The Fear Business, 911, and Homeland Security

Venture Capital Investing and Funding in Homeland Security & Defense Technologies


Among the first to jump into the fear business was Mark Thaller, a former naval officer and general partner at Zero Stage Capital, who in July 2001 launched Patriot Venture Partners, a VC fund devoted to the secu-rity sector. His decision to start the fund seems prescient, coming two months before 9/11, but Thaller would have you define the market in a somewhat different way than we did. "I have been very careful to avoid using the word 'fear,'" Thaller says. "Fear and paranoia might be the potential causes of action, but the real underlying need is to be a
little more at ease.

Another early venture capitalist is Richard Perle, who was also a managing partner in a venture-capital company called Trireme Partners L.P., which was registered in November, 2001, in Delaware. Trireme’s main business, according to a two-page letter that one of its representatives sent to Arab investers last November, was to invest in companies dealing in technology, goods, and services that are of value to homeland security and defense. The letter argued that the fear of terrorism would increase the demand for such products in Europe and in countries like Saudi Arabia and Singapore.The letter mentioned the firm’s government connections prominently: “Three of Trireme’s Management Group members currently advise the U.S. Secretary of Defense by serving on the U.S. Defense Policy Board, and one of Trireme’s principals, Richard Perle, is chairman of that Board.” The two other policy-board members associated with Trireme are Henry Kissinger, the former Secretary of State (who is, in fact, only a member of Trireme’s advisory group and is not involved in its management), and Gerald Hillman, an investor and a close business associate of Perle’s who handles matters in Trireme’s New York office. The letter said that forty-five million dollars had already been raised, including twenty million dollars from Boeing; the purpose, clearly, was to attract more investors.

Yet another was The Paladin Financial Group with headquarters in Washington DC. The term paladine was first used in Ancient Rome for a chamberlain (officer in charge of managing a household).

National Security Experience - The Managing Directors and investment professionals of Paladin have extensive and distinguished track records in service within the security, defense and intelligence fields. Paladin team members include Ambassador Jim Woolsey (former Director of Central Intelligence)
, Lt. General (Ret.) Ken Minihan (former Director of the National Security Agency and Defense Intelligence Agency), and Dr. Alf Andreassen (Bell Labs, AT&T, National Security Agency Advisory Board).

Yaknow* It sure sounds like the Neocons were pretty sure about 911 and the occupation of Iraq to me...