Do I need to be a small business to work with DIU?
No. Unlike SBIR, DIU's Commercial Solutions Opening has no small-business requirement — any commercial entity with an applicable solution can respond, and nontraditional contractors are actively preferred. That makes DIU one of the widest doors into DoD funding. See
DIU vs SBIR for the full comparison.
Is DIU funding a grant?
No — DIU awards non-dilutive Other Transaction (OT) prototype
contracts, not grants. You're paid to build and demonstrate a prototype. It's non-dilutive (no equity), and a successful prototype can transition to a sole-source production contract. Read
what an OTA prototype contract is.
How long does a DIU award take?
DIU aims to award OT prototype agreements in as little as 60–90 days from the start of the process, though the recent average is closer to 120 days. That's much faster than traditional contracting. The full path — solution brief, pitch, proposal — is covered in
how to apply to a DIU CSO.
My startup builds hardware but isn't incorporated yet — is it too early?
It's not too early to prepare. NSIC targets early-stage dual-use hardware at TRL 3+, and idea/stealth-stage teams routinely use OnRamp Hubs and NSIN programming (Vector, Propel) to learn the ecosystem first. The best use of pre-incorporation time is de-risking your physics — see
simulation for dual-use hardware.
Can you get me an Ansys evaluation license and engineering help?
We can arrange an Ansys evaluation license, live engineering support, and free learning content through a channel partner. Access and terms are at Ansys's and the partner's sole discretion, and Ansys's startup programs are Ansys programs — you're always free to use any partner you choose. This site is informational; nothing here is guaranteed or promised.
Which Ansys tools matter most for DIU-style hardware?
It depends on your physics. Drones and interceptors lean on Fluent (aero) and Mechanical (structures); RF sensing uses HFSS; maritime autonomy uses Fluent (hydrodynamics); electronics use Icepak and Sherlock (thermal/reliability); electric propulsion uses Maxwell. The
counter-UAS playbook shows how they combine in one system model.
How long does a DIU CSO take from submission to award?
DIU targets
60–90 days from selection to a prototype Other Transaction award, using its Commercial Solutions Opening. The full path from an initial solution brief through pitch, selection and negotiation typically runs
3–6 months. See DIU's
Work With Us page.
How long should a DIU solution brief be?
Short. DIU asks companies to submit a brief written response to a posted problem statement—usually only a handful of pages plus a slide or two—rather than a full proposal. The exact page and slide limits are stated in each individual CSO problem statement, so always read the live solicitation.
Can non-US companies apply to DIU?
DIU works primarily with US-based companies, and NSIC explicitly funds domestic startups. Some CSOs allow allied or foreign participation on a case-by-case basis, but a US corporate presence, US personnel and a clean supply chain dramatically improve eligibility. Read each problem statement's eligibility clause.
Does DIU require you to be a small business?
No. There is no small-business set-aside and no size standard for a DIU CSO—this is a key difference from SBIR/STTR. DIU seeks the best commercial solution regardless of company size, including nontraditional defense contractors and firms that have never sold to the government.
Is a DIU contract dilutive?
No. A DIU Other Transaction agreement is a non-dilutive government contract—you are paid to deliver a prototype and you keep your equity. It is not an investment and DIU does not take a board seat or ownership stake.
Does DIU take equity in your company?
No. Neither DIU nor NSIC takes equity. NSIC provides non-dilutive capital to advance hardware milestones, and CSO awards are contracts for a prototype. Founders retain ownership and, in most cases, the intellectual property they create.
What is an Other Transaction (OT) agreement?
An OT is a flexible agreement authorized under 10 U.S.C. § 4022 that sits outside the Federal Acquisition Regulation (FAR). It lets DoD award prototype projects quickly, with negotiable IP terms and lighter accounting requirements than a traditional FAR contract.
How much funding does NSIC provide?
NSIC awards typically range from
$500K to $3M over a
12–18 month performance period, for dual-use
hardware startups at
TRL 3 or higher. It is non-dilutive and designed to close the private-capital gap for hard-tech. See
DIU NSIC.
