WEBVTT 1 00:00:00.000 --> 00:00:00.600 It was a little bit. 2 00:00:00.720 --> 00:00:04.639 I was interested by your background. You Uh, you finished 3 00:00:04.639 --> 00:00:06.799 your bachelor's degree at Warden and then you stayed on 4 00:00:06.919 --> 00:00:10.400 an additional year and got a physics degree when I 5 00:00:10.400 --> 00:00:14.320 imagine almost all of your classmates went to Wall Street, 6 00:00:15.080 --> 00:00:16.960 so that must have must have been a pretty tough year. 7 00:00:19.039 --> 00:00:20.760 Did you have a vision at this point for what 8 00:00:20.839 --> 00:00:22.359 you ultimately wanted to achieve? 9 00:00:24.719 --> 00:00:28.440 Well, I, uh, yeah, there were three things in college 10 00:00:28.440 --> 00:00:31.920 that I thought would most affect the world, and there 11 00:00:31.920 --> 00:00:36.520 were the Internet, sustainable energy, and space exploration. I didn't 12 00:00:36.560 --> 00:00:38.079 think I'd be involved in all three of those, but 13 00:00:38.240 --> 00:00:41.640 as it turns out, some success in the internet right 14 00:00:41.679 --> 00:00:44.200 now I was able to get involved in rockets and cars, 15 00:00:44.240 --> 00:00:45.520 which are pretty capital intensive. 16 00:00:47.920 --> 00:00:51.280 And but yeah, after sort of finishing the undergrad. 17 00:00:52.320 --> 00:00:54.880 I I decided I didn't want to work on Wall 18 00:00:54.880 --> 00:00:57.799 Street or work for McKenzie or something like that, which 19 00:00:57.920 --> 00:01:01.039 everybody else went to walk do do. And uh, I'd 20 00:01:01.079 --> 00:01:05.439 taken enough sort of physics electives so that I could 21 00:01:05.519 --> 00:01:07.879 just spend another year and finish of physics degree and 22 00:01:07.920 --> 00:01:11.079 then and then heads to California to do grad studies 23 00:01:11.079 --> 00:01:15.079 at Stafford and material science applied physics, working on hein 24 00:01:15.120 --> 00:01:19.640 inch sinsity capacities for electric vehicles, and then I ended 25 00:01:19.680 --> 00:01:22.239 up putting that on a hold too, really dropping out 26 00:01:23.079 --> 00:01:26.760 going back technically, I'm justerment. Dean says, I can come 27 00:01:26.760 --> 00:01:30.840 back any time, but that's unlikely. 28 00:01:31.920 --> 00:01:35.040 So you know, with that Stanford degree, you might really 29 00:01:35.079 --> 00:01:36.680 do something for life exactly. 30 00:01:40.319 --> 00:01:40.760 Yeah, so. 31 00:01:42.519 --> 00:01:44.159 Did a couple of internet companies and then kind of 32 00:01:44.159 --> 00:01:48.400 circled back to electric cars and and then in rockets. 33 00:01:48.560 --> 00:01:54.799 Yeah, it's a typical story, right, So. 34 00:01:57.640 --> 00:01:59.359 You know, it seems like a long time ago now, 35 00:01:59.400 --> 00:02:02.879 but you know, I think probably you know, your entire 36 00:02:02.920 --> 00:02:05.040 background is very interesting, you know for us, you know, 37 00:02:05.159 --> 00:02:07.239 we were we were you know, we were an internet 38 00:02:07.239 --> 00:02:09.199 company at our at our core as well, and we 39 00:02:09.360 --> 00:02:09.960 came up. 40 00:02:10.039 --> 00:02:12.319 Really during the same period of time as PayPal. 41 00:02:13.080 --> 00:02:16.120 To me, one of the really interesting things about you, 42 00:02:16.159 --> 00:02:18.039 and that is very similar to some of the history 43 00:02:18.039 --> 00:02:19.919 of our company, is that you have been very willing 44 00:02:19.960 --> 00:02:22.280 to put your own capital and your own money into 45 00:02:22.439 --> 00:02:25.560 into your business. And one of the most intriguing times 46 00:02:25.560 --> 00:02:28.039 for me for you was two thousand and eight with Tesla, 47 00:02:28.120 --> 00:02:30.639 and you went in and you were not originally the CEO, 48 00:02:30.800 --> 00:02:33.680 you were you were the funding. You know, you were 49 00:02:33.520 --> 00:02:35.719 the funder and the chairman, but then you were also 50 00:02:35.840 --> 00:02:38.719 just you were a developer. So talk a little bit 51 00:02:38.719 --> 00:02:40.560 about that time and you know what it was like 52 00:02:40.960 --> 00:02:42.840 to have basically everything on the line. 53 00:02:43.599 --> 00:02:50.360 Yeah, that was that was super unpleasant, that's for sure. Yeah, 54 00:02:50.400 --> 00:02:52.599 basically two thousand and seven, two thousand and eight, and 55 00:02:52.639 --> 00:02:53.840 two thousand and nine sucked. 