Speaker 1: Latest interview of Elon muss Tasmanian.
Speaker 2: Hi, all right, great, and then we got galile A
Russell from hyper Change what out third Row?
Speaker 1: And then we got Viv from Who's Falcon Heavy?
Speaker 3: Hey?
Speaker 1: Great? All right, Omar, do you want to introduce our guest.
Speaker 4: Please welcome the inventor of the car fart, Elon miss.
Speaker 1: Thank you, thank you. Please put that on my grapestone.
Speaker 3: I love it so yeah.
Speaker 5: It's kind of crazy that we're actually all here, and thank.
Speaker 1: You so much for doing This're welcome.
Speaker 5: We'll all test the customers, fans, and it's really good
that is finally happening. I remember that I was looking
at your Wikipedia tweet that it's like this bizarre fictionalized
version of reality, and I replied to him, wait, why
don't you come on a podcast and like tell your
fictionalize version of reality?
Speaker 1: Sure, exactly, tell my.
Speaker 5: Fictionalized and You're like, okay, sure, And I was kind
of like taken by surprise by that. And you know
the way you engage listen to your customers online, It's
like I've never seen anything like that from you know,
CEO of a public company or any executive. So can
you tell us a little bit where that came from.
Why you communicate directly instead.
Speaker 4: Of like having this PR strategy that.
Speaker 1: Most companies have.
Speaker 6: Sure, well, I mean it started out. I actually had
one of the very very first Twitter accounts, like when
it was like less than ten thousand people, and then
everyone was tweeting at me like what kind of lat
they had it Starbucks, Like this seems like the silliest
thing ever. So I'd leaded my Twitter account and then
someone else took it over and started tweeting in my name. Yeah,
and then a couple of friends of mine, Wellie and
Jason Calcaana said they both said, hey, you should really
use Twitter to get your message out. And also some
somebody's tweeting in your name and they're crazy things. So
I'll crazy things in my name.
Speaker 1: Did you have to pay them? No?
Speaker 6: No, they they they I'm not sure who it was,
but it was for some reason. I got my account
back great, and and then it was just I don't
know some of you. It's like just sort of I
just started tweeting for fine really and my early tweets
are quite crazy.
Speaker 7: Uh.
Speaker 6: As I was trying to explain, like it has the
arc of insanity is short and that is not very
steep because it started off insane, and so if it's
still insane, it's you know, it hasn't changed that much.
So yeah, and I don't know, it seemed it seemed
kind of fun too, you know. Like I said before,
it's like, you know, some people use their hair to
express myself.
Speaker 1: I use Twitter. Why did you like Twitter? Some? I
mean you could use platforms, yeah, exactly.
Speaker 6: Well, like I don't trust Facebook obviously, you know, and
and and then Instagram is fine, but it's i think,
not exactly my style. It's hard to convey sort of
intellectual arguments on Instagram. It's hot on Twitter too, but
it's but you can't, you know. It's so yeah, Instagram
is also owned by Facebooks, and I was like, yeah, yeah, deleted, yeah, yeah,
just deleted it to It's like I don't really need
to just if I need to say something, I only
really need to say it on one platform pretty much,
and so and so if I'm trying and I don't
spend too much time on social media, so it's just
like if people want to know what I'm saying, then
they can just sort of go to Twitter. You know,
let's keep doing that as long as Twitter is good,
I suppose more good than bad.
Speaker 1: Yeah, cryptos cameras are really I understand that they've been
taken advantage of Vincent recently. I know really Yeah, there's
like ten Vincent's out there.
Speaker 6: All right, but they totally they can copy everything and
just like changed one my.
Speaker 3: Avadars and then the picture and then they just post
like right.
Speaker 1: Below yeah your tweet. Yeah yeah wow yeah, and they
blocked me to We fight them all all the time.
Speaker 2: We're always like reporting them, like every day we report
like ten people.
Speaker 6: Yeah, yeah, I have so many like yeah, exactly, a
conversations of Twitter, like come on, can you just like
I think it would take like three or four customer
service people to just look look at this. It's cryptos
can block it, and it should be easy.
Speaker 2: It should be easy. Like my wife Figan Shelley, I
think you'd like to tweet it. The other day she
got banned for like replying to one of your tweets
and quoting like the video inside of it, and then
she got suspended for like a day.
Speaker 1: Or something, and I was like, what the heck is
going on? Yeah, So it's just weird how the algorithm works.
Speaker 4: Yeah, yeah, there's a lot of manipulation. But you're going
back to the Wikipedia page. You know, it's kind of
interesting just what a decade you've had. I remember I
was reading somebody's article. I think they interviewed you in
two thousand and nine or something like that, and they said,
you know, if you had met Elon Musk in two
thousand and nine, right after the recession, they're like struggling
with the roadster. You know, you never would have thought
that you are where you are today. You're you know,
launching astronauts into space hopefull. Well yeah, this year, you know,
servicing the International Space Station, I mean Tesla with the
Model three, the model why you know, electrification really without Tesla,
it would not be where it is today. You see
where the other legacy automakers are, they're not doing great.
So you know, looking at kind of like this, like
you've become this legendary figure and looking at kind of
like how people kind of see you, kind of the
Ashley Vance biography or Wikipedia page, what is it that
really kind of sticks out to you or you know,
makes you laugh like that's just completely off base.
Speaker 6: Yeah, well, I think I mentioned that that I kept
getting referred to as an investor in like the munch things,
and it's like, but I actually don't invest really except
in companies that I help create. So I only have
the only publicly traded share that I have at all
is Tesla. I have no diversity on publicly traded share
so and yeah, that's right, quite unusual. So, uh, you
know what's everyone diverse by agree? And then the only
stock that I have of significance outside of Tesla is
space X, which is privately private corporation. And and and
then in order to get liquidity, which is mostly to
reinvest in SpaceX and Tesla and occasionally in like uh,
provide funding for much more projects like your link and
boring company. Uh, then I'll actually take out loans against
the Tesla and space X stock. So the so what,
so what I actually have is is whatever my tail
list in space X stock is. And then there's about
a billion dollars of debt against that, so which you know,
it's it's that this is starts taking to imply that
I'm claiming that I have no money, which I'm not claiming,
but it's it's something to make it clear that you'll
see some like number some big number in like four
or something. People will think I have the tessent space
like stock, and I have the cash, and I'm being
somehow I'm just sitting on the cash doing nothing like
hoarding resources, and like, no, it's you know, the only
alternative would be to say, okay, let's give the stock
to the government or something, and then the government would
be running things, and that the government it just is
not good at running things.
Speaker 1: That's the main thing.
Speaker 6: But there's like a fundamental sort of quick question of
like consumption versus capital allocation. This is probably gonna get
me to travel, But the paradigm of say communism versus capitalism,
I think is fundamentally sort of orthogonal to the reality
of actual economics in in some ways. So what you
actually care about is like the responsiveness of the feedback
loops to the maximizing happiness of the population. And if
if more resources are controlled by entities that have poor
response in their feedback leaps. So if it's like a
monopoly corporation or a small oligopoly or in the limit,
I would take the monopolistic corporation in the limit is
the government. So you know, it's just it's it's this
is not to say people who work at the governor
a bad if if those same people are taking and
put in any better sort of operating system situation, that
outcome will be much better. So it's really just what
is the responsiveness of the organization to maximize in the
happiness of the people. And and so you want to
have a competitive situation where it's truly competitive, where companies
aren't gaining the system, and then where the rules are
set correctly, and then you need to be on the alert
for regulatory capture where the referees are in fact captured
by the players, which is, you know, and the players
should not control the referees essentially, which which can happen,
you know. I think like that happened, for example with
I think there's a emission vehicle mandate in California where
California was like really strict on EV's and then they
the car companies managed to sort of, frankly my view,
trick the regulators into into saying, Okay, you don't need
to be so hardcore about the EV's and instead you say, say,
fuel sales of the future, but fuel sales of of
course many years away, so.
Speaker 1: Forever this is so then, so that's something that they
let up the rules.
Speaker 6: And then you know, GM recalled the e V one
and crushed them in a junk yard, which is against
the wishes the owner.
Speaker 1: They all lined up to buy them, and they wouldn't
let them buy that.
Speaker 6: I mean, Chris Paine did this great documentary on it,
and it's like the you know, the owners of the
the ev one, which why there wasn't actually that great
of a car, but they still wanted the electric car
so bad that they held a candle vigil at the
junkyard where their cars were crushed. Like it like it
was like a like a prisoner being executed or something
like that. That was literally like when is the last time
you even heard of that for a product?
Speaker 1: Right?
Speaker 6: You know, GM is stops the product. I mean what
I mean, listen, man, They're not doing that for any
other GM product. You thought, I'm doing the evo. It's
kind of time times hard to get through these guys,
you know. So anyway, I think that's a very important thing.
So generally, where you could see like these oligopolies forming
or duopolies and then they get effective of price fixing
and then they cut back in the R and D.
