High Ground
Defense · Space · Capital Markets
Acquisition Week

Issue 003

April 12, 2026

InterVallo LLC

The Back Door to the Pentagon

The U.S. doesn't have a space capability problem. It has a capital-translation and integration problem. Here's how I and my teammates work that gap — and why the methodology looks more like short selling than acquisition.

My background before this work was as a short seller. That shapes everything about how I approach a company pitch. Engineers study risk to a system — stress points, failure modes, structural dependencies. A business is a system. Short sellers apply that same discipline: deep qualitative and quantitative fundamental analysis to identify where the risk actually lives. Not what management says, but what the numbers and the structure reveal. That's now my passion on the other side of the trade — helping these companies identify those risks early, mitigate them, and scale.

The U.S. doesn't have a space capability problem. It has a capital-translation and integration problem. According to BryceTech's Start-Up Space 2026 report, $73.8 billion was invested in commercial space startups between 2016 and 2025. The technology is real. The companies are building. The friction is that the acquisition system was designed for a world where government was the only buyer — and the VC ecosystem funding these companies runs on an entirely different clock. That 18-to-36-month gap between how fast commercial moves and how fast acquisition moves is where national security risk quietly piles up. Closing that gap is the job.

Companies find us through proactive research, investor referrals, and direct outreach. We're looking for non-traditional companies at TRL 5 and above — far enough along that the technology is real, early enough that there's still time to shape how it comes into the architecture. Once we've got a company worth digging into, we run them through four due diligence lenses: Capability Readiness Level, Operational Utility Assessment, Supply and Cyber Chain Security Level, and Financial Confidence Level. The first three the acquisition community knows. The fourth — the FCL — is where most program offices don't have a process, and where we spend most of our time. Companies that clear it, we get them ready for SpaceWERX TACFI and STRATFI.

Here's the challenge with private companies: they file nothing publicly. No 10-K, no earnings call, no analyst coverage. You get what they decide to give you — a polished pitch deck and a data room they've curated. We read both as sales documents, because that's what they are. What we're actually looking for is what didn't make it in.

The five sources we always run

SAM.gov and USASpending.gov show what the government has actually paid them — a reality check against their claimed DoD revenue. Crunchbase and Pitchbook show who owns the company, when they invested, and at what valuation. We're looking at investor quality, ownership concentration, and any foreign exposure that creates CFIUS risk. LinkedIn employee trends tell us if the company is actually growing or quietly shrinking. Reference checks — former employees, customers, suppliers — are where the most useful intelligence usually lives. The question we always ask is "why did you leave?" We look at the pitch deck and data room last, after we've already formed a view from the other four.

The FCL criteria that actually predict success aren't the ones companies lead with. Team experience matters — not pedigree, but whether anyone on the leadership team has actually scaled a hard tech business before. Investor quality matters more than how much they've raised: majority American-owned, Tier 1 or 2 VCs, nothing in the cap table that creates problems at transition. The most consistent predictor is capital management and milestone execution — a company that has hit its milestones with the money it raised tells you something real about how that team performs under pressure. And IP ownership is non-negotiable: core IP has to be company-owned, not licensed, not exposed to government march-in rights from prior SBIR awards.

The question we keep coming back to on defense alignment is straightforward: is government a pull customer or a fallback? A company that only shows up at the DoD door when commercial sales slow, or whose whole model runs through SBIR dependency, is not one we can build the architecture around. The companies that have come through our process and gotten to STRATFI are the ones where government was a strategic customer from day one — and the outcomes track. Impulse Space, K2 Space, and Apex Space are at or near unicorn valuation. Starfish Space, Muon Space, Varda, and Turion are on that path. Not because the technology was obviously right. Because the fundamentals — team, capital discipline, IP ownership, customer mix — held up when we looked hard at them.

And when a company earns a high rating through our process, the work doesn't stop there. Those of us doing this work — across the space community — open introductions to investors. We take diligence calls — sometimes multiple rounds — where VCs and LPs can ask us directly about operational utility, integration pathway, and how we see the program developing. We sit with founders through TACFI and STRATFI applications, help them translate their technology roadmap into acquisition language, and flag the landmines before they hit them. The USSF acquisition process is hard from the outside. Our job is to walk alongside the companies that have earned that — not hand them a map and step back.

