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Speaker 1: Anty with design.

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Speaker 2: You know, as you think about the big problems in

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the world that you were addressing, do you start with

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a particular product in mind, like there could be this

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model s there could be this Falcon nine, and then

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think how do I get there? Or do you start

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with saying there's something broken in the world, and I'm

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gonna fix it, and I'm going to commit to do it,

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even if I don't know how I get there.

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Speaker 3: Sure, So let's see, is that on?

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Speaker 4: Yeah, it seems to be good in a case of

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Tesla's SpaceX and Solar City and actually will.

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Speaker 3: So the PayPal and the before that.

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Speaker 4: It really stemmed from when I was in college and

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just trying to think what would most affect the future

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in a in a very likely to be a positive way,

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So that the three areas where I was quite sure

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it would be positive were sustainable energy, Internet, and making

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life multiplanetary. And then there were a couple other areas

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where maybe a question mark like AI and writing, genetics

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and lesson, yeah, rewriting, rewriting next just.

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Speaker 1: Three and four might come, you.

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Speaker 4: Know, potentially negative consequences, hopefully positive.

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Speaker 2: But so it could go wrong, like the top three

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and a couple of contenders or were they all kind

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of jumbling around.

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Speaker 4: Waiting for you know, if you look, if you look

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at and say, what's what's really going to have an

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important effect on the future of humanity?

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Speaker 3: As all those are the five.

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Speaker 4: Areas that that I could come up with standing in

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the shower basically, you know.

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Speaker 2: So there's this moment of epiphany that that you held

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for a while because you didn't pursue those right away.

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Right these were this sort of early vision that you

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then got opportunities to execute on. Yeah, so when you

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maybe if we pick an example like Tesla going towards

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the models or SpaceX going towards the Falcon nine, do

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you commit the team, yourself, your resources to that endeavor

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you know, now a little farther along when you the

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end point in mind, or just let's say the cost

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of goods analysis for the rocket or the gosh EV

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should be better.

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Speaker 1: Than internal combustion engines.

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Speaker 2: Just in general, I'll commit, I'll believe that should be done.

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Speaker 3: Yeah, I didn't.

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Speaker 4: I mean I didn't really get into any of this

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with the expectation of success.

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Speaker 3: Or at least Yeah, I started out with.

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Speaker 4: Thinking, okay, when I do something in the electric vehicle space,

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and that's why I originally came to Standford was to

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work on advanced energy storage technologies and particular aultric capastors.

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So that was continuing on research that I'd done as

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an intern in Silicon Valley and summer prior. So that's

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why I originally came out in ninety five. And then

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during that summer I wrote some Internet software and I thought, Okay,

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I can either work on electric vehicle technology or or

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I could sort of work on Internet stuff, try to

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try to do something with the Internet. I thought the

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Internet would something that would dramatically affect the future of humanity,

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be like like acquiring a nervous system. And whereas previously

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communication would have to occur almost by osmosis from one

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person to another slowly through telephone or mail or something

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like that.

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Speaker 3: But now.

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Speaker 4: If you have a nervous system, any part of the

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human collective note can know about any other part instantly,

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and you're previously you'd have to be at the Library

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of Congress, even to have the Library of Congress as

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sort of information. But with everything digitized and access anywhere,

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you could be in a jungle in South America and

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if you had just an Internet link somehow you could,

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you'd have access to all of humanity's information. So it

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would actually effectively create a super organism and fundamentally change

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the nature of humanity itself.

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Speaker 3: So I was kind of I just wanted to be

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kind of.

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Speaker 2: Part of that is that the path AI that you

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might see, it's it's actually not exactly AI.

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Speaker 4: It's some sort of human machine collective intelligence, so different

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different from AI, although AI may not turn out to

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be exactly what hopefully not, it's not exactly what's, you know,

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like describing a terminator or something.

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Speaker 2: Now a quick pause for those that haven't been the

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SpaceX the data center has got to be the coolest

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thing they've ever seen.

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Speaker 1: It's you know, Skynet on the door, cyber nine.

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Speaker 2: Systems branding, and a little bad asset of lights coming

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from a winking server.

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Speaker 1: So you don't own it exactly.

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Speaker 4: Our FAA and CFD cluster is called Cyberdigne Systems.

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Speaker 2: We'll get back to influences, uh later on, but I'm

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gonna try to see if I understand what you were

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saying about this. This You see the long arc of

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and what's important to humanity, not little problems but huge

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problems that could be solved.

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Speaker 1: A lot of us go.

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Speaker 2: Around and we see something frustrating, like traffic on the

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four or five, we just take it as well, crap,

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government screwed.

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Speaker 1: You know what, we need to do it? Right? You

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have this incredible sort of.

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Speaker 2: Scope of ambition, right, planetary scope, interplanetary scope. Right, a

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little more than changing the world, let's change in other

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worlds too, right, And this is big stuff.

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Speaker 1: Is that always in your mind?

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Speaker 2: Or that did you become more emboldened over time that

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this is available.

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Speaker 1: We can do these things.

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Speaker 3: It definitely emboldened over time.

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Speaker 4: I mean at the you know, when I started the

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first Internet companies up Too with my brother and another person,

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a great Curry. The it wasn't really with the thought

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of being wealthy. You know, I've got nothing against being wealthy, but.

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Speaker 1: We'll get better to that.

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Speaker 4: But it's just it was just from the standpoint of

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wanting to be part of the Internet, and I figured

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if we could make enough money to.

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Speaker 3: Just get by, I would be They'll be okay.

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Speaker 4: And when we started off, we literally only had like

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one computer, and so it would be our web server

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during the day and I'd code at night and We

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just got a small office in Palo Alta back when

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rent was not insane, and it cost us like four

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and fifty dollars a month. It was cheaper than an apartment.

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So we actually just slept in the office and then

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and then share at the YMCA on Page mell al Camino.

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So we'd walk her over there and shire and and.

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Speaker 3: That was.

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Speaker 4: Actually I think that was when we first I first

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met you, by the way, and so I don't know

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how many people.

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Speaker 3: Probably not many.

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Speaker 4: People knows, but we actually pitched Steve in like January

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ninety six on the ZIP two business plan, and actually

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I thought she was actually one of the most up

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to speed on on what actually was in our business plan.

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Most most of the people we met did not actually

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read our business plan. In fact, a lot of people,

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a lot of bench capitals who met at the time

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didn't even know what the internet was. They've never used

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They've never used I still do, yeah, right, yeah, something

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like you know, sort of well known people in Sant Hill.

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It was like, wow, okay, but but at the time,

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nobody made any money on the internet, so I guess

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that's you know, then it wasn't really clear evidence that

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that there.

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Speaker 3: Was was a business and yeah, those were fun times.

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Speaker 2: I remember Kimball and you coming in right, very young

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looking guys. I think I was in my first four

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months on the job too.

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Speaker 3: Yeah, yeaheah exactly.

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Speaker 5: So let's excuse for a sec I've I've also had

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the great honor to work with Steve Jobs briefly but enough,

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and as a business school student to study him with

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as much scrutiny as I could during that period.

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Speaker 2: And there's some obvious parallels, and so let's start with

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the most obvious, but just must be like the elephant

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in the room.

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Speaker 1: Is the secret to your.

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Speaker 2: Success to be the CEO of two companies at the

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same time.

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Speaker 1: Oh, I think it's just look at the correlation. Yeah,

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struggling companies.

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Speaker 2: Everything's in the craft can in December two thousand and eight,

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So let's take on a new CEO gig.

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Speaker 1: Yeah, and same for Steve.

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Speaker 3: Coming back to No, definitely, it was not my intention

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to BECO of two companies the after.

