In-Q-Tel, CIA's Venture Arm, Invests in Secrets
Born from the CIA's recognition that it wasn't able to acquire all the technology it needed from its own labs and think tanks, In-Q-Tel was engineered with a bundle of contradictions built in. It is independent of the CIA, yet answers wholly to it. It is a nonprofit, yet its employees can profit, sometimes handsomely, from its work. It functions in public, but its products are strictly secret.
Over the years, some critics have dismissed In-Q-Tel as a government boondoggle. They have described the firms it invests in ominously as "CIA-backed," as if they were phony companies serving as cover for spy capers.
But in interviews with more than a dozen current and former CIA officials, congressional aides, venture capitalists that have worked with it and executives who have benefited from it, no one disputed that what began as an experiment in transferring private-sector technology into the CIA is working as intended. The Army, NASA and other intelligence and defense agencies have, or are planning, their own "venture capital" efforts based on the In-Q-Tel model.
"On a scale from one to 10, I would give it an 11," said A.B. "Buzzy" Krongard , the CIA's former No. 3 official and a former investment banker. "It's done so well even Congress is taking credit for it."
Yet In-Q-Tel remains an experiment that even its most ardent backers say has yet to prove its full potential.
"In my view the organization has been far more successful than I dreamed it would be," said Norman R. Augustine , who was recruited in 1998 by Krongard and George J. Tenet, who then was director of central intelligence, to help set up In-Q-Tel. Augustine, former chief executive of defense giant Lockheed Martin, is an In-Q-Tel trustee. "But my view is also that it's still an unproved experiment."
http:// www.washingtonpost.com/wp-dyn/content/article/2005/08/14/AR2005081401108.html