OSD 300: Open Source Defense Capital
Why we're investing in the civilian defense industry.
Guns are so often pigeonholed as a culture war battleground that people tend to forget something more important: they’re a technology. (Samuel Colt even applied to Y Combinator’s Summer 1851 batch.)
The most important advance in guns since John Browning wasn’t some court case or something a politician did. It was YouTube and Instagram.
Modern tech has transformed the civilian defense industry. Civilian defense has been, and to some extent continues to be, a cottage industry. But its future is starting to look very different. The best companies today aren't just making guns. They’re making content, like Garand Thumb (>4 million YouTube subs). They’re building groundbreaking software, like Silencer Shop. They’re building communities around their products, like T.Rex Arms and PHLster Holsters. And they are large, profitable businesses.
They’re also led by extraordinary people. We’ve spent hundreds of hours talking to founders and execs at companies from <$1 million revenue to >$500 million. They all have the same two problems:
Access to expertise
Google any question about founding and scaling a tech startup, and you’ll never find the end of all the blog posts and YC guides about it.
Civilian defense founders are flying solo. They are playing on hard mode, with none of the support that SF tech startups can take for granted. When you find a great founder in this space, you’ve found someone who has demonstrated world-class resourcefulness.
Access to funding
Civilian defense founders have two options for funding:
Friends-and-family: this brings some money, but not the value-add that the best founders want.
The few firms that will touch this space: these tend to lack operational expertise in civilian defense and tech. Most firms who venture into these waters are either (a) not well-connected to across guns and tech, (b) lacking meaningful operational experience, or (c) private equity firms who'll strip mine the company and sell it for parts in 5-7 years. Founders want values-alignment and long-term commitment to their company.
We started Open Source Defense Capital to solve those problems. Tech moves quickly because that industry has a dense, thriving ecosystem of founders, investors, and employees constantly talking, trading ideas, and most importantly building products relentlessly. For all the talk in the gun space about politics and culture, the most durable path to ubiquity is to just make incredible products. Everything is downstream of product quality. An excerpt from the newsletter a while back:
Laws matter, but the reason they matter is that they block access to products people want. So the good products have to be there as soon as the law’s out of the way (and often even before that). That’s a task for founders, not legislators.
This works in both directions. Removing bad laws helps unblock good products, but creating good products also helps remove bad laws. Recent polling shows support for gun control has continued its 25-year decline, particularly among young people, and one out of every nine US gun owners became a gun owner in 2020. Those new users have been onboarded with an arsenal of good products: educational/cultural content on social media, and an unprecedented selection of high-quality-but-inexpensive guns. And so those products have grown a constituency that can help change laws.
There’s a corollary to this products-first idea of gun rights: if you want to promote gun rights, build great gun-related products. It’s hard to start a company. But it’s much harder (and less controllable) to change an entrenched law. Focus on starting the company and there’s an outcome where your customers help chip away at the law for you.
So if gun rights are going to keep growing, it is only going to happen if there’s a thriving ecosystem of founders, investors, and employees in civilian defense. We’re building that mafia. Success is not guaranteed — as in anything really ambitious, the default outcome is failure. But that’s why we’re focusing relentlessly on this ecosystem. If it’s not healthy, nothing else will matter. So we need to make it succeed. The ecosystem’s vibrancy is the single most important factor for the future of self-defense and liberty.
The three pillars are founders, investors, and employees. We’d love to hear from all three. Click below to reach out.
This week’s links
Silencer sales are through the roof
As of June 2024, there were 4.9 million silencers in US civilians’ hands. That was up 40% from the number just six months prior. For some perspective, the number of new silencers in the first six months of 2024 was larger than the number of new ones over the previous four years.
The first-order effect here is just more silencers in the wild. The second-order effect is much heavier innovation pressure on the industry, and higher returns on out-innovating your competitors. That’s going to lead to great new designs over the next few years. We predicted this a couple years ago:
Modular Bullpup Automatic Rifle
Cool new bullpup design.
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