But Fudgret like kind of a silly one. Frankly, it's
like like candy, like there's a there's a candy oligopoly,
and it's like when's the We don't see much innovation
in candy, so.
Speaker 4: You're still working on the candy company Still candy?
Speaker 3: Is that boring candy?
Speaker 1: Boring candy? He's gonna be boring.
Speaker 6: I haven't seen a candy yet that's good enough to
send out. But and it's yeah, but I think I
think it it's it's there's there's like three companies or
something that control the candy in the world pretty much.
It's crazy and dog food, Yeah, there's somebody constructed like this.
It's this crazy conglomerate and and it's like and it's
like dog food and baby food and candy, and it's
like all you know.
Speaker 1: Rendering, Yeah, hundreds of brands.
Speaker 6: Yeah, you think you're buying from different companies, but it
all funnels up to like three companies or something like that.
Speaker 8: Don't send the rendering food to the candy company.
Speaker 4: Yeah, a big candy.
Speaker 6: So you want to have like a good competitive forcing
functions so that you have to make the product better.
Speaker 1: Or you'll lose.
Speaker 6: Like, if you don't make the product better and and
and improve the product for the end consumer, then then
that company should have relatively less prosperity comparative company it
makes better products. Now, the car industry you know, is
actually pretty competitive, so that's good. And then the good
thing about it competitive company industry, then if if you
make a product that's better, it's going to do better
in the marketplace, definitely.
Speaker 1: So this is Gene Wilders Whole House.
Speaker 2: Yeah, that's amazing, it's lovely. Thanks for having us here
as well. Thanks you really special.
Speaker 1: Yeah, it's a good it's a cool spot and it's
got a soldo glass roof.
Speaker 4: Yeah, portion too, right, we didn't notice it, but you
checked it out the second time.
Speaker 1: I'm waiting for my three. So I'm waiting for a
version three.
Speaker 2: Well, whatever is they're going to put on, I don't
care human motions, right, yeah, looking forward to it.
Speaker 4: Yeah, we saw it at the store in Torrents. Actually
they've got in the stores now. It looks really good.
Speaker 6: Well that it's actually design such that you don't notice it.
Speaker 1: So he's like this, look it's old.
Speaker 6: This is like it's an old house, I know, probably
fifty years old something like that, and it's quite quirky.
So if you put something on that was like it
didn't blend in that it would it would not look right.
Speaker 1: It would be pretty straightent. And this had a black
comp shingle roof.
Speaker 6: So I was like, Okay, let's see if we can
actually have it weave in and still feel natural, look good.
And yeah, and I think it's it's sort of achieved
that goal. But yeah, this is a lovely quirky little house.
I'll show you around afterwards. It's got all those of
weird things.
Speaker 1: It's exactly what is it, Francloyd right now? I don't
think so.
Speaker 6: I think it was just built in increments over time
by probably several people, but that they would have just
knocked it down and built a giant house here.
Speaker 1: So it's like, so glad I didn't. Yeah, it's super cool.
Speaker 6: Really So gene Wild is one of my favorite actorms actually,
so it's great.
Speaker 1: What was some movies?
Speaker 9: So, so when you come up with a product like
the solar glass roof, I think a lot of people
misunderstand that, like your goal is to bring these crazy
technologies to market and really create a change in the world,
and so I think it's fascinating that you do it
through companies, and it seems like the fastest way to
create that feedback loop and to really like get go
from inventing something to millions of people using it right away. Yes,
so like like it seems like buying a Tesla is
almost like the best thing you could do to help
the climate crisis because you're like turbo charging, R and
D and products and innovation. I feel like not enough
people really understand that.
Speaker 6: Yeah, that is I think there's lots of good things
people can do for the climate, but just generally anything
that is moving towards sustainable energy, whether it's sustainable.
Speaker 1: Energy, create generation through solar or with an electric vehicle.
Speaker 6: Actually just think just things like better installation in a
house just is just really effective for energy consumption. But
but fun is more fun, it's ingratiating. That's mom on
the motion. I actually got him a little folloween, a
little mistage mob in the Martian, you know, the helmet
with it looks super cute.
Speaker 1: You got enough funny.
Speaker 4: So did you always know, like you know, business was
the way you wanted to kind of attract attack these
problems versus say, you know, maybe a nonprofit or you know,
working as a college professor or something. I don't know.
Speaker 6: Uh, well, when I was in in high school, I
thought I would most likely be doing physics at a
particle accelerator. So that's what I was if physics and computers.
I mean, I got distinctions in two areas in physics
and computer science and those who are yeah, some of
my two best subjects. And and then I thought, okay,
well that I want to want to figure out what's
the nature of the universe, and so you know, go
try to working with people banging particles together and see
what happens. And and then these sort of things went along,
and the superconducting super collider got canceled in the US,
and that actually I was like, whoa, you know what
if I was working at a collider, I spent all
these years and then the gunment just canceled it. Wow,
and then that would I was like, I'm not going
to do that. So so it's like, well we roll
it back a little, like I was trying to forget
what when I was had like this existential crisis and
I was about twelve years old or something, and and
I was like, well, what does the world mean, what's
it all about?
Speaker 1: We're living some meaningless existence. And then.
Speaker 6: I made the mistake of reading Nieture Inchoprenur and and.
Speaker 1: I'm like, well, don't do that. Not a be a
little older. And actually lately these days are s rear it.
It's like, you know, it's actually he's not that bad.
He's got issues, got issues. I have a question about it,
but you know, it's so.
Speaker 6: But there are the hitchbacks, guys to the galaxy Douglas Adams,
which was which is like quite really, quite a good
book in philosophy, I think, And I was like, Okay,
we don't really know what the answer is obviously, so
but the universe, the universe is the answer, and that really,
what are the questions we should be asking to better
understand the nature of the universe? And so then to
the degree that we expand the scope and scale of consciousness,
then we'll better be able to answer the ask the
questions and understand the why we're here or.
Speaker 1: What it's all about.
Speaker 6: And so we should sort of take the set of
actions that are most likely to result in its understanding.
What questions to ask about the nature of the universe.
So that so therefore, we must propagate human civilization on
Earth as far into the future as possible and become
a multiplanet species to gain extend the scope and scale
of consciousness and increase the problem lifespan of consciousness, which
is going to be I think probably a lot of
machine consciousness as well.
Speaker 1: In the future.
Speaker 6: And that's the best we can do it, basically, you know,
And yeah, that's the best we can do. So, you know,
and think about the various problems that we're facing or
what would most likely change the future. The when they
were in college, there were five things that I thought
would be I thought these were actually I would not
regard this as a profound insight, but rather an obvious one,
that the Internet would fundamentally change humanity because it's it's
like a humanity would become more of a super organism
because the Internet is like the nerves, like the nervous system.
Now suddenly any part of the human human human organisms
anywhere would have access to all the information instantly. You
were like, hey, well, I can imagine if you if
you didn't have a nervous system, you wouldn't know what's
going on your fingers wouldn't know what's going on. Your
total knows what's going on. You'd have to do it
by diffusion. And yeah, and the way information used to
work was really by diffusion. One human would have to
call another human or to write them. Yes, like if
it was a letter you would have to write. You'd
have to have that letter to another human. That would
be carried through a bunch of things and finding another
person would give it to you inefficiently, extremely slow diffusion.
And if you wanted access to books, if you're not
did not have a library, you're not, you don't have it.
Speaker 1: That's okay. So now you have access to all the
books instantly.
Speaker 6: And if you can be in a remote like you know, mountaintop,
jungle location or something and have access to all of
humanity information, if you've got a link to the internet,
this is a fundamental, profound change. So that's one thing.
I was on the Internet early because of you know,
the physics community. That was pretty normal, although it was
interface was you know, almost entirely text and hard to use.
But that another one be obviously making life multiplanetary, making
consciousness multiplanetary, the change human genetics, which obviously I'm not
doing By the way, there's a thorny subject, but it
is being done with Crisper and others. You know, it
would it will, it will become normal to I think,
to change the human geno. It will become normal.
Speaker 9: Like what's the opportunity, Like why is that something that's inevitable.
Speaker 6: Or well, you know, I think for for sure, as
far as say getting rid of diseases or propensity to
various diseases, then that's gonna be like the first thing
that you'd want to edit out, you know. So it's like,
if you've got like your you know, a situation where
you're definitely gonna die of some kind of cancer at
age fifty five, I prefer to have that edit it out.
Speaker 1: Yeah, definitely, So I think, you know, edit that out.
Speaker 6: You know, there's the Gatacus sort of extreme thing where
it's not really edited out, but it's like it's edited
in for various enhancements and that kind of thing, which
probably will come too.
Speaker 1: But I'm saying, you.
Speaker 6: Know, arguing for against, I'm just saying this more likely
to come than not down the road.
Speaker 1: Yeah, so then and then aim really major one.
