Latest / Elon Musk Thinking / Interview Of Elon Musk 11 Years Ago!!!

Transcript

Interview Of Elon Musk 11 Years Ago!!! · Elon Musk Thinking

0:00
Speaker 1: Anty with design.
0:01
Speaker 2: You know, as you think about the big problems in
0:03
Speaker 2: the world that you were addressing, do you start with
0:07
Speaker 2: a particular product in mind, like there could be this
0:09
Speaker 2: model s there could be this Falcon nine, and then
0:12
Speaker 2: think how do I get there? Or do you start
0:13
Speaker 2: with saying there's something broken in the world, and I'm
0:15
Speaker 2: gonna fix it, and I'm going to commit to do it,
0:17
Speaker 2: even if I don't know how I get there.
0:19
Speaker 3: Sure, So let's see, is that on?
0:22
Speaker 4: Yeah, it seems to be good in a case of
0:26
Speaker 4: Tesla's SpaceX and Solar City and actually will.
0:28
Speaker 3: So the PayPal and the before that.
0:32
Speaker 4: It really stemmed from when I was in college and
0:34
Speaker 4: just trying to think what would most affect the future
0:37
Speaker 4: in a in a very likely to be a positive way,
0:41
Speaker 4: So that the three areas where I was quite sure
0:45
Speaker 4: it would be positive were sustainable energy, Internet, and making
0:49
Speaker 4: life multiplanetary. And then there were a couple other areas
0:53
Speaker 4: where maybe a question mark like AI and writing, genetics
0:59
Speaker 4: and lesson, yeah, rewriting, rewriting next just.
1:07
Speaker 1: Three and four might come, you.
1:08
Speaker 4: Know, potentially negative consequences, hopefully positive.
1:12
Speaker 2: But so it could go wrong, like the top three
1:16
Speaker 2: and a couple of contenders or were they all kind
1:18
Speaker 2: of jumbling around.
1:20
Speaker 4: Waiting for you know, if you look, if you look
1:22
Speaker 4: at and say, what's what's really going to have an
1:26
Speaker 4: important effect on the future of humanity?
1:29
Speaker 3: As all those are the five.
1:30
Speaker 4: Areas that that I could come up with standing in
1:34
Speaker 4: the shower basically, you know.
1:36
Speaker 2: So there's this moment of epiphany that that you held
1:39
Speaker 2: for a while because you didn't pursue those right away.
1:41
Speaker 2: Right these were this sort of early vision that you
1:43
Speaker 2: then got opportunities to execute on. Yeah, so when you
1:47
Speaker 2: maybe if we pick an example like Tesla going towards
1:49
Speaker 2: the models or SpaceX going towards the Falcon nine, do
1:53
Speaker 2: you commit the team, yourself, your resources to that endeavor
1:57
Speaker 2: you know, now a little farther along when you the
2:00
Speaker 2: end point in mind, or just let's say the cost
2:03
Speaker 2: of goods analysis for the rocket or the gosh EV
2:06
Speaker 2: should be better.
2:06
Speaker 1: Than internal combustion engines.
2:08
Speaker 2: Just in general, I'll commit, I'll believe that should be done.
2:12
Speaker 3: Yeah, I didn't.
2:13
Speaker 4: I mean I didn't really get into any of this
2:16
Speaker 4: with the expectation of success.
2:19
Speaker 3: Or at least Yeah, I started out with.
2:24
Speaker 4: Thinking, okay, when I do something in the electric vehicle space,
2:27
Speaker 4: and that's why I originally came to Standford was to
2:31
Speaker 4: work on advanced energy storage technologies and particular aultric capastors.
2:36
Speaker 4: So that was continuing on research that I'd done as
2:39
Speaker 4: an intern in Silicon Valley and summer prior. So that's
2:43
Speaker 4: why I originally came out in ninety five. And then
2:45
Speaker 4: during that summer I wrote some Internet software and I thought, Okay,
2:48
Speaker 4: I can either work on electric vehicle technology or or
2:53
Speaker 4: I could sort of work on Internet stuff, try to
2:58
Speaker 4: try to do something with the Internet. I thought the
2:59
Speaker 4: Internet would something that would dramatically affect the future of humanity,
3:02
Speaker 4: be like like acquiring a nervous system. And whereas previously
3:09
Speaker 4: communication would have to occur almost by osmosis from one
3:12
Speaker 4: person to another slowly through telephone or mail or something
3:15
Speaker 4: like that.
3:16
Speaker 3: But now.
3:18
Speaker 4: If you have a nervous system, any part of the
3:21
Speaker 4: human collective note can know about any other part instantly,
3:26
Speaker 4: and you're previously you'd have to be at the Library
3:30
Speaker 4: of Congress, even to have the Library of Congress as
3:32
Speaker 4: sort of information. But with everything digitized and access anywhere,
3:38
Speaker 4: you could be in a jungle in South America and
3:40
Speaker 4: if you had just an Internet link somehow you could,
3:43
Speaker 4: you'd have access to all of humanity's information. So it
3:45
Speaker 4: would actually effectively create a super organism and fundamentally change
3:51
Speaker 4: the nature of humanity itself.
3:53
Speaker 3: So I was kind of I just wanted to be
3:54
Speaker 3: kind of.
3:54
Speaker 2: Part of that is that the path AI that you
3:57
Speaker 2: might see, it's it's actually not exactly AI.
4:00
Speaker 4: It's some sort of human machine collective intelligence, so different
4:07
Speaker 4: different from AI, although AI may not turn out to
4:09
Speaker 4: be exactly what hopefully not, it's not exactly what's, you know,
4:12
Speaker 4: like describing a terminator or something.
4:14
Speaker 2: Now a quick pause for those that haven't been the
4:17
Speaker 2: SpaceX the data center has got to be the coolest
4:19
Speaker 2: thing they've ever seen.
4:19
Speaker 1: It's you know, Skynet on the door, cyber nine.
4:21
Speaker 2: Systems branding, and a little bad asset of lights coming
4:24
Speaker 2: from a winking server.
4:26
Speaker 1: So you don't own it exactly.
4:27
Speaker 4: Our FAA and CFD cluster is called Cyberdigne Systems.
4:32
Speaker 2: We'll get back to influences, uh later on, but I'm
4:36
Speaker 2: gonna try to see if I understand what you were
4:38
Speaker 2: saying about this. This You see the long arc of
4:41
Speaker 2: and what's important to humanity, not little problems but huge
4:43
Speaker 2: problems that could be solved.
4:45
Speaker 1: A lot of us go.
4:46
Speaker 2: Around and we see something frustrating, like traffic on the
4:47
Speaker 2: four or five, we just take it as well, crap,
4:49
Speaker 2: government screwed.
4:50
Speaker 1: You know what, we need to do it? Right? You
4:52
Speaker 1: have this incredible sort of.
4:54
Speaker 2: Scope of ambition, right, planetary scope, interplanetary scope. Right, a
4:59
Speaker 2: little more than changing the world, let's change in other
5:01
Speaker 2: worlds too, right, And this is big stuff.
5:04
Speaker 1: Is that always in your mind?
5:05
Speaker 2: Or that did you become more emboldened over time that
5:08
Speaker 2: this is available.
5:09
Speaker 1: We can do these things.
