Earlier this week, a video surfaced showcasing a Chinese civil aviation hypersonic breakthrough—a so-called oblique detonation engine (ODE) that, if successfully developed, could enable certain aircraft to circle the Earth in just over two hours. The company behind the technology remains unnamed, but the implications are clear: China is racing ahead in next-generation propulsion.

This is more than a scientific milestone. It’s a signal to the U.S. government, investors, and the capital markets that we are in a moment of technological reckoning, and the United States cannot afford to fall behind. For years, China has pursued a deliberate, state-backed strategy to dominate frontier technologies in everything from hypersonics, to quantum computing, artificial intelligence, and advanced energy.

While Washington debates, of course, Beijing acts. It’s no accident that China has made rapid advancements in high-speed propulsion while American aerospace startups struggle to get the capital and contracts needed to scale. The Chinese Communist Party (CCP) is underwriting technological moonshots that private capital won’t touch, with a strategy to bolster China’s competitiveness and leapfrog United States innovation.

The U.S. may still have the world’s top engineering talent, research institutions, and innovation ecosystem. But if we want to maintain and advance ou, we need to treat this moment with the urgency it demands. That means a fundamental shift in how we fund, scale, and deploy new technologies.

Hypersonics Should Be a Wake-Up Call 

China’s ODE isn’t an isolated development—it’s part of a broader pattern. For the last ten years, China has made clear its rapid strides in hypersonic systems and weapons. The Pentagon has taken notice of this, but this week’s news shows that notice isn’t enough.

Contrast China's approach with America’s. Venus Aerospace, an American startup developing an equally breakthrough rotating detonation rocket engine (RDRE) with dual-use applications, represents the future of hypersonic propulsion. But Venus and others like it face bureaucratic hurdles to secure the funding and procurement pathways needed to scale. (For full disclosure, AFF is invested in Hypersonics and is an active supporter of the company.)

The same dynamic we observe in hypersonics applies to AI. Earlier this year, the Chinese surprised leading American firms when a Chinese company launched DeepSeek. The takeaway is that China, fueled by significant sums of state subsidies, and the characteristic willingness to ignore sensitivities surrounding regulation and ethics, is a serious competitor. 

China isn’t simply catching up. They are playing to win. 

What Must Change?

America must stop playing defense – we need to increase our speed and boldness now to outcompete China in the technologies that will define the next century.

We do that by launching a full-spectrum response that harnesses the collective energy of the U.S. government, capital markets, and private investment. Here are some ideas regarding where to start:‍

• The United States needs to scale both public and private investment in frontier tech. We have taken significant steps in the right direction through major investments in semiconductors, AI, and advanced manufacturing as a start. But there is much more to do and it requires matching the Chinese push in hypersonics, metals, synthetic biology, and other major areas of disruption. In the short term, the Trump Administration and Congress could expand R&D programs such as ARPA-E, ARPA-H, and DARPA programs to create more immediate ramp-ups for frontier tech startups and companies.
• Fix the DOD’s procurement bottlenecks, tying reforms and efficiency in the government to how well private industry incentivizes startups to do what they do best – innovate. The government has tried small initiatives in the past, but “trying” isn’t enough now. I’ve reviewed thousands of technologies over my career, and to truly lead in innovation, we need fast-track, high-risk, high-reward ventures. That means creating clear carve-outs for emerging technologies in procurement cycles, expanding the national security innovation base to create direct pipelines for companies like Venus and others, and shifting DARPA’s model from one-off research grants to sustained, scalable funding.‍
• Leverage the private sector as a force-multiplier for USG efforts. The government should not be in the business of picking winners and losers. Instead, it should partner with private capital to accelerate the success of promising private companies. Private-public partnerships have been proven to de-risk frontier technology investments (NASA, SpaceX, and the internet are prime examples) and provide clear demand signals – if the government commits to contracts and programs for hypersonic engines, for instance, then promising startups will get funded and their breakthrough innovations will follow. 

Some progress is already being made through reforming regulatory barriers that slow down commercialization, and this is to be lauded. But China isn’t waiting for us to figure this out. The CCP’s approach is clear: invest big, move fast, dominate key technologies, and lead the world in innovation. 

The U.S. has successfully countered China’s approach before. The Apollo program, the internet, GPS, stealth technologies– each of these breakthroughs happened because we bet big on innovation, and we won. 

The decisions we make today will secure the next half-century. We can do this if we act before it’s too late. 

It’s time for America to play to win.