Speaker 2: So these are all big motivational factors to keep our
consciousness going.
Speaker 6: And it's sustainable, yes, yes, sustainable energy. So sustainable energy
actually was something that I thought it was important before
the vital environmental implications became as obvious as they are,
because if you mine and burn hydrocarbons, then you're gonna
run out of them, because it's it's not like it's
not like mining sort of say metals for example, if
you if you know that we recycle steel and aluminum,
and because that's just it's it's it's.
Speaker 1: Not a change of energy state.
Speaker 6: Whereas if you if you take fossil fuels, you're taking
some from a high energy state converting it to a
lower energy state like CO two, which is extremely stable.
Speaker 1: You know.
Speaker 6: So whereas we will never run out of metals, not
a problem, we will run out of mind hydrocobbins. And
then necessarily, if we have got billions, ultimately twillions of
tons of hydrocobbins that were very deep underground, in solid
liquid gas form whatever, but they're deep underground, you should
remove them from deep underground to the oceans and the atmosphere.
Speaker 1: You will have a change in.
Speaker 6: The chemistry of the of the surface obviously, and then
there's just a certain probably associated with well, how bad
will that be? And the range of possibilities goes from
wildly bad to extremely bad. But then why would you
run that experiment? That seems like the crazy, especially since
we have to go to sustainable energy anyway, why would
you run that experiment? This is the maddest thing I've
ever heard. I'm not saying it shouldn't be some use
of hydroc commons on Earth, but there just should be
the cover the correct price pay placed on CO two production.
And the obvious thing to do is have a common tax.
It's a no brainer every if I don't know the
ninety plus percent of economists would say this, and I
think of physicists, and it's just the you know, the
mark system works well if you've got the right price
in things, it's very very simple. And if you've got
a price of zero effectively or very low, then it's
well people will wave accordingly, though, So it's just that's
that's the thing that needs to get done.
Speaker 1: I think it will get done.
Speaker 6: And then the if, over time, as you raise the
price on common you can actually I think encourage sequestration
technologies over time, and and and there'll be a lot
of innovation in that regard and now that's the way
we to do it.
Speaker 4: So you had these realizations about you know, areas of
big value and you went and started zip to you
sold it, got you know, twenty million cash. You were
the largest shareholder at PA of Papal at the time
eBay acquired it. I think, you know, you got one
hundred sixty million or something like that. You know, you
have enough money basically for an entire lifetime. Why go
and put your money into SpaceX, which is a huge,
you know, risky operation or Tesla. Why not just kind
of you know, relax.
Speaker 1: Sure what?
Speaker 6: So yeah, basically, you know, I graduated from from from
Penn with basically physics and economics and then that we're
act a road trip to to Stamford with with Robin
rand who is in my class and now it works
at Tesesla.
Speaker 1: Actually yeah, he grew up in Shanghai, so yeah, this
was a very smart guy.
Speaker 6: He ended up continuing at Stanford and I ended up
going on Deferma to complate into the semester. But I
was going to be studying material science and the physics
of high in age dentistic capacitors for use electric vehicles.
So the intent was I was going to go, Okay,
I'm want to work on energy storage solutions for electric vehicles,
and I'd worked at a company at Cold Pinnacle Research
for a couple of summers that did high energy density capacitors.
I was going to try to do effect me like
a solid state version of what they were doing with
It's going to get very complicated from a technical standpoint,
but they're using ruthenium tantlemox side. Ruthum is extremely rare
and expensive. You cannot scale that, so like can you
find a substitute for ruthenium? But they were able to
get to uh energy dynasty is comparable to let us
at battery, but with incredibly high power density. So just
I can go down a deep rabbit hole air. But
what's the capacitor in an no?
Speaker 1: I think with the.
Speaker 6: Advent of high energy lithium batteries, a capacitor is not
not the right path.
Speaker 4: What was your thinking back then though, that made you
think you could be useful for evis?
Speaker 6: I want to use advanced chip making equipment to make
capacitors that were precise at a molecular level, so at
the you know, just a level of precision that that
was sort of unheard of in in capacitors. Like capacitors,
energy is a function of its area or and a
separation distance. So if you have if you can have
very tiny separation distance, and you can and you can
inhibit quantum tunneling, like so how do you things get
pretty estery? So you're going to inherit quantity tunneling, give
very short gap and and then you can in theory
get to very high energy densities you by making capacitors
in the way that you would make a a an
X eighty six processor. And since there's there there were
tens of billions of dollars going into chip making R
and D that I thought there might be a way
to make an advanced capacitor using chip making equipment instead
of the conventional means.
Speaker 8: So is it off the table alter capacity?
Speaker 6: It's unnecessary? Interesting, it's unnecessary, It's it's I think I
think it's I think it's probably is physically possible, but
it's it's unnecessary at this point.
Speaker 4: I mean, I know a lot of people were talking
about Maxwell and they had been working on some stuff
with capacitors.
Speaker 6: The funny thing is that when I was doing the
my intentions that this uh mass capacity company called Pink Research,
which was in Less Godess. We talked a lot about
Maxwell and Maxwell is also trying to kags to Capacitor.
Speaker 1: Is no Tesla a required Maxwell?
Speaker 8: Yeah, Wow, we're looking forward to that investorday.
Speaker 1: Yeah, that's kind of a big deal. That's great. Great
to know.
Speaker 6: Maxwell has a bunch of technologies that are that where
if they're applied in the right way, I think can
be have a very big.
Speaker 1: Impact, Like the dry electrode stuff that every one of them.
That's a big deal.
Speaker 6: Yeah, for sure, much much bigger deal than it may seem. Yeah,
and there's a few other things with the space that
it takes up for the ovens that you know, for
the current technology, you can save all that that real
estate space.
Speaker 2: Now that's one aspect. And the cost reduction, the weight savings,
I mean, there's so many pluses.
Speaker 6: Right, Yes, and there's many things that but I left
wait until you know whatever battery day. Sure, hope in
a few months, but I think we've had some pretty
exciting things to share.
Speaker 4: So Galley's very exciting.
Speaker 9: Yeah, it seems like the pace of the innovation of
the battery things just taken off like since you guys
have more capital and being able to like have the
Giga factory be vertically integrated. It seems like know of
their car company is making that many batteries, so they're
not even thinking about what comes next.
Speaker 1: But they're not even you know, man, not even come
cool at all. I can two hundred and one mile
not not either.
Speaker 6: That's a joke, Yeah, no, it's really, it's true. The
other countries just really want to outsourced battery technology, not
even not even making the like this.
Speaker 1: Battery module and cell.
Speaker 6: But they're they're obviously outs hosting the cells, but even
out sourcing the modules in the packs. Yeah, you know,
and it's like they're really not thinking about fundamental chemistry improvements.
And there's some pretty deep wizardry at TELSA.
Speaker 1: On this front.
Speaker 6: I should say a bit about like like electric vehicles,
and it was sustainable energy in general.
Speaker 1: I said it was.
Speaker 6: It was pretty I think obvious to not not just me,
to me, to a lot of people even go back
thirty years or or longer, that we must have a
sustainable energy solution. In fact, it's it's toto logical, if
it's un if it's if it's not sustainable, we must
at some point find an alternative to it. And so
even if there were no environmental impact to the sort
of fossil fuel economy, then we would run out of
them and then we would have economic collapse and well,
civilization would fall apart. So so that that that was
actually my initial motivation for electric vehicles is like, Okay,
we've got to have a solution that does not require
mining hydrocarbons, that that that is sustainable in the long term.
It was not actually initially from an environmental standpoint, because
I had not realized the gravity of the environmental situation
at that time, and I thought, actually, for sure by
now we'd have electric cars, like for sure, but back
on the moon. Yeah, yeah, totally. Why are we not
back on the moon? It's insane, insane. If you sold
something in sixty nine that, yeah, that would not be
back on the moon, And in like twenty twenty, they'd
be like you probably might have getten punched, honestly, because
they'd be like, you're just it's like so insultingly rude
to if youture.
Speaker 1: Because they'd be like, what is wrong with you?
Speaker 6: It's encouraging encouraging them, Yeah, yeah, yeah, So it's like,
we should have a sure of a base on the Moon,
we should have sent people to Mars. None of that's occurred.
You know, it's gonna that We've got to make that happen. Yeah,
So it's a bit on the sustainability front. It was really,
like I said, not so much initially, not so much
from an environmental standpoint, but from the necessity of replacing
a finite resource in order to ensure that civilization could
continue to grow. And then the urgency of it became
much more obvious, like, wow, we're just really better do
something because the environmental stuff is becoming quite serious, and
the the the inertia of large existing companies is just
hard to appreciate that they just want to keep doing
the same thing and maybe five percent different every year,
maybe five percent difference. Big companies had changed. So so
then the you know, the time that Tesla you know,
was creator, you know, there was no no one was
doing electric cars. They weren't really startups. There weren't big
car companies weren't doing it. Uh GM tot cancel their
EV programs.
