Michael Shrader, vice president of Intelligence and Innovative Solutions at Carahsoft, recently spoke with ExecutiveBiz about the government’s growing appetite and budget for innovative technology during the latest Executive Spotlight interview.
Shrader has helped accelerate countless startups into the federal marketplace. Many customers in his portfolio have enjoyed major growth with Carahsoft by their side, but innovation is happening throughout Shrader’s portfolio for companies of all sizes.
In his conversation with ExecutiveBiz, Shrader discussed why it’s such an exciting time for companies with innovative tech that could help the public sector, regardless of maturity level.
You can read the full interview with Michael Shrader below.
ExecutiveBiz: Why is there so much opportunity in the government space right now?
Michael Shrader: “There’s innovation happening everywhere. It’s really that simple. A lot of innovation is coming from small VC-backed companies that are just beginning to make a footprint in the government space.
But big players like HPE, NVIDIA, and Splunk are all releasing innovative capabilities that can really help the government too.
At the same time, innovation is colliding with the government’s growing appetite for new technologies, as well as increased budgets. The government’s investment in innovation is driven by a few factors, including increased funding for technology, modernization of services as a result of the pandemic, and the need to keep up with rivals like China and Russia.
But the bottom line is that the government has more money to invest in tech, while there’s also more tech hitting the market. It’s the perfect storm.”
ExecutiveBiz: What is the key to success for an emerging tech company just starting out in government?
Michael Shrader: “Emerging companies looking to get into the government space need to have the right mix of short-term and long-term thinking. There are quick wins available if you know where to look for them.
For example, you need to know how to expedite procurement so that agencies can implement your technologies as fast as possible. But at the same time, you need to understand that success in the public sector space is a long-term investment. You need the right contract vehicles, partner network, brand, and more.
Carahsoft has a good playbook for both time horizons—and a proven track record guiding and counseling companies to go from zero to millions in government sales.
ExecutiveBiz: Can you talk a bit more about those procurement techniques?
Michael Shrader: “Some government organizations are using Other Transaction Authorities (OTAs) to bring in innovative technology to solve a specific mission problem.
OTAs lend themselves to a fail-fast mindset because they’re not regulated by the FAR. They can help shorten the procurement cycle from 18 months down to two or three.
Many agencies are also leveraging small business partnerships. They’re doing this through things like Small Business Innovation Research (SBIR) grants—grants given directly to small businesses.
We’ve also seen the rise of organizations like the Defense Innovation Unit and the implementation of software factories. Taken together, these techniques demonstrate the growing degree to which the government is willing to take a chance on small companies with new, innovative offerings.”
ExecutiveBiz: What are some common mistakes you’ve seen for companies just getting started in the federal space?
Michael Shrader: “One of the biggest mistakes is failing to have a long-term mindset. Tech players are used to moving fast. But the government operates differently. It moves slower and more deliberately and operates with different terms and conditions.
To that end, another big mistake I’ve seen is companies trying to treat government customers like commercial ones. Remember: government agencies have their own unique challenges and needs, including federal mandates that may influence their purchasing decisions. It’s important to keep all of these factors in mind when selling to a government audience.”
ExecutiveBiz: Where is the most opportunity in government right now?
Michael Shrader: “There’s definitely a tremendous amount of momentum and interest in artificial intelligence and machine learning. And there’s of course great demand for cybersecurity technologies.
At the agency level, most of the innovation and early adoption is coming from the Department of Defense. In the last four to five years, the DoD has stood up its software factories, gotten proficient at using OTAs, and awarded lots of SBIR contracts. It has that fail-fast mindset.
Pockets of the civilian sector are starting to adopt similar techniques, but they’re a little further behind.”
ExecutiveBiz: How has your portfolio at Carahsoft grown over the years?
“My team will be one of the highest-grossing teams at Carahsoft this year, with about $2.5 billion in revenue—around 20% of the company’s total. Over the past five years, we’ve grown by more than 30% annually.”