5:10
Speaker 3: It definitely emboldened over time.
5:12
Speaker 4: I mean at the you know, when I started the
5:16
Speaker 4: first Internet companies up Too with my brother and another person,
5:21
Speaker 4: a great Curry. The it wasn't really with the thought
5:25
Speaker 4: of being wealthy. You know, I've got nothing against being wealthy, but.
5:30
Speaker 1: We'll get better to that.
5:31
Speaker 4: But it's just it was just from the standpoint of
5:34
Speaker 4: wanting to be part of the Internet, and I figured
5:38
Speaker 4: if we could make enough money to.
5:39
Speaker 3: Just get by, I would be They'll be okay.
5:42
Speaker 4: And when we started off, we literally only had like
5:46
Speaker 4: one computer, and so it would be our web server
5:48
Speaker 4: during the day and I'd code at night and We
5:52
Speaker 4: just got a small office in Palo Alta back when
5:57
Speaker 4: rent was not insane, and it cost us like four
6:03
Speaker 4: and fifty dollars a month. It was cheaper than an apartment.
6:05
Speaker 4: So we actually just slept in the office and then
6:08
Speaker 4: and then share at the YMCA on Page mell al Camino.
6:11
Speaker 4: So we'd walk her over there and shire and and.
6:14
Speaker 3: That was.
6:16
Speaker 4: Actually I think that was when we first I first
6:19
Speaker 4: met you, by the way, and so I don't know
6:22
Speaker 4: how many people.
6:23
Speaker 3: Probably not many.
6:24
Speaker 4: People knows, but we actually pitched Steve in like January
6:28
Speaker 4: ninety six on the ZIP two business plan, and actually
6:33
Speaker 4: I thought she was actually one of the most up
6:37
Speaker 4: to speed on on what actually was in our business plan.
6:40
Speaker 4: Most most of the people we met did not actually
6:42
Speaker 4: read our business plan. In fact, a lot of people,
6:45
Speaker 4: a lot of bench capitals who met at the time
6:46
Speaker 4: didn't even know what the internet was. They've never used
6:49
Speaker 4: They've never used I still do, yeah, right, yeah, something
6:54
Speaker 4: like you know, sort of well known people in Sant Hill.
6:56
Speaker 4: It was like, wow, okay, but but at the time,
6:59
Speaker 4: nobody made any money on the internet, so I guess
7:02
Speaker 4: that's you know, then it wasn't really clear evidence that
7:06
Speaker 4: that there.
7:06
Speaker 3: Was was a business and yeah, those were fun times.
7:12
Speaker 2: I remember Kimball and you coming in right, very young
7:15
Speaker 2: looking guys. I think I was in my first four
7:19
Speaker 2: months on the job too.
7:20
Speaker 3: Yeah, yeaheah exactly.
7:21
Speaker 5: So let's excuse for a sec I've I've also had
7:26
Speaker 5: the great honor to work with Steve Jobs briefly but enough,
7:30
Speaker 5: and as a business school student to study him with
7:32
Speaker 5: as much scrutiny as I could during that period.
7:35
Speaker 2: And there's some obvious parallels, and so let's start with
7:38
Speaker 2: the most obvious, but just must be like the elephant
7:41
Speaker 2: in the room.
7:41
Speaker 1: Is the secret to your.
7:42
Speaker 2: Success to be the CEO of two companies at the
7:45
Speaker 2: same time.
7:46
Speaker 1: Oh, I think it's just look at the correlation. Yeah,
7:50
Speaker 1: struggling companies.
7:51
Speaker 2: Everything's in the craft can in December two thousand and eight,
7:53
Speaker 2: So let's take on a new CEO gig.
7:55
Speaker 1: Yeah, and same for Steve.
7:56
Speaker 3: Coming back to No, definitely, it was not my intention
7:59
Speaker 3: to BECO of two companies the after.
8:03
Speaker 4: I mean, there's certain things that I kind of wanted to.
8:07
Speaker 4: I thought it were important to happen, and I thought
8:08
Speaker 4: it was important that that there was that that electric
8:13
Speaker 4: vehicle happened, that there was a success in the electric
8:15
Speaker 4: vehicle arena because the the incumbent companies were convinced that
8:21
Speaker 4: it was not possible to create an electric car that
8:24
Speaker 4: looked good, had range, a good range performance, and so forth,
8:29
Speaker 4: and that even if you did make such a car,
8:31
Speaker 4: it would not sell that Chris, people had this love
8:34
Speaker 4: of gasoline, and.
8:38
Speaker 3: So we had to.
8:38
Speaker 4: Show that it was possible to create a compelling electric car,
8:42
Speaker 4: long range, good looking, you know all those things.
8:45
Speaker 3: That was a test the roads to and don't.
8:46
Speaker 4: If you created if if you made such a thing,
8:49
Speaker 4: people would buy it. And so so that that's that's
8:54
Speaker 4: what we would try to do with with with this.
8:56
Speaker 3: If I should say.
8:57
Speaker 4: Like one mind sort of correction on the on introduction,
9:01
Speaker 4: I'm not a co founder of solar City, but I'm
9:04
Speaker 4: a co founder of Tesla.
9:05
Speaker 1: That's okay, that's a good point.
9:07
Speaker 2: So and probably architectures, yeah, many of its key features.
9:11
Speaker 2: So very much like jobs, both a hand in some
9:14
Speaker 2: of the detail as well as the long arc of
9:16
Speaker 2: what's important for the company.
9:18
Speaker 1: The quipto about being co.
9:20
Speaker 2: CEOs is more than just a joke in that I
9:22
Speaker 2: wonder if in ways that are hard to predict, and
9:24
Speaker 2: you wouldn't set out for this amount of work. It
9:27
Speaker 2: seems insane, but inevitably, both companies cannot expect more than
9:31
Speaker 2: half your time at most.
9:33
Speaker 1: It sort of naturally forces a.
9:35
Speaker 2: Delegation upon you and an expectation they have to rise
9:38
Speaker 2: up for partial awareness at best, right, And I just
9:41
Speaker 2: wonder if that helps drive prioritization and really focusing on
9:44
Speaker 2: what's important a bit more than you otherwise might have to.
9:47
Speaker 3: It probably does, Yeah, I think I probably do.
9:50
Speaker 4: Yeah, I mean, because I have to triage the things
9:52
Speaker 4: that I do at each company and constantly think about
9:56
Speaker 4: what is the most useful thing that I could that
9:58
Speaker 4: I could do.
10:00
Speaker 3: But even with that, it's it's still actually just take
10:03
Speaker 3: it an almost amount of time.
10:05
Speaker 4: And for a while I was just doing constant one
10:07
Speaker 4: hundred hour weeks and that's that's definitely wearing. And you know,
10:12
Speaker 4: now I'm kind of in the eighty to ninety, which
10:15
Speaker 4: is well manageable, but you know that if you divide
10:19
Speaker 4: that by too, it's only like, you know, maybe forty
10:22
Speaker 4: five hours for a company, which is not not much
10:25
Speaker 4: if you're there's a lot of things going on like
10:27
Speaker 4: a slacker.
10:28
Speaker 1: I mean, yeah, so you.
10:32
Speaker 2: Know, it is interesting also how you have a love
10:37
Speaker 2: for certain aspects of the product.
