Ask many small businesses what stands between them and a defence contract, and you'll hear some version of the same concern: it's a closed market, built around established primes, existing relationships and organisations that already understand how Defence works. UK Defence Innovation (UKDI) is designed to make that route into defence innovation considerably easier to navigate.
UKDI describes itself as the front door for companies and individuals wanting to innovate with defence and security. Its competitions are open to organisations of different sizes, including SMEs and companies with no previous defence experience. If you've been assuming that defence innovation isn't accessible to a business your size, it's worth understanding how the system now works.
What is UK Defence Innovation?
UKDI brings together a number of innovation functions that previously operated separately, including the former Defence and Security Accelerator, Defence Innovation Unit, Command Innovation Hubs and DE&S Future Capability Innovation. It officially launched in July 2025 and now operates within the National Armaments Director Group.
The principle is straightforward. Rather than expecting an innovator to work out which of several MOD innovation organisations it needs to approach, UKDI is intended to provide a clearer route into the system and connect promising ideas with relevant defence and security needs.
That doesn't mean every innovation goes through exactly the same process. The route available to you depends on what you have developed, how mature it is and whether there is already a defined government requirement.
Who can apply?
Eligibility is broader than many businesses assume, but it varies by competition. UKDI's general guidance says eligible applicants can include sole traders, SMEs, larger companies, research organisations and universities. Some competitions are restricted to UK applicants, while others accept international organisations too. Individual competition documents therefore matter more than any single blanket eligibility rule. For UK-based innovators, UKDI also provides direct support through its Regional Engagement Team and Innovation Partners.
Overseas businesses should note an important change introduced in July 2026: international organisations may still be eligible for individual calls, but UKDI no longer provides dedicated Innovation Partner support to innovators based outside the UK. So, before investing time in a proposal, check the specific competition's eligibility conditions rather than assuming that previous UKDI rules automatically apply.
The three main routes in
There are three main forms of competition, although they aren't necessarily all open at the same time.
Open Call for Innovation is designed for disruptive ideas that may not fit an existing defined requirement. The model is currently evolving. UKDI is developing a new route for Defence-focused innovations following the Defence Investment Plan, while the Security Open Call continues through competition cycles against defined government security priorities. The next Security Open Call cycle is scheduled to open on 1 October 2026.
Themed Competitions address specific problems or areas of interest identified by government. These tend to have a narrower scope and a defined closing date, so the key question is whether your technology genuinely addresses the published challenge rather than whether it is innovative in the abstract.
Defence Innovation Loans support later-stage research, development and commercialisation of more mature innovations. However, loan cycles are currently paused while UKDI develops an improved service. UKDI's routes change over time, so its live funding opportunities page should always be the definitive source for what you can actually apply for now.
What a live UKDI competition looks like
A useful recent example is Project PANOPTES, a UKDI competition seeking an integrated counter-uncrewed aerial system capability to protect deployed forces against mass and relatively low-cost aerial threats.
The competition used a two-stage process. Stage 1 asked suppliers for a concise, high-level outline setting out their starting technology position, the development work they would undertake and indicative costs. Selected organisations were then invited to submit a more detailed Stage 2 proposal. Up to £5 million was available across multiple potential contracts, with projects expected to last no more than six months.
PANOPTES is a useful example because it shows how UKDI activity can sit much closer to operational capability than the phrase “innovation funding” might suggest. The competition forms the first stage of a planned multi-phase capability development and acquisition route, although any subsequent phases remain subject to future approvals and contracting decisions.
Working with an Innovation Partner
One of UKDI's more distinctive features is its network of Innovation Partners. These are civil servants who provide free guidance to UK-based innovators, helping businesses understand UKDI routes, discuss specific competitions, consider whether an innovation could be relevant to Defence and navigate the submission process. Intellectual property is protected when you discuss an idea with an Innovation Partner.
The process is relatively simple. Register for the UKDI submission service, sign into your supplier dashboard and select “Contact UKDI Innovation Partner”. UKDI says an Innovation Partner should make contact within 15 working days. It's worth doing this before investing heavily in a proposal, particularly if this is your first attempt to work with UKDI.
If you're unsure whether your idea fits an Open Call or one of the Themed Competitions that accepts outlines, you may be able to submit a short summary through the UKDI submission service. UKDI then provides a simple indication of whether it wants to see a full proposal, and a positive response may lead to further discussion with its Regional Engagement Team. That can save a considerable amount of effort where there is uncertainty about whether an idea is genuinely in scope.
What to prepare before you apply
The technical idea matters, but UKDI's own application guidance makes clear that technical capability alone isn't enough. Your proposal needs to explain the desirability, feasibility and viability of what you're proposing. UKDI says applicants often find desirability (essentially, why the innovation matters to a defence or security user) particularly challenging.
Don't assume that technical assessors want dense technical language either. UKDI advises applicants to include strong technical detail but explain it in plain English, working on the assumption that assessors have at least degree-level technical knowledge.
You also need to demonstrate that you've considered the practicalities around delivery. That can include regulatory approvals, testing, project risks, staffing, facilities and where the work will actually take place. Human trials, for example, may require MOD Research Ethics Committee approval.
Cash flow deserves attention too. UKDI payments are made in arrears against completed deliverables, with no advance payments. If profit isn't already included within your labour rates, the current guidance allows you to identify a separate profit percentage within your finance schedule.
For a small or growing company, those details matter just as much as the headline funding value. Winning work that you aren't financially or operationally prepared to deliver creates a different problem.
Building UKDI into a wider defence strategy
UKDI is best understood as one part of a much wider push to open defence opportunities to smaller and non-traditional suppliers. That sits alongside the ambitions in the MOD SME Action Plan 2026, which targets significant growth in both direct and indirect MOD spending with SMEs.
Innovation funding won't automatically turn into a production contract, but it can help build the evidence a business needs for its next opportunity. A successfully delivered UKDI-funded project can give you a relevant case study, experience of working with defence stakeholders and evidence that your technology has moved further along its development pathway. Those things can all become useful when you later approach a larger procurement or a prime contractor.
For a sense of what larger-scale technology adoption can look like elsewhere in MOD, we've previously covered Programme FRONTIER, which is bringing frontier AI capability into Defence and initially focusing on areas including cyber risk reduction. It illustrates the wider opportunity for innovative technology providers beyond individual UKDI funding competitions.
If you're serious about building a defence presence over several years, the more useful question isn't simply “Which UKDI competition can we enter?” It's where UKDI fits into your wider route to market.
How Thornton & Lowe can help
Writing a strong UKDI proposal draws on many of the same disciplines as other competitive bids, while adding its own technical, commercial and innovation-specific evaluation requirements.
At Thornton & Lowe, we help SMEs and innovators build their route into the UK defence market and develop the evidence and narrative needed to respond clearly to UKDI or wider defence evaluation criteria.
That can include shaping the proposal around the published requirement, strengthening how you evidence the benefit of the innovation, making technical information clearer to assessors and helping you position the immediate project within a longer-term defence strategy.
If you've got a technology or capability that you think defence should know about, we're happy to talk through whether UKDI looks like the right route and what you'll need before you apply.