56 00:02:53.960 --> 00:02:54.840 They were really horrible. 57 00:02:54.879 --> 00:02:56.240 It was awesome here in Washington. 58 00:02:59.759 --> 00:03:03.759 So so yeah, so you know, my thought with what 59 00:03:03.840 --> 00:03:07.000 I had originally hoped with Tesla, I mean, was that 60 00:03:07.080 --> 00:03:12.000 I wouldn't that I could just dedicate enough time to 61 00:03:12.039 --> 00:03:16.560 do product development but then not actually run the company. 62 00:03:16.680 --> 00:03:20.800 So that turned out to be a false assumption, and 63 00:03:20.919 --> 00:03:23.159 I was sort of faced with the choice of in 64 00:03:23.159 --> 00:03:25.879 two thousand and eight to either run the company and. 65 00:03:26.439 --> 00:03:30.800 Just work a lot more, or or would die mostly 66 00:03:30.840 --> 00:03:31.039 you know. 67 00:03:31.280 --> 00:03:35.319 So, Yeah, in two thousand and eight was particularly tough 68 00:03:35.319 --> 00:03:39.599 on a number of number of fronts because the third 69 00:03:39.680 --> 00:03:45.719 launch of the Falcon one rocket for SpaceX failed. The 70 00:03:45.759 --> 00:03:49.919 Tesla financing round fell apart because or we kept people 71 00:03:50.000 --> 00:03:52.000 kept telling us that the term sheet was just around 72 00:03:52.000 --> 00:03:52.319 the corner. 73 00:03:52.639 --> 00:03:54.159 They just want to see what the market's going to 74 00:03:54.240 --> 00:03:54.879 do like. 75 00:03:56.680 --> 00:04:01.520 It was great, we were doing the same thing right, 76 00:04:03.000 --> 00:04:08.400 So so Tesla desperately needed money, and then Solicity had 77 00:04:08.439 --> 00:04:12.759 a deal with Morgan Stanley, solo lease finance deal that 78 00:04:12.879 --> 00:04:14.319 Morgan Stanley themselves could. 79 00:04:14.159 --> 00:04:16.160 Not honor because they just didn't have money. 80 00:04:17.639 --> 00:04:19.879 And then I was also getting divorced, So that was 81 00:04:19.920 --> 00:04:27.879 like just ship on every level, utter misery. And then 82 00:04:27.879 --> 00:04:30.040 fortunately things perked up towards the end of the year. 83 00:04:30.519 --> 00:04:35.879 The fourth launch of Falcon one did work. Solicity was 84 00:04:35.920 --> 00:04:40.279 able to get through that period by just selling solar 85 00:04:40.319 --> 00:04:41.680 systems instead of leasing them. 86 00:04:42.040 --> 00:04:44.079 It was very tough Tesla. 87 00:04:44.879 --> 00:04:48.360 Tesla was probably the most difficult in that time because 88 00:04:49.639 --> 00:04:52.600 you know, obviously General Motives and Christ they were busy 89 00:04:52.680 --> 00:04:53.879 getting bankrupt. 90 00:04:55.240 --> 00:04:56.920 And trying to raise money. 91 00:04:57.040 --> 00:04:58.560 Can you imagine trying to raise money for a car 92 00:04:58.680 --> 00:05:02.560 company in late two thousand eight while Jero's and Christs 93 00:05:02.560 --> 00:05:04.959 are trying to are going bankrupt, and they're like asking 94 00:05:04.959 --> 00:05:09.160 for examples of prior successful car companies and the last, 95 00:05:09.279 --> 00:05:12.360 you know, the last examples are at least you know 96 00:05:12.439 --> 00:05:15.800 that they're not in delivering memory, you know, So there's 97 00:05:15.800 --> 00:05:19.160 that Tucker, Yeah, yeah, I mean they think of Tucker 98 00:05:19.160 --> 00:05:21.519 and Laurian. You know, it's like I've had a buck 99 00:05:21.560 --> 00:05:23.439 for every time somebody mentioned Laurien. I wouldn't need to 100 00:05:23.480 --> 00:05:30.319 have an IPO. So yeah, that was very difficult. In fact, 101 00:05:30.319 --> 00:05:32.160 the only way we could raise money was internally, so 102 