In partnership with

Merchant Ship Collective | The Launch Dock
“Where small businesses learn the truth about power, policy, and opportunities that actually matter.”

When the System Itself Becomes the Gatekeeper: PPPs, Data Power, and the Digital Barriers Small Businesses Can’t See

In today’s economy, data is power — and whoever controls the systems controls the opportunities.

For small businesses, the biggest threat isn’t always a competitor with deeper pockets.
Sometimes the biggest threat is a public–private data system that decides:

• Who can access a contract

• Which vendors are “eligible”

• What platforms you must use

• What insurance or certifications you need

• Whether your bids are even seen

This is where PPPs do their quietest — and most damaging — work.

In this issue, we break down how PPPs controlling data and digital infrastructure can reshape entire markets without public oversight… and why small businesses must understand these systems before they get locked out.

The Rise of Data-Based PPPs

Modern PPPs don’t just build roads or manage services.
They build digital infrastructure — the unseen systems that determine:

• How public money flows

• How agencies communicate

• How contracts are advertised

• How applications are processed

• How compliance is verified

• How performance is measured

And unlike public systems, these digital platforms are usually proprietary — owned, operated, and updated by a private company.

This creates a new form of control:

He who owns the system owns the market.

How PPP-Controlled Data Systems Hurt Small Businesses

1. Proprietary Vendor Portals Create Artificial Barriers

When a public agency shifts to a proprietary procurement system:

• Local businesses must learn that specific software

• They may face account fees

• They must meet new compliance requirements

• The system may only integrate with large corporate back-end tools

Small vendors often lack:

• Dedicated admin staff

• IT support

• Time

• Capital

• Training

• High-end compliance systems

Large firms do not.
And that’s the difference.

2. PPPs Control the Flow of Contract Information

Some PPP-run systems determine:

• Which contracts are public

• Which are “invite-only”

• Which vendors get automatic notifications

• Which opportunities require pre-existing relationships

• How quickly bids open and close

GAO reports have identified that digital procurement systems can reduce competitive access when poorly monitored (Government Accountability Office, 2021).

This is not a conspiracy — it’s a structural design problem.

3. Data Analytics Favor Large Firms

Many PPPs offer agencies “vendor scoring,” “risk analysis,” or “predictive procurement tools.”

These tools almost always reward:

• Large firms

• High-capital companies

• Vendors with nationwide presence

• Companies with in-house compliance departments

• Businesses with high-volume contracting history

Small businesses get:

• Lower scores

• Increased risk flags

• Fewer invitations

• Lower opportunity visibility

Your business isn’t failing — the system is grading you differently.

4. PPPs Gain Access to Entire Community Datasets

This includes:

• Local demographics

• Spending patterns

• Business registries

• School data

• Public health information

• Infrastructure usage

• Government service needs

Once private companies have this data, they gain enormous strategic advantages over small firms.

They can:

• Target specific markets

• Anticipate public contracts

• Shape proposals before opportunities open

• Underbid local businesses

• Build predictive models

• Create proprietary benchmarks agencies adopt

Small businesses don’t get the same visibility.
That’s the imbalance.

5. PPP Systems Are Not Subject to FOIA Transparency

Public agencies must comply with open records laws.
Private vendors do not.

So when a PPP runs:

• A student-data system

• A public health dashboard

• A procurement portal

• A logistics platform

• A grant-distribution system

…the records, algorithms, and vendor decisions inside that system often become private property.

This means:

• No public audits

• No public access

• No scrutiny

• No transparency

• No accountability

Agencies can literally say:
“We can’t disclose that — it belongs to our private partner.”

And the small business community has no way to challenge unfair decisions.

The Real-World Impact on Small Businesses

Reduced Access to Contracts

Big companies get automatic alerts and privileged visibility.
Small businesses do not.

Inconsistent Scoring & Compliance Requirements

Algorithms can quietly enforce standards that only large firms can meet.

Higher Operating Costs

New systems often require:

• Paid training

• Paid subscriptions

• New insurance

• New documentation tools

• Additional certification

Loss of Local Market Share

Data-driven PPPs help large companies:

• Predict demand

• Undercut pricing

• Expand territory

• Target high-value local markets

Local businesses get boxed out — long before the contract opens.

Permanent Dependency on a Private Vendor

When a digital system becomes the “official” tool, the private company becomes the gatekeeper.

Forever.

Why Government Agencies Allow This

Simplicity

One vendor system seems “efficient.”

Outsourced Risk

PPPs promise to absorb liability.

Data Expertise

Agencies lack the capacity to build modern digital tools.

Lobbying Influence

Large tech vendors have far more political reach than small businesses.

Emergency Policies

COVID-19 accelerated digital contracting and emergency-authorized systems (USDA, 2025; GAO, 2021).

What Small Businesses Can Do (Starting Now)

We’ll dive deeper in future issues, but here are the first moves:

• Track which digital systems your city/school/county is adopting

• Attend meetings when agencies vote on new tech platforms

• Push for local vendor set-asides within digital procurement

• Advocate for un-bundled contracts

• Ask agencies to publish algorithmic transparency statements

• Request public documentation before systems go live

• Form coalitions with other small vendors

• Comment during public procurement workshops

• Demand alternative access methods for small firms

You don’t need to fight the system alone — but you do need to understand how it works.

That’s why this series exists.

Call to Action

Next in The Launch Dock:

-How COVID-19 emergency PPPs reshaped entire sectors
-How crisis funding created long-term monopolies
-The industries most affected
-What small businesses can do to reclaim opportunity

This is the big one — the newsletter many readers have been waiting for.

In solidarity,

Lyndsay LaBrier
The Merchant Ship Collective

References

Government Accountability Office. (2021). COVID-19: Emergency contracting and the need for transparency. https://www.gao.gov

United States Department of Agriculture. (2025, February 26). USDA invests $1 billion to combat avian flu and reduce egg prices [Press release]. https://www.usda.gov

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