Speaker 1: Now everybody's doing it right now, like.
Speaker 7: And their mom, the mom is doing it, and we
will all like to congratulate about the take off.
Speaker 1: Actually three one, yeah.
Speaker 7: Yeah, it's and I would like to know, like why
China is the best country to build a first foreign
Giga factory.
Speaker 6: China is the biggest consumer cars in the world, so it's.
Speaker 1: So that that that alone would be enough to do it.
Speaker 6: I think also there was a lot of uncertainty about
the tariffs, and and you know, it's like potentially would
be unable to sell effectively in China if we did
not have a factory locally, or at least unable to
sell at prices that weren't extremely high. But those are
really the two two main reasons.
Speaker 1: I think that.
Speaker 6: But I think there's also a third important reason that
that there's just so much talent and drive in China
that I think it's a good place to do a
lot of things. And the evidence is there in the
incredible progress in the factory, which was built with very
very high quality and very short period of time, and
that the car is coming out of of Shanghai are
already very high quality.
Speaker 1: I can't tell. And the run rate is amazing.
Speaker 2: And I love that they used the Chinese badge as well.
It's like a simple pride and you know made made
in China.
Speaker 1: So yeah, it's cool, it's super cool.
Speaker 4: How did Tesla manage to get the first wholly owned
foreign car company in China? I mean a factory?
Speaker 6: Uh well, I've went to China many times and they
kept saying that we would have to do this, you know,
majority local venture. And I said that, well, we had
to partner with someone, and say, well, oh, you know,
we're a little late to the dance here, you know,
so who do we partner with? You know, there's nobody,
nobody left, and uh and also we're just a little company,
so you know, we're you know, like because they should
get married, like we're young.
Speaker 1: That's a good example.
Speaker 6: But yeah, you know, and then so then you know,
but and then also is pointing out like you know,
there's so many Chinese companies that are going to you know,
that are establishing factories or in the US, and there's
like Verity Future and that kind of thing, and that's
known by them. And so I mean, to be fair,
it should be allowed that a marine car company should
be able to own its factory in China as well.
And so we talked to him over and over of
years and they eventually said Okay, well.
Speaker 1: We'll change law.
Speaker 6: They changed law, but now those other companies can do
it as well, so it's not just limited to Tesla.
Speaker 9: And how much of that production hell like learnings have
really enabled because one of the I don't want to
like to bring up Capex, but one of my favorite
things is the stats and the shareholder letter. It's so
much cheaper, not only faster, but it seems like that
you have learned so much from this the Fremont factory,
and that really enabled like kind of a turbo charged
build for Shanghai.
Speaker 1: Yeah, the.
Speaker 6: I think the big difference is is like we are
way less dumb than we were, so the the fullishness
of capital expenditures was very high and it's less high.
Speaker 1: Know, and then.
Speaker 6: The the Shanghai factory, we designed out all of or
as much of the foolishness as we could think of
that exists at Fremont and at Nevada. So we just
made a lot of decisions that weren't smart and and
we designed those out so such the production line is
much simpler, So it's much simpler and better implemented. And
then we also found like that in most cases the
suppliers were more efficient in China as well than in
the US, so, but we've also managed to get a
lot more output from existing equipment in the US as well.
So the Model three bodyline in Fremont, for example, was
only ever meant to do five thousand cars Model three
is a week and it's doing seven thousand nice, nice
and with with with with turning off a bunch of
unnecessary things that were being done. So it I mean,
there's just there's a lot of bullish things that were
doing so and we changed some of the designs and
made it easier to would it's it's like hundreds of
little things to make it, to make it easier to build,
and and so being able to get forty percent more
output off the same line obviously makes it makes a
big difference, and while while reducing the cost of the module,
cost of production and I and I think improving the
quality of the car. So it's just all good, good stuff.
It was the result of a ton of hard work
by a lot of people. So yeah, it was kind
of necessary in that there was we didn't really have
a place to put a second molitary body line. So
it's like you either we either make with one go
faster or we will not be able to achieve production.
But the Model three body line in Shanghai is much
much simpler than the one in and I said that
a good way then, because it has the same the
same end result. So if if you know and and
but but it's much easier to understand this just getting
rid of unnecessary movement. There's a lot of unnecessary movement
in the Freemont body line, but not in Shanghai.
Speaker 4: So you guys said in the production letter that you
just started battery production in Shanghai too, And I heard
that you guys were getting cells from cattle and l GCM.
Are the cells basically kind of like a commodity part
that you can assemble into your battery packs there or
you know, does it make a difference. How do you
see that long term?
Speaker 6: I believe these cells are not yet from LG We
do expect to use locally, locally produced cells, but I'm.
Speaker 1: Like, I don't know, it's a week clear.
Speaker 6: I don't always know exactly what's going on everywhere in
the fifty thousand person company. So some of the things,
like most most most of the things I say, will
be crippets of maybea occasionally something that's not as to
that my knowledge, we're not yet using Algae camp cells.
We are using Panasonic cells made in Nevada.
Speaker 4: But LGAE CAM can make pretty much the same cells
as Panasonic.
Speaker 6: Yes, but pretty much is not the same as the same.
So there's still a few bugs to work out with
the LGA camp cells before we can use them in
our module and battery pack production system. The CTL cells,
the CL situation will be more of an integrated module
then it will be a cell. And that's so that
it's it's not just it's not super easy to replace
these things. But yeah, we'll be We do expect to
use CTL. We do expect to use Algae. Currently we're
use using Panasonic. Might expect to use I mean like
virtually a matter of months. So by the middle of
this year we will probably be using both LGA and
ctail in volume.
Speaker 3: Wow.
Speaker 8: So we were talking about a lot of Tesla stuff,
but we kind of wanted to ask you about your
personal history because we were saying you were saying how
there's some misconceptions you would like to make straight. And
you know, Ashley Vance wrote a book about you. I
just read May's loved the book, and it was really wonderful.
I loved it, and I learned a little bit more
history about your family and you. What are some of
the misconceptions that you would like to correct?
Speaker 6: You know, most of this is just and it ended
up being kind of water under the bridge that people
didn't notice that much. Yeah, I mean there's a sort
of some stories in there where it sounds like I
like fired people all of a sudden and arbitrarily, which
was not the case.
Speaker 1: There.
Speaker 6: You know, it just Ashley asked somebody who who didn't
know what was going on, and then that person was
suddenly not there.
Speaker 1: And they didn't know why.
Speaker 6: Yeah, but I yeah, I definitely do not fire talented people.
And yeah, you know, unless there's no option. So yeah,
and absolutely not not without warning or like.
Speaker 8: Keep hearing you say, we like it sounds like you're
always thinking of everybody. I see you as a very
selfless person. I mean seriously, I mean, yeah, it's like
from the age of twelve, it sounds like you've been
thinking about how to help humanity.
Speaker 6: Yeah, I mean I'm not trying to be sort of
like some you know, the sort of savior or something
like that. You know, but it's really just that if
it just seems like there, it's just I don't know,
it feels like the obvious things to do. I can't like,
I'm not sure why you do anything else. We want
to maximize happiness to the population and propagating to the
future as far as possible and understand the nature of reality,
and from that, I think everything else follows.
Speaker 5: I saw you on Twitter like talking about how like
people are having this rumor that you've been wealthy your
whole life and that would be like the only reason
who became successful and you've debunked that, And can you
ask share more about your upbringing and what led you
to go into North America.
Speaker 6: Sure, I was in South Africa and it seemed like
wherever there was like a lot of the advanced technology
in the world was being produced in America and Solucton
Valley especially, So I wanted to be where I could
sort of have an impact on technology, so that's or
be involved in the creation of new technology. So that's
what brought me to go to at first Canada because
I could get citizenship in Canada through my mom, and
then ultimately to the US.
Speaker 1: But yeah, I just left Slavco. When I was seventeen and.
Speaker 6: Land in Montreal, I had like about two thousand dollars Canadian.
Speaker 1: Uh yeah.
Speaker 6: I started staying in a youth hustle for a few days,
and then there was a you could buy a ticket
to across the country for hard bucks and stopped along
the way, and so I put that and just took
it greyhound across Canada and sold these like little towns.
Speaker 1: Well we were getting I didn't have much.
Speaker 6: I had like a backpack again suitcase books, but that
the bus company, the Greyhound, unloaded it in one of
the cities and then the bus left without my stuff.
Speaker 1: So I literally had nothing. All your books but you're
closed to.
Speaker 6: Actually, weirdly, I think I might have had the books thing,
but I closed that prior you need it, Yeah, because
I needed. I was just sitting in the bus station reading,
waiting for the bus to get ready, and I think
I have the books but not not.
Speaker 1: But no clothing.
Speaker 6: So anyway, but I managed to get to Swift Current, Saskatchewan,
and then my, my, it's your cousins cousin's son, Yeah,
has a whaed farm there, and I worked on the
wheat farm for about six weeks and turned eighteen and Saskatchewan.
