In November 2025, Under Secretary of War for Research and Engineering Emil Michael collapsed the Department's list of critical technology areas from 14 to 6, saying plainly that "fourteen priorities in truth means no priorities at all." The new six — Applied Artificial Intelligence, Quantum and Battlefield Information Dominance, Contested Logistics Technologies, Scaled Hypersonics, Scaled Directed Energy, and Biomanufacturing — are explicitly designed to deliver results within 36 months. The NatSec100 methodology reflects this updated framework, and the data tells a pointed story about where the ecosystem is aligned with government priorities and where it is not.
Private capital and government money are not funding the same things
That divergence is the defining finding of this section. Private investment in Applied AI (even excluding OpenAI) grew from $3.6B in 2023 to $29.9B in 2025, consuming 75.4% of all private capital raised by NatSec100 companies. At the same time, government obligations are considerably more balanced: AI received 46.1% of USG spending, with Contested Logistics Technologies drawing 34.4% and Quantum and Battlefield Information Dominance reaching 11.3%. The government is effectively using its procurement dollars to fund the areas private markets underweight, as an implicit industrial policy decision.
The pipeline chart reveals where the ecosystem is structurally thin
Across four years of NatSec100 data, Scaled Hypersonics has never exceeded 6 companies, Biomanufacturing has never exceeded 4, and Scaled Directed Energy sits at just 1 company in 2026.
Contested Logistics Technologies is the breakout category of this edition
Growing from 20 companies in 2025 to 25 in 2026, contested logistics is the largest non-AI gain in the cohort, driven directly by the manufacturing and production companies that broke into the list for the first time this year. Hadrian, Machina Labs, Divergent, Vulcan Elements, and others represent a new wave of companies building the industrial infrastructure that the production bottleneck analysis in this report identifies as the binding constraint. Private capital in this category also recovered sharply to $4.2B in 2025 after a dip to $1.1B in 2024, surfacing a potential signal that investors are beginning to follow the government's demand signal into harder, less familiar territory.
Quantum and Battlefield Information Dominance held steady at 27 companies
Almost entirely consistent across the past three years and the second-largest category in the cohort. Private investment in this area grew from $792M in 2023 to $4.2B in 2025, a trajectory that reflects both the maturation of quantum computing companies like PsiQuantum and Atom Computing and the growing recognition that information dominance (encompassing cybersecurity, data analytics, and battlefield intelligence) is as consequential as kinetic capability.
“Recent conflicts have depleted our missile stockpiles, and with adversaries like China building theirs, we can’t afford to fall behind. The old duopoly in solid rocket motor production isn’t enough to meet urgent demand or keep our deterrence credible.
At X-Bow, we’re committed to speed and execution. With our patented AMSP additive manufacturing and partnership with the Air Force Research Laboratory’s RE-ARM program, we’ve reached a major milestone in end-to-end energetics and are scaling to millions of pounds of propellant per year.
Across 15 solid rocket motor programs—ranging from tactical to strategic—we’re delivering rapid solutions for tomorrow’s fight: rocket-assisted takeoff motors, low-cost cruise missile boosters, low-cost interceptors for missile defense, affordable hypersonics, and contested logistics with our Rocket Factory in a Box. Our February XB-34 hypersonic prototype test was a breakthrough, and our upcoming static fire of the Large Solid Rocket Motor (LSRM)—developed to support the Navy’s hypersonic Conventional Prompt Strike program and triple the size of XB-34—will push the envelope even further.
Building scaled hypersonics production is capital-intensive and high-risk. We believe America’s industrial base can deliver if we get faster, more flexible funding and long-term commitments that match the urgency of the mission.”