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Speaker 4: I mean, there's certain things that I kind of wanted to.

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I thought it were important to happen, and I thought

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it was important that that there was that that electric

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vehicle happened, that there was a success in the electric

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vehicle arena because the the incumbent companies were convinced that

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it was not possible to create an electric car that

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looked good, had range, a good range performance, and so forth,

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and that even if you did make such a car,

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it would not sell that Chris, people had this love

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of gasoline, and.

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Speaker 3: So we had to.

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Speaker 4: Show that it was possible to create a compelling electric car,

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long range, good looking, you know all those things.

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Speaker 3: That was a test the roads to and don't.

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Speaker 4: If you created if if you made such a thing,

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people would buy it. And so so that that's that's

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what we would try to do with with with this.

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Speaker 3: If I should say.

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Speaker 4: Like one mind sort of correction on the on introduction,

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I'm not a co founder of solar City, but I'm

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a co founder of Tesla.

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Speaker 1: That's okay, that's a good point.

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Speaker 2: So and probably architectures, yeah, many of its key features.

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So very much like jobs, both a hand in some

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of the detail as well as the long arc of

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what's important for the company.

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Speaker 1: The quipto about being co.

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Speaker 2: CEOs is more than just a joke in that I

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wonder if in ways that are hard to predict, and

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you wouldn't set out for this amount of work. It

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seems insane, but inevitably, both companies cannot expect more than

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half your time at most.

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Speaker 1: It sort of naturally forces a.

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Speaker 2: Delegation upon you and an expectation they have to rise

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up for partial awareness at best, right, And I just

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wonder if that helps drive prioritization and really focusing on

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what's important a bit more than you otherwise might have to.

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Speaker 3: It probably does, Yeah, I think I probably do.

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Speaker 4: Yeah, I mean, because I have to triage the things

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that I do at each company and constantly think about

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what is the most useful thing that I could that

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I could do.

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Speaker 3: But even with that, it's it's still actually just take

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it an almost amount of time.

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Speaker 4: And for a while I was just doing constant one

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hundred hour weeks and that's that's definitely wearing. And you know,

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now I'm kind of in the eighty to ninety, which

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is well manageable, but you know that if you divide

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that by too, it's only like, you know, maybe forty

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five hours for a company, which is not not much

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if you're there's a lot of things going on like

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a slacker.

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Speaker 1: I mean, yeah, so you.

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Speaker 2: Know, it is interesting also how you have a love

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for certain aspects of the product.

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Speaker 1: So it's SpaceX you.

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Speaker 2: You know, the whole concept and the vision of going

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to Mars back into features and stuff. It's it's a

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wonderful thing to see. I think what obviously should strike

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folks in the room as remarkable as the diversity of

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industries that you've tackled, right from commercial banking to the

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military industrial complex to the automotive industry. These are heavily

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regulated industries the generally investors flee from and startups routinely failing,

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and they haven't seen much change for good reason over decades.

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So there might not be an obvious pattern in which

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industry you tend to thrive in. But I wonder if

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there's a pattern perhaps in process, like do you approach

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each of these perhaps the way a software architect might

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to think of a different way to bring innovation, a

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different way to reset, you know, for first principles, perhaps

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instead of iterating from the past a breakthrough. And is

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there reason you end up in these otherwise really tough industries.

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I mean, I don't know if that's ever occurred to

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you that you don't even in Solo City going up

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against the regulated autilities. None of these are places that

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you would normally find entrepreneurs.

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Speaker 4: Yeah, like I said, it was not from the standpoint

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of like what's the best risk adjustin rate or return

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or you know, where I think it thinks could be successful.

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It's just like I think these things need to happen,

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to try to make them happen, And certainly when we

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started SpaceX or Tesla, I thought the probably of success

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was less than fifty percent, you know, probably a fair

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bit less than fifty percent.

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Speaker 3: In the case of Solar.

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Speaker 4: City, I thought the probably to success was probably greater

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than fifty percent, But it wasn't clear what the magnitude

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of success would be.

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Speaker 3: You know, it could just be small.

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Speaker 4: And yeah, but it was I just thought these were

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things that needed to get done, and even if the

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money's lost, okay, it's still worth trying.

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Speaker 1: See conviction, But it didn't mean certainty.

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Speaker 2: Right, you knew that all vehicles would be electric in

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your heart, but.

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Speaker 4: Ultimately also, I mean, I think the sort of fundamental

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good that Tesla can accomplish is acceleration of the inevitable,

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which is electric transportation. But I thinks there's a lot

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of value to accelerating, even though I think it's somewhat inevitable.

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Speaker 3: It's about this value to accelerating it to.

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Speaker 4: Minimize the that the environmental and economic damage.

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Speaker 3: That would otherwise occur.

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Speaker 4: So you know, it's better if we transition sustainable transport

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ten years or maybe twenty years sooner than might otherwise

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be the case. And I think the Tesla's effect has

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been much greater than the cars that made that It's

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made internally because when we announced the Tesla Roadster, then

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Bob Lutz, who was fish shamed GM at the time,

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saw our pressure release and said, if a small company

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in California can do it, than circ and jam and

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he took it to his engineers who told him that

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you could build an electric car and told them that

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they need to get going. That's what got the volt rolling,

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and that in turn got nisigned to do the Leaf

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and so it's kind of got the got things going,

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and ultimately it's like it's what we induce other companies

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to do that will have a greater impact than the

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cars we make ourselves.

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Speaker 1: And it's an interesting point. I'm going to come back

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to you later.

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Speaker 2: This idea that Tesla's founding mission is as Elon has

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articulated from the very beginning through the most recent reports

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to the public, is to cat is an industry shift

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that test level be is some part of. But to

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help others in that shift as well, which is remarkable.

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Speaker 3: So we supply pow trains to Toyota and to Mercedes.

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Speaker 2: To help what could be viewed as your biggest competitors

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one day, you know, absolutely in fact accelerate that. Before

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we get to that sort of purpose driven mission, I

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do want to ask one or at least maybe make

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sure the audience realizes how cool this car is, and

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so the eland doesn't have to do this in case

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you haven't been as much of a fan as the

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two of us, it's a bit unprecedented the reviews it's received,

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consumer reports saying it's the best car they've ever tested,

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road in tracks saying it's the most important car in

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America's history, the safety testing showing is the most safe

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car ever manufactured by far, including Vans and Issuvies. And

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so it's pretty remarkable to peg performance, desirability, safety and

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all these parameters. So is it luck or is there

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something particularly unique about the EV design space that let

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it be possible to build the best car.

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Speaker 4: Well, I think, you know, let does play some role here,

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but I think we I think electric pickles have a

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fundamental architectural advantage if one designs an electric vehicle from

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the ground up and takes advantage.

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Speaker 3: Of of what's possible.

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Speaker 4: Like if you just were to convert a gasoline car,

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you would not you would not achieve these advantages. But

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if it's probably done, you can actually package the battery

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pack in the full pan and achieve a low center

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of mass and have a very compact motor and a verter.

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Speaker 3: And gearbox, so that that the actually usable space.

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Speaker 4: In the car is significantly greater than a gasoline car

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of the same over external excelled dimensions.

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Speaker 3: And then if you do a few.

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Speaker 4: Other things which one's necessarily specifically related to an electric car,

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like using an aluminum body in chassis is helpful because

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you can absorb more energy per unit mass.

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Speaker 3: Essentially in a crash, it crupples.

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Speaker 4: Yeah, well so that yeah, but part of it's related

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to electric vehicle architecture, and part of it is related

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to other technical decisions that were made in the design

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of the model ass and.

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Speaker 3: So yeah, that's that's what leads to sort.

