Palmer Luckey’s Secretive Defense Company Is Booming Under Trump

As many tech giants grow skittish about cashing in on the surveillance boom, one company helmed by an industry iconoclast seems custom-built for Big Brother.

For Anduril Industries, scanning the California desert alongside border agents or helping drones home in on targets isn’t toxic—it isn’t even controversial. That mostly has to do with the company’s founder, Palmer Luckey. 

The 26-year-old is best known as the designer of the Oculus Rift virtual reality headset that shepherded the futuristic technology into the mainstream. In 2014, Luckey sold his 100-person virtual reality company to Facebook for $3 billion. 

Luckey was reportedly forced out of Facebook in early 2017 after The Daily Beast revealed that he was bankrolling an unofficial pro-Trump group dedicated to “shitposting” and circulating anti-Clinton memes. 

It only took a few months for the boyish, ever-Hawaiian shirt-clad near-billionaire to launch his second act, a defense company called Anduril Industries. Prone to references to fantasy worlds and role-playing games, Luckey named his new project after a mythical sword from The Lord of the Rings trilogy. Tellingly, the weapon’s other name is the “Flame of the West.” 

With Oculus, Luckey turned science fiction into affordable hardware. With Anduril, he’d port those innovations over into the defense sector, fusing affordable hardware and machine learning to create a border and battlefield surveillance suite that the federal government couldn’t resist. 

Two years ago, Anduril was little more than a placeholder website with a casting call for “dedicated, and patriotic engineers.” But with a handful of contracts in its cap and some friends in high places, Luckey’s AI-powered defense experiment has established itself as an up-and-comer in the scrum for federal business. Anduril is still small—a fraction of the size of a Lockheed or a Raytheon, say—but it has quickly grown to employ close to 100 people, moving into a 155,000-square-foot headquarters in Irvine, California, where it can comfortably double in size.

And far from shying away from politics post-Facebook, Luckey leaned into the #MAGA-friendly ideology—donating big money to pro-Trump outfits, and meeting with Trump cabinet officials, all while his company quietly picks up military contracts and expands its work with border patrol.

In a recent Reddit thread Luckey defended his new company’s business model: “Of the things people might find divisive about me, this should be near the bottom of the list.” 

BIG BORDER BUSINESS

When Trump’s vision of a “big, beautiful wall” ran into the costly, inefficient realities of a contiguous physical partition along the southern U.S. border, high-tech surveillance solutions emerged as a viable next best thing. In 2017, Luckey worked with Rep. Will Hurd (R-TX) on cost estimates for legislation to push a virtual border wall into consideration.

As part of that collaboration, Hurd introduced Luckey to a rancher in his Texas border district who agreed to let the young company test-drive three of its portable sentry towers on his private land. (On Thursday, the 41-year-old tech-savvy congressman announced that he would not seek re-election “in order to pursue opportunities… to solve problems at the nexus between technology and national security.”)

Anduril bills itself as an “AI product company” specializing in hardware and software for national defense. Its hallmark product, called Lattice, is a modular surveillance setup comprising drones, “Lattice Sensor Towers,” and software that autonomously identifies potential targets. As it demonstrated in two live pilot programs at the U.S. southern border last year, the system can detect a human presence and push alerts to Customs and Border Protection agents in real time.

Now, the company is expanding its reach. Anduril is currently working on a new pilot program with Customs and Border Protection (CBP) to test “cold weather variations” of its high-tech surveillance system capable of running reliably outside the hot, dry climate of states along the U.S. border with Mexico. 

That program consists of two limited trials, one in Vermont and one in Montana. The pilots were pursued by the agency’s innovation team, which explores new technologies for guarding U.S. borders and will “determine the efficacy and applicability of the technology to northern border challenges,” according to CBP. 

While the northern U.S. border sees far less activity outside of designated border crossing sites, it does span some terrain even more remote and challenging than the arid stretches that line the southwest states. The U.S.-Mexico border makes headlines for its divisive role in American immigration policy, but the line dividing the U.S. and Canada is actually five times as long. 

Anduril may also be shopping its technology to the other side of the border. In May, Luckey represented Anduril at a Toronto event advertised as part of an official trade delegation to Canada. When asked if Anduril’s business in Canada was purely aspirational or actually in the works, the company declined to comment. 

Anduril’s border work was previously limited to a CBP pilot near San Diego and some unofficial testing at a private ranch outside of El Paso. The San Diego program began with only four towers in the agency’s San Diego Sector and expanded over time to 14. Now, with the pilot program successfully ended, those 14 towers remain operational. 