00:05:33.160 --> 00:05:37.920 from existing investors and uh, and then I had to 103 00:05:38.000 --> 00:05:41.240 commit all of all of my available capital to to 104 00:05:41.360 --> 00:05:45.120 Tesla in order to get the other investors to do 105 00:05:45.199 --> 00:05:47.560 the other half of the round. And that was enough 106 00:05:47.560 --> 00:05:50.920 to get Tesla through that point. And then a lot 107 00:05:50.959 --> 00:05:54.000 of people assume that the deer we saved our butt, 108 00:05:54.000 --> 00:05:58.279 but actually it was Daimler. So that that in early 109 00:05:58.279 --> 00:06:03.120 two thousand and nine, Diamler invested fifty million dollars into Tesla, 110 00:06:03.160 --> 00:06:07.000 which was extremely important. Teslas didn't actually get any dearing 111 00:06:07.040 --> 00:06:08.279 money until twenty ten. 112 00:06:08.879 --> 00:06:13.040 So if that was alone, correct, correct the structure. 113 00:06:12.759 --> 00:06:17.720 Alone, and it's it's a staggered loan. It's actually what 114 00:06:18.439 --> 00:06:23.319 it is is as we incur expenses, those expenses and 115 00:06:23.319 --> 00:06:27.560 then audited by PwC, and the portion that is applicable 116 00:06:27.600 --> 00:06:32.839 to the model s and to powertrain deals or powertrains 117 00:06:32.839 --> 00:06:35.040 supply to other companies like the powertrainsply deal, we have 118 00:06:35.120 --> 00:06:40.120 to dime level Toyota. That portion is then reimbursed about 119 00:06:40.160 --> 00:06:44.079 a month or two later, because we also got some 120 00:06:44.120 --> 00:06:46.720 bullshit press about like, oh, the dear Wes, you know, 121 00:06:46.839 --> 00:06:48.800 giving us money for the for the roads to and 122 00:06:48.839 --> 00:06:51.120 it's like no, it's like literally impossible for them to 123 00:06:51.160 --> 00:06:56.199 do that. So yeah, I made the mistake of calling 124 00:06:56.240 --> 00:06:58.800 some the New York Times reporter who falsely reported that 125 00:06:58.920 --> 00:07:03.000 knowingly falsely report that a doucheback. If somebody knowingly falsely 126 00:07:03.040 --> 00:07:04.040 reports something. 127 00:07:03.800 --> 00:07:10.160 Look the truth. Well, I'm gonna ask you a we'll 128 00:07:10.199 --> 00:07:12.000 go from dark to light. Here's a question. 129 00:07:12.040 --> 00:07:15.000 I really never thought that i'd ask someone what was 130 00:07:15.040 --> 00:07:17.399 it like to have a rocket fail? 131 00:07:18.000 --> 00:07:19.439 I mean, I mean, that sucks. 132 00:07:19.439 --> 00:07:20.240 It's really terrible. 133 00:07:20.240 --> 00:07:24.120 It was, it was, but it looked kind of cool. 134 00:07:25.759 --> 00:07:32.199 It did look kind of cool, just between you and me. Well, 135 00:07:32.560 --> 00:07:33.319 so the first one. 136 00:07:33.319 --> 00:07:34.759 I mean, I guess a serious question. 137 00:07:34.839 --> 00:07:36.800 I mean, you had to expect that there was a 138 00:07:36.879 --> 00:07:39.240 very high likelihood that the rocket was you know that 139 00:07:39.720 --> 00:07:41.040 there were kind of a lot of things that could 140 00:07:41.079 --> 00:07:41.519 go wrong. 141 00:07:41.839 --> 00:07:43.040 Yes. Yes. 142 00:07:43.120 --> 00:07:45.399 At the beginning, at the start of SpaceX, I thought 143 00:07:45.399 --> 00:07:47.360 the chance of success of the company was less than 144 00:07:47.399 --> 00:07:52.079 fifty percent. How are we doing now, oh, I'd say, 145 00:07:52.879 --> 00:07:58.079 well ninety nine percent at this point, because well, SpaceX 146 00:07:58.079 --> 00:08:00.279 has been profitable for four years and will be proffible year. 147 00:08:00.319 --> 00:08:03.079 Is three billion dollars of contracts under revenue a contract, 148 00:08:03.519 --> 00:08:07.279 three billion dollars in revenue under contract, even if we 149 00:08:07.279 --> 00:08:10.600 didn't sell any more launches, would be profitable for the 150 00:08:10.600 --> 00:08:11.639 next just for several. 151 00:08:11.439 --> 00:08:13.720 Years existing the NASA contract. 