A few years ago, Clarifai, a five-year old startup that makes image-recognition software, held a discussion among its workers about two kinds of controversial business partners. The first was the pornography industry, where several companies had expressed interest in automated analysis that would classify videos according to the specific acts in each scene. The second was the military. At the time, Clarifai decided to avoid both kinds of contracts, according to three people with knowledge of the conversation.

Clarifai continues to bat away the smut peddlers. But Matt Zeiler, its founder and chief executive, is now embracing defense work. On Thursday, the New York-based company is announcing the formation of a subsidiary in Washington, D.C. called Neural Net One, which will exclusively handle government work. It will pursue defense and intelligence contracts, as well as work in disaster relief, border security, and environmental monitoring.

The opening of Neural Net One comes after the Department of Defense last summer hired Clarifai to participate in Maven, a project the government said would “leverage advanced commercial technologies to provide advantage to the warfighter in contested environments.” The Pentagon allocated $16 million for Maven in fiscal 2018, and $13.9 million in fiscal 2019. Alphabet Inc.’s Google has also  been involved. Maven was significantly larger than any of the Clarifai’s deals with commercial clients, according to three people familiar with the project. They asked not to be identified for fear of retaliation.

Clarifai’s work on Maven was controversial internally. Four former employees said Zeiler’s lack of candor about the project damaged morale, complicated recruitment, and undermined trust within the company. At least two employees left Clarifai because they were concerned that its focus on military work would subsume the company’s other work. “If you’re a Palantir, and that’s the company culture, that’s fine,” said one of them, referencing the company that Peter Thiel founded in 2004 to work with the Pentagon and Central Intelligence Agency in war zones. “But the company culture here was kind of the opposite.”

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