Highlights from Defense Innovation Unit’s 2021 annual report

Here are some excerpts from the Defense Innovation Unit 2021 annual report (I compiled the table below for your reading ease):

In fiscal year (FY) 2021, DIU delivered the following commercial solutions to DoD end-users, bringing the cumulative total of DIU delivered capabilities to 35.

In addition to delivering these cutting-edge capabilities to warfighters, we experienced growth across nearly all of our key performance metrics, including efforts to strengthen the national security innovation base (NSIB). Specifically, in FY 2021, we:

• Published 26 solicitations for commercial solutions, a 4% increase from the prior FY.
• Received a total of 1,116 company proposals, a 10% uptick from FY 2020. We saw an average of 43 proposals per solicitation, with the highest number of commercial proposals received in response to a single solicitation rising from 111 in FY 2020 to 153 in FY 2021.
• Issued 72 prototype Other Transaction (OT) contracts to commercial companies, a 31% increase from FY 2020

By the way, 1,116 proposals received and 72 prototypes awarded translates to a p-win of roughly 6 percent. That’s a pretty competitive market. In FY 2019, by contrast, there were just 425 proposals and 57 prototypes, or a p-win of 13%. Winning a DIU prototype is twice as hard as it was two years prior.

As for transitioned prototypes, DIU defines it in the following way: “when the prototype successfully completes and results in a production or service contract.” There’s no transition size or impact criteria, though the very fact that a customer was willing to put money to it says something about impact — it offered more value than the alternatives.

Overall, the report gives a good narrative of the types of work it is doing but there’s more to be desired in terms of metrics for operational success or user feedback. A few bits I did pull out:

• For modeling hypersonic trajectories: “This solution can produce tens of thousands of missile trajectories in a matter of minutes—a 100-fold increase in model generation capacity and speed”
• For tactical vehicle hybridization: “By reducing the FMTV’s fuel consumption by up to 20% and expanding to additional tactical vehicles in the future, the TVH effort has the potential to help reduce DoD’s petroleum consumption, which is over 80 million barrels annually.”
• For synthetic aperture radar: “Meta Orbital Effects, dramatically improved its SAR processing technology, increasing ortho-rectification precision (i.e., the conversion of a raw image into a one that is planimetrically accurate) and reducing processing time from several minutes to under 90 seconds.”

DIU reports $893M total funding for prototype efforts between 2016 and 2021. The chart looks like nearly 90% of that came from external organizations providing matching funds. Through FY2020, the figure was $644.5M. I’ve compiled some of the statistics from the past three DIU reports in the table below.

I’d still like to know how much DIU funding went to the prototypes and how much goes to other sources. It would appear that since 2016, roughly $100M of DIU funding went towards prototypes. I would have to go through all the budget docs and have to pull out parts of the budget for NSIN, NSIC, and perhaps other areas of spending that don’t contribute to these stats.