Speaker 1: It's just a ton of called swift current.
Speaker 2: So that was summertime, right it is June, Yeah, June
twenty eighth, So because I've been there in the winter
and it's like minus forty yeah, yeah, you don't want
to be traveling.
Speaker 8: Yeah did you ice kate? Did you try ice skating?
Speaker 1: No? There was it was quite warm.
Speaker 8: Well, I mean in the winter.
Speaker 1: Stay for there in the winter. I was just I
was there for about six weeks. Oh, you're lucky you survived.
That's good. Yeah.
Speaker 6: I was old there literally working on the wheat farm,
did a bond raising and they cleared out the wheat binds,
you know, the grain, grain salos, that kind of thing,
and I just worked the vegetable patch basically just doing
various things.
Speaker 8: Would your mind just thinking of what you're what you're
going to do after that?
Speaker 1: Yeah, t figure what I do next. I don't know
what to do.
Speaker 6: So then, but I ended up getting back on the
bus and went to Vancouver and I had a half
uncle there who was kind of in the lumber industry.
He like made lumber, like lumber equipment.
Speaker 8: Sounds like the Northwest.
Speaker 6: Yeah, yeah, basically throwing up chains, throwing logs and working
on the slumber mill and cleaning out the where they
where they boil the pulp and just like create crazy
so boiler rooms and that that might be the hardest
job I've had, actually, because you had to like crawl
through this little tunnel and it has mat suit and
then with shovel with and then shovel the sort of
steaming sand and mulch out of the boilers.
Speaker 1: To clean him out.
Speaker 6: And you had to like there's only one entrance to exit,
which is like a little tunnel. If you're classrophobic, you
could be real bad. And then you could shovel the
sand and the mulch through the tunnel and it actually
blocked the tunnel, and then somebody else would reach in
and shovel it out from the outside. So it just
big enough long enough if you have a trovel with
a long handle, one person on the inside can shovel
it far enough that someone on the outside can shovel
it out. And then you have to rotate every fifteen
minutes to avoid getting hyperthermia.
Speaker 8: Oh wow, and the safeties just a man looking out
for you.
Speaker 6: There were just two people kind of paired up. So
if like one person's collap and you go to call somebody,
but it'd be really hard to drag somebody out. I
have to say that it does not seem safe because
if the tunnel gets blocked, trying to get then and
block that tunnel would be very difficult in a short
period of time. So, but it was the highest painting
job at the employment office. Sorry, I was like, okay,
the other jobs were like, I don't know, eight dollars
an hour and this one was eighteen dollars an hour.
Speaker 8: It fire your clothes and were gone.
Speaker 1: Well they gave you they did you give you a
have hazmat suits?
Speaker 6: Yeah?
Speaker 1: How long did you have to did you do that
job for? It was like four days, it was it
was then it was done.
Speaker 6: Yeah, you said it was like a short term thing,
clean green fins, continding that the boilers the ball.
Speaker 3: Rooms, so what was next? We were in boiler rooms and.
Speaker 1: Then yeah, so basically.
Speaker 6: Yeah, I mean literally it was like a lump of dragons,
chainselwing logs and just during the lumber or lumber stuff
basically for a few months there and then applied for college,
going to Queen's University and Kingston.
Speaker 1: And was there for a couple of years.
Speaker 6: And then some of that's just that I should apply
to Jupan, and I didn't think I'd be able to
go because I've paid for my own way through university
just which is actually not that hard in Canada because
the tuition system.
Speaker 1: Yeah, the tuitions had yourselves that I is in Canada.
Speaker 6: So so with you know, with basically some if you
sort of worked during the summer semester and take out
some omens and get some scholarships, you can pretty much
go to any college in Canada, I think. But I
met someone who was at Yupan and they said you
should at least apply, and I applied and they actually
gave me like quite a big scholarship, so that that
allowed me to go there, and so that I did
the physics and economics there and uh and and then.
Speaker 1: That that's what led to the road trip to Stafford
with Robin ran.
Speaker 6: And and and then I was during that that summer
that I was was like, Okay, if I can either
spend several years kind of doing a PhD and know
that I care about the PhD actually, but I just
need a lab. But I could either spend a bunch
of years working in a lab and maybe it would
maybe the technology would pan out or maybe it wouldn't,
but the Internet would was definitely about to go super
and over in ninety five. So I was like, Okay,
I can always come back to working on electric cars basically,
and which I did, but the Internet is not going
to wait. So it's so then I put stafford on
defoement and started up to which was really just you know,
I started off with maps and directions, yell pages, white pages,
that kind of thing, and it was the best of
my knowledge of the first maps and directions on the Internet.
So this was some like patents I have. I don't
know how many more of it. They've obviously lapsed at
this point, but for maps and directions and yell pages
and advertising and stuff. And I wrote the whole the
whole initial code base I wrote personally because there wasn't
any reels.
Speaker 1: It's just me so.
Speaker 6: And I only had a few thousand dollars and my
brother joined and he brought like five thousand dollars, which
was led. Yeah, at least for the first few months,
there was literally only one computer. So the website when
the website wasn't working. It was because I was compiling
code and and even again an interat connection was pretty hard,
but there was an Internet service provider on the flow blows.
We're more or less squatted in this office because the
landlord was like out of the country or something and
nobody was using it.
Speaker 1: So so you've lived in there.
Speaker 8: Yeah, I think I've read that in Mays book. You
showered at wymc A then, right, that's right. Yeah, it's
smart though, I mean you were thrifty to what you
had to do.
Speaker 4: We just like had no no money, so we're gonna
do you know, what did people think about zip tou generally?
Was it like seen as a crazy idea or like
do people even understand the Internet? Back then, most people
didn't understand the Internet.
Speaker 6: Most people didn't know Even on sand Hill Road, like
we tried pitching people to invest in an inter company.
Speaker 1: Most of the vcs we pitched too had never used
the Internet.
Speaker 4: Do you remember some of the VC firms you went
to on sandial.
Speaker 6: I remember most of time we wouldn't take a meeting,
and if they didn't take a meeting, there were pretty
bored and not say like who's who's made money on
the Internet. No, like no one, okay, but the seed
change occurred when Escape went public.
Speaker 1: Yeah.
Speaker 6: So the first thing I tried to do was not
to start a company. I tried to get a job
in Netscape, but they didn't reply to me. Oh no,
oh man, So I just I tried. I tried hanging
out in the lobby at Escape. I don't know who
to talk to. I was really too shy to talk
to you when I don't know. So it's like, Okay,
I can't get a job at the only internet company
that you know that that does Internet software, So then
I'll try writing software.
Speaker 1: So that's.
Speaker 6: Kind of what happened there. Yeah, and then like I said,
my brother came down and joined. This is like well
like late ninety five.
Speaker 4: And then.
Speaker 1: In January ninety five, I think it was the.
Speaker 6: There was there was a lot more interest in the
internet stuff following the newscape I p O and that's
the software software was more impressive, I guess.
Speaker 1: So then we then more more. David aw invested so
they're VC from on sand Hill Road and they.
Speaker 6: They invested I think it was like three million dollars
for effectively sixty percent of the company.
Speaker 1: Wow, which we thought was crazy.
Speaker 6: They're like, well, these get Learn gives us the money
for nothing, they must be mad. Yeah, so they that
this this seems like like crazy that they're to give
so much money for a company that consisted the time
of about five people, like literally I think five people.
Speaker 1: At the time.
Speaker 6: So but anyway, it worked out well for them in
the end, so we hired a lot more people were
both out the service, and they also ended up writing
a bunch of software to bring the newspapers online. So
Night Ritter, New York Times Company, Hurst well became investors
and customers, and at one points of two which responsible
for a significant section of the New York Times company website. Yeah,
so I got to know the media industry pretty well.
And but over what really happened with with it effectively
got too much there was too much control by the
existing media companies, so that too may board seats and
too much boarding control, and that they kept trying to
push the company down directions that made no sense. So
like so, if you actually had really good software, I'd
say software is comparable in some ways more advanced than
say Yahoo were excite at the time, but it was
just not being used properly, and it was all being
forced through uh, through media companies who they're not.
Speaker 1: Not use it, you know.
Speaker 6: So it's like it's okay, we've got the best technology,
but it's it's not being deployed properly. So but unfortunately
compback came along and they compat compact It acquired Digital Equipment,
and Digital Equipment had owned Aulti Vesta, which at the
time was probably the best the search best search engine.
So they thought that their idea was they will combine
Altivesta with a bunch of other Internet companies and try
to compete create a competitor to Yahoo or Excite that
that was the Excite used to be a big thing,
amazingly and yeah, who used to be a big thing
a long time.
Speaker 4: Ago that it was like owned by Verizon or something.
Speaker 8: Yeah, and there was Ala.
