Defense Business Brief: Startup dies in crypto collapse; Highest-paid defense CEOs; Hypersonic success; and more...
The collapse of cryptocurrency exchange FTX has taken out the U.S. arm of a promising defense tech startup with a who’s who list of former Pentagon officials on its board.
Improbable U.S. Defense & National Security, the American arm of British metaverse firm Improbably, will close its U.S. operation on Dec. 31, according to employees’ social media posts.
“The decision was largely driven by external factors, most notably, recent challenges in the cryptocurrency market, and especially the collapse of FTX, with whom some of our parent company’s investors and commercial metaverse customers and partners were heavily leveraged,” Caitlin Dohrman, president and general manager of Improbable U.S. Defense & National Security, wrote in a Dec. 7 letter to the company’s U.S. customers.
The company's U.S. team was focused on creating virtual training environments for American forces.
“To better prepare for the realities of today’s warfare, the armed forces must transform how they train, plan, and collaborate,” the company wrote in an October advertisement. “Critical to this transformation…is the ability to scope threats ahead of time and make joint tactical, operational, and strategic decisions.”
Improbable’s U.S. board, chaired by former Air Force Secretary Deborah Lee James, also includes Christine Fox, a former acting deputy defense secretary, and Michael Vickers, a former defense undersecretary for intelligence.
“Improbable's sudden decision to leave the U.S. defense space is heartbreaking,” Dohrman wrote in a LinkedIn post. “This course of action was taken out of necessity due to Improbable’s refocus on its commercial metaverse business and need to accelerate its path to profitability amidst challenging macroeconomic conditions.”
In September, the Financial Times reported that Improbable was closing on $100 million in funding, but that the company had taken more than $180 million in losses in 2021.
It’s unclear how many contracts Improbable has with the Pentagon or other U.S. security or intelligence agencies. Early this year, Dohrman wrote that the company was participating in the U.S. Army’s Project Convergence experiments.
Despite the U.S. office shuttering, Improbable told Breaking Defense that it remains committed to the defense market. Marine Boulot, an Improbable spokesperson, said in an email to Defense One that the company is “working on the handover plan” for its existing U.S. contracts.
You’ve reached the Defense Business Brief by Marcus Weisgerber. Send along your tips and feedback to email@example.com or @MarcusReports. Check out the Defense Business Brief archive here, and tell your friends to subscribe!
The U.S. Air Force fired a hypersonic Air-launched Rapid Response Weapon from a B-52 bomber on Dec. 9, the service said on Monday. It was the “first launch of a full prototype operational missile,” whereas “previous test events focused on proving the booster performance.” An assessment showed objectives were met during the test.
General Dynamics CEO Phebe Novakovic was the highest-paid defense executive in 2021, according to a new assessment from the Quincy Institute's Bill Hartung. Novakovic, the longest-tenured of the “Big 5” CEOs, received $23.5 million. Raytheon Technologies’ Greg Hayes made $21.8 million; Boeing’s Dave Calhoun, $21.1 million; Northrop Grumman’s Kathy Warden, $19.9 million; and Lockheed Martin’s Jim Taiclet, $18.1 million.
The U.S. military is not taking advantage of predictive maintenance technology that could improve readiness, the Government Accountability Office said in a new report. “While the military services have begun piloting predictive maintenance programs on some weapon systems, they do not replace parts or components regularly based on predictive maintenance forecasts,” the report said. “GAO found that the military services have not consistently adopted and tracked implementation of predictive maintenance. By developing plans to implement predictive maintenance, including action plans and milestones for weapon systems, the military services would be better positioned to determine where, when, and how to effectively adopt predictive maintenance.”
Slovakia will buy 152 CV9035 infantry fighting vehicles from BAE Systems Hagglunds, the Swedish division of the UK-based defense giant, for $1.37 billion. “The vehicle combines improved battlefield speeds and handling with an upgraded electronic architecture to support future growth and meet the needs of the evolving battlefield,” a BAE statement said.
Teledyne FLIR Defense has tapped Mark Blanco to lead its new Integrated Detection Systems business. Blanco will report to JihFen Lei, vice president and general manager of Teledyne FLIR Defense. Blanco will “lead a diverse business responsible for next generation CBRNE and counter-UAS technology, developing solutions to detect and locate threats from chemical, biological, radiation, nuclear and explosive agents to weaponized drones,” the company said in an emailed statement.