The United States Department of Defense (DoD) has taken a significant step toward strengthening national security by establishing the Office of Strategic Capital (OSC) in December 2022, as detailed in the Investment Strategy for the Office of Strategic Capital (OSC) for Fiscal Year 2024. The OSC's principal purpose is to attract and scale private capital investment in technologies important to US national security. This project is about more than just innovation; it is also about strategically utilizing finance and lending to keep the United States technologically competitive.

The OSC follows a guiding paradigm that stresses the relevance of component-level technologies and procedures that are critical to the supply chain but may not always be supported by direct procurement. This method is unique and complements current DoD initiatives by emphasizing components over capabilities, finance over innovation, and lending over spending. OSC's strategic capital needs identify areas where public support is required to attract private investment, notably for vital component technologies with broad commercial uses that are also relevant to national security.

One of OSC's primary efforts is the Small Business Investment Company (SBIC) Critical Technologies Initiative, which seeks to provide loan guarantees to licensed funds for investments in priority technological areas. This initiative aims to stimulate private sector investment in vital technologies by offering a safety net through loan guarantees. This program's initial priority areas include nanomaterials, bioenergetics, synthetic biology, Open RAN, sensor hardware, assembly testing and packaging, microelectronic materials, quantum computing, quantum security, quantum sensing, battery storage, and space-enabled services and equipment. These areas were chosen because of their ability to support various DoD priorities and requirements, the need for strategic capital, and the impact on security.

The OSC's investment strategy is not static; it will evolve to meet new possibilities and challenges. The OSC's prioritizing strategy is a three-stage process that considers enabling technologies, market share dynamics, the requirement for strategic resources, and the security effect of possible investments. This method ensures that investments are directed to areas that will have the greatest impact on national security.

The OSC's activities are consistent with the 2022 National Defense Strategy, which emphasizes the need to improve the defense industrial base and ensure the United States' long-term technological superiority over prospective enemies. By collaborating with private capital providers, the OSC hopes to strengthen the United States' strong national advantages in capital markets and technology development. This partnership is critical for establishing and maintaining robust and varied supply chains, which are critical to national security.

Transparency and ethical conduct are key to the OSC's activities. The public publishing of the investment plan enables open and ethical discussion with public and private sector stakeholders. The OSC invites investors and companies to join in its program activities, which aim to improve both national and economic security.

Finally, the OSC's investment plan shows a forward-thinking approach to national security. The OSC's focus on strategic capital investment in vital technologies strives to ensure that the United States maintains its technical advantage in an increasingly competitive global environment. Collaboration between the public and commercial sectors is critical to this endeavor because it combines their capabilities to achieve common security goals. As the OSC implements its plan, it will have a significant impact on determining the future of military and national security.