10:38
Speaker 1: So it's SpaceX you.
10:39
Speaker 2: You know, the whole concept and the vision of going
10:41
Speaker 2: to Mars back into features and stuff. It's it's a
10:44
Speaker 2: wonderful thing to see. I think what obviously should strike
10:47
Speaker 2: folks in the room as remarkable as the diversity of
10:51
Speaker 2: industries that you've tackled, right from commercial banking to the
10:54
Speaker 2: military industrial complex to the automotive industry. These are heavily
10:57
Speaker 2: regulated industries the generally investors flee from and startups routinely failing,
11:01
Speaker 2: and they haven't seen much change for good reason over decades.
11:05
Speaker 2: So there might not be an obvious pattern in which
11:07
Speaker 2: industry you tend to thrive in. But I wonder if
11:11
Speaker 2: there's a pattern perhaps in process, like do you approach
11:14
Speaker 2: each of these perhaps the way a software architect might
11:16
Speaker 2: to think of a different way to bring innovation, a
11:18
Speaker 2: different way to reset, you know, for first principles, perhaps
11:23
Speaker 2: instead of iterating from the past a breakthrough. And is
11:26
Speaker 2: there reason you end up in these otherwise really tough industries.
11:29
Speaker 2: I mean, I don't know if that's ever occurred to
11:32
Speaker 2: you that you don't even in Solo City going up
11:33
Speaker 2: against the regulated autilities. None of these are places that
11:36
Speaker 2: you would normally find entrepreneurs.
11:40
Speaker 4: Yeah, like I said, it was not from the standpoint
11:42
Speaker 4: of like what's the best risk adjustin rate or return
11:44
Speaker 4: or you know, where I think it thinks could be successful.
11:48
Speaker 4: It's just like I think these things need to happen,
11:50
Speaker 4: to try to make them happen, And certainly when we
11:54
Speaker 4: started SpaceX or Tesla, I thought the probably of success
12:00
Speaker 4: was less than fifty percent, you know, probably a fair
12:03
Speaker 4: bit less than fifty percent.
12:04
Speaker 3: In the case of Solar.
12:05
Speaker 4: City, I thought the probably to success was probably greater
12:09
Speaker 4: than fifty percent, But it wasn't clear what the magnitude
12:11
Speaker 4: of success would be.
12:12
Speaker 3: You know, it could just be small.
12:15
Speaker 4: And yeah, but it was I just thought these were
12:19
Speaker 4: things that needed to get done, and even if the
12:22
Speaker 4: money's lost, okay, it's still worth trying.
12:26
Speaker 1: See conviction, But it didn't mean certainty.
12:29
Speaker 2: Right, you knew that all vehicles would be electric in
12:32
Speaker 2: your heart, but.
12:33
Speaker 4: Ultimately also, I mean, I think the sort of fundamental
12:36
Speaker 4: good that Tesla can accomplish is acceleration of the inevitable,
12:42
Speaker 4: which is electric transportation. But I thinks there's a lot
12:46
Speaker 4: of value to accelerating, even though I think it's somewhat inevitable.
12:51
Speaker 3: It's about this value to accelerating it to.
12:52
Speaker 4: Minimize the that the environmental and economic damage.
12:56
Speaker 3: That would otherwise occur.
12:58
Speaker 4: So you know, it's better if we transition sustainable transport
13:03
Speaker 4: ten years or maybe twenty years sooner than might otherwise
13:07
Speaker 4: be the case. And I think the Tesla's effect has
13:11
Speaker 4: been much greater than the cars that made that It's
13:13
Speaker 4: made internally because when we announced the Tesla Roadster, then
13:20
Speaker 4: Bob Lutz, who was fish shamed GM at the time,
13:22
Speaker 4: saw our pressure release and said, if a small company
13:25
Speaker 4: in California can do it, than circ and jam and
13:27
Speaker 4: he took it to his engineers who told him that
13:29
Speaker 4: you could build an electric car and told them that
13:31
Speaker 4: they need to get going. That's what got the volt rolling,
13:34
Speaker 4: and that in turn got nisigned to do the Leaf
13:37
Speaker 4: and so it's kind of got the got things going,
13:42
Speaker 4: and ultimately it's like it's what we induce other companies
13:46
Speaker 4: to do that will have a greater impact than the
13:47
Speaker 4: cars we make ourselves.
13:49
Speaker 1: And it's an interesting point. I'm going to come back
13:50
Speaker 1: to you later.
13:51
Speaker 2: This idea that Tesla's founding mission is as Elon has
13:54
Speaker 2: articulated from the very beginning through the most recent reports
13:58
Speaker 2: to the public, is to cat is an industry shift
14:01
Speaker 2: that test level be is some part of. But to
14:03
Speaker 2: help others in that shift as well, which is remarkable.
14:07
Speaker 3: So we supply pow trains to Toyota and to Mercedes.
14:10
Speaker 2: To help what could be viewed as your biggest competitors
14:12
Speaker 2: one day, you know, absolutely in fact accelerate that. Before
14:16
Speaker 2: we get to that sort of purpose driven mission, I
14:18
Speaker 2: do want to ask one or at least maybe make
14:20
Speaker 2: sure the audience realizes how cool this car is, and
14:23
Speaker 2: so the eland doesn't have to do this in case
14:25
Speaker 2: you haven't been as much of a fan as the
14:27
Speaker 2: two of us, it's a bit unprecedented the reviews it's received,
14:32
Speaker 2: consumer reports saying it's the best car they've ever tested,
14:35
Speaker 2: road in tracks saying it's the most important car in
14:37
Speaker 2: America's history, the safety testing showing is the most safe
14:41
Speaker 2: car ever manufactured by far, including Vans and Issuvies. And
14:47
Speaker 2: so it's pretty remarkable to peg performance, desirability, safety and
14:51
Speaker 2: all these parameters. So is it luck or is there
14:54
Speaker 2: something particularly unique about the EV design space that let
14:57
Speaker 2: it be possible to build the best car.
15:01
Speaker 4: Well, I think, you know, let does play some role here,
15:03
Speaker 4: but I think we I think electric pickles have a
15:05
Speaker 4: fundamental architectural advantage if one designs an electric vehicle from
15:09
Speaker 4: the ground up and takes advantage.
15:11
Speaker 3: Of of what's possible.
15:13
Speaker 4: Like if you just were to convert a gasoline car,
15:15
Speaker 4: you would not you would not achieve these advantages. But
15:19
Speaker 4: if it's probably done, you can actually package the battery
15:23
Speaker 4: pack in the full pan and achieve a low center
15:26
Speaker 4: of mass and have a very compact motor and a verter.
15:31
Speaker 3: And gearbox, so that that the actually usable space.
15:35
Speaker 4: In the car is significantly greater than a gasoline car
15:38
Speaker 4: of the same over external excelled dimensions.
15:42
Speaker 3: And then if you do a few.
15:45
Speaker 4: Other things which one's necessarily specifically related to an electric car,
15:48
Speaker 4: like using an aluminum body in chassis is helpful because
15:53
Speaker 4: you can absorb more energy per unit mass.
15:55
Speaker 3: Essentially in a crash, it crupples.
