Is there a way in which pirate fleets can gradually become larger and more lethal with every victory they achieve? Like using the loot to hire more mates, sort of.

You could have a small fleet of pirates bugging you at first, taking out your scouts and lone freighters or constructors- but if you ignore them for too long they might become deadly.

A possible method would be to use a points system similar to hit points gain by experience- only, after a number of kills, the mateys get a new ship. Also (I don't know if this can be implemented, however) the size and value of the new ship could depend on the kind of unit defeated; Starbases could yield the greater benefit, followed by cargo hulls (maybe THEN you'd think about those poor freighters!) and after that, vessels according to size.

If that is possible, it would make the Pirate threat not easily dismissed. "Big deal, I lost like, two or three scouts and a few sensor probes and a freighter or two, I have the Drengin to worry about for now and -WHERE DID THOSE SHIPS COME FROM OMG" -You get the picture.

As for *hiring* pirates: It makes me snicker with evil overlord glee just thinking about it, but I'm not that sure it can work...

That's why they call them pirates. Actually, military might should be a partial deterrent to pirates but not totally because they use hit and run tactics. What’s not credible would be for them to have straight up battles with your top line fleets. They should do what pirates do best which is attack freighters and unprotected starbases.

That's what I meant, frieghters and starbases, not battleships and dreadnaughts.