The U.S. will face some very serious challenges in the coming decades, including arresting damage to the environment, rebuilding our infrastructure, reinventing education, defending against new geopolitical threats, and venturing to Mars. Traditionally, we look to the federal government to tackle these problems—but that tradition may be over.
The technical talent needed to confront our biggest problems now works in the private sector, because that’s where the money is. And too many of those talented people are spending their days working on trivial problems like ad-tech algorithms and photo-sharing apps.
“A big part of our thesis is that innovative companies can fill in where existing government agencies have fallen short,” Boyle tells Fast Company.
Boyle will work the sector from her new home in Miami. She believes she might have a clearer view of the field of civic tech startups from a vantage point far away from tech industry hubs such as the Bay Area and Austin.
Boyle and General Catalyst have already made some bets on companies that could be called “civic tech.” Crunchbase shows that General Catalyst participated in three funding rounds for Anduril Industries, the Palmer Luckey-founded defense startup that produces autonomous drone surveillance systems.
Boyle’s investment thesis recognizes that engineers and designers and programmers and data scientists aren’t likely to take a pay cut and move from San Francisco to Washington to work for a government agency. Innovation happens in the private sector. Her new fund is part of a growing awareness that the government should lean harder on private-sector startups—civic tech startups—to find new approaches to the massive challenges we face as a society.
Where the talent is
Boyle says that there was a time in America when entering civil service professions within the government were a source of social cachet and a respectable salary. This attitude among professionals was influenced by President John F. Kennedy’s famous words, “ask not what your country can do for you—ask what you can do for your country.” That maxim came in the midst of the Cold War (and the Space Race), when, regardless of their political party, Americans felt the presence of a common enemy in the Soviet Union.
How times have changed. We live in a deeply polarized society with great distrust of the government, and as a result, working within it is no longer as popular.
“The best software development talent is going to Facebook to do app optimization or to Amazon to do cloud infrastructure software,” says Trae Stephens, who cofounded Anduril and now is a partner at Founders Fund (Founders Fund is an investor in Anduril).
Other techies are pulled into the ocean of niche ad-tech startups, or into huge advertising-centered companies like Google, or they’re lured by the big paychecks of Wall Street jobs.
Even those who are interested in solving social problems aren’t likely to do so from within the government, Boyle says. “You look at young people who are really excited about education . . . they used to say, ‘okay, I’m going to go become a teacher, or I’m going to go work in the Department of Education,'” she said on a recent Deep End podcast. “Now those people will say, ‘I’m going to go get an MBA or I’m going to go to Silicon Valley and I’m going to start building an education company.'”
Software eats government
Meanwhile, there’s a growing realization that many of the government’s biggest challenges are really software problems. Even the fighter jets ordered up by the military are really just millions and millions of lines of code inside the aluminum wrapper of an airplane (a reality that will be more true when the plane is piloted by AI).
The government’s software development needs to start with the job of bringing its own systems into the 21st century. Updating those systems within federal agencies was and is the main job of the U.S. Digital Service (USDS), the so-called “startup” established within the Obama White House and staffed by technologists largely recruited from Silicon Valley. This led to the establishment of other tech innovation centers within the government, such as 18F and the Defense Digital Service within the office of the Secretary of Defense.
The USDS continued receiving funding during the Trump years, but Silicon Valley denizens were far less inclined to take a government job and move to Washington.
“Washington tried the cool thing before,” Boyle wrote in her Rambler newsletter in January. “We once had a cool president who invited all the cool tech people to work in Washington and now those cool people make Spotify podcasts and Netflix documentaries.”
Not all of them though: During the Trump years, many tech workers joined civil service organizations that work with the government, Code for America CEO Amanda Renteria told me in March. Code for America works with state and local governments to create new service delivery policies, systems, and websites.
“The big ‘aha’ was that during those four years the external ecosystem really built up,” Renteria said. “There’s a lot more coordination among civic tech organizations [such as Code for America] than there used to be.”
Looking outward
The government is already relying on tech sector companies to help with the biggest problems the world is facing. In aerospace, Elon Musk’s SpaceX might very well provide the rocket that takes us to Mars. Anduril might someday help defend American soldiers from drone attacks. Shield AI’s software might allow U.S. soldiers to operate drone swarms where GPS isn’t available.
There’s a growing recognition within defense agencies that the government’s go-to defense contractors, such as Raytheon and Boeing, can’t compete with the speed of innovation of private-sector defense startups when it comes to creating the weapons and defense systems of the future. Defense agencies are trying to devise ways of working better and faster with defense tech startups. They’re also trying to rely more on startups to envision the technology that will be vital to solving big tactical problems on the battlefields of the future.
Silicon Valley, of course, is far better than Washington at developing software, Boyle says, and not just software for consumers or enterprises. Part of the reason that private tech companies have been the engine of software innovation is because of the profit incentive of developing either consumer or enterprise software that scales to millions of users. But it also has a lot to do with the way the development of disruptive software is funded, Boyle says.
“The speed at which software can scale—combined with monetary policy that encourages capital to flow to private markets—has made venture capital the most efficient incentive system for solving civic problems,” Boyle wrote in her newsletter. (Changes during the 1970s allowing pension funds to invest in startups, and a reduction in the capital gains tax, lead to the VC boom.) “What a company can accomplish in a venture fund’s investment time horizon is far greater than what politicians can accomplish in a two-term presidency.”
Many defense startups have found that the government is often not set up to test and scale products at the speed the companies and their investors desire. But Boyle says General Catalyst hopes to invest in startups that won’t work in partnership with the government.
“The procurement process is always arduous, but what we’re seeing is that founders are learning more about how to work within the process and government now has a better understanding of the needs and pace of startups,” Boyle says. “There are now enough companies that have scaled through government contracts—like SpaceX and Anduril—that Silicon Valley is building the institutional knowledge needed to weather the long and complicated sales cycle.” (It doesn’t hurt that SpaceX and Anduril have deep-pocketed founders to see them through the lean times.)
Boyle also hopes to fund civic tech startups that won’t rely on government contracts at all.
Motivated by impact
Boyle’s thesis rests on a provable reality. The private sector is where the talent is, and that won’t be changing anytime soon. Nor will the government’s paralysis, as hyperpartisanship persists in Washington and everywhere else.
But can current and future civic tech startups compete for top talent against big Silicon Valley companies, which can offer big salaries, industry cache, and perks?
The truth is, for many technologists, money and status aren’t everything.
“While the perks of some of those companies might be appealing, young people coming out of college want to work on missions they think are having a strong impact, whether it be in aerospace or defense or education,” Boyle says. “Companies that can articulate a strong and unique mission always have an easier time recruiting top talent.”
She also points out that young tech talent can now look around and see examples of successful civic tech companies like SpaceX that offer both the chance to work on big problem areas that affect millions of people while also earning a good salary at a high-profile company.
Even more young techies may decide to take that route as the country’s problems grow more daunting.
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