The company has also turned its unofficial deployment in Texas into a formal relationship. The agency recently bought 18 additional Anduril-made towers and plans to deploy them later this year. That installation is not part of a pilot program. 

“Like any company, CBP’s future relationship with Anduril will be subject to fair and open competition, the company’s ability to deliver relevant technology, available funding, and a variety of other factors,” CBP told The Daily Beast.

Beyond its border-watching sentry towers, Anduril also makes its own heli-drone, a sort of miniaturized helicopter that can stay airborne for long periods. Those drones, known as Lattice Ghosts, are capable of stealth flight and flying in formation over large swaths of land or sea for anything from “anti-cartel operations to stealth observation.”

GAMER GOD GOES TO WASHINGTON 

Anduril is a curious company to have grown out of the West Coast tech scene—and a sign of the times. Luckey might still refuse to wear closed-toed shoes, but he’s reinvented himself within Anduril’s hyper-patriotic, veteran-friendly image. Luckey has smartly made efforts to surround himself with serious military types who blend in with the close-cropped national security crowd. 

The company has quickly built its operation out in Washington D.C., recruiting former Senate Armed Services Committee staff director Christian Brose late last year to serve as the company’s head of strategy. As the Intercept previously reported, that hire helped get Anduril into the National Armaments Consortium, a nonprofit that connects defense companies with military contracts.

“The company’s existed a year, and they already have systems that have been built and fielded right now,” Brose told Defense News around the time of his hiring. “This isn’t the classic play, ‘Give us billions of dollars and 10 years, and we’ll promise we’ll build you something.’ They have developed systems, and they’re going out and solving problems with them.”

Anduril also picked up Scott Sanders, a former intelligence and special operations officer for the Marine Corps, to lead operations. By late 2018, Sanders was demoing Anduril’s hardware and software surveillance system for Marines at Camp Pendleton. Less than a year later, the company sealed the deal on a $13.5 million contract with the Marine Corps to secure bases in Japan, Arizona, and Hawaii, surrounding each with a “virtual ‘digital fortress.’” 

With two members of its founding team from Oculus and three from Palantir, tech’s biggest defense success story, Anduril’s early hires have been key to its quick expansion. One of those was Trae Stephens, a former Palantir engineer and current partner at Peter Thiel’s Founders Fund, who joined Trump’s transition team through Thiel.

Anduril’s leadership represents a blend of political leanings, even if Palmer Luckey’s politics are quite a bit louder. The company’s co-founder and COO Matt Grimm in particular is an active Democratic donor, with donations to Hillary Clinton, Beto O’Rourke, ActBlue, and Pete Buttigieg’s presidential campaign more recently. 

Co-founder and CEO Brian Schimpf donates to Democrats, too, including Henry Cuellar, a co-sponsor of Hurd’s SMART Wall Act bill in late 2018. Christian Brose represents the traditional Republican wing within the company, having worked under the late Sen. John McCain. 

Given his work with Trump and Thiel, Stephens has shown a willingness to work with leaders whose politics are more closely aligned with Luckey’s own. Next to Thiel, Luckey is probably Trump’s most high-profile booster in the tech world, even if he was excommunicated from its mainstream. 

SIX DEGREES OF TRUMP

Luckey has described himself as “fiscally conservative, pro-freedom, little-L libertarian, and big-R Republican.” Regularly donning wigs and candy-colored anime garb, Luckey might be the only military contractor who’s active on the cosplay circuit. 

Reportedly a longtime Trump fan, converted after reading The Art of The Deal, Luckey donated $100,000 to Trump’s inaugural committee. He was spotted last month at a Trump 2020 fundraiser put on by Donald Trump Jr. and his girlfriend, former Fox News host Kimberly Guilfoyle. 

While his political choices and some of his company may have previously placed him outside of Silicon Valley’s establishment politics, the Trump administration’s embrace of fringey, irreverent far-right ideologues helpfully opened some doors. 

In 2017, for example, Luckey discussed his border wall tech with Trump’s Interior Secretary Ryan Zinke in a face-to-face partially arranged by Chuck C. Johnson, a former Breitbart reporter who was permanently banned from Twitter for threatening to “take out” Black Lives Matter activist DeRay Mckesson. 

During Anduril’s earliest days, Luckey also met with former Trump strategist and Breitbart editor Steve Bannon, another figure from the political edges who found his way to the center in 2016. Luckey, described as a “proud nationalist” by former Oculus friend John Carmack, has evoked ominous language with echoes of Trump’s own on the issue of the border.

“If I could wave a magic wand, the United States would have perfect border security and arms wide open to everyone who believes in American values,” Luckey said in a tweet. “Murderous gangs that terrorize communities across North America don’t fit the bill, and I hope we can erase them from existence.”