15:59
Speaker 4: Yeah, well so that yeah, but part of it's related
16:02
Speaker 4: to electric vehicle architecture, and part of it is related
16:05
Speaker 4: to other technical decisions that were made in the design
16:07
Speaker 4: of the model ass and.
16:11
Speaker 3: So yeah, that's that's what leads to sort.
16:14
Speaker 4: Of having a high safety is I mean, I don't
16:19
Speaker 4: want to sort of go into too much stakes because
16:20
Speaker 4: it might take up too much time.
16:22
Speaker 2: But like, did you know some of those things at
16:25
Speaker 2: the get go or did they unveil themselves as you
16:28
Speaker 2: went along. I'm just curious how the vision materializes, for example,
16:33
Speaker 2: like along either the product dimensions, like it will have
16:35
Speaker 2: all these great features like like at the get go
16:38
Speaker 2: that the ald gel And then secondly, I'm also curious when.
16:41
Speaker 1: Did you first know that all vehicles would be electric?
16:44
Speaker 1: Like was that.
16:46
Speaker 3: Probably twenty two years ago something like that.
16:51
Speaker 1: Before he met Tesla.
16:54
Speaker 4: Before, way before there was before there's a way for
16:57
Speaker 4: those Tesla. Oh yeah, well, like I said it, you
16:59
Speaker 4: know when I originally came out when I I mean
17:03
Speaker 4: when I was studying physics pen That's probably when I
17:07
Speaker 4: thought it was the case. And maybe you know, sooner
17:09
Speaker 4: than that, probably when I was in my sophomore year.
17:13
Speaker 1: Did you have certainty in your heart?
17:15
Speaker 3: Yeah? Absolutely, it's super obvious.
17:17
Speaker 1: Yes, yes, now yes now it is.
17:20
Speaker 3: There are something that was super obvious then.
17:21
Speaker 2: But that this is a bless in my mind because
17:23
Speaker 2: even like three years ago, most people probably didn't agree
17:26
Speaker 2: with this point of view. And if I could be
17:27
Speaker 2: confident of any prediction I could make, it's that within
17:29
Speaker 2: ten years old, people will be of this point of view,
17:32
Speaker 2: but we won't have made the transition yet, but we'll
17:34
Speaker 2: realize that it's a ridiculous debate to be having. You
17:38
Speaker 2: were a lone voice of sorts back then, probably amongst
17:40
Speaker 2: your cohort and friends and you know social.
17:43
Speaker 4: Yes, actually I used to talk to like dates about
17:46
Speaker 4: electric cars.
17:48
Speaker 3: How I go. It wasn't it wasn't helpful. It better.
17:55
Speaker 4: Yeah, So, actually I ran into a girl I did
17:58
Speaker 4: briefly in Canada, Christy Nicholson. She's now at like a
18:01
Speaker 4: writer for Scientific American, and she mentioned, Yeah, when we
18:05
Speaker 4: were on a date, I asked her, do you ever
18:07
Speaker 4: think about electric cars? And she said, no, I don't.
18:14
Speaker 4: So yeah, a while back, it's pretty I mean, almost
18:18
Speaker 4: everything's electric that we have in our daily lives here.
18:21
Speaker 2: It was from the physics of it, Yeah, the heat
18:23
Speaker 2: loss of an eternal combustion engine just yeah, pretty amazing,
18:27
Speaker 2: pretty amazing. So I'm gonna I want to share a
18:30
Speaker 2: little story that leads to a question along a different angle.
18:32
Speaker 2: I don't think you've heard this before, so, but I
18:35
Speaker 2: find it fascinating. I was at a lunch at a
18:37
Speaker 2: Google event, and out of the blue, with no expectation
18:41
Speaker 2: this would be a topic, Larry Page turned to me,
18:43
Speaker 2: knowing a little bit about our connection, said.
18:45
Speaker 1: You know, how much money do I have?
18:48
Speaker 2: And you mentioned a number. I thought that was cute
18:50
Speaker 2: that he was trying to recall that. He goes, you know,
18:52
Speaker 2: if I were to get hit by a bus today,
18:55
Speaker 2: I should leave all of it to Elon Musk.
18:57
Speaker 3: Really, yeah, he said that.
18:59
Speaker 2: Yeah, And and so I'm like paper pen.
19:06
Speaker 1: Yes, so he likes, he likes singers, he likes.
19:09
Speaker 3: He's like a good friend of mine.
19:11
Speaker 1: So he was so context is important, you know.
19:13
Speaker 4: I mean I met Larry before he got venture funding. Yeah,
19:18
Speaker 4: so that's.
19:18
Speaker 3: That's like.
19:20
Speaker 1: Yeah, yeah, wow.
19:22
Speaker 2: Well he's a remarkable guy, obviously also underachiever, and you know,
19:26
Speaker 2: has a company that wants to do good in the world, right,
19:29
Speaker 2: And I think he looks at you with a bit
19:31
Speaker 2: of end because what he then proceeded to say was,
19:33
Speaker 2: you know, I could give my money to nonprofit and
19:37
Speaker 2: a lot less we get done than a corporation that's
19:39
Speaker 2: pursuing things that are directly aligned with things I care
19:42
Speaker 2: about like getting off of oil and colonizing other planets.
19:45
Speaker 2: He bleeds in those missions and thinks that a corporation
19:48
Speaker 2: with endowed with the right to do that has his
19:50
Speaker 2: business purpose, is the best vehicle out there, and wishes
19:53
Speaker 2: he could do more of that in his own life.
19:56
Speaker 2: He compared poigntly, I think to some other software companies
20:01
Speaker 2: in the Pacific Northwest who might have executives who do
20:03
Speaker 2: evil for the first part of the career, then do
20:05
Speaker 2: good for the second half, and then the sad story
20:08
Speaker 2: of others who'd never get to the second half of
20:10
Speaker 2: their life, like Steve Jobs. I mean not in a
20:13
Speaker 2: joking way, I mean seriously, and it was a very
20:16
Speaker 2: deep moment. So it raises the question of a purpose
20:18
Speaker 2: driven business. So you've heard already that Tesla is not
20:20
Speaker 2: just trying to make money. That is not the parody
20:22
Speaker 2: if you read the most recent shareholder letter.
20:25
Speaker 4: Yes, in fact, I started off the the shareholder letter
20:29
Speaker 4: saying the profits are not our primary goal.
20:32
Speaker 3: And then I got a little.
20:33
Speaker 1: Bit of.
20:36
Speaker 4: Some of the board members who question that statement, and
20:41
Speaker 4: I was like, well, it's true, you know.
20:44
Speaker 2: Like like like for now or like just just while
20:47
Speaker 2: we're growing, But no, just not the parody, which I
20:49
Speaker 2: think in a business goal is a really good point
20:51
Speaker 2: to dwell on for a moment.
20:52
Speaker 3: Yeah, it's not that I think they're unimportant or anything.
20:55
Speaker 3: It's just not the primary goal.
20:57
Speaker 4: And I actually told me well that on IPO as well,
21:00
Speaker 4: And so it's not like new information at least, you know,
21:04
Speaker 4: if people had watched the IPR, it's not your information.
21:07
Speaker 4: And yeah, and actually amazing the stock went up after that.
21:12
Speaker 1: Was I think there's a profound reason.
