Defense Pulse: Tachycardia — $852B Bill, Knox Startup & Multipolar Realities

Vital signs

Pulse: Tachy. Pressure: Low. Skin: Cool.

Cool skin and low pressure but high pulse mean that there's not much in the vessel containers, but the overall system is alerted and adrogenic. With US federal politicians on summer recess, there's a lot of action despite the world's embers smoldering, and world war may catch aflame again. It's ironic that Russian volcanoes are reawakened after that massive earthquake, which occurred remotely near their deep underground nuclear facility. Is that the universe admin alerting the human players?

Defense Appropriations

On July 31, the Senate Appropriations Committee advanced its FY 2026 defense bill by a 26–3 vote. The measure totals about $852 billion, roughly $21.7 billion above the administration’s request, and includes $800 million for Ukraine and $225 million for the Baltics. The Senate has now moved eight of its twelve appropriations bills, but the House has advanced only five; leaders are openly discussing a continuing resolution to keep the government funded when the fiscal year ends September 30. The Senate and House remain far apart on toplines and policy. The minibus deal struck earlier this week may still fall apart over unrelated disputes.

NRSS: The likelihood of a CR extension is high, but statistically, that's the norm, not the exception. I do not advise reeling from that news; instead, I advise accepting it as the way things are today, for better or worse, and taking advantage of the extra time to shape whatever mark you have in play in those bills.

A startup that catches the eye

Knox Systems, a FedRAMP-as-a-service pioneer, has launched its Boundary Platform on the AWS Marketplace. By hosting customer applications inside Knox’s pre‑authorized federal boundary, SaaS vendors can achieve FedRAMP and DISA IL 4 compliance in as little as ninety days using their existing AWS architecture and budgets. This model promises to cut the time and cost of certification by roughly ninety percent, allowing startups to enter the federal market quickly and maintain continuous compliance as they scale.

NRSS: This sort of startup way was paved by known brands today, and a well-understood and head-scratching problem. As more accreditors leave government and take early buyouts and the government demonstrates full ignorance of software as a topic and technical domain, what were commercial agencies may become startups and those startups may give way to AI firms or smaller models and be forced to enter the AI battlefield that feels like a mosh pit today.
I think these startups are an interesting application, but the devil is in the details. The USG is ripping away red tape from hardware—a topic they understand well and better than the industry in many cases.
Software isn't a discipline that defense weapons experts will grasp to an iota of a seasoned software engineer. These startups sound like a boost to deployment, but they risk being a mirror of the government red tape.

The issue with the government isn't necessarily the people, but it's more so the paperwork, which beats the people to a pulp—and then we observe the classic sad panda bureaucrats. But it's the policies that do that, not their genetics. Policies, directives, and guidance cast the die, not solely the person on either side of the call. Please don't blame the same people who can help you by thinking they hurt you.

Signals for startups

Startups should track upcoming changes to governmentwide acquisition contracts. NASA’s SEWP V contract, a leading vehicle for IT products and services, has been extended to October 31, 2025, with optional three‑month extensions while the agency prepares SEWP VI. NIH’s CIO‑SP 3 runs through April 2026, and the Alliant 2 GWAC has a five‑year option running to June 30, 2028.

The White House has directed agencies to consolidate many GWACs under GSA, and new vehicles such as Alliant 3 and SEWP VI will arrive over the next two years. Firms hoping to compete should align early with these schedules and consider pairing their offerings with prime contractors under the existing vehicles.

So what? This, along with the announcement of the OpenAI GSA, means that GSA is open to AI business. If you have an AI sword, sharpen it and attack that bunker. The government likes competition, so bring it. OpenAI may give way to overwhelming usage and retreat to an API-first approach, like Anthropic, and battle in the background. Customer-first firms innovating workflows, the detailed minutiae of the UX, and steps to complete tasks will benefit and compete on more traditional customer intimacy terms. The frontier monoliths lack the physics to be a planet and plant a backyard garden at the same time.

Who dares may win in the new Pentagon

Feel free to skip if you think it's a diatribe

The DOD, USG, and I will keep beating this drum. It is now more open to blue sky pitches dedicated to the mission than at any other time. It's not about programmatic elements, "colors of money" or a half-cocked theory of warfare that echoes Call of Duty. But, mission-whatever it is-and a concept of employment-what your stuff does in an operation that impacts that fight, that mission, whatever it is, from front line to back office. The admin could not be clearer about the priority of lethality and the earfighting functions. If you show up spewing nonsense like a kid caught stealing a cookie about the budget, NDA, and other stuff unrelated to whoever you're engaged with, you're written off as operationally immature and therefore unlikely to build for the mission. If a PM wants to hear your opinion on the budget, they might not be as empowered as you think because they're also birddogging for money and relevance. Don't mean it's a bad contact - but it's not a gun to put in the fight in contact today.

NRSS: The GTM is a selection process. And like any other selection - to varying degrees - it is not about the "best", it's about "right". The right technology will ultimately prevail, not the best. What is right and not necessarily "best" is in flux as the barriers and temporal aspects to getting to prove yourself change. But the fundamental truth is immutable - the right technology is implemented. Focus on what makes sense, not what sounds good. Your intuition may be weak.
Substance> optics: don't fall victim to the "DC" "blob": the old way of doing business through the proverbial "cocktail" circuit is the exact behavior this administration eschews and may eradicate. For example, the army's constituency is the soldiers and their mission. That is your focus. Many firms have struck lightning in the past as the defense budget has grown, no matter what; a well-trained monkey could have submitted your appropriations request. The world changed last November, and your best long-term strategy is through gravity, not electromagnetism. Lightning rarely strikes twice in nature; why would it in the defense business?

