The ax has become an important part of the Space Force’s arsenal

Space RCO is modeled on the Air Force Rapid Capabilities Office, whose programs include the X-37B spaceplane and the B-21 Raider strategic bomber.

“A lot of what I do is not disclosable in the public until we make a shift, which the department is in process of,” Hammett said. “We’ll take the lead from this administration. … We’re, as a department and as a service, working through how can we talk about more of this stuff more publicly. But we don’t have all that guidance in effect. So that can hamstring some of the conversations.”

The Space Force’s greater openness and an appetite for cost-cutting are combining to imperil the grip of the nation’s major defense contractors. If programs aren’t as secret, space companies don’t need the highest security clearances to bid on contracts. And many of these startups are backed by wealthy founders or venture capital.

The question Hammett asks today is: Why should the government pay for something billionaires are already funding?

While SpaceX led the way in revolutionizing the commercial launch business, a new wave of companies is vying to supply the military with missiles, interceptors, surveillance data, and, as Ars learned at the recent Space RCO pitch day, sensors, propulsion, and space-based AI to shield satellites from attack.

Unafraid of the blade

The 10 companies that participated in the recent pitch day are relative newcomers to the space industry. All but one are under eight years old, and most have fewer than 200 employees.

In preparation for the event, Hammett said his office culled a list of 62 interested companies down to 10. The initial list included small firms and traditional military contractors, often called “defense primes” in the arcane world of government acquisition. While Hammett didn’t name those companies, chances are you’ve heard of them. For reference, the Pentagon’s five largest contractors are Lockheed Martin, RTX (formerly Raytheon), Northrop Grumman, General Dynamics, and Boeing.

“All those traditional primes opted out of this event, every single one,” Hammett said. “We’re cultivating an A-team who’s willing to work with us, who’s hungry, who wants to bring affordability and speed, and it’s not the existing industry base.”

Hammett’s office didn’t set out to banish the big defense contractors. Simply put, he said they haven’t performed or aren’t interested in going in the direction Space RCO wants to go.

“I’ve terminated 11 major contracts in less than three years,” Hammett said. “Eighty-five percent of those were with traditional defense primes.” Most of these programs are classified, so it doesn’t become news when a contract is canceled.

“We try to fix the programs,” Hammett said. “We work with the performers, but if they can’t get right, and if we have program baselines where they’re now exceeding it by 100 percent in cost or schedule … we’re going to fire them and start again.”

At the same time, venture-backed companies seem to emerge every day from the ether of Silicon Valley or one of the nation’s other tech corridors.

“There’s a lot of opportunity to bring other performers into the portfolio, but there are lots of barriers,” Hammett said. One of those barriers is leadership at many startups don’t have a security clearance. Many small companies don’t use the certified accounting systems the government usually requires for federal contracts. 

“You have to be willing to modify your approach, your acquisition strategies, those types of things, so I have directed my team to open the aperture, to find the A-team, wherever the A-team lives, because it doesn’t seem to be in our current portfolio,” Hammett said.

There’s still a place for the Pentagon’s incumbent contractors, according to Hammett. Small companies like the ones at Space RCO’s pitch lack the national, or even global, footprint to execute the military’s most expensive programs.