152 00:08:13.759 --> 00:08:16.639 Correct, Yeah, the NASA is the biggest contract. But SpaceX 153 00:08:16.680 --> 00:08:19.040 has over thirty launches. Thirteen of those are for NASA, 154 00:08:19.439 --> 00:08:21.439 so about forty percent of our businesses with NASA. But 155 00:08:22.079 --> 00:08:24.800 you know, if you look at the government spending as 156 00:08:24.839 --> 00:08:26.720 a percentage of the economy, it's about forty percent. So 157 00:08:26.759 --> 00:08:29.319 even if you sold pencils, about forty percent of your 158 00:08:29.319 --> 00:08:30.399 business would be with the government. 159 00:08:32.240 --> 00:08:32.960 I've lost more. 160 00:08:35.279 --> 00:08:38.120 And then I was like to when when when the 161 00:08:38.879 --> 00:08:40.399 when the fourth rocket went up and it was a 162 00:08:40.440 --> 00:08:42.279 successful launch, that that had to. 163 00:08:42.279 --> 00:08:45.600 Be kind of cool too, Yeah, that was awesome. Was 164 00:08:45.639 --> 00:08:47.600 it was actually more just relief. I didn't feel elation. 165 00:08:47.679 --> 00:08:54.279 I just felt like extreme stress relief. Yeah, I actually 166 00:08:54.679 --> 00:08:56.360 were disappointed that I didn't feel happier. 167 00:08:57.559 --> 00:08:58.320 I just felt like. 168 00:08:58.559 --> 00:09:03.559 Slightly less stressed, just onder the next thing, well that 169 00:09:04.000 --> 00:09:08.120 the fourth launch just meant that we wouldn't die quite then. 170 00:09:10.159 --> 00:09:11.440 But well that's good news, right. 171 00:09:13.399 --> 00:09:17.120 But then we were awarded a big massa contract the 172 00:09:17.200 --> 00:09:20.440 end of literally I think it was December twenty third. 173 00:09:22.519 --> 00:09:24.240 In fact, the absolute low. 174 00:09:24.120 --> 00:09:27.200 Point was for me, it was I think December twenty 175 00:09:27.240 --> 00:09:31.200 second or twenty first of two thousand and eight, because 176 00:09:31.200 --> 00:09:35.960 even though we'd had the that Falcone success, the I mean, 177 00:09:36.360 --> 00:09:38.720 we didn't. We still had very few contracts and we 178 00:09:38.759 --> 00:09:40.399 didn't have enough money to keep the company going. We 179 00:09:40.440 --> 00:09:45.360 really needed a big contract win. And then NASA Corden 180 00:09:45.440 --> 00:09:51.120 said that they had awarded us the main contract for 181 00:09:52.679 --> 00:09:57.159 replacing the cargo transport function of the Space Shuttle and 182 00:09:57.600 --> 00:10:01.159 it was one point six billion. So I was like, 183 00:10:01.919 --> 00:10:03.440 I said, I love you guys. 184 00:10:03.759 --> 00:10:05.600 I don't know if that's your supposed to say that, but. 185 00:10:07.519 --> 00:10:09.960 Yeah, that was billion with a B right right right? 186 00:10:10.120 --> 00:10:16.320 I don't know, yes, lust all decorum. 187 00:10:17.679 --> 00:10:22.480 The I think one of the interesting things, you know, 188 00:10:22.559 --> 00:10:25.639 taking quotes from you, is that your cost is about 189 00:10:25.679 --> 00:10:28.639 one third you know, I believe that tried of of 190 00:10:28.639 --> 00:10:32.320 of the competitors for for for for rocket launches or yeah, 191 00:10:32.480 --> 00:10:35.559 are you are there things that you think that NASA 192 00:10:35.600 --> 00:10:37.960 could learn from private companies that are that are coming 193 00:10:38.000 --> 00:10:38.639 into the market. 194 00:10:38.679 --> 00:10:41.960 Now, yeah, you know, I think in general it's tough 195 00:10:42.000 --> 00:10:47.919 for government to do things efficiently, you know. So I 196 00:10:47.960 --> 00:10:50.519 mean I generally I think that that government should do 197 00:10:54.879 --> 00:10:57.080 try to minimize the number of things that government does. 198 00:10:58.480 --> 00:11:01.480 So I'm generally proponent of of of smaller government, not 199 00:11:01.519 --> 00:11:05.519 bigger government, just because government as a as a system 200 00:11:05.639 --> 00:11:08.440 is not an efficient system. So you want to minimize 201 00:11:08.480 --> 00:11:11.480 the government participation in the economy. That doesn't mean getting 202 00:11:11.559 --> 00:11:12.919 rid of it, but it's just saying you have to 203 00:11:13.039 --> 00:11:17.519 think really carefully before government does something versus free enterprise 204 00:11:17.600 --> 00:11:19.480 does something. For erprise is always going to be more efficient. 