Investing in Great Power Tech Competition: Comparing Early-Stage Deep Tech Investment Trends in the US and China

Abstract

The US defense acquisition system is positioning for strategic competition with China. This competition will be determined in large part by technological and industrial capacity emanating from commercial sectors – with potential for leapfrog, disruptive advance in emerging deep tech areas, including dual-use relevant ones. The sources of capital investing in these technologies differ across the US and Chinese systems, both from each other and from historical precedent. They respond to different, albeit overlapping, priorities and benefit from differing degrees of reciprocal, or non-reciprocal, access. This creates analytical and structural challenges for the US defense acquisition system as it engages in great power competition in an era of commercial technological advance.