21:15
Speaker 2: I mean, you see the benefits of being focused on
21:17
Speaker 2: something that's a higher calling as your primary motivation.
21:20
Speaker 1: Your employees love.
21:21
Speaker 2: At the customers love and partner's love, right, and you
21:23
Speaker 2: feel better about your job. The interesting thing, the irony perhaps,
21:26
Speaker 2: is that at least with an our portfolio, the companies
21:29
Speaker 2: that have that kind of a founding principle actually make
21:32
Speaker 2: more profit and grow their revenue more quickly than the.
21:34
Speaker 1: Ones that don't.
21:35
Speaker 2: You know, it's this low sample set, but the handful
21:37
Speaker 2: that had taken this bold of a step to say no, no,
21:39
Speaker 2: that we will not make that a number one priority
21:42
Speaker 2: actually do a great job. And it occurred to me,
21:44
Speaker 2: and I don't know if this was conscious in your head,
21:46
Speaker 2: at at some point that if you weren't wildly profitable,
21:49
Speaker 2: the auto industry wouldn't follow you. In other words, this
21:51
Speaker 2: whole mission of catalyzing a shift to a new electric
21:54
Speaker 2: vehicle isn't going to work if the business model is
21:57
Speaker 2: worse than a current business model.
21:58
Speaker 1: And so even you know, it's the obvious byproduct.
22:01
Speaker 2: Of what you're focusing on. I'm not obvious, but it
22:03
Speaker 2: curs to me that it's a byproduct. It wasn't obvious
22:06
Speaker 2: at first at all. But I'm curious that thought occurred
22:09
Speaker 2: to you, that all, yeah, the profits will come, or yeah, well.
22:13
Speaker 4: We have to generate positive cash flow, or we have
22:16
Speaker 4: to generate enough cash flow to fund future developments, which
22:19
Speaker 4: requires having a good gross magin. And so I guess
22:23
Speaker 4: one could just say, okay, well we're going to stop
22:25
Speaker 4: developing your products, and then you would be really profitable.
22:28
Speaker 3: So at any given point.
22:29
Speaker 4: You could sort of say, we could be profitable, you know,
22:32
Speaker 4: at this point in a significant way, but we've got
22:36
Speaker 4: these great things that we want to develop for the future,
22:38
Speaker 4: and they're a good investment, and that's what we're doing.
22:41
Speaker 2: And similarly, at SpaceX, the you know, the founding vision
22:44
Speaker 2: was to colonize Mars indirectly again interestingly catalyzing others to move. Yeah,
22:50
Speaker 2: and then you realize, hey, I've got to actually lead
22:52
Speaker 2: this charge.
22:53
Speaker 3: Yeah, well, I mean with SpaceX.
22:56
Speaker 4: Originally I started off just thinking, well, how do I
23:00
Speaker 4: increased NASA's budget.
23:01
Speaker 3: Actually, that was my goal.
23:03
Speaker 4: So it was like two thousand and one with just
23:07
Speaker 4: just Torn, a friend of mine, and he asked me.
23:09
Speaker 4: He asked me what I was going to do after PayPal,
23:11
Speaker 4: and I thought, well, you know, I was wondering, like
23:14
Speaker 4: I'd like to get involved in space, but I just
23:16
Speaker 4: didn't think there's anything as an individual. And but I
23:19
Speaker 4: was curious as to when we when we're NASA would
23:22
Speaker 4: be sending a team to Mars, because that was always
23:26
Speaker 4: going to be the thing to do.
23:27
Speaker 3: After the Moon.
23:29
Speaker 4: I figured that that there'd be some plan and I
23:31
Speaker 4: just go to the website and I could read, you know,
23:33
Speaker 4: the schedule, and oh yeah, it's like okay, twenty seventeen, good, okay,
23:40
Speaker 4: But actually there wasn't anything on the website, and or
23:44
Speaker 4: at least I thought like, am I cannot not find it?
23:46
Speaker 4: Like what's going on here? And is it secret?
23:49
Speaker 3: I don't know?
23:50
Speaker 4: So but it turned out that that NASA had done
23:54
Speaker 4: a study on what it would constant send to do
23:57
Speaker 4: a man Mars mission. And this was under Bush the
24:01
Speaker 4: first and in suppose he asked for a ninety day
24:05
Speaker 4: study short laughter taking office and now so he came
24:09
Speaker 4: back with a five hundred billion dollar price tag and
24:12
Speaker 4: he said, okay, maybe not billion. That's when five hundred
24:14
Speaker 4: billion dollars was serious money.
24:18
Speaker 3: For the government. So I.
24:23
Speaker 4: So then that got totally shelved and it was like
24:25
Speaker 4: you were not allowed to talk about any kind of
24:27
Speaker 4: crude mission to Mars at NASA.
24:31
Speaker 3: Anyway.
24:31
Speaker 4: So but I thought, well, if I can do something
24:34
Speaker 4: that would galvanize public interest that and then that public
24:38
Speaker 4: interest would translate to additional appropriations for NASA and increased
24:43
Speaker 4: that their budget, then maybe they could do it. So
24:46
Speaker 4: so actually, what I sort of thinking I would do
24:49
Speaker 4: is send us a small greenhouse the service of Mars
24:53
Speaker 4: seats in dehydrated jail and then upon landing, hydrate to
24:56
Speaker 4: jail to grow the plants. And the public tends to
24:59
Speaker 4: respond to precedents superlatives, so this would be the furthest
25:01
Speaker 4: that life's ever traveled, the first life on Mars. And
25:05
Speaker 4: you have this great shot of green plants on a
25:07
Speaker 4: red background, and.
25:09
Speaker 3: I thought, okay, maybe that would get the money shot.
25:12
Speaker 3: The money shot.
25:12
Speaker 4: Yeah, I'm never quite sure whether that's the sort of
25:15
Speaker 4: a word you can use or not. Now i'm realizing maybe, yeah,
25:23
Speaker 4: I didn't. I didn't know its origins until somebody pointed.
25:26
Speaker 3: It out to me.
25:26
Speaker 2: But so moving back to that greenhouse on Marsh, Yes,
25:33
Speaker 2: the photo is out.
25:35
Speaker 4: There and you have this great photo, and I thought, okay,
25:41
Speaker 4: if we could make this happen to be cool and
25:43
Speaker 4: now so we get the money and they could do
25:44
Speaker 4: they could sort of send a team.
25:47
Speaker 3: To Mars and be great. So I tried to trying
25:50
Speaker 3: to figure.
25:50
Speaker 4: Out how to do this with the proceeds that I
25:52
Speaker 4: had from from PayPal, and I was able to figure
25:56
Speaker 4: out how to get the cost of the spacecraft down
25:59
Speaker 4: and the munications and the little greenhouse and everything. But
26:03
Speaker 4: the one thing I couldn't compress was the cost launch.
26:05
Speaker 4: It was only a few options, and the US options
26:08
Speaker 4: were way too expensive, and so I ended up going
26:11
Speaker 4: to Russia three times to try to buy the biggest
26:15
Speaker 4: ICBM in the Russian nuclear fleet.
26:18
Speaker 1: That's where I started.
26:19
Speaker 4: Yeah, yeah, I mean, okay, that.
26:26
Speaker 6: Was it.
26:26
Speaker 3: Was.
