The Department of War is bypassing major defense contractors as it seeks to rapidly expand its drone capabilities, turning instead to startups founded by drone racers and hobbyists, as well as firms from commercial drone industries.

The push comes amid the launch this year of Drone Dominance, a contest whose winners will share $1.1 billion in defense contracts that could lead to the Pentagon purchasing about 300,000 drones, The Washington Post reported Monday.

The Trump administration has even grander goals, seeking $53.6 billion in the fiscal year 2027 budget to dramatically expand drone warfare programs.

The conflicts in Ukraine and Iran have highlighted the growing role of small, inexpensive drones on the battlefield.

The Pentagon believes the U.S. needs to rapidly expand its drone capabilities and sees Drone Dominance as a way to identify the most promising manufacturers, the Post reported.

The drones being tested are relatively inexpensive at about $5,000 each and are designed to be expendable in combat.

Inspired by technology used in drone racing, they can maneuver at high speed and strike targets with precision.

Drone Dominance involves four increasingly challenging contests in which troops test systems over several days. After each round, contract awards increase while the price the Pentagon pays per drone decreases.

Travis Metz, deputy director of the Defense Innovation Unit, the Pentagon office overseeing the competition, told the Post the idea is to encourage rapid innovation without the pressure of an ongoing war.

“It’s a slightly blunt way of trying to replicate what has happened in Ukraine,” he said. “The pace of change is extraordinary.”

The first round took place in February at Fort Benning, Georgia, with 26 companies invited to compete.

The competitors were given two hours to train a group of military pilots.

The exercise tested how easy the drones were to operate.

Manufacturers then chose which pilots would use their drones on the test range.

Missions included hitting targets the size of a desk up to six miles away and carrying out a strike inside a building.

Two companies are ahead of the pack in the competition, according to the Post: Skycutter, a British firm partnered with Ukrainian drone maker Skyfall, and Neros, founded by Soren Monroe-Anderson, a former drone racing world champion.

A new round of the contest is set to begin next week.

Monroe-Anderson’s firm already works with the Army and Marine Corps, and he told the Post officials he had high expectations as the competition began.

“I do love the fact that it’s keeping everyone on their toes,” he said. “There’s no free lunch in Drone Dominance.”

Neros has raised $120 million from venture capital firms, according to the Post.

The company recently moved into a new factory in Torrance, California.

It is on track to become the first winner to fulfill its order, according to the Pentagon’s leaderboard.

The company will compete again as the second round gets underway in Michigan.

“We’re not happy with anything besides first place, so I think it’s good motivation for the team,” Monroe-Anderson said. “We won’t rest until we’re at No. 1.”