205 00:11:21.120 --> 00:11:25.519 So now, now there are things like like basic physics research, 206 00:11:25.639 --> 00:11:29.600 and obviously I think would rather have a government army 207 00:11:29.639 --> 00:11:34.279 than a private army. And I think probably a government 208 00:11:34.440 --> 00:11:37.279 justice system than a private justice system. You know, there's 209 00:11:37.320 --> 00:11:39.200 sort of things that are that the government should do 210 00:11:39.480 --> 00:11:42.200 and and also kind of doing things like the Hubble 211 00:11:42.600 --> 00:11:46.440 and the Mars rovers. You know, something like the Hubble 212 00:11:47.120 --> 00:11:50.320 is a small amount of good for everyone. Like it's like, well, 213 00:11:50.360 --> 00:11:52.240 we learn learn more about the universe, got some really 214 00:11:52.279 --> 00:11:57.240 cool pictures and and and that's that's that's that's a 215 00:11:57.360 --> 00:12:00.320 value to all of America and all of humanity really, 216 00:12:00.879 --> 00:12:02.519 but it's hard to say, like who's going to pay 217 00:12:02.519 --> 00:12:04.759 for it? If you try to raise private funds for it. 218 00:12:05.120 --> 00:12:06.320 I mean, you might be able to get it, but 219 00:12:06.360 --> 00:12:07.759 it's it's it's harder. 220 00:12:09.159 --> 00:12:11.240 So you got your money back from the last thing, right, 221 00:12:11.279 --> 00:12:12.480 so the. 222 00:12:14.639 --> 00:12:17.279 You got your money back from you know, having uh 223 00:12:17.840 --> 00:12:19.960 invested in Tesla and you know you just got the 224 00:12:19.960 --> 00:12:21.120 contract from NASA. 225 00:12:21.200 --> 00:12:25.960 So yeah, Actually, as it turns out, Tesla. 226 00:12:25.639 --> 00:12:29.440 And Space extensil the city are doing really well. 227 00:12:29.480 --> 00:12:33.559 And you know at the you know, the I think 228 00:12:33.600 --> 00:12:37.159 it's if you look at say the Tesla stock price, 229 00:12:37.200 --> 00:12:40.759 it's actually been remarkably stable. It's been sort of in 230 00:12:40.799 --> 00:12:44.399 the twenties for a year, despite massive grations in the market. 231 00:12:45.879 --> 00:12:48.200 And there was a there was a momentary short squeeze 232 00:12:48.240 --> 00:12:51.159 in December of last year, which there's a bunch of 233 00:12:51.240 --> 00:12:53.279 articles that reference, oh, Tesla had this high of like 234 00:12:53.279 --> 00:12:54.840 thirty six dollars. See that's not because there was a 235 00:12:54.840 --> 00:12:57.440 short squeeze at the end of December. It was because 236 00:12:57.799 --> 00:13:00.240 at the end of the that was when the six 237 00:13:00.279 --> 00:13:03.080 month lock up period for the IPO expired, and I 238 00:13:03.120 --> 00:13:05.000 think people in the market expected that there would be 239 00:13:05.000 --> 00:13:07.000 a lot of people selling stock at that point, and 240 00:13:07.039 --> 00:13:07.759 actually they won't. 241 00:13:07.840 --> 00:13:10.159 Just didn't happen, right, So it's a big short squeeze 242 00:13:10.159 --> 00:13:11.039 it took place. 243 00:13:12.080 --> 00:13:14.200 I think there's probably gonna be another short squeeze on 244 00:13:14.240 --> 00:13:16.960 Tesla because, like I apparently get these Google alerts that 245 00:13:17.000 --> 00:13:20.000 were like the third most shorted stock on the Nasdaq. 246 00:13:19.679 --> 00:13:21.080 Twenty one million sharees short. 247 00:13:21.159 --> 00:13:23.600 Now, I mean, somebody's got a lot of balls. 248 00:13:23.720 --> 00:13:24.519 Yeah. Well, so. 249 00:13:26.039 --> 00:13:27.559 All right, all right, saved. 250 00:13:27.679 --> 00:13:30.000 I mean, what do they have wrong? 