startups that break out will look less like single program contractors and more like product companies with several ways to get paid. The strongest companies will design for repeatable deployment, multiple procurement paths, and adjacent commercial demand from the start, which makes the valley of death feel less like fate and more like a planning error.