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Speaker 4: Of having a high safety is I mean, I don't

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want to sort of go into too much stakes because

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it might take up too much time.

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Speaker 2: But like, did you know some of those things at

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the get go or did they unveil themselves as you

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went along. I'm just curious how the vision materializes, for example,

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like along either the product dimensions, like it will have

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all these great features like like at the get go

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that the ald gel And then secondly, I'm also curious when.

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Speaker 1: Did you first know that all vehicles would be electric?

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Like was that.

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Speaker 3: Probably twenty two years ago something like that.

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Speaker 1: Before he met Tesla.

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Speaker 4: Before, way before there was before there's a way for

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those Tesla. Oh yeah, well, like I said it, you

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know when I originally came out when I I mean

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when I was studying physics pen That's probably when I

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thought it was the case. And maybe you know, sooner

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than that, probably when I was in my sophomore year.

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Speaker 1: Did you have certainty in your heart?

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Speaker 3: Yeah? Absolutely, it's super obvious.

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Speaker 1: Yes, yes, now yes now it is.

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Speaker 3: There are something that was super obvious then.

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Speaker 2: But that this is a bless in my mind because

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even like three years ago, most people probably didn't agree

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with this point of view. And if I could be

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confident of any prediction I could make, it's that within

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ten years old, people will be of this point of view,

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but we won't have made the transition yet, but we'll

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realize that it's a ridiculous debate to be having. You

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were a lone voice of sorts back then, probably amongst

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your cohort and friends and you know social.

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Speaker 4: Yes, actually I used to talk to like dates about

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electric cars.

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Speaker 3: How I go. It wasn't it wasn't helpful. It better.

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Speaker 4: Yeah, So, actually I ran into a girl I did

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briefly in Canada, Christy Nicholson. She's now at like a

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writer for Scientific American, and she mentioned, Yeah, when we

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were on a date, I asked her, do you ever

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think about electric cars? And she said, no, I don't.

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So yeah, a while back, it's pretty I mean, almost

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everything's electric that we have in our daily lives here.

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Speaker 2: It was from the physics of it, Yeah, the heat

378
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loss of an eternal combustion engine just yeah, pretty amazing,

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pretty amazing. So I'm gonna I want to share a

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little story that leads to a question along a different angle.

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I don't think you've heard this before, so, but I

382
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find it fascinating. I was at a lunch at a

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Google event, and out of the blue, with no expectation

384
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this would be a topic, Larry Page turned to me,

385
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knowing a little bit about our connection, said.

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Speaker 1: You know, how much money do I have?

387
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Speaker 2: And you mentioned a number. I thought that was cute

388
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that he was trying to recall that. He goes, you know,

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if I were to get hit by a bus today,

390
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I should leave all of it to Elon Musk.

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Speaker 3: Really, yeah, he said that.

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Speaker 2: Yeah, And and so I'm like paper pen.

393
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Speaker 1: Yes, so he likes, he likes singers, he likes.

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Speaker 3: He's like a good friend of mine.

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Speaker 1: So he was so context is important, you know.

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Speaker 4: I mean I met Larry before he got venture funding. Yeah,

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so that's.

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Speaker 3: That's like.

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Speaker 1: Yeah, yeah, wow.

400
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Speaker 2: Well he's a remarkable guy, obviously also underachiever, and you know,

401
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has a company that wants to do good in the world, right,

402
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And I think he looks at you with a bit

403
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of end because what he then proceeded to say was,

404
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you know, I could give my money to nonprofit and

405
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a lot less we get done than a corporation that's

406
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pursuing things that are directly aligned with things I care

407
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about like getting off of oil and colonizing other planets.

408
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He bleeds in those missions and thinks that a corporation

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with endowed with the right to do that has his

410
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business purpose, is the best vehicle out there, and wishes

411
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he could do more of that in his own life.

412
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He compared poigntly, I think to some other software companies

413
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in the Pacific Northwest who might have executives who do

414
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evil for the first part of the career, then do

415
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good for the second half, and then the sad story

416
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of others who'd never get to the second half of

417
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their life, like Steve Jobs. I mean not in a

418
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joking way, I mean seriously, and it was a very

419
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deep moment. So it raises the question of a purpose

420
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driven business. So you've heard already that Tesla is not

421
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just trying to make money. That is not the parody

422
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if you read the most recent shareholder letter.

423
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Speaker 4: Yes, in fact, I started off the the shareholder letter

424
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saying the profits are not our primary goal.

425
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Speaker 3: And then I got a little.

426
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Speaker 1: Bit of.

427
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Speaker 4: Some of the board members who question that statement, and

428
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I was like, well, it's true, you know.

429
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Speaker 2: Like like like for now or like just just while

430
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we're growing, But no, just not the parody, which I

431
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think in a business goal is a really good point

432
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to dwell on for a moment.

433
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Speaker 3: Yeah, it's not that I think they're unimportant or anything.

434
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It's just not the primary goal.

435
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Speaker 4: And I actually told me well that on IPO as well,

436
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And so it's not like new information at least, you know,

437
00:21:04,000 --> 00:21:06,279
if people had watched the IPR, it's not your information.

438
00:21:07,759 --> 00:21:12,119
And yeah, and actually amazing the stock went up after that.

439
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Speaker 1: Was I think there's a profound reason.

440
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Speaker 2: I mean, you see the benefits of being focused on

441
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something that's a higher calling as your primary motivation.

442
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Speaker 1: Your employees love.

443
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Speaker 2: At the customers love and partner's love, right, and you

444
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feel better about your job. The interesting thing, the irony perhaps,

445
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is that at least with an our portfolio, the companies

446
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that have that kind of a founding principle actually make

447
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more profit and grow their revenue more quickly than the.

448
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Speaker 1: Ones that don't.

449
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Speaker 2: You know, it's this low sample set, but the handful

450
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that had taken this bold of a step to say no, no,

451
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that we will not make that a number one priority

452
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actually do a great job. And it occurred to me,

453
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and I don't know if this was conscious in your head,

454
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at at some point that if you weren't wildly profitable,

455
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the auto industry wouldn't follow you. In other words, this

456
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whole mission of catalyzing a shift to a new electric

457
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vehicle isn't going to work if the business model is

458
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worse than a current business model.

459
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Speaker 1: And so even you know, it's the obvious byproduct.

460
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Speaker 2: Of what you're focusing on. I'm not obvious, but it

461
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curs to me that it's a byproduct. It wasn't obvious

462
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at first at all. But I'm curious that thought occurred

463
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to you, that all, yeah, the profits will come, or yeah, well.

464
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Speaker 4: We have to generate positive cash flow, or we have

465
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to generate enough cash flow to fund future developments, which

466
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requires having a good gross magin. And so I guess

467
00:22:23,839 --> 00:22:25,759
one could just say, okay, well we're going to stop

468
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developing your products, and then you would be really profitable.

469
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Speaker 3: So at any given point.

470
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Speaker 4: You could sort of say, we could be profitable, you know,

471
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at this point in a significant way, but we've got

472
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these great things that we want to develop for the future,

473
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and they're a good investment, and that's what we're doing.

474
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Speaker 2: And similarly, at SpaceX, the you know, the founding vision

475
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was to colonize Mars indirectly again interestingly catalyzing others to move. Yeah,

476
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and then you realize, hey, I've got to actually lead

477
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this charge.

478
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Speaker 3: Yeah, well, I mean with SpaceX.

479
00:22:56,440 --> 00:22:59,839
Speaker 4: Originally I started off just thinking, well, how do I

480
00:23:00,119 --> 00:23:01,240
increased NASA's budget.

481
00:23:01,400 --> 00:23:02,440
Speaker 3: Actually, that was my goal.