26:27
Speaker 4: There was some strange trips, that's for sure, but you're
26:31
Speaker 4: just like virtually like you can buy any.
26:33
Speaker 3: It's a very capitalist society in some ways.
26:38
Speaker 4: So I actually did negotiate a deal to buy two
26:40
Speaker 4: of the ICBMs minus the nukes. And but I came
26:46
Speaker 4: to the conclusion after that their trip that it wouldn't
26:49
Speaker 4: really matter, like if if I actually came innclusion that
26:51
Speaker 4: my initial premise was was was wrong, because I actually
26:56
Speaker 4: think there's there's amount of will in American population, particularly
27:01
Speaker 4: to explore the United States, you know, maybe more than
27:06
Speaker 4: any other country, is a distillation of the human sporad
27:11
Speaker 4: of exploration, and it's really fundamental to psyche. So if
27:15
Speaker 4: people think there's a way, I think you actually get
27:17
Speaker 4: a lot of sport. But then it can't be just
27:21
Speaker 4: bang your head against the wall. I gotta believe that
27:23
Speaker 4: this can be done without breaking the federal budget. So
27:27
Speaker 4: that's when I said, Okay, well, is there some way
27:30
Speaker 4: to affect the cost of space transport and and and
27:35
Speaker 4: so I got together with a group of people of
27:39
Speaker 4: a series of saturdays just to just try tounside. Is
27:42
Speaker 4: there something super fundamentally super expensive about rockets or can
27:46
Speaker 4: the cost be substantially improved. And we had a bunch
27:53
Speaker 4: of those kind of brainstorming sessions and I couldn't see
27:56
Speaker 4: I couldn't see any fundamental obstacle to improving the cost
27:59
Speaker 4: of rockets.
28:00
Speaker 3: So that's when I started SpaceX.
28:04
Speaker 1: I'll just build them myself.
28:06
Speaker 7: Yeah.
28:06
Speaker 1: And then but I.
28:07
Speaker 4: Said, at that point I would just say the probity
28:09
Speaker 4: of success was definitely less than fifty percent. I thought
28:12
Speaker 4: it would most likely not succeed, but what's worth a try.
28:16
Speaker 2: But it's fascinating. But the parallels are so many between
28:19
Speaker 2: these companies. Again, probability is low, certainty that it needs
28:23
Speaker 2: to be done, certainly that it could be done by
28:26
Speaker 2: for physics, and first principles that it's the success is
28:29
Speaker 2: an option, right, it's one of the possibilities. And interestingly,
28:33
Speaker 2: starting with a roadster and a Falcon one as a
28:35
Speaker 2: proof point to a larger design. You know, as I
28:38
Speaker 2: look at the Falcon nine and it looks like the
28:41
Speaker 2: product of a software engineer modular reuse, like let's build
28:44
Speaker 2: one engine and step and repeat and building all kinds
28:47
Speaker 2: of elegance into the system design to abstract away almost
28:51
Speaker 2: from the hardware into the software, into the design the
28:54
Speaker 2: beauty of the system. And I wonder if that's why
28:56
Speaker 2: incumbents don't see the sort of re engineering of the.
28:59
Speaker 1: Of the car, of the rocket, or the what have you.
29:01
Speaker 2: The hyper loop is this, they don't approach it in
29:03
Speaker 2: that kind of blank sheet of paper. How would you
29:05
Speaker 2: do this if you didn't have to create jobs across
29:07
Speaker 2: district or you didn't have some other ulterior motive?
29:10
Speaker 1: Interesting, interesting looking at the.
29:11
Speaker 2: Time I want to give I'll ask one last question,
29:13
Speaker 2: but i'll give a heads up on there's Mike's to
29:15
Speaker 2: start getting them ready for audience, because I don't want
29:17
Speaker 2: to monopolize people's time here. Actually, there's so many questions
29:21
Speaker 2: i'll ask, but what I'll start with maybe and here
29:24
Speaker 2: for at least some of the quirky.
29:26
Speaker 1: One about influences.
29:28
Speaker 2: So you, uh, we've heard about the Iron Man reference
29:31
Speaker 2: and your childhood interest in comic books and Hitchiker's Guy
29:34
Speaker 2: the Galaxy and as them off. But there's all kinds
29:39
Speaker 2: of things woven into like cyber nine systems that at.
29:42
Speaker 1: SpaceX that we heard, and then some Easter eggs.
29:44
Speaker 2: So some of us noticed that the steria goes to
29:48
Speaker 2: eleven right on the on the Tesla. This is the
29:50
Speaker 2: spinal type reference for those who know that this one
29:52
Speaker 2: goes to eleven and he just just one more.
29:54
Speaker 3: Louder than loud. That's right, exactly, that's right.
29:57
Speaker 2: But no one seems to have noticed the product lineups.
29:59
Speaker 2: You got the models, you got the Model X. Oh
30:02
Speaker 2: you've just trademarked the Model E.
30:05
Speaker 3: Yeah.
30:05
Speaker 1: No, one's yeah, you got and the model and the
30:08
Speaker 1: Model Y.
30:09
Speaker 4: No, I know exactly, but there's not I guess there's
30:12
Speaker 4: not a lot of humor and trademark uh, the trademark law,
30:15
Speaker 4: you know, because yeah, obviously we just trademarked sexy.
30:20
Speaker 3: So uh.
30:22
Speaker 4: And then we're having this this discussion with the like
30:25
Speaker 4: Ford because they.
30:29
Speaker 3: The Ford's Council.
30:32
Speaker 4: They also didn't get it, like because because they're they're
30:36
Speaker 4: sort of slightly opposing us using Model E.
30:39
Speaker 3: And then they saw that we.
30:40
Speaker 4: Were registered Model Y and they said, oh, you're planning
30:42
Speaker 4: to use Model WY instead of Model E.
30:44
Speaker 3: Like, no, it's just a joke.
30:48
Speaker 1: We don't do that.
30:50
Speaker 3: What is this foul? Come on?
30:53
Speaker 2: Fantastic? Well do we I'll keep going if we don't.
30:56
Speaker 2: But do we have microphones for folks if they want
30:58
Speaker 2: to ask.
30:58
Speaker 1: Questions Okay, let's do a qu see if anyone Oh
31:01
Speaker 1: my gosh, yes we have them. Why don't we do that.
31:03
Speaker 1: Let's take a couple of questions in the audience and
31:06
Speaker 1: I'll let you guys figure out how to do the allocations.
31:10
Speaker 1: Thank you very much.
31:12
Speaker 6: I heard you talk about supersonic aircraft. You guys have
31:18
Speaker 6: done some beautiful work at space X on be tall. Ah.
31:23
Speaker 6: Clearly tesla is is focused on electric. Have you thought
31:27
Speaker 6: about the the synergies of electric and be tall and
31:31
Speaker 6: aircraft for solving the four or five challenge?
31:35
Speaker 3: For solving the four five film? Well, I mean, I
31:38
Speaker 3: do think there's there's a there's.
31:39
Speaker 1: A real vertical take off and landing.
31:41
Speaker 4: Yeah right, sorry, vertical take for landing is vitall? And
31:45
Speaker 4: uh yeah, I do think there's there's a really like
31:49
Speaker 4: the I think the optimal sort of air transport solution
31:52
Speaker 4: is a vetall electric supersonic plane and and it actually
31:58
Speaker 4: works together quite well for a bunch of reasons.
