Isn’t SpaceX the perfect example of a new company taking on the remaining defense contractors post 90s mergers?
https://www.sbir.gov/about
Plenty of small companies are suckling on the government teat. From what I saw, the bar is pretty low, and some really terrible solutions are bought by the government. Someone with the patience to understand the process of applying for contracts could establish a very profitable business I think.
Seems TFA is right on the money with the way new contracting is done: the pentagon likes a thing made by the private sector and they want their own military version of it, or they piggyback on corporate infrastructure with military hardware (as was referenced with spaceX).
But these days it would be very difficult for any new company to break into military contracting.