The Threat

World tensions continue to mount, underscoring the need for focused overproduction rather than panic. US sanctions recently targeted a network controlled by former Iranian security chief Ali Shamkhani for shipping missile and drone components to Russia.

At the same time, Tehran debates creating a “strategic command center” better to integrate its military, economic, and diplomatic power. In Moscow, Vladimir Putin has brushed off Donald Trump’s cease‑fire ultimatum and is determined to capture more Ukrainian territory.
Beijing is touting the rise of an “equal and orderly” multipolar world, while Taipei’s Han Kuang 2025 exercises an integrated number of drones and highlights the island’s resolve.
As before, None of these theaters presents an existential threat to the United States homeland, but each demands tailored approaches and the ability to operate with limited connectivity, contested logistics, and resilient supply chains. However, it is important to note that world powers and non-state actors are part of an intricate and undulating transregional dance where you push on the balloon here, and it expands there. That's my pedantic way of saying it's all connected, and the homeland is less safe the more dangerous the world becomes.

Tensions and security issues in a multipolar world escalate, not cease. You'd think the Iran strikes would limp them so hard they're out of the game. But they will find new ways to lean in and get revenue over whatever time horizon. If Israel invades, it will create new security challenges, not fewer - just different. The world's defense market coffers are opening like the volcanoes in Russia. The standard to get your technology in the fight will rise because the mission won't be rudderless, and other nations will have clear needs and unity of action in their government to solve them. The future may hold more defense across the globe, not less.

Defense Policy

Nothing significant to report since the last edition

The FY 2026 National Defense Authorization Act is still in flux. Both chambers want to make the Accelerate the Procurement and Fielding of Innovative Technologies pilot permanent, raise ceilings on Other Transaction Authority deals, and reauthorize the Defense Production Act with higher funding caps. SBIR and STTR reforms are also on the table to smooth the jump from prototype to production. With Chairman Mike Rogers' term‑limited, Republicans are already looking ahead: Vice Chair Rob Wittman is seen as the front‑runner to lead the House Armed Services Committee in the next Congress, though he has publicly said he will not challenge Rogers before his term ends.

Many argue that Europe will be forced into a military confrontation with Russia sooner rather than later. The last US Presidential election was cold water for the Europeans. And for good measure. They were in a lull and a bit of denial about Russian intentions in Eastern Europe. They're not confused anymore. The day of the last US presidential election vote count, the most crucial defense firm in Europe, and perhaps the world, Rheinmetall, was queued.

At first, the stock moved, but not on a bull streak; it gained momentum. World events like the Zelinsky Oval Office meeting drove big-money momentum investors to Rheinmetall, but then backed out as rhetoric evolved. As the prospect of a Ukraine-Russia resolution became an obvious fantasy, Rheinmetall ($RNMBY) rose with strengths and strides that transcend typical momentum investor signals. This long-term growth firm will be forced to meet the demand for European security. It's a stock that won't lose.

It is now slowly extended to European defense startups and public equities like $RNMBY. This is part of the world's defense pulse taking shape everywhere. All nations may wake up to a more dangerous reality, and their livelihood are at risk unless they defend themselves. Multi-polarity has arrived in its early days of new life.

International sales are an opportunity for defense startups that can aid in security independence. It is incumbent on US firms that can play a role and provide soft power through commerce that diplomacy alone cannot.

I will cover these topics in a separate newsletter and content on the OFFSET Magazine site. I will interview and cover the human terrain of European defense technology, startups, investors, and other geographies as they come online. And the US firms are focused on extending the US's superior technical chops to democracies worldwide under threat of oppressive regimes. Sign up to follow in future editions.

NRSS / my take

We are still on summer break, and I swear the weather remains glorious compared to when the Politicians are here. I don't believe in coincidences these days, and it feels connected. That's how I know it's the fall of deception, and when Congress is back, the hellish heat returns.

The OpenAI announcement, the Palantir announcement, and whatever other announcements may come to light. They're announcements. If I let myself tweak over announcements, I'd have had a heart attack and be dead not long after leaving active duty when I first stumbled into the Defense business. I had no idea this complex system toiled while deployed around AOs as a young Green Beret. I didn't. And I still am confused by the industry's bravado, mindset, and self-importance. But it's human nature, and on the teams, the guys are also at the center of their universe. But the firms that win go "there" - Anduril, Palantir - they can not be your cup of tea, but you can't take away anything from the fact they're forward. They are "there". These firms - again, you don't have to like the culture - but the pitch is to solve problems the mission owners face, and with a scale that alleviates government-sized risk avoidance. The seem less risky and the big programs and their custodians prefer big firms because they are not worried they "might not exist" in the future. A PM did not sign up to be whupped alongside a founder at the next board meeting. The moral of the story is mission first, optics later. We are in such a unique time in this industry's history that if you have access to mission: users/operators, facility (clearances), and paper (contract) - you might be in a if you build they will come scenario. Money is not moving with alacrity in the government, and as outlined above, the oversight and funding of the department are murky and episodic. But it's not a question of whether there's money in the banana stand. But buzzwords, cringe dinners, events, fishing adventures, won't get the money out of the banana stand. The fire is your technology maturity and ability to perform in a way aligned with your customer's mission, rather than optics to reinforce.

But for new entrants chasing paper agreements, and hints of the ankle and symbolic wins. It's time to cut to the chase and spend less time trying to get customer memorandums for an open-topic SBIR win and exclusively talk with customers your technology impacts. The US is preparing for great power conflict and low-intensity conflict elsewhere, and is poised for overproduction of things they can deploy. Not DIY projects with service members and "free chicken" money and experiments.

They want the programs and prototypes that are mature to test their mettle.