The hardest transition in GovCon: From founder to visionary

According to conventional wisdom, you have to be a little crazy to start a business. 

But after working with hundreds of government contractors, I’ve noticed that entrepreneurs who thrive are the ones who transform that touch of brilliant entrepreneurial madness into an evolution of themselves and their companies. 

Entrepreneurs take huge risks, build something from nothing, and leave the easy path of W-2 employment behind. They know failure is always a possibility, yet nearly 6 million new small businesses formed just last year.

This spirit of innovation is also the cornerstone of nearly 78,000 small business federal government contractors. Their founders build incredible businesses after identifying problems and needs few others noticed. They work relentlessly to solve those problems for years, sometimes decades, within a highly regulated procurement system with layers of paperwork, and often, long waits for final payment.

Yet the skills required to start a GovCon company are often very different from those required to scale one.

Many founders succeed initially because they are exceptional business developers or technical experts. They identify need, win contracts, and build strong customer relationships. But as a company grows, the founder who insists on making every decision and micromanaging their team eventually becomes the bottleneck to their own leadership development and the company’s growth and profit.

The most successful founders eventually stop trying to be the best salesperson, contract manager, and problem solver in the organization. Their job becomes building the team, systems, and culture that allow the company to perform without them being involved in every decision.

One of the most common mistakes I see is founders treating every opportunity as one that must be pursued. Early in a company’s life, that mentality can drive growth. Later, it can strain working capital, overwhelm teams, and create operational risk.

Transformative thinking separates companies that grow from those that stall. Many firms can win work. Far fewer can build the infrastructure needed to navigate and sustain growth through multiple business cycles and market shifts.

Perhaps the most challenging part of growth for GovCon companies over the last 18 months has been financial, due to government market uncertainty. Many contracting officers who long held approval authority left their roles with contracts often delayed or cut.

During periods of uncertainty, founders often feel pressure to pull decision-making closer to themselves. In my experience, the opposite is usually required. Companies that navigate disruption successfully already invested in strong teams, disciplined financial controls, strategic financial partnerships, and trusted advisors before the disruption arrived.

The final benefit for a visionary leader willing to evolve is stakeholder trust. Federal agencies need to know that prime contractors will deliver on their commitments. Prime contractors depend on subcontractors who then rely on suppliers, advisors and financial partners. Success depends on every link in that chain performing consistently and delivering on its commitments.

Not only have I seen these leadership growth strategies succeed with our clients, but it has been my professional journey as well. I started at Parabilis early in my career and had the opportunity to work through virtually every role within the firm, and was involved in developing many best practices we still use today. But becoming CEO has given me an opportunity to see the bigger picture both for our company and the greater GovCon market.

The GovCon market has been hit by disruption after disruption, especially since the pandemic. Organizations across the sector navigated many uncertainties and shifting federal priorities. Unfortunately, those challenges proved terminal for some contractors stuck in their own status quo.

Entrepreneurship will always require courage and that little drop of crazy. Companies that thrive are those with a leader who sees beyond the company’s immediate positioning and evolves to grab the future. They see challenge as an opportunity and manage accordingly.

There is now growing optimism that the industry is entering a new period of opportunity as we are starting to observe a growing volume of solicitations and renewed agency spending.

For the first time since early 2025, most financing requests we receive are tied to growth opportunities rather than cash flow challenges. Borrowers report stronger proposal pipelines, increased solicitation activity, and healthier cash flows after an extended period of uncertainty. While challenges remain, we see encouraging signs that many government contractors are shifting from navigating disruption to pursuing expansion.

Opportunities ahead will not belong to companies with the biggest ambitions. They will belong to companies with the leadership, discipline, and financial infrastructure necessary to execute on them.

In GovCon, great ideas often open the door. But it’s long-term strategic thinking that transitions as the business scales that keeps that door open. 

Evan Henris is a former entrepreneur and current CEO of Parabilis, where he and his team help finance the future of federal contracting.