It is relatively easy for DARPA PMs to re-deploy funding

DARPA PMs have the ability to pull funding built into contracts with performers, which means that they can quickly move money away from an approach that isn’t working and into an approach that is working. You would expect people to be hesitant to to work on something risky if they know that the funding could be pulled quickly. Anna Goldstein pointed out that the actual pieces of the programs are less risky. The PMs take on the risk.

The definition of the ARPA model has changed over time and it’s not clear whether easy fund-pulling was always part of the model or if it was introduced as part of formal process around deliverables. However, it seems worth replicating for two reasons.

First, it makes sense that it would increase willingness for funding wacky things that might go nowhere (DARPA funds wacky things that go nowhere ) becauseIf you know it’s easy to shut something down it’s easier to start.

Second, it increases the contrast between DARPA and other institutions that give out money - pure grant-giving orgs and venture capital. Organizations that give out long-term grants like the National Science Foundation - NSF or Howard Hughes Medical Institute (HHMI) need to either very carefully consider proposals which leads to things dying death by committee or lean on trust in a researchers experience. Either way, it slices out a large amount of idea-space. Venture capitalists write checks that are meant to fund a company for 18 months or more. This timescale means that they can end up with a lot of sunk cost in a company that is clearly not doing well. That possibility rationally leads to more risk aversion and when it inevitably happens it can burn time and resources trying to help the struggling company.

Mechanically, this is done by using contracts instead of grants for most research and having goals in the contracts that are almost impossible to hit. If the performer doesn’t hit the goal, it’s the PMs discretion whether to cancel the contract.


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