CisLunar Industries Government Sales Playbook: Why Space Force Contracts Are Less Scary Than You Think

There’s non-dilutive funding sitting on the table, and most tech founders won’t touch it. The reason? Government contracts sound like a bureaucratic nightmare—jargon-heavy, slow-moving, and designed for defense contractors with armies of compliance officers, not startup founders trying to ship fast.

In a recent episode of Category Visionaries, Gary Calnan, CEO and Co-Founder of CisLunar Industries, dismantled that assumption. His company has won contracts from NASA, the Space Force, DARPA, and the ISS National Lab. These contracts provided the non-dilutive capital that kept CisLunar alive while their primary market was still a decade away from commercialization.

Gary’s take on government contracting? “Most intelligent people running businesses…can figure out how to navigate if you want to.” The intimidation is real, but it’s mostly psychological. Here’s what CisLunar learned from winning government contracts that could change how you think about funding your startup.

The SBIR Process: Less Mysterious Than It Seems

Every major government department has money allocated to Small Business Innovation Research (SBIR) contracts. It’s not just defense or aerospace—if you’re building technology in any sector, there’s probably an SBIR program that fits.

The structure is straightforward: Phase One contracts prove feasibility. Phase Two scales up for development. Phase Three moves toward commercialization. It’s designed for early-stage companies.

CisLunar’s entry point was NASA’s SBIR program in 2021. They proposed developing a metal recycling foundry for processing space debris. They won on roughly their second or third attempt—and that’s an important detail.

Managing Win Rate Expectations

If you’re coming from commercial sales where you close a meaningful percentage of qualified opportunities, government contracting will humble you. The hit rate is lower, and that’s by design.

Gary’s experience: they tried multiple proposals before winning. “We’ve done a few couple tries on most of the other agencies before we’ve gotten in the door,” he explains. Each rejection provided feedback. “You’ll get feedback, and putting it out there to get that feedback is super helpful.”

Treat your first few proposals as learning exercises. You’re figuring out what evaluators want, how to frame your technology in their terms, and what technical rigor they expect. CisLunar brought on their CTO, Joe Pwelsky, who added technical credibility to the proposal.

The pattern: submit, learn, refine, repeat. If you’re winning by your third or fourth try, you’re learning the system.

The Jargon Is a Feature, Not a Bug

Yes, government contracting comes with acronyms. “There’s lots of jargon, especially when you get into the military, there’s even more jargon,” Gary acknowledges. “So, you know, it is a little intimidating at first blush.”

But here’s the reframe: jargon exists because government contracting is a mature, standardized system. Once you learn the terminology, you can navigate any agency with similar principles.

The practical barrier isn’t intellectual—it’s psychological. Gary’s observation: “Most intelligent people running businesses are generally intelligent people can figure out how to navigate if you want to.”

The Space Force Surprise

If you’re assuming government agencies move like slow-turning battleships, the Space Force might surprise you. As the newest branch of the military, they’ve deliberately tried to avoid the calcified processes that frustrate startups.

Gary’s experience contradicted his expectations: “My expectation was that they, you know, you expect bureaucracies are slow and kind of, you know, hard to work with and maybe a bit opaque and not willing to work with you as an entrepreneur.”

Reality proved different. “The Space Force is a new agency. They’re trying to be adaptable to the industry as it is, and take advantage of the benefits of entrepreneurship. And they’ve moved pretty fast, and they’ve been very helpful and collaborative with us.”

This matters because it signals a broader shift. The Space Force isn’t unique in recognizing that innovation increasingly comes from small, agile companies rather than traditional defense contractors. Multiple agencies are creating founder-friendly paths—you just need to know they exist.

The Infrastructure Investment

Government contracts require infrastructure investment. You’ll need secure email systems. You might need certain certifications. There’s overhead in compliance and reporting.

Gary’s honest about this: “It does require dealing with some bureaucracy and you need to spend a little bit more money for certain systems like email and so on. So you can meet the security requirements, but it’s doable.”

For CisLunar, the non-dilutive funding was worth the infrastructure cost. Government contracts provided capital when VC funding was unavailable and validated their technology.

Building Reputation Creates Momentum

Government contracting differs from commercial sales: reputation compounds faster. Once you successfully deliver on one contract, evaluators at other agencies notice.

“Once you start to get in the door and people see that you can produce things and you can build stuff and successfully achieve the project, you’ll find that…you start to build a reputation amongst those who are evaluating these things,” Gary explains.

CisLunar now has contracts with NASA, the Space Force, DARPA, the ISS National Lab, and the State of Colorado. Each win made the next one more achievable.

When Government Contracts Make Strategic Sense

Government contracting is particularly valuable in specific situations:

Long commercialization timelines. CisLunar’s metal processing vision is a decade out commercially. Government R&D contracts fund that development while markets mature.

Validation for commercial customers. Government contracts signal that your technology works and sophisticated buyers believe in it.

Deep tech or hardware. Hardware requires more capital and longer development cycles—exactly what SBIR programs support.

Funding winters. When VC markets contract, government money doesn’t disappear. CisLunar survived tough fundraising years because government contracts kept cash flowing.

The Bottom Line

Government contracting isn’t a panacea, and it’s not effortless. But the barriers are lower than most founders assume. You don’t need a defense contracting background. You don’t need DC lobbyists. You need a technology that solves a problem a government agency cares about, the patience to learn a new system, and the persistence to keep submitting when early proposals don’t win.

“It is a process,” Gary notes. But for founders leaving non-dilutive funding on the table because government contracting seems too daunting, CisLunar’s experience suggests the real question isn’t whether you can figure it out—it’s whether you’re willing to try.

The next time someone mentions defense tech or government sales, maybe the question isn’t “why would I do that?” Maybe it’s “why wouldn’t I?”