Last summer, an underwater drone powered by highly specialized lithium-ion cells navigated the depths of Narragansett Bay, hunting for targets designed to mimic lethal sea mines. This high-stakes mission demands power densities and safety durations that conventional batteries simply cannot provide. Simultaneously, at strategic ports and high-profile global events, spectroscopic gamma detection systems stand guard against nuclear smuggling, utilizing unique optical technology to filter out natural background radiation and pinpoint concealed threats with surgical precision.
These critical defense layers were not plucked from commercial shelves or developed by typical Silicon Valley start-ups focused on rapid market scaling. Instead, they are the product of Physical Sciences Inc. (PSI), an employee-owned firm in Andover, Massachusetts, that has spent decades mastering the slow, painstaking process of military innovation.
The SBIR advantage: Why employee ownership beats the venture capital race
The development of these technologies was made possible through the Small Business Innovation Research (SBIR) program, a four-decade-old initiative that fuels small business R&D. PSI’s unique model as an employee-owned company allows it to act as its own investor, operating on timelines far longer than those acceptable to venture capitalists. By avoiding the pressures of private equity and onerous debt, PSI can focus on the rigorous testing and decade-long prototyping cycles required to integrate sensitive technology into the nation’s most vital security platforms.
Scaling domestic capability: From hypersonic components to advanced energetics
PSI is currently spearheading a massive expansion of its manufacturing footprint to secure the domestic supply chain. This includes a $30 million, 67,000-square-foot battery facility repurposed to support the Navy’s next generation of anti-submarine warfare. Additionally, the company has established specialized facilities for high-temperature ceramic components used in hypersonic missiles, as well as a dedicated site for radiation threat detection systems built entirely from U.S.-sourced components. These investments allow PSI to scale production capabilities hundred-fold, moving beyond mere prototyping.
A cornerstone of innovation: Delivering mission-critical technology at scale
With 250 employee-owners committed to long-term national security goals, PSI has proven its ability to overcome the barriers that often prevent small companies from working with defense agencies. From $9 million investments in advanced propellants to the production of infrared optical components that reduce weight and supply chain risks, PSI addresses the „unseen” technological needs of the industrial base. As the Pentagon prioritizes the fielding of critical capabilities at scale, PSI stands as a trusted partner, transforming innovative research into the tactical tools needed by military and law enforcement personnel worldwide.
