Strategic Pivots in Dual-Use Space Ventures: Capability Sequencing under Institutional Constraints

Ventures operating at the intersection of commercial innovation and government procurement face a strategic puzzle: pivoting is commonly portrayed as a rapid, feedback-driven process, yet in dual-use sectors firms must reorient their business models in environments where market feedback is opaque, delayed, or inaccessible. This study examines how established U.S.-based space ventures pivot across the commercial–defense boundary. Drawing on comparative case studies of Long Wall, Voyager Technologies, and Palantir Technologies, we inductively develop a two-by-two pivot typology based on pivot direction (commercial-to-defense versus defense-to-commercial) and pivot model (clean versus hybrid), and identify four capabilities that enable these transitions: internal readiness, strategic market fluidity, infrastructural alignment, and temporal synchronization. Across cases, we find that successful dual-use pivots do not unfold through iterative responses to market signals but through anticipatory capability sequencing and institutional adaptation. More surprisingly, this pattern emerges in both pivot directions, including defense-to-commercial expansion, where experimentation would normally be expected to dominate. Our findings identify a distinct mode of strategic adaptation in regulated, state-mediated markets that complements feedback-centric accounts of entrepreneurial change and offers implications for research on entrepreneurial strategy and dynamic capabilities, as well as for founders, investors, and policymakers navigating dual-use innovation.