32:04
Speaker 3: In particular, the higher you go, the better.
32:07
Speaker 4: The electric the more efficient the electric aircraft is, whereas
32:10
Speaker 4: if you have a combustion aircraft, as you as you
32:12
Speaker 4: get higher it get it tends to get worse because
32:15
Speaker 4: you have a kind of.
32:15
Speaker 3: A fixed aperture and airscoope.
32:19
Speaker 4: Yeah, like the engine is the hole in the front
32:21
Speaker 4: of the engine is a fixed size, and so you
32:25
Speaker 4: have to pick a particular cruising altitude and so you've
32:27
Speaker 4: got to figure out how do you get the right
32:30
Speaker 4: amount of air at sea level.
32:32
Speaker 3: All the way through really high altitude.
32:34
Speaker 4: And then you've got this issue of super supersonic combustion
32:37
Speaker 4: that you know, you see, you end up having to
32:38
Speaker 4: slow the air down and it ends up being not
32:41
Speaker 4: that efficient. But electric after aircraft would just get better
32:43
Speaker 4: and better as it got the higher and then electric
32:47
Speaker 4: motors have a higher power weight ratio than a combustion engine,
32:51
Speaker 4: so you could you can actually have the power to
32:54
Speaker 4: do the vertical takeoff landing part with a fairly small
32:57
Speaker 4: motor compared to combustion. And then you could get rid
33:02
Speaker 4: of the elevator and uh and rider, so you don't
33:08
Speaker 4: need the rare control services if you gimble the end
33:10
Speaker 4: that you can gimble the.
33:11
Speaker 2: Motor gotch so it starts to look like a podcraft,
33:15
Speaker 2: like yeah, Bolivian or something, right.
33:19
Speaker 4: And so it's it's yeah, it's something quite the real
33:23
Speaker 4: trick of it is like, how do you make it
33:24
Speaker 4: really long range and at least as safe as existing aircraft?
33:30
Speaker 4: But those are really the only two questions on that front,
33:33
Speaker 4: I think. But they're they're tricky, they're certainly.
33:37
Speaker 1: Don't underestimate those questions.
33:42
Speaker 2: Great, let's go to the next one.
33:44
Speaker 1: Or whoever has a.
33:44
Speaker 2: Mic, however, we're doing the allocation fairly and efficiently.
33:51
Speaker 1: Let me give him a hand. Okay, No that we
33:52
Speaker 1: have someone great.
33:53
Speaker 7: Young GSP and Andy four Hey, Steve by a long time.
33:57
Speaker 7: And one question, are you as Tesla going to expand
34:02
Speaker 7: the worldwide? And I think GSB is going to host
34:07
Speaker 7: China two point zero tomorrow, and do you have any
34:11
Speaker 7: plans to go into the biggest car market today? But
34:15
Speaker 7: I know you're a little concerned through another friend of mine,
34:18
Speaker 7: I actually asked you indirectly a few years ago that
34:21
Speaker 7: you were concerned about the secret and the parenting in
34:28
Speaker 7: the Chinese market. Are you still concerned about that or
34:32
Speaker 7: you have a strategy?
34:34
Speaker 4: Yeah, So Tesla is definitely going to ship worldwide. In fact,
34:38
Speaker 4: the Tesla roadsters in thirty one countries right now, and
34:41
Speaker 4: we expect to ship the model ast to China starting
34:46
Speaker 4: next year as well. As to Japan and Hong Kong
34:50
Speaker 4: and Singapore and Morella and Australia. So really it's going
34:56
Speaker 4: to be quite widely distributed next year. Certainly, China is
35:00
Speaker 4: an extremely important market in fact, for premium sedans. China
35:06
Speaker 4: is about half the world market for premium sedans. So
35:11
Speaker 4: if it takes some growing, yeah, to take something Mercedes
35:14
Speaker 4: S class, but last year fifty four percent of Mercedes
35:17
Speaker 4: S classes was sold in China, so pretty important market.
35:22
Speaker 4: And yeah, so we're gonna definitely do a major push
35:28
Speaker 4: in China. And actually some of the most enthusiastic potential
35:31
Speaker 4: customers we've seen are people from China, So we actually
35:35
Speaker 4: want to make sure that the car actually has features
35:38
Speaker 4: which are specific to the Chinese market and make sure
35:42
Speaker 4: that it's not just you know, taking an American product
35:44
Speaker 4: and you know, just sort of sending it to China
35:47
Speaker 4: without any any changes.
35:48
Speaker 3: So we want to make sure it's tailored to the
35:49
Speaker 3: market and Japan as well.
35:53
Speaker 4: I don't want to you know, a lot of it's
35:55
Speaker 4: not many American class sell in Japan, but I think
35:57
Speaker 4: that would be like which were symbolism. Yeah, I mean,
36:01
Speaker 4: like I think we should take the Japanese market seriously,
36:06
Speaker 4: and and I think if we do things right, we
36:08
Speaker 4: should have reasonable sales there. So yeah, so that that's
36:14
Speaker 4: going to be next year. I mean as far as
36:17
Speaker 4: copying stuff, I think that that's certainly a risk. I
36:19
Speaker 4: think China is actually getting a lot better these days,
36:23
Speaker 4: and I think the new government is taking taking intellectual
36:26
Speaker 4: property a lot more seriously. So I'm actually starting to
36:31
Speaker 4: feel more and more confident about that the technology not
36:36
Speaker 4: actually not being copied in China, or at least you know,
36:40
Speaker 4: it's getting much better. And I don't think it's going
36:43
Speaker 4: to be too much of an issue until we want
36:45
Speaker 4: to establish local production and that that's that's where you know,
36:49
Speaker 4: we need to make sure that we do it right.
36:50
Speaker 4: And there's not an incentive for the factory team that
36:55
Speaker 4: we established there to sort of go across the road
36:57
Speaker 4: and create a competing factory.
36:59
Speaker 3: But but that'll that concern is a few years away.
37:04
Speaker 2: Do you have an know that, oh yeah, up here
37:06
Speaker 2: and the students are largely upstairs that right, Yes, this
37:10
Speaker 2: is GARYL.
37:11
Speaker 3: Parra, NBA student. First of all, thank you.
37:14
Speaker 8: It is very inspiring to hear an experience about actually,
37:17
Speaker 8: you know, changing the war using organizations as the organs
37:21
Speaker 8: that you created hopefully will inspire another Ironman.
37:26
Speaker 3: Movie as well.
37:27
Speaker 8: And I was wondering if you can tell us more
37:29
Speaker 8: about the experience about like you know, how to balance
37:33
Speaker 8: you know, those straight off between your profits and you know,
37:35
Speaker 8: following purpose that goes forwarther than just make money. You know,
37:40
Speaker 8: you are trying to change the war, you know, well
37:42
Speaker 8: for the humanity rather than just make profits in the
37:45
Speaker 8: short term.
37:48
Speaker 1: What was the question, I'm sure if I.
37:51
Speaker 3: How do you balance? Well? Yeah, well, I mean, first
37:57
Speaker 3: of all, I should say.