251 00:13:30.159 --> 00:13:30.200 What? 252 00:13:31.279 --> 00:13:31.600 Okay? 253 00:13:31.720 --> 00:13:34.240 So that guy he's short your shares, So talk to 254 00:13:34.320 --> 00:13:37.320 Dave Meyer. You tell him why he's wrong. 255 00:13:37.440 --> 00:13:48.320 Dude, it's gonna sting, That's what I tell you. It's yeah, 256 00:13:48.360 --> 00:13:52.480 I think, well, I mean, I don't know if you're 257 00:13:52.559 --> 00:13:57.679 actually okay, but but I think generally when I told 258 00:13:57.679 --> 00:13:59.440 people who short the shows that they're not shorting it 259 00:13:59.480 --> 00:14:01.559 because of any they know about Tesla, they just shortened 260 00:14:01.600 --> 00:14:02.320 it because. 261 00:14:03.600 --> 00:14:04.799 Of historical precedent. 262 00:14:05.519 --> 00:14:08.200 It's like, oh, there's never there hasn't been a successful 263 00:14:08.200 --> 00:14:10.679 car company in ages, So Tesla is going to be 264 00:14:11.679 --> 00:14:12.840 is not going to succeed. 265 00:14:12.679 --> 00:14:15.519 Like, how about looking at the fundamentals? You know. 266 00:14:17.200 --> 00:14:21.840 So the thing is that whenever there's a big change 267 00:14:21.879 --> 00:14:25.600 in technology, whenever there's a big technology just continuity, that's 268 00:14:25.639 --> 00:14:29.600 when opportunity arises in an industry. And if you look 269 00:14:29.600 --> 00:14:33.080 at say, like the computer industry, we had IBM was 270 00:14:33.120 --> 00:14:36.240 extremely dominant in mainframes and everyone thought, oh, you know, 271 00:14:36.240 --> 00:14:39.200 they'll just be extremely dominant in PCs and everything, and 272 00:14:39.399 --> 00:14:42.600 they weren't. They just they have a hard time with 273 00:14:42.759 --> 00:14:45.399 the technology. You know, when there's a shop change in technology. 274 00:14:45.440 --> 00:14:48.240 Gradual changes they can deal with, but but sharp changes 275 00:14:48.279 --> 00:14:52.039 that they tend to not do well with. And and 276 00:14:52.159 --> 00:14:54.120 you can look at the Internet and say, well, why 277 00:14:54.240 --> 00:14:59.480 wasn't Microsoft the leader in search? Why didn't they beat Google? 278 00:15:00.840 --> 00:15:03.840 Why didn't Google beat Facebook? And you know, it's just 279 00:15:04.039 --> 00:15:08.200 tough to deal with big technology change. And what we're 280 00:15:08.200 --> 00:15:10.960 seeing in the automotive industry is the biggest technology change 281 00:15:11.039 --> 00:15:14.480 since the moving production line and the entire powertrain is changing. 282 00:15:14.720 --> 00:15:19.080 So and and then and and then people say, well, 283 00:15:19.120 --> 00:15:21.840 how could you possibly compete with like the big car 284 00:15:21.919 --> 00:15:26.200 companies like Toyota, Like I mean Toyota mean our partner, 285 00:15:26.279 --> 00:15:29.720 the one that we're providing electric power trains to that? 286 00:15:29.799 --> 00:15:35.320 Would that be the Toyota referring to it? You know, 287 00:15:35.960 --> 00:15:36.279 it's it. 288 00:15:37.360 --> 00:15:39.159 You have to say, well, why is why is Toyota 289 00:15:39.240 --> 00:15:41.559 having Tesla supply electric power trains? 290 00:15:41.919 --> 00:15:43.000 It can't be that easy. 291 00:15:43.279 --> 00:15:46.440 If if if if we're doing that, why is Diamond, 292 00:15:46.480 --> 00:15:48.799 of the company that invented internal commission engines having a 293 00:15:48.840 --> 00:15:54.080 supply components to them? And it's it's because it's it's 294 00:15:54.200 --> 00:15:56.360 it's really hard technology, but it tells it is really 295 00:15:56.519 --> 00:15:59.279 it's it's a we're a hardcore technology and design company. 