Darren Farber

You would call next-generation defense. I think it's going to be very challenging. And I worry about that, too. I worry about capital leaving the system. I'm old enough, 99, 2000 is not an ancient memory for me. And so the technologies that came out of that push were absolutely meritorious. And the capital structure for a lot of these businesses didn't work.

You would call next-generation defense. I think it's going to be very challenging. And I worry about that, too. I worry about capital leaving the system. I'm old enough, 99, 2000 is not an ancient memory for me. And so the technologies that came out of that push were absolutely meritorious. And the capital structure for a lot of these businesses didn't work.

I think at the limit, maybe a global crossing or something like that. But global crossing built was so important and we still use it every day. And the recognition by capital markets that this was extremely important and that it would fundamentally change our life was right. It was a good directional view. It was a very bad weighing machine in terms of

I think at the limit, maybe a global crossing or something like that. But global crossing built was so important and we still use it every day. And the recognition by capital markets that this was extremely important and that it would fundamentally change our life was right. It was a good directional view. It was a very bad weighing machine in terms of

rate of return of capital, how much needed to be deployed, how much you would get back. There was a lot of carnage on the back end of that. So I worry about that in these next generation defense rounds, because you have to understand how the budget is built. The budget is not built 3G style and zero-paced budgeting. We look at the previous requirements for the year.

rate of return of capital, how much needed to be deployed, how much you would get back. There was a lot of carnage on the back end of that. So I worry about that in these next generation defense rounds, because you have to understand how the budget is built. The budget is not built 3G style and zero-paced budgeting. We look at the previous requirements for the year.

We look at these different colors of money that Congress appropriates to the Pentagon. So in a synthetic attempt to control the way the Pentagon spends, We give it types of money, operations and maintenance, research, development, and technological evaluation.

We look at these different colors of money that Congress appropriates to the Pentagon. So in a synthetic attempt to control the way the Pentagon spends, We give it types of money, operations and maintenance, research, development, and technological evaluation.

For many years, there was something called GWAT, Global War on Terror money, Commander's Emergency Response Program, which Dave Petraeus was very important in creating a form of money that allowed him a more permissive environment for a theater of war. He co-authored a manual called Money as a Weapon System, how they would use it in a theater. So those colors of money

For many years, there was something called GWAT, Global War on Terror money, Commander's Emergency Response Program, which Dave Petraeus was very important in creating a form of money that allowed him a more permissive environment for a theater of war. He co-authored a manual called Money as a Weapon System, how they would use it in a theater. So those colors of money

drive to dictate spending to a certain extent. And so when you set up the budget, it's largely allocated. You know who's going to get the money. It's not like people look at the last year's NDAA and say $858 billion without any black ops or special appropriations in it. And that's my damn. I'm like, whoa, whoa, whoa. These programs are accounted for.

drive to dictate spending to a certain extent. And so when you set up the budget, it's largely allocated. You know who's going to get the money. It's not like people look at the last year's NDAA and say $858 billion without any black ops or special appropriations in it. And that's my damn. I'm like, whoa, whoa, whoa. These programs are accounted for.

It goes on this multi-year contract or this or this or this. And so to grab market share takes much longer than a conventional market. And I think the investors in this ecosystem have to understand that. You're not going to take over a market in 24 months unless it's fundamentally a brand new requirement and we haven't run the competition yet.

It goes on this multi-year contract or this or this or this. And so to grab market share takes much longer than a conventional market. And I think the investors in this ecosystem have to understand that. You're not going to take over a market in 24 months unless it's fundamentally a brand new requirement and we haven't run the competition yet.

So that's where I think these next generation defense businesses are uniquely set up because if the requirement's new, there's no incumbency advantage. You don't have to dislodge an existing program. It's not a gerrymander into a district, all these kinds of things. So if it's fundamentally new and novel, then there's a much greater opportunity, obviously.

So that's where I think these next generation defense businesses are uniquely set up because if the requirement's new, there's no incumbency advantage. You don't have to dislodge an existing program. It's not a gerrymander into a district, all these kinds of things. So if it's fundamentally new and novel, then there's a much greater opportunity, obviously.

But if it's trying to display something existing and the Pentagon's built the requirement, they're saying, this is what I need. Well, it's going to be an enormous capital lift for someone to spend investors' dollars to say, you're wrong, and my taste is better than your requirement. By the way, I don't view that as necessarily a bad setup.

But if it's trying to display something existing and the Pentagon's built the requirement, they're saying, this is what I need. Well, it's going to be an enormous capital lift for someone to spend investors' dollars to say, you're wrong, and my taste is better than your requirement. By the way, I don't view that as necessarily a bad setup.

I think this is a whole separate line of the conversation, this concept of a responsible party. And we have that in the nuclear navy, and we should talk about that. But the net-net is, in terms of capital allocation, the manner in which the market behaves is

I think this is a whole separate line of the conversation, this concept of a responsible party. And we have that in the nuclear navy, and we should talk about that. But the net-net is, in terms of capital allocation, the manner in which the market behaves is