# TechCrunch: Will the Pentagon's Anthropic controversy scare startups away from defense work?

_Friday, June 26, 2026 at 8:19 PM EDT · Policy · Latest · Tier 2 — Notable_

![TechCrunch: Will the Pentagon's Anthropic controversy scare startups away from defense work? — Primary](https://techcrunch.com/wp-content/uploads/2026/03/GettyImages-1461207630.jpg?resize=1200,857)

Negotiations between the Pentagon and Anthropic over use of the company's Claude technology collapsed in just over a week. The Trump administration designated Anthropic a supply-chain risk, prompting the AI company to say it would fight the designation in court. OpenAI then announced its own deal, which drew backlash that included a surge in ChatGPT uninstalls.

On the Equity podcast, hosts and guests Kirsten Korosec, Sean O'Kane, and Anthony discussed what the dispute means for other startups seeking federal contracts, especially with the Pentagon. Kirsten said the events should give any startup pause about pursuing federal dollars. Sean noted that most defense contractors operate without similar public attention because their work receives less consumer focus.

Sean added that the scrutiny stems in part from the companies' consumer products and from questions about how the technologies could be used in lethal missions. He said companies such as Applied Intuition and General Motors are unlikely to change course. Kirsten said the Pentagon's effort to alter terms on an existing contract marks a departure from normal processes and should concern potential contractors.

## Sources

- [TechCrunch](https://techcrunch.com/2026/03/08/will-the-pentagons-anthropic-controversy-scare-startups-away-from-defense-work/)

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Retrieved: 2026-06-27T04:57:46.496Z
Publisher: Tech & Business (techandbusiness.org)