A first government contract changes a commercial space company in ways the revenue line doesn’t capture. The award validates the technology, opens a customer base most startups spend years trying to reach, and tells investors the company can serve both commercial and government markets.
But once the hiring starts, the trouble often begins.
Across our government-focused searches, one pattern keeps surfacing. A company wins with the Space Development Agency, the Space Force, or a defense prime, and then tries to build the team the same way it built its commercial engineering organisation. But what they don’t realise is that the approach that worked for their first 20 hires doesn’t carry over, and the mistakes that follow are consistent enough to name.
The adjacent-industry trap
The first hire is usually a business development or government sales lead – someone to own the new relationship and build a pipeline for the next award. The instinct is to find a person who has sold to government before, so companies look to government IT, cybersecurity, or traditional defense contracting. On paper, it works since they’ve sold to the same agencies, they know the procurement process, and they understand how government contracting works.
What they don’t have is the space context. Selling a satellite communications program to the Space Force is not the same as selling cybersecurity tools to the DoD. The technical vocabulary is different, the stakeholder map is different, and the competitive landscape is different in ways that take months to learn. The pattern we see is that the person struggles to build traction and the company has to eventually restart the search. They would’ve spent the time, the budget, and some credibility with the candidates who were watching.
The compensation disconnect
Government BD talent in space is expensive, and it’s for a reason.
The people who can sell to DARPA, the Space Force, or the DoD at the level a scaling company needs are typically on high compensation. They know what they’re worth, because when they perform, they’re directly responsible for contract wins worth millions.
A company that sets the role slightly lower isn’t saving money, but instead filtering out the candidates it actually wants. The people who accept the lower number tend to be the ones who couldn’t command the higher one, and the search ends roughly where it started.
The equity problem
A third factor is shaping senior outcomes more than it did two years ago. Mid-career and senior candidates moving into government space work are weighing equity more carefully, because they’ve watched companies in the sector go from Series A to serious valuations and they want a share of that trajectory.
The friction shows up when a company wants to offer equity but can’t get sign-off inside the candidate’s decision window. We’ve seen offers declined for exactly this reason – the US hiring manager understood the market, but approval sat with a corporate parent on a different continent and a slower clock. Where equity is structurally hard to offer, that needs surfacing before the search opens, not after the preferred candidate is reading the offer.
The engineering team’s assumption
Beyond the business development hire is an assumption that the existing commercial engineering team can flex into classified work without much change. It can’t, at least not quickly. A classified program needs:
- Cleared engineers, and clearances take months.
- An accredited secure facility, which has its own timeline.
- Compliance infrastructure that a commercial operation doesn’t carry
- Program managers fluent in government reporting, earned value management, and the deliverable cadence defense customers expect.
None of this is impossible to build, but none of it appears on its own once the contract lands. The companies that execute well are the ones that planned the team, the infrastructure, and the timeline before the award, not the ones assembling it after.
The takeaway
A government contract reshapes a company well beyond the revenue it brings. The hiring requirements shift, the candidate profiles change, and the cost of getting it wrong is measured in lost contracts and cooled relationships, not just recruiting fees. The companies that treat the win as a strategic build, not a hiring sprint, are the ones where government work actually sticks.