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Tech Loves Big Government (as a Customer) - The Information

Author: The Information

Source: https://www.theinformation.com/articles/tech-loves-big-government-as-a-customer

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By| Oct.27, 2023 4:30 PM PDTPhoto: The Pentagon.Photo via United States Department of Defense.Tech giants usually prefer to avoid Washington politicians and bureaucrats.Congressional hearings, Justice Department lawsuits and Securities and Exchange Commission probes are no fun.But a new generation of tech companies is finding governments are more likely to be customers than adversaries. That’s clear from the under-the-hood financial details we got this week on startups Anduril and Shield AI, which are selling a growing array of autonomous software and war-fighting hardware to the Department of Defense, the Department of Homeland Security and other agencies.Wartime is a good time for these firms.Sales are swelling.Investors seem willing to accept the high costs of running these businesses.(Anduril’s $8.5 billion valuation, for instance, is 12 times forward revenue, despite the fact it’s a money-losing hardware firm and not a high-profit-margin software firm.)

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