Speaker 4: Yeah, it was a crazy story. They you know, they
failed to ocquord Google twice. You know, Microsoft offered them
like forty billion or something and they turned.
Speaker 9: It down and then Alibaba saved them out of nowhere.
Speaker 4: Yeah, the Alibaba steak was worth more than the whole
whole company I went.
Speaker 9: By, like, yeah, huge amount. It was basically a proxy
for Alibaba shares training.
Speaker 1: Yeah exactly. But at one point, I mean at that time,
like if you get back.
Speaker 6: To say ninety eight, ninety nine, yeah, who seemed like
an unstoppable juggernaut, Like literally like this company, will you know?
It's a behemoth. Nobody could possibly defeat them. But anyway,
and where's com back today?
Speaker 1: Yeah?
Speaker 6: So, but that was their idea, which is at least,
if executed well, could have made sense.
Speaker 3: Kimball, Yeah, what do you what are you guys doing?
Speaker 4: We're recording a podcast?
Speaker 3: Yeah, how do you want me to join?
Speaker 1: Yeah?
Speaker 4: So what do you remember about it?
Speaker 1: Too? Well? Remember?
Speaker 3: Yeah? So, but then the Internet came along with came
this huge thing. I mean it was always it was
always there, but it became a big deal. And then
Elan was working on uh, working in Silicon Valley, and
as I remember it, you know, I never heard a
meeting where some of the Yellow Pages companies were thinking
of doing sort of online yellow Pages, And.
Speaker 1: No, where would I why would I have been? This
is a long time ago.
Speaker 3: You called me up and you said we should do
you think you can do a better job, so we
think we can do it.
Speaker 4: Maybe you made that up to try and get Kimball interested.
Speaker 1: How would I be in a meeting with Yellow Pages company.
Speaker 3: I have no idea, that's what I remember Leafless.
Speaker 1: I don't even know any of Yellow Persons.
Speaker 3: Yeah, I agree with you now. But so it was
like I think April of nineteen ninety five we started
working on it, and the I guess the idea was
fairly simple to take mapping and apply it to the Internet,
and there were a few other companies trying to do it,
but no one with the very cool technology of sort
of what was called vector based mapping, which is which
is what we all use today, where the map is
actually alive, you know, not just a picture.
Speaker 4: I was very ahead of its time.
Speaker 3: I think we were the first. I know there were
other people putting maps on the Internet, but I think
we were the first to put vector based mapping, which
is what the kind of technology used today on the Internet,
and orginal directions. So it was cool. I remember my
brother and I pressing go on his server at our
office and took about sixty seconds for the first door
to door directions to come up on the screen. And
even sixty seconds was amazing. You're like, this is incredible.
Directions to anywhere. This is just amazing and definitely seen
amazing at the time. Definitely seen amazing at the time.
Yeah it now, it's like, but this was like an
impossible thing. It was so cool and using Java, you know,
had coated a interactive map, which again all super normal
stuff today, but the ability to just draw square and
zoom in or zoom out, that was just unheard of technology.
Draw square, yeah, you remember that, it was a little
little red square on the Java browser.
Speaker 1: That was unusual.
Speaker 4: Yes, just like, yeah, well you cheated if you're using
Java applets.
Speaker 1: Yeah, this is when Java sucked and it was barely.
Speaker 3: Yeah, this was like probably the most I think we
even got some sort of recognition because it was the
most advanced Java application on Java at the time because
it was so ridiculously hot.
Speaker 1: It was.
Speaker 3: It was a really crappy technology at the time, but
this this was done on it.
Speaker 6: The thing is that if you if you downloaded the
job outplet, we could we could transmit the vector data,
not just a betmap. And this is what when everyone's
on a modem, so something's on like you know, twenty
covets motem or you know, trying to download a map
image to take forever, whereas if you had downloading the
vector data, is that locally rendered using the Java applet
was super was relatively speaking, super fast.
Speaker 1: That's what made it cool.
Speaker 4: Sparta, I mean yeah, even like vector maps are even
Google Maps using like raster maps a few years ago,
like it seems like very out of its time.
Speaker 3: Well, we were the first, I believe. I believe the
two of us were the first humans to see the
maps and little directions on the Internet, which I think
is pretty cool, very cool cool.
Speaker 8: Yeah, Garman came out. When did Garman first launch?
Speaker 3: Well, they were an Internet based right, so you could
you could. Actually I don't think Garman was even a
player at this point. It was Navtek was the only
place that we were. That's where we got the data from. Yeah,
and they were building it for for Hurts Never Lost,
which came out a few years lady. You know those
things that no one uses in the GPS systems, really
really bad technology. But the actual mapping data was amazing,
and so we took that and applied it to the Internet.
That we were twenty two and twenty three at the time.
It had cost them three hundred million dollars to build
this data. And they gave it to us for free
with a simple contract saying, if you ever make any
money on this, you've got to you've got to come share.
And that's how we got it. That's amazing that, Yeah,
you can say it's amazing what happens if you ask nicely.
And there's also part of it was these guys had
been working so hard on the tech and no one
had ever seen what they were doing because it was
not on the internet and it was not being used
for for hurts, and so it was just they were
excited that someone would use the data and it would
think people could see what they've been they've been working on.
Speaker 9: So how did you guys get the engineering chops to
pull this off? Because it sounds like you were so
young you didn't really have any help and then you
built this like cutting edge piece of technology.
Speaker 3: Did you need to teach yourselves from I don't know
what time, what age, but publisher for the.
Speaker 9: Like blast Star game, right, yeah, when it was twelve.
Speaker 1: Did you write any other cool stuff back then? Yeah?
Speaker 6: I wrote a bunch of games. Yeah, and then like
occasionally software for people like asked for software.
Speaker 3: You know, you also worked for a video game company.
Speaker 1: Yeah, our funily it was called rocket Science. Yeah, that's funny.
Speaker 4: By the way, we took a SpaceX to yesterday.
Speaker 1: It was insane. Thank you for that. That was amazing. Yeah,
it was so good.
Speaker 4: It's like Batman's layer in there.
Speaker 3: It's really it is amazing.
Speaker 2: But it gives your perspective on what Tesla's doing because
the technology is so advanced and that there's you know,
interchange of information there. Like the I know they used
to incannel fuse right, was from SpaceX. When they couldn't
get the power output right, it kept burning up the
fuse in the in the performance models. So yeah, that's awesome.
Speaker 3: Yeah, it's pretty cool to see the SpaceX tech being
applied to Tesla. I think I think there's a joint
there's one joint employee between SpaceX and Tesla, and it's real.
It's the materials is it the materials engineer?
Speaker 1: What about you want.
Speaker 3: In addition to el because they're just not that many
humans on the planet that know how to do this stuff.
Speaker 1: Well, it sounded like back in the old days it
was was it just elam doing the coding or.
Speaker 6: I mean I did a little for like HTML friend,
not recently but no, there was there was no money,
so you can employ it.
Speaker 1: Yeah, so I strolled the software and you worked through
the night.
Speaker 8: Right, you just never according to his book, he never slept.
I don't know.
Speaker 3: I mean we we lived in a little office. I
think this address was four to seventy Sherman Way in
Palo Alto. It was probably Lea. Yeah, it was probably
like fifteen feet wide by thirty feet long, with a
little little closet in the back. And we would we
we couldn't afford a place to sleep or like a
house home apartment, so we would sleep in it and
it had a couch that was a photon and it
would pull out the futon, take turns sleeping on the
fouts on or the floor, although he coated a lot
at night, so I usually got the futon at night,
and we had we had to coat it at night
because the server when the Internet was live, needed to
be functional, and we just had data for the Bay
area at the time, so we were just kind of
making sure that the people in the Bay area could
use it. And then and then we had a little
little mini fridge with a cooking stove on and we'd
cook simple things, you know, pasta, sauce and pasta and
things like that that would be as cheap as dirt.
People think it's expensive to eat. Real food is actually
really cheap. Yah, books, vegetables, pasta and beans and stuff.
Beans super cheap, so that Jack the cheapest, and then
we would go eat a Jack in the Box, which
I can still and still kind of shiver a little
still even there for probably twenty years or longer, maybe
twenty two years, and I can still probably recite the
entire menu.
Speaker 6: Yeah, recycled through the menu and Jack in the Box
because what it was like just a few blocks away
from and it was up in twenty four hours, over
twenty four hours, and tried to get to you know,
dinner at Coalbelta after ten a zero.
Speaker 5: Yeah.
Speaker 1: Yeah, So did they know you very well Jack in
the Box.
Speaker 3: Well they didn't really, they did know. And I remember
one time I got a milk chick and I was
so tired. I was like four in the morning and
just needed to get some sugar for the rest of
the night. And there was something in it, and I
remember just flicking it out and just pertaining it didn't exist,
kept drinking my milkshake. It was it was like that
or that kind of like not in the zone to
go back into Jack argue about a milkshake, but I
don't want to not drink the milkshake.