Luckey added that his views are “mainstream libertarian as it gets” and that in spite of his business in border security he is “a big fan of immigration.” In any online scrap over Anduril’s border business, he’s quick to draw a distinction between the concept of “border security” and policies around immigration that shape realities—and technologies—at the U.S. border.

While his departure from Facebook also coincided with the end of the Zenimax trial, in which the Oculus founder defended himself against allegations that his virtual reality empire was built on stolen trade secrets, Luckey’s tendency to live his right-leaning, irreverent politics out loud within Facebook’s tepidly liberal leadership culture led to the events that made the axe come down.

“I contributed $10,000 to Nimble America because I thought the organization had fresh ideas on how to communicate with young voters,” Luckey said in a Facebook post at the time, claiming that he actually planned to cast his vote for Gary Johnson. The Wall Street Journal later reported that Luckey’s public support for the third-party candidate was a facet of Facebook’s PR strategy foisted on him by executives at the company.

TECH UNDER THE MICROSCOPE

The tide of public opinion has turned against the tech industry in recent years. After the revelations of Russian interference in the 2016 election and a concurrent wave of heightened sensitivity for privacy, the sector is no longer viewed as an optimistic hub filling the near-future with consequence-free innovation.

That shift in public perception coupled with new activist energy within the tech workforce means that tech companies are facing a new level of scrutiny on their government defense deals, when previously they might have guiltlessly enjoyed federal cash infusions. Those deals have also grown out of the government’s increased comfort with maturing tech companies capable of handling sensitive contracts and jumping through certification hoops. 

When Google came under fire and backed away from the Pentagon’s controversial Project Maven contract, developing AI that can help drones autonomously home in on potential targets, Anduril stepped in. Amazon stayed the course under similar pressure, batting away internal dissent about the Pentagon’s whopping $10 billion cloud computing project for Joint Enterprise Defense Infrastructure, better known as “JEDI.”

After Microsoft landed a $480 million Army contract for its HoloLens augmented reality goggles late last year, a cluster of Microsoft employees protested. “While the company has previously licensed tech to the U.S. military, it has never crossed the line into weapons development,” they wrote. “With this contract, it does.”

Microsoft CEO Satya Nadella defended the work in an interview with CNN. “We made a principled decision that we’re not going to withhold technology from institutions that we have elected in democracies to protect the freedoms we enjoy,” Nadella said.

Last month, Luckey spelled out Anduril’s own uncomplicated attitude toward military work in an interview with CNBC. 

“What I am glad of is that Microsoft and Amazon are both willing to do this contract in the first place. There’s a lot of U.S. tech companies that have been pulling out on the D.O.D,” Luckey said. He went on to criticize Google for withdrawing from Pentagon’s $10 billion JEDI contract over internal backlash around ethical concerns.

“I’m mostly just glad that Amazon and Microsoft are still in there fighting this… they are willing to work with the military,” Luckey said. “I think we could use a lot more of that and I would love to see even more companies in the mix.”

With a president shredding his office’s long-held traditions while obsessing over slowing immigration to a trickle, maybe it’s no surprise that a boyish gamer demi-god in a Hawaiian shirt could reinvent himself as a serious security contractor keen to lock down borders around the world.

In June, Anduril entered into a relationship with the U.K.'s Royal Navy through its NavyX tech accelerator. “The artificial intelligence and [intelligence, surveillance and reconnaissance] systems from Anduril are game changing technologies for the Royal Marines Future Commando Force,” Royal Navy Chief Technology Officer Dan Cheesman said.

Recently, Luckey has hinted at the company’s interest in deploying its border surveillance system to the Irish border, where Brexit has reignited historical tensions along what would become the only land border between the U.K. and the E.U. 

Anduril believes that its technology is modular and versatile enough t0 be applied well beyond the military sector. While its AI-powered towers have mostly been implemented to secure borders, the company is in conversation about providing tech to other industries, like securing power grids and oil and gas facilities.

What’s more, the company has signaled its interest in applying its AR and VR expertise to “real-time battlefield awareness for soldiers”— a chance it might get after landing a piece of the drone-centric Project Maven contract. The company is also interested in providing tech to aid soldiers on the ground. 

“Imagine if the Nazis had been the first people to make practical nuclear weapons. Imagine if the Russians had been the first people to make practical nuclear weapons,” Luckey told CNBC last month. 

If America’s top scientists and technologists steered clear of that technology due to ethical concerns, Luckey argued that we’d be in “a very different world today.”

“It would not be the world that we’re in right now—and it would be a lot worse.”