482
00:23:03,640 --> 00:23:07,160
Speaker 4: So it was like two thousand and one with just

483
00:23:07,160 --> 00:23:09,200
just Torn, a friend of mine, and he asked me.

484
00:23:09,519 --> 00:23:10,920
He asked me what I was going to do after PayPal,

485
00:23:11,000 --> 00:23:13,680
and I thought, well, you know, I was wondering, like

486
00:23:14,519 --> 00:23:16,160
I'd like to get involved in space, but I just

487
00:23:16,160 --> 00:23:19,599
didn't think there's anything as an individual. And but I

488
00:23:19,599 --> 00:23:22,400
was curious as to when we when we're NASA would

489
00:23:22,400 --> 00:23:26,200
be sending a team to Mars, because that was always

490
00:23:26,200 --> 00:23:27,119
going to be the thing to do.

491
00:23:27,119 --> 00:23:27,880
Speaker 3: After the Moon.

492
00:23:29,519 --> 00:23:31,240
Speaker 4: I figured that that there'd be some plan and I

493
00:23:31,279 --> 00:23:33,319
just go to the website and I could read, you know,

494
00:23:33,440 --> 00:23:39,759
the schedule, and oh yeah, it's like okay, twenty seventeen, good, okay,

495
00:23:40,720 --> 00:23:44,720
But actually there wasn't anything on the website, and or

496
00:23:44,720 --> 00:23:46,720
at least I thought like, am I cannot not find it?

497
00:23:46,759 --> 00:23:49,599
Like what's going on here? And is it secret?

498
00:23:49,680 --> 00:23:50,079
Speaker 3: I don't know?

499
00:23:50,960 --> 00:23:54,559
Speaker 4: So but it turned out that that NASA had done

500
00:23:54,559 --> 00:23:57,039
a study on what it would constant send to do

501
00:23:57,079 --> 00:24:01,759
a man Mars mission. And this was under Bush the

502
00:24:01,799 --> 00:24:05,640
first and in suppose he asked for a ninety day

503
00:24:05,640 --> 00:24:09,319
study short laughter taking office and now so he came

504
00:24:09,359 --> 00:24:12,000
back with a five hundred billion dollar price tag and

505
00:24:12,039 --> 00:24:14,799
he said, okay, maybe not billion. That's when five hundred

506
00:24:14,799 --> 00:24:16,279
billion dollars was serious money.

507
00:24:18,880 --> 00:24:21,799
Speaker 3: For the government. So I.

508
00:24:23,400 --> 00:24:25,400
Speaker 4: So then that got totally shelved and it was like

509
00:24:25,519 --> 00:24:27,400
you were not allowed to talk about any kind of

510
00:24:27,480 --> 00:24:29,279
crude mission to Mars at NASA.

511
00:24:31,079 --> 00:24:31,400
Speaker 3: Anyway.

512
00:24:31,440 --> 00:24:34,000
Speaker 4: So but I thought, well, if I can do something

513
00:24:34,000 --> 00:24:38,359
that would galvanize public interest that and then that public

514
00:24:38,400 --> 00:24:43,440
interest would translate to additional appropriations for NASA and increased

515
00:24:43,440 --> 00:24:45,880
that their budget, then maybe they could do it. So

516
00:24:46,440 --> 00:24:49,559
so actually, what I sort of thinking I would do

517
00:24:49,680 --> 00:24:53,079
is send us a small greenhouse the service of Mars

518
00:24:53,720 --> 00:24:56,720
seats in dehydrated jail and then upon landing, hydrate to

519
00:24:56,799 --> 00:24:59,000
jail to grow the plants. And the public tends to

520
00:24:59,000 --> 00:25:01,519
respond to precedents superlatives, so this would be the furthest

521
00:25:01,519 --> 00:25:04,799
that life's ever traveled, the first life on Mars. And

522
00:25:05,519 --> 00:25:07,480
you have this great shot of green plants on a

523
00:25:07,599 --> 00:25:08,960
red background, and.

524
00:25:09,400 --> 00:25:11,240
Speaker 3: I thought, okay, maybe that would get the money shot.

525
00:25:12,200 --> 00:25:12,839
The money shot.

526
00:25:12,920 --> 00:25:15,519
Speaker 4: Yeah, I'm never quite sure whether that's the sort of

527
00:25:15,640 --> 00:25:23,039
a word you can use or not. Now i'm realizing maybe, yeah,

528
00:25:23,279 --> 00:25:26,599
I didn't. I didn't know its origins until somebody pointed.

529
00:25:26,319 --> 00:25:26,759
Speaker 3: It out to me.

530
00:25:26,839 --> 00:25:33,720
Speaker 2: But so moving back to that greenhouse on Marsh, Yes,

531
00:25:33,880 --> 00:25:35,319
the photo is out.

532
00:25:35,160 --> 00:25:41,079
Speaker 4: There and you have this great photo, and I thought, okay,

533
00:25:41,200 --> 00:25:43,400
if we could make this happen to be cool and

534
00:25:43,640 --> 00:25:44,839
now so we get the money and they could do

535
00:25:44,880 --> 00:25:47,359
they could sort of send a team.

536
00:25:47,160 --> 00:25:50,599
Speaker 3: To Mars and be great. So I tried to trying

537
00:25:50,599 --> 00:25:51,039
to figure.

538
00:25:50,880 --> 00:25:52,599
Speaker 4: Out how to do this with the proceeds that I

539
00:25:52,640 --> 00:25:56,799
had from from PayPal, and I was able to figure

540
00:25:56,799 --> 00:25:59,640
out how to get the cost of the spacecraft down

541
00:25:59,680 --> 00:26:03,680
and the munications and the little greenhouse and everything. But

542
00:26:03,680 --> 00:26:05,599
the one thing I couldn't compress was the cost launch.

543
00:26:05,799 --> 00:26:08,359
It was only a few options, and the US options

544
00:26:08,359 --> 00:26:11,680
were way too expensive, and so I ended up going

545
00:26:11,759 --> 00:26:15,160
to Russia three times to try to buy the biggest

546
00:26:15,319 --> 00:26:16,759
ICBM in the Russian nuclear fleet.

547
00:26:18,319 --> 00:26:19,160
Speaker 1: That's where I started.

548
00:26:19,240 --> 00:26:24,039
Speaker 4: Yeah, yeah, I mean, okay, that.

549
00:26:26,519 --> 00:26:26,680
Speaker 6: Was it.

550
00:26:26,799 --> 00:26:27,000
Speaker 3: Was.

551
00:26:27,039 --> 00:26:31,400
Speaker 4: There was some strange trips, that's for sure, but you're

552
00:26:31,480 --> 00:26:34,039
just like virtually like you can buy any.

553
00:26:33,880 --> 00:26:36,559
Speaker 3: It's a very capitalist society in some ways.

