Why Should We Care if China’s Military is Innovating Faster than America’s? | with Steve Blank

In this thought-provoking episode, we're joined by renowned Silicon Valley entrepreneur and defense reform advocate Steve Blank in a sweeping conversation on Pentagon innovation, the U.S.-China technological rivalry, and what it takes for democracies to outpace authoritarian competitors.

Key Highlights & Takeaways:

Diagnosing U.S. Innovation Stagnation: Steve dissects why the once dominant U.S. defense sector, long-dominated by the big “primes”, got overtaken by bureaucratic inertia—contrasted with China’s highly focused whole-of-nation approach. He examines how factors such as lobbying, revolving doors, and outmoded acquisition systems have played their parts in hampering adaptation to new threats.

Hacking for Defense Origins: Steve unpacks how the “get out of the building” lean startup method moved from Silicon Valley to challenging national security problem-solving, birthing the global Hacking for Defense movement that started at Stanford but is now in dozens of universities worldwide.

From “Innovation Theater” to Outcomes: The conversation critiques the proliferation of “incubators” unconnected to real acquisition, and highlights how meaningful reform only comes when new tech is linked to actual defense deployment.

What’s Changing: Blank describes major reforms currently underway under the new Trump Administration: scrapping legacy acquisition hurdles, empowering innovation-focused leadership, expanding the Defense Innovation Unit, and setting new strategic priorities.

Politics and Semiconductors: Steve provides a unique take on the CHIPS Act, Taiwan’s semiconductor leverage, and the evolution of U.S. “industrial policy” as exemplified by the U.S. government’s taking of a direct stake in the Intel Corporation.

Practical Advice: Steve and the hosts help surface actionable lessons: embrace private-sector speed, connect innovation directly to field outcomes, and learn from adversaries who now copy America’s best ideas and occasionally outpace them.

SeaLight Targeted by Beijing: Steve and Ray banter about how Ray’s innovation project inspired by Hacking for Defense blossomed into the SeaLight phenomenon, and how its success in illuminating China’s “gray zone” activities got both of them targeted by Beijing’s propaganda machine.

This essential episode illuminates how democracies can survive and thrive amid global tech rivalry, and what must change if the U.S. hopes to remain a leader in security and defense innovation.

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👉 Follow Ray Powell on X, @GordianKnotRay, or LinkedIn, or check out his maritime transparency work at SeaLight

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👉 Sponsored by BowerGroupAsia, a strategic advisory firm that specializes in the Indo-Pacific