The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch 20VC: Palantir CTO on The Broken Incentive Structure of How Governments Buy Defence, The Danger of Defence Spending at Historic Lows, How Elections and Wars Change Government Defence Buying & Why Budgets are Anti-Creative with Shyam Sankar
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Jan 17, 2024 
Shyam Sankar, CTO of Palantir Technologies and Chairman of Ginkgo Bioworks, dives into the flaws in government defense procurement. He critiques how outdated processes stifle innovation and emphasizes the urgency for change in defense spending, especially in light of global conflicts. Shyam shares personal insights from his father's challenges, highlighting resilience and responsibility. He also draws parallels between hiring top talent in tech and the entertainment industry, advocating for a creative approach to assembling teams.
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Joining Palantir
- Sankar joined Xoom as the fifth employee after persistently pursuing Kevin Hartz.
- Inspired by personal experiences with terrorism, he later joined Palantir, a 12-person startup focused on national security.
Government Procurement Model
- Governments, particularly the U.S., often default to a cost-plus labor model for defense purchases.
- This discourages innovation as companies are incentivized to prioritize cost over R&D investment.
New Playbook for Selling to Governments
- Refuse hourly payment from the government; instead, build a compelling product and charge license fees.
- Fund product development through venture capital to create a product so good that the government must buy it.