What is the DIU transition rate?
GAO reported that roughly 51% of DIU's completed prototypes transitioned to a production or follow-on program—meaning about half cross the ‘valley of death.’ That rate is a core reason founders pursue DIU over pure grant programs.
How big is DIU's budget in FY2026?
House appropriators proposed over $1.3 billion combined for DIU, APFIT and the Office of Strategic Capital in the FY26 defense bill. DIU itself reported more than $983M in FY2024 funding—a 431% jump—reflecting its expanded scaling mission.
Does DIU fund software or hardware?
Both. DIU's CSOs cover software, AI, autonomy, space, energy, cyber and human systems. NSIC specifically funds hardware startups, while software and platform companies typically come in through a CSO problem statement or the Replicator initiative.
What is the Replicator initiative?
Replicator is a DoD effort DIU helps lead to field
thousands of attritable, all-domain autonomous systems in 18–24 months. The first round targeted ~$1B across FY24–25; DoD announced its first
Replicator 2 acquisition in January 2026. See
DIU Replicator.
How do I get on the Blue UAS Cleared List?
A US drone must pass cybersecurity review, supply-chain audit and operational testing, and needs a DoD sponsor advocating for it. As of July 2025 the list is managed by DCMA, with DIU-recognized third-party assessors (MTSI, Dark Wolf, AUVSI) able to evaluate platforms and components.
Who manages the Blue UAS list now?
The
Defense Contract Management Agency (DCMA) assumed primary responsibility for the Blue UAS Cleared List in July 2025. DIU remains a partner shaping standards and checklists. The list now includes
50+ platforms. See the
Blue UAS Cleared List.
Is an OTA a real government contract?
Yes—an OT agreement is a legally binding federal instrument, just not a FAR-based procurement contract. It obligates real appropriated dollars and can lead directly to a follow-on production OT without re-competition when the prototype succeeds.
Can I keep my IP with a DIU OTA?
Usually, yes. Because OTs sit outside the FAR, IP terms are negotiated. Companies commonly retain ownership of commercially developed IP and grant the government limited-purpose rights—far more founder-friendly than default FAR data-rights clauses.
DIU vs SBIR—what's the difference?
SBIR is a phased grant/contract program restricted to small businesses with fixed dollar tiers. DIU uses OT agreements with no size restriction, larger and faster awards, a real end-user sponsor, and a built-in path to production. Many founders do both.
DIU vs AFWERX—which should I pursue?
AFWERX is the Air Force's innovation arm and runs its own SBIR-based open topics; DIU is DoD-wide and uses CSOs/OTs tied to a specific operational problem and sponsor. AFWERX is often an easier front door; DIU offers larger prototypes and stronger transition odds.
What TRL do you need for NSIC?
NSIC works with startups from at least proof-of-concept (TRL 3) through pre-production (late stage). If you have a working prototype demonstrating your hardware's core capability, you likely meet the entry bar.
Does DIU pay upfront or on milestones?
OT prototype agreements are typically milestone-based—you're paid as you hit negotiated technical deliverables. Terms vary per award, and payment structure is one of the items negotiated after selection.
Do I need a facility clearance to work with DIU?
Not to start. Most DIU CSOs are unclassified at the solution-brief stage, so you can compete without a facility clearance. Some problem statements or later phases may require personnel clearances—this is stated in the specific solicitation.
How competitive is a DIU CSO?
Very. Popular problem statements draw dozens to hundreds of solution briefs, and DIU shortlists only a small number to pitch. A tightly scoped brief that maps directly to the stated problem and end-user need is what advances.
What happens after a DIU prototype succeeds?
A successful prototype OT can convert to a follow-on production Other Transaction or FAR contract without re-competing, and DoD components can buy your solution directly. This transition path—not the prototype dollars alone—is DIU's real value.
Is DIU part of the Pentagon?
Yes. DIU is a DoD organization that reports to the Secretary of Defense, headquartered in Silicon Valley with offices in Austin, Boston, Chicago and D.C. Its mission is to field commercial technology to warfighters at speed and scale.
