Smaller space companies want to see how the “commercial first” mantra of Pentagon acquisition reform translates into programs of record.
The Space Force contends that its nine, new program acquisition executives (PAEs) will lead to more opportunities for smaller companies trying to get their foot in the door, as military forces in the field press the PAEs for more commercial technology.
“These PAEs will enjoy an unprecedented high level of authority — acquisition authorities being pushed down to a very low level that will allow them to speed capabilities to the warfighter,” Space Force Col. Dan Urban, director of the service’s space system of systems engineering directorate, told a Washington Space Business Roundtable (WSBR) forum on Aug. 25.
That directorate is under Assistant Secretary of the Air Force for Space Acquisition and Integration Erich Hernandez-Baquero, sworn in on Aug. 24 and formerly the president for space intelligence, surveillance and reconnaissance at RTX’s Raytheon business.
Announced in August 2025, the Pentagon’s cancellation of the Joint Capabilities Integration and Development System (JCIDS) “will help us move faster,” Urban said. “Instead of taking years to get a requirement through the JCIDS process, the PAEs will have closer to direct authority [for requirements]. The other thing I’m trying to do is eliminate vendor lock. We’re looking a lot at open systems architecture to allow more players into the game instead of having just one prime being able to fill a gap.”
Space Force matches of $80 million in funding through mechanisms, such as Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR), have led to “tangible results” in attracting new companies like K2 Space, Varda Space Industries, Apex, Impulse Space, Starfish Space, and Muon Space, and boosting their market value to $6.8 billion, he said.
Urban said that Space Force may institute a scorecard for the nine PAEs in which they will receive grades on areas like “foreign partner integration” and possibly commercial integration.
“There’s a degree of accountability there, but that does not mean necessarily that will lead directly to programs of record that are one-for-one commercial programs,” he said.
Space at the Table?
Smaller space companies are wary, as they are unsure whether there will be room for them at the “programs of record” table with the big defense primes.
“Let’s not confuse government enthusiasm for commercial space with a functional commercial space model,” Tahara Dawkins, senior director of policy at Astroscale U.S., said at Tuesday’s WSBR forum. “They’re not the same. Companies cannot build a sustainable business based solely on demonstration and pilot programs. It doesn’t happen. Eventually there has to be a customer buying an operational capability or a service at scale. That’s the only way we move forward.”
“The government has become really good at starting innovation,” she said. “We have SBIRs, OTAs [Other Transaction Authorities], and innovation offices, but what we don’t have is the hammer. We struggle with that. We don’t know who owns the capability after demonstration. Who incorporates it into their architecture? Who budgets for it, and who becomes the recurring customer? Those are conversations that are largely not happening.”
In April last year, Space Systems Command awarded Astroscale U.S., a subsidiary of Japan’s Astroscale, a $61 million contract to demonstrate hydrazine refueling above Geostationary Orbit.
Clive Cook, the CEO of Precursor SPC, told the WSBR forum of two “Valleys of Death,” the first being a technical one in which companies must invest internally in systems to move them from Technology Readiness Level (TRL) 6 to TRL 9 for fielding.
“Most serious companies cross the technical ‘Valley of Death’,” he said. “The acquisition ‘Valley of Death’ — therein lies the big challenge — moving from a demonstrational capability to a funded program of record. This is where companies die.”
“Requirements are retrospective,” Cook said. “You’re finding a visible gap in a baseline requirement, but guess what? Commercial innovators are ahead of that cycle so their ability to deliver a capability is not described in a requirement. Hence, they cannot receive funding because the funding is all tied to the requirement which is fed into the program of record. Therein lies this circular doom spiral that becomes so difficult to get out of. That’s further compounded by, as you move forward, you’re asked to integrate into classified national security systems, which requires a sponsor… The new startups do not have that.”
Cook suggested that rather than the current practice of coupling programs of record with commercial add-ons, PAEs should have budgeted “programs of merit” that include innovative technologies that look promising but that have not gone through formal validation.
Precursor SPC is a Seattle-based geospatial intelligence company that analyzes the ionosphere in order to detect space weather changes affecting launches. Cook said another area of use may be in detecting and tracking adversary hypersonic missiles.