Speaker 6: And probably reason that food was like so cheap is
that they had some people I think that had of
food poisoning.
Speaker 3: Right around that time when they got fit into a
food poisoning scare.
Speaker 6: Yeah, so that there, it was just very cheap to
eat there, and I figured, like, you know, they probably
you know, have taken some action because that after the
food poisoning, so hopefully, Yeah.
Speaker 1: There's just like eat a little bit of it, just
tastes funny. Stop eating if it tastes funny.
Speaker 3: You run out of things to eat because after like
the seventeenth chicken feet at Peta, you like can't do it.
Speaker 1: The yacha boll, remember that is that one good? It's
actually it veried, but it was it was edible. It
was so bad.
Speaker 3: Which one one? The chariochy baal teriochy ball wasn't bad.
There was the sort of sour dough grilled grilled cheese
thing that was wasn't bad.
Speaker 4: Yeah, those were the good old days, right, I mean
it was honestly good days.
Speaker 3: I mean we just we were just hoping that people
would let us stay in the country.
Speaker 1: We weren't really that word about what we were eating.
Speaker 3: We were just doing everything we could to to get
to get someone to support the company. We didn't really understand.
I didn't understand the venture capital that much. So we
were doing a seed round and angel around and doing
our best to talk to everyone and anyone we could find.
We had a very good friend with us, Greg Curry,
who now passed away, who was older than us by
about ten years I think, And yeah, it was a
wonderful mentor helped us out and put a little money
in as well. And and then I did a lot
of the work to just find just network with people.
I think our our first salesman who was selling Yellow
Pages ads for us, I was a real state agent
who knew another person who knew this other person who
helped us, who helped us raise put together We ended
up not doing the round, but put together a round
of like two hundred thousand dollars or something.
Speaker 1: Yeah, and then we did like part of it or something.
Speaker 3: But I think once we had the Java Java Map,
which was really quite impressive. I mean, if you've never
seen if you're never you've never seen Google maps or
Java maps before. It really is a remarkable thing to see.
We started to go to we got it. We got
some audiences with some venture capitalists, and it just went
from we were starving, we had no car. Well, the
car we had it broken, the will fell off, the
wheel fell off, the wheel fell off. Yeah, what kind
of car was it? I remember that's an old BMW
three wed across the country.
Speaker 1: Yeah, the one that my mom mest some pictures of.
Speaker 3: I think there's I think there's still a there's a
there's a car of in the in the road at
page Mill and night alchemmed. Literally the wal came off,
will fell off, and and and the guy literally in
the air section just drove it without the wheel to
the to the silence.
Speaker 6: It's pretty much time for the junk yard at that point,
because the whole car is falling apart. So yeah, it's
like the point which the wheel falls off, it's time
to go to the junkyard.
Speaker 4: In the morning. No, that was that was way more.
Speaker 3: That was way later because we already had the deal,
but we were we were not I don't know if
you were, but I was not legally in America. So
I was illegally there.
Speaker 1: I was legally there, but but I was mentioning student work.
Speaker 3: At a student work you you were you were doing
you were supposed to be doing a PhD in Stanford.
Speaker 1: And yeah, I decided not to do so. And it
was like I was allowed to do work sort of
supporting whatever, you know, I don't know.
Speaker 3: I tried to get a visa, but there's just there's
just not no visa you can get to do a startup.
Speaker 1: Unfortunately, nobody was paying you anything either, and so so
we ended up.
Speaker 3: We got a deal from from from More David out
and uh, this really high well respected DC firm, and
we had to break the news to them that that
that we take the bus. We took the bus to
get to to the offices. We don't have a car,
and we don't have an apartment, and were illegal.
Speaker 1: No, no, no, you're illegal.
Speaker 6: And so I was legal, but my visa was going
to run out in two years, okay, yeah, but I
was definita.
Speaker 3: We needed to get it sorted. And so, uh they
were great. I mean they're the lead investor's wife was
from Canada. They knew the whole challenge of being an
immigrant and we had Canadian passports, and so uh. They
they funded the company and they gave us some money
to each buy a car, and they gave us a
salary so could rent an apartment, and they I got
a visa through the company. But but the day, the
morning we were supposed to present to the partners, I
went to Toronto because my mother was freaking out because
she needed her computer fixed. And seriously, this is brutal.
Speaker 5: So I.
Speaker 3: Flew out there planning to fly back on Sunday and
the meeting was on Monday. And I get to the
airport on Sunday and the border control they they called
me out. They're like, you're you're you're going down to work.
You're not going down for for for travel. I was like, no, no, no,
I'm going out to work. I explained, Actually no, I didn't.
I said I'm not going to work because I think
that's what I was supposed to say. The Lord's told
me not to say anything, and so they rejected me
from the border and so I'm sposed to would do
the presentation with you on the next morning, and so
a friend of mine came to pick me up at
the airport and drove me across the border, and we
went to the Buffalo border and just said we're going
to go see the David Letterman show. And the Border
Control I was like, yeah.
Speaker 1: Go ahead, wow'z I.
Speaker 3: I got on the late night flight from Buffalo to
San Francisco and we made the meeting in the morning.
Speaker 6: So yeah, I mean, technically we're not going out of
work because that would have required meant you of being
paid something.
Speaker 1: Yeah.
Speaker 3: I wasn't actually paid anything. Yeah, yeah, yeah, technically we weren't.
Actually you're not actually breaking the law. We're not breaking
the law because we we were not being paid anything. Yeah.
I should have told them that the Border Control.
Speaker 1: Anyway, it was very getting paid for something. No, no, yeah,
you're right exactly. We were not not being paid exactly.
But yeah.
Speaker 3: So so then they approved the deal that Monday, and
we started buildings up too, you know. And it wasn't
a business model for you know, back in those days,
well it was.
Speaker 6: It was kind of like a pre like YELP is
like business model is similar to sort of yell But
it was at a time when most businesses didn't didn't
know what the internet was so and most people didn't
haven't email address or yeah, we went online flinging to.
Speaker 3: Them what a website was. The internet was kind of
this cool thing. People were using Netscape browser and I
think by the end of it, we got eighteen thousand
businesses to be on our service, pay pain to be
like with websites and everything, you know a lot of
the things that you can do today, like automatically build websites.
We built a lot of those sort of tools to
make it easier to build websites. And we had to
sell door to door.
Speaker 1: Because that was the only way.
Speaker 8: Did you hire people or is it just to you
guys going.
Speaker 3: No, No, We had a team by that time because
we could hire a team. But I remember talking to
the Yellow Pages guy once and it was amazing. That
was the head of the Toronto Star that they owned
all the.
Speaker 1: Yellow Pages in the Yellow Pages will never die famous last.
Speaker 3: Work literally because we went to talk to him partner.
We said, we want to part with you and let's
just be one of your partners to do to put
the Yellow Pages online. And he picked up the Yellow Pages.
This book, this big thick book that full of as
this multi billion dollar Redney stream.
Speaker 1: I mean, these guys were so arrogant and so like
we are kings of the world and it will never end.
Speaker 3: He picked he picked up this book and grew it
at me and he said, do you ever think you're
going to replace this? And I was just literally like,
I mean my head and my head is like, dude,
you're already dead.
Speaker 4: The anti Tesla people, you know, guess cars.
Speaker 3: Will never die. Yeah, But I mean, like we we
saw the growth of the Internet, we saw the use
of the Yellow Pages, We saw even more our competitors
and stuff, and no one was using the paper yellow
Pages if you had the choice, yes, exactly, no one.
And so so at that point, very few people who
are on the internet. So it was really a question
of really is the Internet going to succeed, which we
were huge believers in, and these guys were not, you know,
they didn't even clue in.
Speaker 6: Yeah, there was like one one point country after another.
We say like, listen, we'll just put your l pays online,
gonna cost very little. You know, you're still own all
the content and everything. And they're like, just throw us,
throw us.
Speaker 1: Out of the office. Yeah, you know, like no, and
how do you even suggest this?
Speaker 3: Extraordinary?
Speaker 1: And we're like, okay, I guess we'll just build it
and we're Yeah.
Speaker 3: But it's been interesting to watch over the years where
like in PayPal, the competitors were not uh banks, you know,
even though that should have been the competitive No, there
were there were banks that try to compete, but wasn't
it eBay mostly that was sort of the band.
Speaker 1: Bull point.
Speaker 6: Yeah, that which but it wasn't exactly like PayPal. But
generally EVA had an issue with trying to get payment
for stuff like like two.
Speaker 1: People would have to mail checks to each other.
Speaker 3: Yeah, that's gonna work.
Speaker 6: If you have mail a check and you receive the
check and how do you know the checks real? Then
you've got to you know, cash check and take you know,
two to five day for the money to transfer. So
it could take two weeks before somebody had confirmed payment
and then I then they would ship you the item
and so that the transaction velocity was very low. As
a result, if you had instant payment, you improved transaction
velostity dramatically, like factor of you know, maybe three to five.