Raise
Company Vehicle Value Agency · Date Note
Starfish Space
On-Orbit Servicing
FAR — Fixed Price $52.5M SDA · Jan 21, 2026 First-of-its-kind end-of-life satellite disposal contract for the Proliferated Warfighter Space Architecture. Starfish will build, launch, and operate Otter spacecraft to deorbit SDA satellites at end of operational life — targeting 2027. Debris mitigation as a defense service.
Northwood Space
Ground Infrastructure
FAR — 3-Yr Agreement $49.8M SSC · Jan 27, 2026 Modular "portal" antenna sites to expand the Satellite Control Network. Phased-array antennas, RF front ends, and control software deployed to address GAO-flagged congestion in aging SCN infrastructure — a capacity problem most people outside the acquisition community don't know exists.
AST SpaceMobile
Direct-to-Device SATCOM
OTA $30M SDA · Feb 23, 2026 HALO Europa Track 2 demonstration: high-bandwidth tactical satellite communications delivered directly to unmodified government end devices via BlueBird commercial constellation. Demonstrations run through December 2027. Commercial satellite architecture serving a warfighter requirement.
Muon Space
Environmental Monitoring
SBIR Phase III OTA $44.6M Space Force · Feb 2026 Three satellites carrying Quickbeam-SBEM multispectral infrared sensors (9-channel visible to long-wave IR) for DoD meteorology, oceanography, and global wildfire detection. Dual-use architecture: the same hardware serves both military weather and commercial wildfire monitoring. 2026 launch schedule.
Gravitics
Orbital Infrastructure
STRATFI $60M SpaceWERX · Mar 26, 2026 Flight demonstration of Orbital Carrier architecture for rapid orbital response, including Viper orbital transfer vehicle with third-party payload deployment. $30M government, $30M private match. The bet: the next phase of space logistics looks less like a satellite and more like a carrier at sea.
Scan

K2 Space completes in-space demonstration

K2 Space's GRAVITAS satellite — a 2-metric-ton, 40-meter wingspan spacecraft carrying 12 classified DoD and commercial payloads — launched on a SpaceX Falcon 9 in late March and has now completed its first in-space demonstration. The mission's next objective is using that thruster to raise the spacecraft from LEO to MEO over the next 90 days — a maneuver that would validate low-thrust orbit-raising as a viable architecture for persistent, high-power platforms at higher orbits. They also completed a successful test firing of a 20 kW Hall-effect thruster - which will be the most powerful electric propulsion system ever flown. K2 received its $60M STRATFI award from SpaceWERX in December 2024. This is what a STRATFI bet paying off on orbit looks like.

Space Force seats 14 vendors — including Anduril and Turion Space — on $1.8B Andromeda contract

Space Force awarded 14 companies positions on the Andromeda IDIQ contract vehicle on April 8 — a 10-year, $1.84 billion program to replace the aging GSSAP constellation with next-generation space domain awareness capability. The vendor pool mixes traditional primes (Lockheed, Northrop, L3Harris) with non-traditional companies including Anduril, True Anomaly, Turion Space, and Millennium Space Systems. Task orders will be competed among the 14, meaning no single award — inclusion is the gate, not the guarantee. For the non-traditional companies, this is a reference contract that opens the door to follow-on production business without re-qualifying. The first task order will fund development of the RG-XX satellite program.

Impulse Space and Anduril selected for Golden Dome interceptor development

The Pentagon selected Anduril Industries as lead and Impulse Space as subcontractor to develop prototype space-based interceptor technology for the Golden Dome missile defense architecture. Impulse will provide in-space mobility and orbital maneuvering systems — the same propulsion capability it built to compete for commercial rideshare. The Golden Dome program is targeting operational capability by 2028 at a projected cost of approximately $185 billion. Impulse Space previously received a STRATFI award from SpaceWERX. The through line: the SBIR-to-STRATFI pathway built the propulsion capability that is now a candidate for one of the largest defense programs in a generation.