554
00:26:38,480 --> 00:26:40,960
Speaker 4: So I actually did negotiate a deal to buy two

555
00:26:40,960 --> 00:26:46,119
of the ICBMs minus the nukes. And but I came

556
00:26:46,160 --> 00:26:49,480
to the conclusion after that their trip that it wouldn't

557
00:26:49,480 --> 00:26:51,920
really matter, like if if I actually came innclusion that

558
00:26:51,960 --> 00:26:56,440
my initial premise was was was wrong, because I actually

559
00:26:56,480 --> 00:27:01,279
think there's there's amount of will in American population, particularly

560
00:27:01,920 --> 00:27:06,920
to explore the United States, you know, maybe more than

561
00:27:06,960 --> 00:27:11,119
any other country, is a distillation of the human sporad

562
00:27:11,119 --> 00:27:15,759
of exploration, and it's really fundamental to psyche. So if

563
00:27:15,759 --> 00:27:17,759
people think there's a way, I think you actually get

564
00:27:17,759 --> 00:27:21,440
a lot of sport. But then it can't be just

565
00:27:21,440 --> 00:27:23,039
bang your head against the wall. I gotta believe that

566
00:27:23,079 --> 00:27:27,039
this can be done without breaking the federal budget. So

567
00:27:27,839 --> 00:27:30,240
that's when I said, Okay, well, is there some way

568
00:27:30,279 --> 00:27:35,400
to affect the cost of space transport and and and

569
00:27:35,519 --> 00:27:39,400
so I got together with a group of people of

570
00:27:39,519 --> 00:27:42,000
a series of saturdays just to just try tounside. Is

571
00:27:42,000 --> 00:27:46,480
there something super fundamentally super expensive about rockets or can

572
00:27:46,559 --> 00:27:53,200
the cost be substantially improved. And we had a bunch

573
00:27:53,200 --> 00:27:56,519
of those kind of brainstorming sessions and I couldn't see

574
00:27:56,599 --> 00:27:59,279
I couldn't see any fundamental obstacle to improving the cost

575
00:27:59,279 --> 00:27:59,960
of rockets.

576
00:28:00,079 --> 00:28:03,000
Speaker 3: So that's when I started SpaceX.

577
00:28:04,480 --> 00:28:05,640
Speaker 1: I'll just build them myself.

578
00:28:06,119 --> 00:28:06,319
Speaker 7: Yeah.

579
00:28:06,319 --> 00:28:07,720
Speaker 1: And then but I.

580
00:28:07,599 --> 00:28:09,480
Speaker 4: Said, at that point I would just say the probity

581
00:28:09,519 --> 00:28:12,319
of success was definitely less than fifty percent. I thought

582
00:28:12,319 --> 00:28:15,559
it would most likely not succeed, but what's worth a try.

583
00:28:16,240 --> 00:28:19,119
Speaker 2: But it's fascinating. But the parallels are so many between

584
00:28:19,160 --> 00:28:23,200
these companies. Again, probability is low, certainty that it needs

585
00:28:23,240 --> 00:28:26,160
to be done, certainly that it could be done by

586
00:28:26,200 --> 00:28:29,160
for physics, and first principles that it's the success is

587
00:28:29,200 --> 00:28:33,240
an option, right, it's one of the possibilities. And interestingly,

588
00:28:33,400 --> 00:28:35,720
starting with a roadster and a Falcon one as a

589
00:28:35,839 --> 00:28:38,359
proof point to a larger design. You know, as I

590
00:28:38,359 --> 00:28:41,079
look at the Falcon nine and it looks like the

591
00:28:41,079 --> 00:28:44,000
product of a software engineer modular reuse, like let's build

592
00:28:44,000 --> 00:28:47,279
one engine and step and repeat and building all kinds

593
00:28:47,279 --> 00:28:51,680
of elegance into the system design to abstract away almost

594
00:28:51,680 --> 00:28:54,359
from the hardware into the software, into the design the

595
00:28:54,359 --> 00:28:56,880
beauty of the system. And I wonder if that's why

596
00:28:56,880 --> 00:28:58,880
incumbents don't see the sort of re engineering of the.

597
00:28:59,000 --> 00:29:01,119
Speaker 1: Of the car, of the rocket, or the what have you.

598
00:29:01,720 --> 00:29:03,519
Speaker 2: The hyper loop is this, they don't approach it in

599
00:29:03,559 --> 00:29:05,599
that kind of blank sheet of paper. How would you

600
00:29:05,640 --> 00:29:07,839
do this if you didn't have to create jobs across

601
00:29:07,880 --> 00:29:09,640
district or you didn't have some other ulterior motive?

602
00:29:10,279 --> 00:29:11,880
Speaker 1: Interesting, interesting looking at the.

603
00:29:11,839 --> 00:29:13,880
Speaker 2: Time I want to give I'll ask one last question,

604
00:29:13,920 --> 00:29:15,599
but i'll give a heads up on there's Mike's to

605
00:29:15,599 --> 00:29:17,480
start getting them ready for audience, because I don't want

606
00:29:17,480 --> 00:29:21,559
to monopolize people's time here. Actually, there's so many questions

607
00:29:21,599 --> 00:29:24,359
i'll ask, but what I'll start with maybe and here

608
00:29:24,359 --> 00:29:26,960
for at least some of the quirky.

609
00:29:26,680 --> 00:29:28,000
Speaker 1: One about influences.

610
00:29:28,319 --> 00:29:31,880
Speaker 2: So you, uh, we've heard about the Iron Man reference

611
00:29:31,920 --> 00:29:34,599
and your childhood interest in comic books and Hitchiker's Guy

612
00:29:34,680 --> 00:29:39,519
the Galaxy and as them off. But there's all kinds

613
00:29:39,519 --> 00:29:42,200
of things woven into like cyber nine systems that at.

614
00:29:42,119 --> 00:29:44,319
Speaker 1: SpaceX that we heard, and then some Easter eggs.

615
00:29:44,400 --> 00:29:48,119
Speaker 2: So some of us noticed that the steria goes to

616
00:29:48,160 --> 00:29:50,160
eleven right on the on the Tesla. This is the

617
00:29:50,160 --> 00:29:52,480
spinal type reference for those who know that this one

618
00:29:52,559 --> 00:29:54,319
goes to eleven and he just just one more.

619
00:29:54,319 --> 00:29:56,519
Speaker 3: Louder than loud. That's right, exactly, that's right.

620
00:29:57,319 --> 00:29:59,720
Speaker 2: But no one seems to have noticed the product lineups.

621
00:29:59,759 --> 00:30:02,200
You got the models, you got the Model X. Oh

622
00:30:02,920 --> 00:30:04,480
you've just trademarked the Model E.

623
00:30:05,039 --> 00:30:05,279
Speaker 3: Yeah.

624
00:30:05,480 --> 00:30:08,240
Speaker 1: No, one's yeah, you got and the model and the

625
00:30:08,240 --> 00:30:08,720
Model Y.

626
00:30:09,160 --> 00:30:12,960
Speaker 4: No, I know exactly, but there's not I guess there's

627
00:30:12,960 --> 00:30:15,559
not a lot of humor and trademark uh, the trademark law,

628
00:30:15,720 --> 00:30:20,640
you know, because yeah, obviously we just trademarked sexy.

629
00:30:20,960 --> 00:30:22,240
Speaker 3: So uh.

630
00:30:22,519 --> 00:30:25,799
Speaker 4: And then we're having this this discussion with the like

631
00:30:25,960 --> 00:30:27,319
Ford because they.

632
00:30:29,599 --> 00:30:30,640
Speaker 3: The Ford's Council.

633
00:30:32,960 --> 00:30:35,319
Speaker 4: They also didn't get it, like because because they're they're

634
00:30:36,599 --> 00:30:38,720
sort of slightly opposing us using Model E.

635
00:30:39,759 --> 00:30:40,599
Speaker 3: And then they saw that we.

636
00:30:40,519 --> 00:30:42,400
Speaker 4: Were registered Model Y and they said, oh, you're planning

637
00:30:42,440 --> 00:30:43,839
to use Model WY instead of Model E.

638
00:30:44,119 --> 00:30:45,599
Speaker 3: Like, no, it's just a joke.

639
00:30:48,720 --> 00:30:49,279
Speaker 1: We don't do that.

640
00:30:50,200 --> 00:30:51,319
Speaker 3: What is this foul? Come on?