296 00:16:00.440 --> 00:16:03.200 You know, there's I think there's other companies out there 297 00:16:03.679 --> 00:16:05.360 like that that that are not that are sort of 298 00:16:05.440 --> 00:16:09.320 different and you know, like like Fisco is pretty different 299 00:16:09.320 --> 00:16:12.399 from us, like they're not a hardcore engineering company, but 300 00:16:12.480 --> 00:16:13.519 but but we are. 301 00:16:13.559 --> 00:16:15.919 And so I think come with me. 302 00:16:16.039 --> 00:16:18.639 There's there's this huge value and tests in terms of 303 00:16:18.679 --> 00:16:23.240 the intellectual property that that we've developed. And if you 304 00:16:23.240 --> 00:16:27.200 look at you know, some of our strategic investors like 305 00:16:27.279 --> 00:16:31.559 Daimler and uh and like Toyota and like Panasonic who 306 00:16:31.600 --> 00:16:34.000 have not sold a share in fact, Diamler at the 307 00:16:34.039 --> 00:16:37.159 last when we do secondary earlier this year, Diamler participated 308 00:16:37.600 --> 00:16:41.200 for Parana in that secondary. 309 00:16:41.960 --> 00:16:45.200 You know, it's difficult to ask for a better endorsement 310 00:16:45.240 --> 00:16:45.559 than that. 311 00:16:46.759 --> 00:16:49.720 I think that the power train contract that you all 312 00:16:50.039 --> 00:16:53.399 signed with U with Toyto was very interesting for for 313 00:16:53.480 --> 00:16:56.159 one reason. It's it seems to me I couldn't think 314 00:16:56.159 --> 00:16:59.279 of another another instance where a company, a car company, 315 00:16:59.279 --> 00:17:02.519 had outsourced such a central component, Like usually they do 316 00:17:02.519 --> 00:17:05.000 a lot of manufacturing, but that's a central component. So 317 00:17:05.680 --> 00:17:08.079 that feels like not just a game changer for you, 318 00:17:08.119 --> 00:17:11.039 but a game changer for the industry. 319 00:17:11.519 --> 00:17:13.640 Yeah, you're right, it is unusual for that to occur. 320 00:17:13.920 --> 00:17:19.160 And part of what Akio Turta is trying to do 321 00:17:19.279 --> 00:17:22.480 with his company is is try to push it to 322 00:17:22.519 --> 00:17:26.079 be more entrepreneurial. He remembers the days of his grandfather 323 00:17:26.200 --> 00:17:29.200 when it was very entrepreneurial. You know, Toyota made sewing 324 00:17:29.240 --> 00:17:33.720 machines in the thirties, and then there's just decided one 325 00:17:33.759 --> 00:17:35.799 day they're going to make cars, and people like, ah, 326 00:17:35.839 --> 00:17:37.839 they can possibly make a car that anyone will want 327 00:17:37.839 --> 00:17:38.799 to buy, and then. 328 00:17:38.559 --> 00:17:39.519 They made a great car. 329 00:17:40.759 --> 00:17:44.839 But they were very entrepreneurial, and Ako Turta's concerned that 330 00:17:44.839 --> 00:17:48.640 they've become two set in their ways. They've become too 331 00:17:48.680 --> 00:17:52.559 convinced in their own rightness and that's part of what 332 00:17:52.640 --> 00:17:55.079 led to some of the issues that that he came 333 00:17:55.119 --> 00:17:58.400 in to fix. And Akotota is a really great guy 334 00:17:58.440 --> 00:18:01.359 about Toyota is really fortunate to have him at the 335 00:18:01.400 --> 00:18:05.119 helm there. But but but he you know, he wants 336 00:18:05.200 --> 00:18:09.039 to push push his team to to try new things. 337 00:18:09.119 --> 00:18:12.400 Because when he went to his team and said, hey, 338 00:18:12.680 --> 00:18:15.039 what about electric vehicles, they said it couldn't be done. 339 00:18:15.599 --> 00:18:18.400 And so it's like, okay, so let's see if this 340 00:18:18.440 --> 00:18:22.119 little company to Tesla can do it. And so and 341 00:18:22.400 --> 00:18:24.319 we're doing it and I'm like, oh, okay, I guess 342 00:18:24.319 --> 00:18:24.960 it can be done. 343 00:18:26.359 --> 00:18:28.440 Why don't you think they could do it? I mean 344 00:18:29.559 --> 00:18:32.200 they tried for they tried on a number for a 345 00:18:32.240 --> 00:18:35.319 long time. They put millions of dollars into into developing 346 00:18:35.359 --> 00:18:36.039 the technology. 347 00:18:36.079 --> 00:18:37.519 What's what's different. 