Speaker 1: Yeah.
Speaker 3: I've just sort of seen that the when you when
in into industry is disrupted, that you worry about the
major players. I mean, when we saw a test that
we were aspiring to be the GM of the twenty
first century. Four years later, GM went bankrupt. You're like, oh, okay,
we don't we don't read. We're good, We're good, We're good,
and uh and and it's you know, whoever is going
to be the main competitors. You know, we don't know yet,
but uh, it may not be the entrenched players, may
be sort of other companies. And so so that happened
it up two where we we we tried our our
best to partner with the industry because that seemed like
the best way to make some money and actually have
a revenue model. And we ended up finding the newspapers
to be a better partner because they didn't have the
Yellow Pages business, and I think they seem we're smarter.
Their classifized business was getting eaten away by Craigslist. You know,
before craigslist classifies, was the bread and butter of the newspaper.
And of course anyone who used Craigslist would never use
the newspapers. So it was it was those folks seemed
to have a better Uh, at least some of the
players had a more more vision of the future, and
so our business became putting major newspapers in New York
Times to all of the Philadelphia acquirers, Chicago Tribune or whatever,
all the main players, all the Alley Times, everyone, and
then we started going internationally doing the same thing. So
if you went on to the New York Times website
and you wanted to search for a restaurant, of course
have all these reviews. Or if you wanted to search
for a home, then you could. You could. We tie
the mls together with maps and directions. So all of
these services that we now use and take for granted
that use maps and directions, we we did that all
in the nineties to find a business model.
Speaker 5: Yeah you do PayPal after zup too, Why do didn't
you go like straight into sustainable.
Speaker 1: Energy, right, so.
Speaker 6: Kind of recall things that are quite a while. So
it would have been like ninety eight when Compact offered
to acquire zip to, and which I think it was
a good thing to put them to acquire it because
as I mentioned that, the newspapers actually when the media
companies had too much control over zip too, so they
were not we had great technology that was not being
deployed effectively, and they would just generally be averse to
anything that could remotely be competitive with their new papers.
So so we're sort of trapped in this situation and
they think of Compact came along and bought the company
in late ninety eight and the deal closed early ninety nine.
So that as a result that Kim that I had
some capital twenty million dollars with something out of it.
And I think the thing that was frustrating to me
was that we're built incredible technology and it had not
been used. It was just sort of like very disappointing.
You know, we put a lot of work into this
technology and just wasn't being used. So I was like, Okay,
I'm going to I want to do one more thing
on the Internet, just to show that we can make
technology that is, when it's used properly, can be extremely effective.
So I thought about what what's digital? Essentially, what's what's it?
What's what exists in the form of information and is
also not high bandwidth because it in ninety nine people
still mostly had modems, so you couldn't like video is
not really feasible in ninety nine, so but money is
low bandwidth and digital effectively mostly digital. So it's like,
what can we do to make money work better. And
the money, in my views, is essentially an information system
for label allocation, so it has no power in and
of itself. It's a it's like a database for this
for guiding people what what as to what they should do.
And so you can think of banks as a set
of heterogeneous databases with that that are actually not very secure.
And certainly the the monetary system, the transfer system of
checks is not is very insecure. Still isn't secure, so
our credit cards and and it's it's still mostly batch processing.
And it was entirely batch processing that day, so it
was not so payments were money. It was just like
hitero geneous, high latency, low security collection of databases. That's
what banks are. And so just from an information three standpoint,
there should be something that could be much better if
it could be real time uh secure and you know,
just very fast. Essentially it's just one real time database.
So it's like, okay, let's tradable that. So that's that's
that's what x dot com was.
Speaker 7: And then.
Speaker 6: At the time I also thought what we should try
to do is just do all the financial things as well,
not just payments. I still think that's really what PayPal
should have done, but whatever, it's what areuner the bridge
at this point. And then there was a company that
was formed around the same time called Confinity, which was petertialed,
Max Left and Luke Nosak, David Sachs, Ken Howard and
neberthos and at x dot com there's also like Jeremy.
Speaker 1: Stuffleman and.
Speaker 6: Who created yelp roll off Botza, who then went on
to run Sequoia and and found YouTube that was it
was x dot com.
Speaker 1: So we just had this like.
Speaker 6: Two companies with like a crazy amount of talent. X
dot Common Confinity and Confinity started as a palm pilot
cryptography company. Back when you you could communicate via the
infrared port of a home pilot, Yeah, they had one.
So it was like, so you could you can basically
communicate cryptotokens between pompouts using the infrared port and then
reconcile them on a piece on a PC. And obviously
that's they evolved to go on the in the payments
direction as well. And we were both in Palo Alto,
like literally block away from each other. I think at
one point we're briefly even in the same building that
was you know, yeah, so, so we were just competing
with each other like maniacs and and and then we
had uh a coffee and University Avenue and said, hey,
when don't we just combine our efforts or we're just
gonna bludge each other to death here.
Speaker 1: So we merged Confinity and x dot com.
Speaker 6: And raised million dollars in the space of three weeks
in March of two thousand. Yeah, and then April of
the market went into free fall.
Speaker 1: Yeah.
Speaker 6: So yeah, I was like, I remember that that was
insane and we kind of thought it was going to
go into free fall, but like, we better get this
thing done fast or we're both gonna die.
Speaker 1: So and so.
Speaker 6: Xo com was technically the acquire of Confinity, but it
was a you know, fifty point one and forty nine
point nine or something like that. And and then there's
a lot of drama that there was so much drama
at at x dot com. And the company was called
x dot com for about a year and then we
changed the company name to the product name. The product
the product was PayPal, but all the incorporation documents and everything,
it's all my incorporation.
Speaker 4: Documents that came up with PayPal name.
Speaker 1: I actually don't know.
Speaker 4: People call you guys the PayPal in mafia. Now, you know,
deal with that in this book.
Speaker 6: You know, I don't know who did the PayPal. I
was never a huge fan of PayPal as a name,
the reason being that I thought it made sense for
the company to kind of broader, be much broader. Yeah, exactly.
I mean, if you don't know yourself to payments, then
necessarily people want to transfer money out of the system.
And as soon as they transfer money out of the system,
the efficiency of the database drops dramatically because now you're
in the traditional banking world. So if you just offer
all the things that if you just basically address all
the reasons why people are taking money out of the
PayPal system, so you have to provide them with checks
so that you have a bridge to the legacy transaction system.
You got to provide them with a debit card, provide
them with the ability to.
Speaker 1: Get a loan, and that kind of thing, and.
Speaker 6: That these were all ancelary to accelerating the velocity and
accuracy and security of payments. Then if basically payper would
be all the money is, it would just suck all
the money out of the banks. And they wouldn't be
the banks would go away. Yeah, so any plan you're
going to do with the I wrote, if they're just
execute the business, you know, the product plan I wrote
in July two thousands, let's just do that.
Speaker 1: But they I talked to them several times, but they
didn't do it.
Speaker 4: So why did you? And PayPal kind of part way
of what was really the drama that led to that,
you know separation.
Speaker 6: Ultimately, Well, things were very dicey in two thousand. You know,
companies were dying like all over the place, so obvious
here of the combined company, and we're doing quite well
from a growth standpoint. We're like adding one hundred thousand
users a month type of thing, which back then was
a lot. But financially things were tough and we needed
to raise financing around We're also like there's some technical
questions around what what code architecture would we go with?
And then there's also a branding question, like I said,
like I think we should not use PayPal as brand
because this is not consistent with being where all the
money is.
Speaker 1: We want to centralize database.
Speaker 6: So so I was kind of against the PayPal branding
and and I wanted to Basically, I wanted to do
a bunch of things that seemed extremely risky, and I
think those things would have would have worked out. But
at a time when companies are dropping like flies, and
I'm proposing that we do all these things that sound
very risky, this is this is just much too scary
for the rest of the team.
Speaker 4: You seem to be attracted to crazy ideas that other
people are like that, like, you know, I think the
Autopilot one is a great example where everyone's kind of
trying the spatial approach to self driving. You know, they're
doing way more for ten years nobody cares, and you
come out and say, hey, we think vision is the
way forward and deep learning and vision you know, will
take us all the way there. How do you find like, yeah,
the courage inside to I mean.
Speaker 10: People have to be coming up with you all the
time and you know, thinking that you're an idiot or
it's never going to happen, and you know, how do
you find that in yourself to like go through all
that resistance and still be confident in you know, your thesis.
Speaker 6: I mean I try to be hyper rational, so it's
not you know, it's like if this is if the
reasoning fits, and you're not violating loads of physics or something,
then that the thing you should do. So and I
guess at the other day, if we lost all the money,
I wouldn't as long as we didn't lose other people's money.
I guess I just lost lose my money out of mind.
These things just don't seem that crazy to me, so
like I think, if
Speaker 1: If Thanks for listening, See you in the next episode.