641
00:30:53,799 --> 00:30:56,599
Speaker 2: Fantastic? Well do we I'll keep going if we don't.

642
00:30:56,599 --> 00:30:58,599
But do we have microphones for folks if they want

643
00:30:58,599 --> 00:30:58,960
to ask.

644
00:30:58,839 --> 00:31:01,519
Speaker 1: Questions Okay, let's do a qu see if anyone Oh

645
00:31:01,559 --> 00:31:03,200
my gosh, yes we have them. Why don't we do that.

646
00:31:03,279 --> 00:31:06,480
Let's take a couple of questions in the audience and

647
00:31:06,559 --> 00:31:08,759
I'll let you guys figure out how to do the allocations.

648
00:31:10,519 --> 00:31:11,200
Thank you very much.

649
00:31:12,079 --> 00:31:18,119
Speaker 6: I heard you talk about supersonic aircraft. You guys have

650
00:31:18,160 --> 00:31:22,920
done some beautiful work at space X on be tall. Ah.

651
00:31:23,279 --> 00:31:27,480
Clearly tesla is is focused on electric. Have you thought

652
00:31:27,519 --> 00:31:31,240
about the the synergies of electric and be tall and

653
00:31:31,400 --> 00:31:35,000
aircraft for solving the four or five challenge?

654
00:31:35,240 --> 00:31:38,519
Speaker 3: For solving the four five film? Well, I mean, I

655
00:31:38,559 --> 00:31:39,839
do think there's there's a there's.

656
00:31:39,720 --> 00:31:41,119
Speaker 1: A real vertical take off and landing.

657
00:31:41,200 --> 00:31:45,240
Speaker 4: Yeah right, sorry, vertical take for landing is vitall? And

658
00:31:45,440 --> 00:31:49,440
uh yeah, I do think there's there's a really like

659
00:31:49,440 --> 00:31:51,960
the I think the optimal sort of air transport solution

660
00:31:52,200 --> 00:31:58,319
is a vetall electric supersonic plane and and it actually

661
00:31:58,359 --> 00:32:01,039
works together quite well for a bunch of reasons.

662
00:32:04,640 --> 00:32:07,960
Speaker 3: In particular, the higher you go, the better.

663
00:32:07,839 --> 00:32:10,559
Speaker 4: The electric the more efficient the electric aircraft is, whereas

664
00:32:10,559 --> 00:32:12,960
if you have a combustion aircraft, as you as you

665
00:32:12,960 --> 00:32:15,160
get higher it get it tends to get worse because

666
00:32:15,200 --> 00:32:15,880
you have a kind of.

667
00:32:15,880 --> 00:32:19,000
Speaker 3: A fixed aperture and airscoope.

668
00:32:19,200 --> 00:32:21,960
Speaker 4: Yeah, like the engine is the hole in the front

669
00:32:21,960 --> 00:32:25,559
of the engine is a fixed size, and so you

670
00:32:25,599 --> 00:32:27,759
have to pick a particular cruising altitude and so you've

671
00:32:27,759 --> 00:32:30,359
got to figure out how do you get the right

672
00:32:30,400 --> 00:32:32,359
amount of air at sea level.

673
00:32:32,079 --> 00:32:33,720
Speaker 3: All the way through really high altitude.

674
00:32:34,400 --> 00:32:36,880
Speaker 4: And then you've got this issue of super supersonic combustion

675
00:32:37,119 --> 00:32:38,480
that you know, you see, you end up having to

676
00:32:38,480 --> 00:32:40,839
slow the air down and it ends up being not

677
00:32:41,160 --> 00:32:43,359
that efficient. But electric after aircraft would just get better

678
00:32:43,400 --> 00:32:46,680
and better as it got the higher and then electric

679
00:32:47,240 --> 00:32:51,160
motors have a higher power weight ratio than a combustion engine,

680
00:32:51,200 --> 00:32:54,319
so you could you can actually have the power to

681
00:32:54,319 --> 00:32:57,200
do the vertical takeoff landing part with a fairly small

682
00:32:57,400 --> 00:33:02,759
motor compared to combustion. And then you could get rid

683
00:33:02,759 --> 00:33:08,119
of the elevator and uh and rider, so you don't

684
00:33:08,119 --> 00:33:10,400
need the rare control services if you gimble the end

685
00:33:10,559 --> 00:33:11,400
that you can gimble the.

686
00:33:11,359 --> 00:33:14,920
Speaker 2: Motor gotch so it starts to look like a podcraft,

687
00:33:15,039 --> 00:33:18,680
like yeah, Bolivian or something, right.

688
00:33:19,400 --> 00:33:23,160
Speaker 4: And so it's it's yeah, it's something quite the real

689
00:33:23,160 --> 00:33:24,640
trick of it is like, how do you make it

690
00:33:24,720 --> 00:33:29,240
really long range and at least as safe as existing aircraft?

691
00:33:30,240 --> 00:33:33,559
But those are really the only two questions on that front,

692
00:33:33,680 --> 00:33:37,880
I think. But they're they're tricky, they're certainly.

693
00:33:37,799 --> 00:33:39,200
Speaker 1: Don't underestimate those questions.

694
00:33:42,279 --> 00:33:44,160
Speaker 2: Great, let's go to the next one.

695
00:33:44,240 --> 00:33:44,839
Speaker 1: Or whoever has a.

696
00:33:44,839 --> 00:33:48,839
Speaker 2: Mic, however, we're doing the allocation fairly and efficiently.

697
00:33:51,160 --> 00:33:52,799
Speaker 1: Let me give him a hand. Okay, No that we

698
00:33:52,839 --> 00:33:53,640
have someone great.

699
00:33:53,680 --> 00:33:57,160
Speaker 7: Young GSP and Andy four Hey, Steve by a long time.

700
00:33:57,160 --> 00:34:02,960
And one question, are you as Tesla going to expand

701
00:34:02,960 --> 00:34:07,039
the worldwide? And I think GSB is going to host

702
00:34:07,319 --> 00:34:11,679
China two point zero tomorrow, and do you have any

703
00:34:11,760 --> 00:34:15,360
plans to go into the biggest car market today? But

704
00:34:15,480 --> 00:34:18,719
I know you're a little concerned through another friend of mine,

705
00:34:18,719 --> 00:34:21,800
I actually asked you indirectly a few years ago that

706
00:34:21,880 --> 00:34:28,679
you were concerned about the secret and the parenting in

707
00:34:28,719 --> 00:34:32,079
the Chinese market. Are you still concerned about that or

708
00:34:32,480 --> 00:34:33,400
you have a strategy?

709
00:34:34,599 --> 00:34:38,519
Speaker 4: Yeah, So Tesla is definitely going to ship worldwide. In fact,

710
00:34:38,559 --> 00:34:41,320
the Tesla roadsters in thirty one countries right now, and

711
00:34:41,400 --> 00:34:46,880
we expect to ship the model ast to China starting

712
00:34:46,880 --> 00:34:50,880
next year as well. As to Japan and Hong Kong

713
00:34:50,920 --> 00:34:56,320
and Singapore and Morella and Australia. So really it's going

714
00:34:56,400 --> 00:35:00,880
to be quite widely distributed next year. Certainly, China is

715
00:35:00,880 --> 00:35:06,559
an extremely important market in fact, for premium sedans. China

716
00:35:06,639 --> 00:35:10,960
is about half the world market for premium sedans. So

717
00:35:11,039 --> 00:35:14,320
if it takes some growing, yeah, to take something Mercedes

718
00:35:14,400 --> 00:35:17,000
S class, but last year fifty four percent of Mercedes

719
00:35:17,000 --> 00:35:20,079
S classes was sold in China, so pretty important market.