348 00:18:37.599 --> 00:18:39.200 Well, no, I think they will be able to do 349 00:18:39.200 --> 00:18:42.720 it over time. But it's just it's just not very 350 00:18:42.799 --> 00:18:54.440 quick and you know they didn't, uh, the mindset of 351 00:18:54.480 --> 00:18:58.799 trying something new and radical was just not there. That 352 00:18:59.720 --> 00:19:03.759 it's you know, if there's people have written books about this, 353 00:19:03.799 --> 00:19:04.400 like Crushing the. 354 00:19:04.440 --> 00:19:06.720 Chasm and innovator's dilemma and all. 355 00:19:06.599 --> 00:19:10.039 That about how it's difficult to do radical innovation at 356 00:19:10.039 --> 00:19:12.440 a big company because if you try to do radical 357 00:19:12.440 --> 00:19:14.960 innovation and you fail, you get a huge ding. 358 00:19:16.279 --> 00:19:17.759 And and and then. 359 00:19:17.880 --> 00:19:20.640 And especially if you have something to protect to start with. 360 00:19:21.079 --> 00:19:24.200 Yeah, right, exactly, you've got to decide that you're trying 361 00:19:24.200 --> 00:19:26.960 to decide that you can to cannibalize your existing business 362 00:19:27.240 --> 00:19:29.319 and take a big risk and deal with all the 363 00:19:29.359 --> 00:19:31.599 issues that inevitably arise when you're trying to push a 364 00:19:31.640 --> 00:19:35.839 new technology, and and and and then and not get 365 00:19:35.880 --> 00:19:36.640 fired along the way. 366 00:19:36.759 --> 00:19:37.519 It's pretty hard. 367 00:19:38.680 --> 00:19:41.240 One of your one of your passions has been, uh 368 00:19:41.680 --> 00:19:44.079 been clean energy, and you know this is you know, 369 00:19:44.079 --> 00:19:46.720 this has been something that you've done, I guess on 370 00:19:46.799 --> 00:19:49.480 the side of the other you know, these other very 371 00:19:49.480 --> 00:19:55.079 small projects. Do you believe that the developing markets like 372 00:19:55.119 --> 00:19:58.000 India and China, how are they going to develop in 373 00:19:58.039 --> 00:20:01.599 a way that sustainable and clean energy is possible? 374 00:20:02.640 --> 00:20:08.039 Well, China is actually already moving to towards clean energy 375 00:20:08.160 --> 00:20:09.079 very aggressively. 376 00:20:10.440 --> 00:20:10.720 People. 377 00:20:11.319 --> 00:20:14.160 There's a lot of press about Clendra and you know, 378 00:20:14.480 --> 00:20:17.720 the dary giving flinder for hundred million dollars and cylinder 379 00:20:17.839 --> 00:20:20.799 failed and should should the government really have given them. 380 00:20:20.680 --> 00:20:21.720 A hundred million dollars? 381 00:20:21.799 --> 00:20:24.680 And well, it's worth pointing out that they got about 382 00:20:24.680 --> 00:20:28.519 eight hundred million dollars from from private investors, primarily Silicon 383 00:20:28.559 --> 00:20:30.759 Valley venture capitalists, including some very big names. 384 00:20:31.079 --> 00:20:32.720 So we're suckers who got that money. 385 00:20:33.599 --> 00:20:36.680 And the fundamental issue with Slender was they would have 386 00:20:36.680 --> 00:20:38.960 been okay at about two dollars or work for solar, 387 00:20:39.039 --> 00:20:41.599 but the Chinese pushed it down to a claskal white. 388 00:20:41.680 --> 00:20:41.839 Yeah. 389 00:20:41.839 --> 00:20:44.640 The prices collapsed, right, Yeah, and the Chinese government invested 390 00:20:44.680 --> 00:20:50.720 forty billion in their solar industry. And so people were like, like, Slender, 391 00:20:50.759 --> 00:20:54.720 you suck for failing. I'm like, yeah, they had literally 392 00:20:54.759 --> 00:20:58.319 one percent the resources of their competitors. 393 00:20:59.720 --> 00:21:03.200 Who would win in that situation, It's pretty hard. You 394 00:21:03.240 --> 00:21:04.640 did well? Okay? 395 00:21:04.759 --> 00:21:08.279 Yeah, but you know in the case of Solar City, 396 00:21:10.319 --> 00:21:13.759 so I mean I did I thought this would occur, 397 00:21:14.680 --> 00:21:17.440 you know, I thought there would be a rabbit competition 398 00:21:17.680 --> 00:21:21.519 in the cost per what of solar the somewhat inevitable 399 00:21:21.599 --> 00:21:27.440 with Korea, Japan, China, Germany or competing like mad On 400 00:21:27.440 --> 00:21:29.599 on cost per WAT and it's a very much a 401 00:21:29.640 --> 00:21:33.400