BryceTech: SpaceX flew half the world's orbital launches in 2025

BryceTech's 2025 annual launch report, released this week, counted 325 total orbital launches and 4,544 spacecraft deployed globally — up 25% and 54% year-over-year respectively. SpaceX conducted 165 of those launches, capturing just over 50% of global market share. The supply chain concentration question this raises is one that national security planners are not fully comfortable answering publicly: when a single commercial provider controls half of orbital access, launch availability is no longer just an industrial base question — it is a strategic dependency. For investors evaluating defense space companies, launch risk and provider concentration deserve a line in any due diligence model.

Reading the Contract Trail
Four stages of government validation — and what each one signals
Stage 01

SBIR Phase I / II — DoD Is Curious

Small Business Innovation Research awards are non-dilutive, non-committal, and publicly searchable on SBIR.gov. Phase I (~$200K) tests feasibility. Phase II (~$2M) funds prototype development. The government is not buying a capability — it is paying to learn whether a technology is real. What to look for: How many SBIR awards does the company hold, and are they from the same agency repeatedly? Repeat awards from a single customer suggest a genuine working relationship, not a grant-collection strategy. A company sitting at Phase II for years without a Phase III transition is a yellow flag — the technology may not be maturing on a schedule that matches operational need.

→ SBIR alone is not a defense business. It is an option on one.
Stage 02

TACFI / STRATFI — DoD Is Co-Investing

TACFI (up to $3.8M total, 1:1 government-private match) and STRATFI ($3M–$15M government, catalyzing up to $60M total) are the bridge between research funding and operational contracting. Both require private capital to participate — the government is not writing a check alone. What this signals: A STRATFI award means a program office has reviewed the technology, the team, and the business case and decided to match private investment with public funds. It is the closest thing to a DoD co-sign that a private company can earn before a production contract. K2 Space received a $60M STRATFI in December 2024 and launched GRAVITAS three months later.

→ STRATFI is the clearest public signal that DoD intends to scale the technology — not just study it.
Stage 03

OTA Prototype — DoD Is Testing Delivery

An OTA prototype award means the company has cleared the vendor credentialing process and DoD is now paying for a deliverable — not a study. IP terms are negotiable, overhead is lower than FAR, and the government can iterate on requirements without a formal contract modification. What to look for: Is this a direct award or consortium task order? Direct awards signal a more intentional relationship. Consortium task orders are faster to award but easier to lose on follow-on. Look at the awarding office — a Space Systems Command OTA carries different weight than a research lab exploratory agreement. Muon Space's $44.6M SBIR Phase III OTA from SSC this year is both: non-traditional contract structure with a serious operational customer.

→ OTA prototype = the company can deliver. The question is whether DoD will follow on at scale.
Stage 04

FAR Contract / IDIQ — DoD Has Committed

A FAR-based production contract or IDIQ vehicle position means the company is part of the architecture — not a prototype. Full audit rights, cost accounting standards, and compliance overhead apply, but so does the stability of a long-term customer relationship. What this means for valuation: FAR revenue is sticky but margin-compressed. IDIQ positions — like the 14 slots on the $1.84B Andromeda contract awarded April 8 — are not revenue, they are access. The task orders competed within the vehicle are where the money is. A company that holds an IDIQ position can receive follow-on business without re-qualifying, which is a durable competitive advantage that does not appear on the balance sheet.

→ IDIQ inclusion is the moat. Task order wins are the revenue. Know the difference.

The pitch deck is where a company shows you its best case. The SAM.gov record, the cap table, the reference check, the SBIR phase transition history — those are where you build your own view. Most great companies look uncertain in the middle. The ones that clear rigorous due diligence and earn a high rating are showing the qualitative indicators of future success. The gap in defense acquisition has never been technology. It's been the analytical infrastructure to evaluate it with the same rigor the private market applies to any high-stakes investment. That infrastructure is being built, one diligenced company at a time.