720
00:35:22,079 --> 00:35:28,079
And yeah, so we're gonna definitely do a major push

721
00:35:28,119 --> 00:35:31,280
in China. And actually some of the most enthusiastic potential

722
00:35:31,280 --> 00:35:35,880
customers we've seen are people from China, So we actually

723
00:35:35,920 --> 00:35:38,559
want to make sure that the car actually has features

724
00:35:38,559 --> 00:35:42,679
which are specific to the Chinese market and make sure

725
00:35:42,719 --> 00:35:44,639
that it's not just you know, taking an American product

726
00:35:44,639 --> 00:35:47,239
and you know, just sort of sending it to China

727
00:35:47,280 --> 00:35:48,280
without any any changes.

728
00:35:48,320 --> 00:35:49,800
Speaker 3: So we want to make sure it's tailored to the

729
00:35:49,840 --> 00:35:53,440
market and Japan as well.

730
00:35:53,440 --> 00:35:55,440
Speaker 4: I don't want to you know, a lot of it's

731
00:35:55,840 --> 00:35:57,960
not many American class sell in Japan, but I think

732
00:35:57,960 --> 00:36:01,760
that would be like which were symbolism. Yeah, I mean,

733
00:36:01,760 --> 00:36:05,960
like I think we should take the Japanese market seriously,

734
00:36:06,039 --> 00:36:08,760
and and I think if we do things right, we

735
00:36:08,960 --> 00:36:14,360
should have reasonable sales there. So yeah, so that that's

736
00:36:14,360 --> 00:36:17,280
going to be next year. I mean as far as

737
00:36:17,280 --> 00:36:19,800
copying stuff, I think that that's certainly a risk. I

738
00:36:19,840 --> 00:36:23,239
think China is actually getting a lot better these days,

739
00:36:23,239 --> 00:36:26,840
and I think the new government is taking taking intellectual

740
00:36:26,880 --> 00:36:31,880
property a lot more seriously. So I'm actually starting to

741
00:36:31,920 --> 00:36:36,039
feel more and more confident about that the technology not

742
00:36:36,079 --> 00:36:40,119
actually not being copied in China, or at least you know,

743
00:36:40,400 --> 00:36:43,800
it's getting much better. And I don't think it's going

744
00:36:43,880 --> 00:36:45,280
to be too much of an issue until we want

745
00:36:45,280 --> 00:36:49,159
to establish local production and that that's that's where you know,

746
00:36:49,199 --> 00:36:50,800
we need to make sure that we do it right.

747
00:36:50,840 --> 00:36:55,320
And there's not an incentive for the factory team that

748
00:36:55,320 --> 00:36:57,559
we established there to sort of go across the road

749
00:36:57,559 --> 00:36:59,039
and create a competing factory.

750
00:36:59,840 --> 00:37:01,840
Speaker 3: But but that'll that concern is a few years away.

751
00:37:04,039 --> 00:37:06,199
Speaker 2: Do you have an know that, oh yeah, up here

752
00:37:06,559 --> 00:37:10,519
and the students are largely upstairs that right, Yes, this

753
00:37:10,599 --> 00:37:11,039
is GARYL.

754
00:37:11,119 --> 00:37:14,199
Speaker 3: Parra, NBA student. First of all, thank you.

755
00:37:14,639 --> 00:37:17,400
Speaker 8: It is very inspiring to hear an experience about actually,

756
00:37:17,440 --> 00:37:21,440
you know, changing the war using organizations as the organs

757
00:37:21,599 --> 00:37:26,440
that you created hopefully will inspire another Ironman.

758
00:37:26,119 --> 00:37:26,719
Speaker 3: Movie as well.

759
00:37:27,480 --> 00:37:29,519
Speaker 8: And I was wondering if you can tell us more

760
00:37:29,519 --> 00:37:33,519
about the experience about like you know, how to balance

761
00:37:33,519 --> 00:37:35,760
you know, those straight off between your profits and you know,

762
00:37:35,880 --> 00:37:39,880
following purpose that goes forwarther than just make money. You know,

763
00:37:40,039 --> 00:37:42,679
you are trying to change the war, you know, well

764
00:37:42,760 --> 00:37:45,280
for the humanity rather than just make profits in the

765
00:37:45,320 --> 00:37:48,000
short term.

766
00:37:48,320 --> 00:37:49,719
Speaker 1: What was the question, I'm sure if I.

767
00:37:51,360 --> 00:37:57,960
Speaker 3: How do you balance? Well? Yeah, well, I mean, first

768
00:37:57,960 --> 00:37:58,760
of all, I should say.

769
00:37:59,000 --> 00:38:04,800
Speaker 4: Yeah, with with with all of the companies, but I

770
00:38:04,840 --> 00:38:09,840
think particularly SpaceX and Tesla, although there's in a good

771
00:38:09,880 --> 00:38:15,199
position today, they went through some super tough times and

772
00:38:15,599 --> 00:38:21,079
in fact, for SpaceX, I reserved to capital to do three,

773
00:38:21,159 --> 00:38:25,400
to have three launch failures, or to withstand two launch

774
00:38:25,440 --> 00:38:27,599
failures and have the third one b success sort of

775
00:38:27,679 --> 00:38:31,119
three strikes. And actually we had three launch failures, were

776
00:38:31,159 --> 00:38:33,559
just able to scrape enough money together for a fourth

777
00:38:33,559 --> 00:38:36,159
flight that succeeded in two thousand and eight.

778
00:38:36,280 --> 00:38:37,800
Speaker 3: And then also in two thousand and eight.

779
00:38:38,400 --> 00:38:42,679
Speaker 4: As Steve knows, we got the Tesla financing round done

780
00:38:42,840 --> 00:38:44,639
on the last hour of the last day. It was

781
00:38:45,199 --> 00:38:48,119
like six PM December twenty fourth, two thousand and eight.

782
00:38:48,480 --> 00:38:52,559
And if we hadn't gotten it down then the company

783
00:38:52,559 --> 00:38:54,800
would have gone bankrupt a few days after Christmas.

784
00:38:55,039 --> 00:38:58,079
Speaker 1: So what he's not the only reason that happened is

785
00:38:58,079 --> 00:38:58,679
he wrote.

786
00:38:58,440 --> 00:39:02,360
Speaker 2: A check for the remainder of his wealth to save

787
00:39:02,400 --> 00:39:04,760
the company during payroll and Christmas when no one else

788
00:39:04,760 --> 00:39:07,599
would and Goldwin had just failed the private offering and

789
00:39:07,639 --> 00:39:10,559
the financial collapse was amongst us. There was no deal,

790
00:39:10,679 --> 00:39:13,320
we loan, there was no Daimler deal. The car had

791
00:39:13,320 --> 00:39:14,360
a negative gross margin.

792
00:39:14,519 --> 00:39:15,920
Speaker 1: It was not pretty.

793
00:39:15,920 --> 00:39:17,880
Speaker 2: Oh and you had you know, your largest yearholder just

794
00:39:17,880 --> 00:39:19,199
completely pissed off.

795
00:39:18,960 --> 00:39:23,119
Speaker 1: And you know, gong a wall. Yeah yeah, it was ugly.

796
00:39:23,360 --> 00:39:24,880
Speaker 8: Yeah Yeah.

797
00:39:24,920 --> 00:39:26,000
Speaker 3: It was a stressful period.

798
00:39:27,920 --> 00:39:28,800
Speaker 4: And that was just at work.

799
00:39:29,159 --> 00:39:30,239
Speaker 3: Yeah.

800
00:39:30,559 --> 00:39:32,679
Speaker 4: So so for a while that really wasn't a question

801
00:39:32,760 --> 00:39:36,519
of profit or nonprofit is It was like we need

802
00:39:36,559 --> 00:39:36,920
to live?

