The CIA runs a nonprofit venture capital firm. What’s it investing in?

The Central Intelligence Agency is responsible for collecting information relevant to national security, updating policymakers and conducting top-secret actions. Also running an investment firm called In-Q-Tel. According to its website, its mission is to “be the premier partner trusted to identify, evaluate, and leverage emerging commercial technologies for the U.S. national security community and America’s allies.”

“Marketplace” host Kai Ryssdal spoke with Jon Keegan, tech reporter at Sherwood News, about the companies the CIA is investing in. The following is an edited transcript of their conversation.

Kai Ryssdal: The CIA, it turns out, has an investment arm. Say more.

Jon Keegan: Yeah, this is unusual. It’s not exactly breaking news that this company exists, but it’s an interesting moment to be looking at it. So, back in 1999, the CIA decided that they needed to get their hands into the technology that was emerging from Silicon Valley. It was an exciting time. The internet was just booming. All these companies were developing all this cool technology. And over on the other side of the country, the CIA was watching, and so they started a venture capital firm. It’s a most unusual venture capital firm. It’s a nonprofit, and they are looking for companies that are making technology that could be useful to them.

Ryssdal: We’re going to get into the technology they’re investing in in a minute. But I want to give people a sense of the size and the scale of this thing. Since 2011 you write, In-Q-Tel, which is the name of this investment firm, the nonprofit that CIA has established, they’ve gotten $1.2 billion in taxpayer money in the last 13, 14 years. How does it work?

Keegan: So, the company will go out and look in the marketplace to see what interesting new technologies are emerging with an eye towards things that will be beneficial to the U.S. intelligence community and the defense community. They might approach them and say, “Hey, we know you probably have been told don’t bother working with the government because of the bureaucracy.” It’s kind of the antithesis of “Move fast and break things.” But they say, “Look, if you bring your technology over here, we can teach you. We’ll invest in your company, and we’ll teach you how to do business with the government, and then you can help your country.”

Ryssdal: The key phrase here, Jon, is “dual use,” right? Dual-use technologies. Explain that for me a little bit.

Keegan: Right, so dual use is a really key concept. Here, they’re looking for, In-Q-Tel is looking for companies that maybe have a product that’s already out in the marketplace but could be advantageous for the intelligence or defense community. So, they might be looking for a company that on their website is advertising, say, a customer service tool that could detect the emotion of someone calling a company’s customer service line. But then elsewhere on their website, they are marketing the same tools toward the government. So, there’s a bunch of companies like that that have these things that can be used for one sector of the economy and then another use that could be used within the intelligence community.

Ryssdal: I do want to get to, I think it’s the subhead of this piece. “You can’t spell CIA without AI,” you write. [Artificial intelligence] figures very prominently in what In-Q-Tel is looking at.

Keegan: Yes, it’s actually the largest category of companies that they’re investing in right now. Unlike the CIA, which has, you know, opaque financials, In-Q-Tel is a nonprofit, so their tax returns are public, and they share quite a bit on their website about the portfolio of companies they invest in. So looking at their website, you can get a sense of some of the different applications within AI that they are looking at. They do a lot of AI infrastructure and hosting companies, so these would be companies like Databricks, where you can host these tools or train AI models. But then also a lot of companies that are involved in geospatial and remote sensing. This could be a satellite company that can identify the number of cars in a parking lot at a shopping mall or shipping containers moving into ports, for example.

Ryssdal: I should say, for listeners who are curious, go to this story and you can, you can have a look, scrolling down a little bit, and you’ll see some of the companies that In-Q-Tel is invested in. Last question, Jon, and then I’ll let you go. Is the CIA good at investing?

Keegan: Yeah, it’s actually made some really smart bets in the past. One of the earliest companies they invested in was Keyhole. This is a satellite-mapping app that later became Google Earth. They also invested in Palantir. This is the data-analytics firm cofounded by [investor and political activist] Peter Thiel and that’s now valued at about $80 billion. They also are no longer invested in that company. So yeah, they seem to get in on the ground floor at some of these interesting companies, and they’re trying to take these technologies and put them to use for clandestine purposes.

Ryssdal: Palantir, we should say, is not without controversy, right?

Keegan: True. They’ve definitely received a lot of scrutiny for, you know, working with the defense community and how their data tools are being used.