37:59
Speaker 4: Yeah, with with with all of the companies, but I
38:04
Speaker 4: think particularly SpaceX and Tesla, although there's in a good
38:09
Speaker 4: position today, they went through some super tough times and
38:15
Speaker 4: in fact, for SpaceX, I reserved to capital to do three,
38:21
Speaker 4: to have three launch failures, or to withstand two launch
38:25
Speaker 4: failures and have the third one b success sort of
38:27
Speaker 4: three strikes. And actually we had three launch failures, were
38:31
Speaker 4: just able to scrape enough money together for a fourth
38:33
Speaker 4: flight that succeeded in two thousand and eight.
38:36
Speaker 3: And then also in two thousand and eight.
38:38
Speaker 4: As Steve knows, we got the Tesla financing round done
38:42
Speaker 4: on the last hour of the last day. It was
38:45
Speaker 4: like six PM December twenty fourth, two thousand and eight.
38:48
Speaker 4: And if we hadn't gotten it down then the company
38:52
Speaker 4: would have gone bankrupt a few days after Christmas.
38:55
Speaker 1: So what he's not the only reason that happened is
38:58
Speaker 1: he wrote.
38:58
Speaker 2: A check for the remainder of his wealth to save
39:02
Speaker 2: the company during payroll and Christmas when no one else
39:04
Speaker 2: would and Goldwin had just failed the private offering and
39:07
Speaker 2: the financial collapse was amongst us. There was no deal,
39:10
Speaker 2: we loan, there was no Daimler deal. The car had
39:13
Speaker 2: a negative gross margin.
39:14
Speaker 1: It was not pretty.
39:15
Speaker 2: Oh and you had you know, your largest yearholder just
39:17
Speaker 2: completely pissed off.
39:18
Speaker 1: And you know, gong a wall. Yeah yeah, it was ugly.
39:23
Speaker 8: Yeah Yeah.
39:24
Speaker 3: It was a stressful period.
39:27
Speaker 4: And that was just at work.
39:29
Speaker 3: Yeah.
39:30
Speaker 4: So so for a while that really wasn't a question
39:32
Speaker 4: of profit or nonprofit is It was like we need
39:36
Speaker 4: to live?
39:37
Speaker 3: How do we live?
39:39
Speaker 4: So that was the main challenge. And and and now,
39:44
Speaker 4: I mean now we're at the sort of the stage
39:45
Speaker 4: where we can say, okay, we can shift the dial
39:50
Speaker 4: between we could we could make let's say, at this point,
39:53
Speaker 4: a medium amount of profit or a small amount which
39:56
Speaker 4: sort of chosen to make a small amount because we
39:59
Speaker 4: can reinvest the cash flow into future products. So now
40:03
Speaker 4: we're you know, right now, we're reinvesting the cash flow
40:05
Speaker 4: into developing the Model X, which is an suv, and
40:09
Speaker 4: to increasing the production capacity of the factory and doing
40:15
Speaker 4: a little bit of advanced planning on the third generation
40:17
Speaker 4: vehicle that'll be a mass market sort of affordable, compelling
40:22
Speaker 4: electric car. So so that's really I guess what what's
40:27
Speaker 4: meant by in this case not pursuing We're not trying
40:31
Speaker 4: to maximize profit at this point because it would constrain
40:35
Speaker 4: the business, the growth of the business, and constrain the
40:38
Speaker 4: overall objective of transitioning the world towards electric cars. So
40:44
Speaker 4: I don't think against profit in general, but it's just
40:46
Speaker 4: it's just it's not I mean, I actually don't think
40:49
Speaker 4: it's the smart move. I mean, if one were to
40:51
Speaker 4: take the net present value of future cash flows, I
40:53
Speaker 4: think maximizing profit at the stage is actually not the
40:56
Speaker 4: smart move, you know.
41:00
Speaker 2: And it's interesting because earlier I said, we get back
41:02
Speaker 2: to it, you mentioned that your goal was not to
41:03
Speaker 2: start a company that has the chance of making the
41:06
Speaker 2: most money for you the quickest, right, and that the
41:09
Speaker 2: wealth personally is almost.
41:10
Speaker 1: A byproduct of these activities.
41:12
Speaker 2: Of passion and by analogy, like in the investment field
41:15
Speaker 2: inventric capital.
41:16
Speaker 1: You know, you could look for the thing.
41:18
Speaker 2: That'll make the most money the quickest, right, like a
41:20
Speaker 2: new ad network for social media, but who cares?
41:24
Speaker 1: I guess it really just doesn't help the world in
41:26
Speaker 1: any meaningful way.
41:27
Speaker 2: And there are much over longer if you take a
41:29
Speaker 2: longer term perspective, there are things you could do that
41:31
Speaker 2: don't answer the short term question of what's going to
41:33
Speaker 2: make me the most money this year or this five
41:35
Speaker 2: year period, but the over twenty years focusing on those ironically,
41:38
Speaker 2: he may make the most money right of any entrepreneur,
41:41
Speaker 2: or these companies might be more profitable than their cohort
41:44
Speaker 2: that doesn't follow that same purpose driven kind of almost
41:48
Speaker 2: messy onic zeal.
41:50
Speaker 1: So there was a balance. Question almost implies the dichotomy.
41:52
Speaker 2: That may not be opposed, but maybe aligned if you
41:55
Speaker 2: orchestrate it right.
41:56
Speaker 3: Yeah, maybe more of a short term it's a long
41:58
Speaker 3: term approach.
41:59
Speaker 1: Yeah, exactly, great. We have one hand up here, up here,
42:03
Speaker 1: another one occur sure up here?
42:05
Speaker 3: This will be the last question.
42:06
Speaker 1: Oh, this is the last question.
42:07
Speaker 9: Okay, Yes, from your current car marketing strategy. You could
42:14
Speaker 9: say that your car is directed towards a luxury car marketplace,
42:17
Speaker 9: so that's a fairly well defined market. Do you have
42:20
Speaker 9: any plans for expanding it to the general marketplace, to say,
42:25
Speaker 9: make a car for the masses, which might be maybe
42:28
Speaker 9: in the twenty five to thirty five thousand dollars range.
42:34
Speaker 3: Yeah, absolutely question.
42:36
Speaker 4: In fact, for the first blog piece I wrote for
42:39
Speaker 4: Tesla was the Tesla master Plan, which is to start
42:46
Speaker 4: off with an expensive, low volume vehicle, then go to
42:49
Speaker 4: a mid price mid volume, and then sort of low,
42:52
Speaker 4: low price, high volume. So we're kind of in phase
42:55
Speaker 4: two and without third generation vehicle, we expect to be
43:00
Speaker 4: somewhere in the thirty to thirty five thousand dollars range
43:03
Speaker 4: for the car, which when you're take into account the
43:06
Speaker 4: savings from the use of electricity instead of gasoline, is
43:10
Speaker 4: more like comparing it in the US to about a
43:12
Speaker 4: twenty eight thousand dollar car or in Europe to a
43:14
Speaker 4: twenty two thousand dollars car, and.
43:16
Speaker 1: The maintenance is much the least to feel costs so much.
43:18
Speaker 3: Yeah, absolutely, that's right.
43:20
Speaker 2: Well, great, well, I want to thank you very much
43:23
Speaker 2: for this and transition to the closing segment of our invenite.
43:27
Speaker 1: Thank you all right,