The Arsenal Dilemma: The Case Against Centralized Manufacturing

Why Anduril Could be Taking a Strategic Misstep for US Defense—and its Investors

Last week, Anduril Industries, America’s leading DefenseTech scale-up, announced it had closed a $1.5Bn Series F fund raise.

Before I go any further, I want to highlight that I’m a massive fan of Anduril, consider myself to have quite a few friends working there, and wish to highlight that the raise and associated $14Bn valuation are well-deserved!

Anduril has absolutely transformed the conversation around Aerospace & Defense and has been a major force in driving both the Defense Technology sector and in the conversation about attritable systems.

All of that is to say that I love the company, love the people in the company, love their impact. Yet, I have reservations about their announced use of the most recently raised funds, and specifically the intent to build a large (five million square foot), vertically-integrated manufacturing facility, that they’ve dubbed Arsenal-1. Further, the company has announced their intent for a follow-on Arsenal-2 facility.

While I hold deep respect f…