803
00:39:37,639 --> 00:39:38,280
Speaker 3: How do we live?

804
00:39:39,639 --> 00:39:44,079
Speaker 4: So that was the main challenge. And and and now,

805
00:39:44,199 --> 00:39:45,840
I mean now we're at the sort of the stage

806
00:39:45,840 --> 00:39:50,159
where we can say, okay, we can shift the dial

807
00:39:50,199 --> 00:39:53,920
between we could we could make let's say, at this point,

808
00:39:53,960 --> 00:39:56,400
a medium amount of profit or a small amount which

809
00:39:56,440 --> 00:39:59,800
sort of chosen to make a small amount because we

810
00:39:59,840 --> 00:40:03,559
can reinvest the cash flow into future products. So now

811
00:40:03,559 --> 00:40:05,840
we're you know, right now, we're reinvesting the cash flow

812
00:40:05,880 --> 00:40:09,679
into developing the Model X, which is an suv, and

813
00:40:09,840 --> 00:40:14,800
to increasing the production capacity of the factory and doing

814
00:40:15,079 --> 00:40:17,280
a little bit of advanced planning on the third generation

815
00:40:17,360 --> 00:40:22,440
vehicle that'll be a mass market sort of affordable, compelling

816
00:40:22,440 --> 00:40:27,599
electric car. So so that's really I guess what what's

817
00:40:27,639 --> 00:40:31,760
meant by in this case not pursuing We're not trying

818
00:40:31,760 --> 00:40:35,159
to maximize profit at this point because it would constrain

819
00:40:35,199 --> 00:40:38,639
the business, the growth of the business, and constrain the

820
00:40:38,639 --> 00:40:44,079
overall objective of transitioning the world towards electric cars. So

821
00:40:44,159 --> 00:40:46,320
I don't think against profit in general, but it's just

822
00:40:46,400 --> 00:40:49,679
it's just it's not I mean, I actually don't think

823
00:40:49,719 --> 00:40:51,599
it's the smart move. I mean, if one were to

824
00:40:51,639 --> 00:40:53,880
take the net present value of future cash flows, I

825
00:40:53,880 --> 00:40:56,679
think maximizing profit at the stage is actually not the

826
00:40:56,719 --> 00:40:58,159
smart move, you know.

827
00:41:00,079 --> 00:41:01,960
Speaker 2: And it's interesting because earlier I said, we get back

828
00:41:02,000 --> 00:41:03,880
to it, you mentioned that your goal was not to

829
00:41:03,880 --> 00:41:06,400
start a company that has the chance of making the

830
00:41:06,400 --> 00:41:09,239
most money for you the quickest, right, and that the

831
00:41:09,280 --> 00:41:10,840
wealth personally is almost.

832
00:41:10,519 --> 00:41:13,039
Speaker 1: A byproduct of these activities.

833
00:41:12,480 --> 00:41:15,599
Speaker 2: Of passion and by analogy, like in the investment field

834
00:41:15,599 --> 00:41:16,320
inventric capital.

835
00:41:16,920 --> 00:41:18,159
Speaker 1: You know, you could look for the thing.

836
00:41:18,079 --> 00:41:20,880
Speaker 2: That'll make the most money the quickest, right, like a

837
00:41:20,880 --> 00:41:24,320
new ad network for social media, but who cares?

838
00:41:24,440 --> 00:41:26,159
Speaker 1: I guess it really just doesn't help the world in

839
00:41:26,199 --> 00:41:27,000
any meaningful way.

840
00:41:27,039 --> 00:41:29,519
Speaker 2: And there are much over longer if you take a

841
00:41:29,519 --> 00:41:31,440
longer term perspective, there are things you could do that

842
00:41:31,480 --> 00:41:33,440
don't answer the short term question of what's going to

843
00:41:33,519 --> 00:41:35,159
make me the most money this year or this five

844
00:41:35,239 --> 00:41:38,639
year period, but the over twenty years focusing on those ironically,

845
00:41:38,719 --> 00:41:41,199
he may make the most money right of any entrepreneur,

846
00:41:41,519 --> 00:41:44,239
or these companies might be more profitable than their cohort

847
00:41:44,360 --> 00:41:48,079
that doesn't follow that same purpose driven kind of almost

848
00:41:48,079 --> 00:41:48,840
messy onic zeal.

849
00:41:50,400 --> 00:41:53,400
Speaker 1: So there was a balance. Question almost implies the dichotomy.

850
00:41:52,920 --> 00:41:55,800
Speaker 2: That may not be opposed, but maybe aligned if you

851
00:41:55,960 --> 00:41:56,719
orchestrate it right.

852
00:41:56,960 --> 00:41:58,559
Speaker 3: Yeah, maybe more of a short term it's a long

853
00:41:58,639 --> 00:41:59,519
term approach.

854
00:41:59,679 --> 00:42:03,760
Speaker 1: Yeah, exactly, great. We have one hand up here, up here,

855
00:42:03,800 --> 00:42:05,199
another one occur sure up here?

856
00:42:05,239 --> 00:42:06,199
Speaker 3: This will be the last question.

857
00:42:06,239 --> 00:42:07,119
Speaker 1: Oh, this is the last question.

858
00:42:07,159 --> 00:42:14,320
Speaker 9: Okay, Yes, from your current car marketing strategy. You could

859
00:42:14,360 --> 00:42:17,480
say that your car is directed towards a luxury car marketplace,

860
00:42:17,519 --> 00:42:20,639
so that's a fairly well defined market. Do you have

861
00:42:20,679 --> 00:42:25,800
any plans for expanding it to the general marketplace, to say,

862
00:42:25,840 --> 00:42:28,519
make a car for the masses, which might be maybe

863
00:42:28,519 --> 00:42:33,519
in the twenty five to thirty five thousand dollars range.

864
00:42:34,320 --> 00:42:35,559
Speaker 3: Yeah, absolutely question.

865
00:42:36,960 --> 00:42:39,800
Speaker 4: In fact, for the first blog piece I wrote for

866
00:42:39,920 --> 00:42:46,199
Tesla was the Tesla master Plan, which is to start

867
00:42:46,239 --> 00:42:49,199
off with an expensive, low volume vehicle, then go to

868
00:42:49,400 --> 00:42:52,480
a mid price mid volume, and then sort of low,

869
00:42:52,599 --> 00:42:55,760
low price, high volume. So we're kind of in phase

870
00:42:55,800 --> 00:43:00,519
two and without third generation vehicle, we expect to be

871
00:43:00,559 --> 00:43:03,639
somewhere in the thirty to thirty five thousand dollars range

872
00:43:03,639 --> 00:43:06,599
for the car, which when you're take into account the

873
00:43:06,599 --> 00:43:10,119
savings from the use of electricity instead of gasoline, is

874
00:43:10,159 --> 00:43:12,000
more like comparing it in the US to about a

875
00:43:12,000 --> 00:43:14,440
twenty eight thousand dollar car or in Europe to a

876
00:43:14,480 --> 00:43:16,719
twenty two thousand dollars car, and.

877
00:43:16,679 --> 00:43:18,559
Speaker 1: The maintenance is much the least to feel costs so much.

878
00:43:18,760 --> 00:43:20,559
Speaker 3: Yeah, absolutely, that's right.

879
00:43:20,800 --> 00:43:22,800
Speaker 2: Well, great, well, I want to thank you very much

880
00:43:23,039 --> 00:43:26,960
for this and transition to the closing segment of our invenite.

881
00:43:27,039 --> 00:43:27,800
Speaker 1: Thank you all right,