Unlocking Federal AI Opportunities in FY 2025: Navigating the Two-Tiered Approach to Maximize Success
Author: Harvey Morrison
As Artificial Intelligence (AI) becomes an engine driving innovation across industries, its role in the Federal government is accelerating at an unprecedented pace. With FY 2025 federal funding poised to fuel AI initiatives across all agencies, it’s clear that AI has transcended from being a technological trend to a national priority.
But how should AI organizations position themselves to capture the opportunities that come with this surge in federal investment? At Marion Square, we’ve spent the past three years working hand-in-hand with AI companies to map the federal landscape. What’s become evident is that agencies are adopting a two-tiered approach to AI investment—one that will define how successful organizations engage the federal market.
Understanding and strategically leveraging this tiered structure will be crucial for companies looking to accelerate their go-to-market (GTM) strategies and secure contracts that matter.
The Two-Tiered Approach to AI Funding in FY 2025
The Executive Order 13960, which mandates all agencies to inventory and document their AI use cases, laid the groundwork for the Federal government’s AI strategy. But as AI budgets expand, we’ve identified a critical distinction: some agencies are focused on establishing governance frameworks and ethical guidelines, while others are pushing the envelope by developing, testing, and deploying AI at scale.
Agencies Leading in AI Deployment
Take the Department of Defense (DoD) as a prime example. The DoD is spearheading the development of the Joint Common Foundation, a centralized AI platform designed to empower its various components to quickly develop and deploy AI models. Accompanying this infrastructure is DRAID, a specialized contract vehicle aimed at streamlining the procurement of cutting-edge AI and data services from commercial vendors.
The DoD isn’t merely exploring AI—they’re committed to operationalizing it, and vendors who recognize this focus can gain access to significant opportunities if they understand the agency's strategic vision. If you’re an AI company looking to target the DoD, you must be prepared to navigate platforms like the Joint Common Foundation and leverage procurement vehicles like DRAID to secure contracts quickly and effectively.
Agencies Focusing on AI Governance and Ethical Standards
Conversely, agencies like the Department of Justice (DOJ) are allocating their AI resources to ensure the ethical use of AI systems. For FY 2025, the DOJ is emphasizing AI programs that adhere to the highest standards of regulation, in line with Executive Order 13960. Their primary concern is not just the deployment of AI systems but ensuring these technologies meet stringent ethical, legal, and civil liberties requirements.
For AI organizations, engaging agencies like the DOJ means understanding how to align your solutions with ethical frameworks and regulatory compliance. This isn’t about showcasing technical prowess—it’s about demonstrating responsibility and alignment with federal governance priorities.
What This Means for Your Go-to-Market Strategy
While every federal agency will be investing in AI in FY 2025, success requires more than a one-size-fits-all approach. Your GTM strategy must account for each agency's unique AI priorities, key programs, and preferred contracting vehicles.
At Marion Square, we’ve developed a deep understanding of federal AI initiatives, tracked funding streams, and identified the programs that matter. We’ve helped AI companies refine their messaging, tailor their solutions, and align their strategies to maximize win rates and reduce time-to-contract. Whether you’re targeting agencies with large-scale AI deployments like the DoD or navigating compliance-focused environments like the DOJ, our experience can help you break through the noise.
Why Partner with Marion Square?
With AI becoming deeply embedded in the fabric of federal innovation, the potential is vast—but only for those who can effectively navigate the terrain. Marion Square’s expertise lies in helping companies like yours understand which agencies to target, which initiatives are worth pursuing, and how to position yourself as the go-to provider for federal AI solutions.
We’ve guided AI companies through complex government acquisitions and helped them secure high-value contracts by ensuring they are ahead of the curve. Let us help you capitalize on this next wave of federal AI investment.