Office of Strategic Capital (OSC)

The Office of Strategic Capital (OSC) is a program element within the Office of the Secretary of Defense, established to attract and scale private capital investments in technologies deemed critical to the national and economic security of the United States. The OSC's primary objectives are to develop, integrate, and implement capital investment strategies proven in the commercial sector. It identifies and prioritizes promising critical technologies and assets, making eligible investments in these areas, particularly those not always supported through direct government funding. The program leverages financial instruments such as loans, loan guarantees, and technical assistance to encourage private sector participation, aligning government and private incentives to strengthen the Department of Defense's (DoD) technological and industrial base.

The Critical Technologies Limited Partnership Program (CTLP Program) is designed to provide loans, loan guarantees, and technical assistance to investment funds. The goal is to increase investable capital for portfolio companies operating within the 33 Covered Technology Categories (CTCs) defined by Congress. These categories encompass sectors vital to national security, such as supply chain technologies and advanced manufacturing. The CTLP Program aims to attract sophisticated private sector investment funds through market-aligned terms, expanding permissible investments and enabling international participation. The program is expected to issue its first approval or license to a qualifying fund, with future funding budgeted under the DoD Credit Program Account.

The Credit Program focuses on providing direct loans, loan guarantees, and technical assistance to businesses within the 33 CTCs. Many companies in these sectors face significant market risk, making private debt financing insufficient or inaccessible. The Credit Program addresses this gap by offering attractively priced, long-term capital to support manufacturing expansion, secure supply chains, and produce critical components. OSC began accepting applications for equipment finance loans and is currently conducting credit underwriting and national security assessments, with the first conditional approvals expected soon. Funding for this program will be managed under the DoD Credit Program Account.

The Transition Acceleration Program (TAP) is intended to align private investment and RDT&E funding to co-invest in critical technology companies developing military capabilities with clear transition pathways to programs of record. TAP leverages existing development programs and warfighter priorities to maximize operational impact and capital efficiency. TAP funded a Pathfinder program to validate advanced manufacturing methods for solid rocket motors, awarding contracts to emerging technology companies to increase domestic production capacity. This effort supports OSC's objective to strengthen the domestic supply chain for critical defense components. Future funding for TAP will be budgeted under a separate program element.

The Global Technology Scouting and Co-Investment Program (GTS) leads international activities to leverage OSC's financial tools and co-investment opportunities with allied nations. The program aims to support interoperability, integrated deterrence, and prevent adversarial capital investment in critical technologies. GTS developed an international strategic engagement plan to advance collaboration with DoD, interagency, and international partners, sourcing deals aligned with OSC's mission and Combatant Command priorities. Funding for GTS will transition to a new program element.

The Investment Strategy program is responsible for developing and coordinating OSC's investment strategy to ensure alignment with DoD priorities as articulated in key strategic documents such as the Interim National Defense Strategic Guidance, National Security Strategy, and National Defense Strategy. The program conducts research to map economic networks, assess key industries, and identify critical technologies essential to national security. The strategy team enhanced its data analytics capabilities and integrated perspectives from various stakeholders, providing actionable insights to guide OSC investments. Funding for this activity will also be managed under a new program element.

Additional initiatives include the Defense Ventures Fellowship Program, which places DoD personnel in fellowships within leading investment firms and technology companies to foster innovation and public-private partnerships. The Initiative on Economic Competition supports analysis and coordination of economic competition activities to identify priority targets and develop DoD courses of action. These programs are designed to enhance DoD expertise, drive innovation, and ensure military advantage in the economic domain. The OSC's suite of programs is structured to efficiently leverage taxpayer dollars, attract private capital, and strengthen the U.S. defense industrial base through targeted investments and strategic partnerships.