Latest / The ReForge Podcast / What We Saw at the Reindustrialize Summit (with Matt and Colin) | ReForge 019

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What We Saw at the Reindustrialize Summit (with Matt and Colin) | ReForge 019 · The ReForge Podcast

• 0:05
  Welcome to the Reforge podcast.
• 0:08
  I'm Matthew Chang, and we're here to explore all things AI, automation, and the American worker, proving that the American reindustrialization is possible, pivotal, and pressing.
• 0:19
  Thanks for joining us today.
• 0:21
  Let's get into the episode All righty.
• 0:25
  Welcome back, everyone, to episode 19 of the Reforged Podcast.
• 0:31
  We are, we are coming up quickly on that 20 plus here, Matt.
• 0:37
  Are we still banned?
• 0:39
  I don't know.
• 0:39
  We d- we didn't look into that.
• 0:40
  I, I don't think, uh, I don't think I got an update.
• 0:43
  Last I heard they were, uh, messing with us.
• 0:45
  They, uh, the Chinese, uh, o- op that Y- YouTube was running, uh, didn't, didn't like what we were saying so- I might, uh, might have to look into that b- bit more again.
• 0:55
  All right.
• 0:55
  If we can make it to- So- like 50 episodes while we're banned, I'll be very happy.
• 1:00
  I, I think that's, you know, pretty, pretty good benchmark.
• 1:02
  We, we'll aim for that and see where we land.
• 1:04
  Um, but today we are going to get into, at least for me, the topic everyone's dying to know about is all about Reindustrialized.
• 1:13
  Um, you were there la- uh, not last week, week before, and for those who somehow don't know what Reindustrialized is, this is the third year of a, um, industry show, trade show, conference, whatever you wanna call it, in Detroit.
• 1:28
  Um, really all about people who are building, supporting, trying to push American manufacturing, really the exact stuff that we're talking about here, um, trying to push that forward.
• 1:39
  And obviously what better place than in the heart of Detroit, you know, Motor City itself.
• 1:44
  So Matt, you were there.
• 1:46
  We gotta know, you know, give us the rundown.
• 1:48
  What was happening there?
• 1:49
  What was the vibe?
• 1:50
  What was coolest things you saw?
• 1:52
  You know, I'm, I'm dying to hear ab- hear about that.
• 1:57
  Yeah.
• 1:57
  It, first off, it's a very impressive conference, very well organized.
• 2:02
  Um, you know, had a great time at Reindustrialize.
• 2:06
  The, it's one of those conferences where they kind of get almost every detail perfect.
• 2:11
  You know, every- everybody could be, leave a little room for improvement, but almost every detail was perfect.
• 2:16
  They feed you premium food, plenty of outside the conference events to find and, and locate or be invited to.
• 2:24
  Um, that creates lots of opportunity for partnership and sponsorship, so pretty much any small company for some amount of money can sponsor part of the event.
• 2:32
  Um, really high level speakers.
• 2:35
  You know, they had a numerous- Yeah, I saw some huge names there yeah.
• 2:39
  On, and top of the, the famous kind of ventury crowd and, uh, startup crowd that you might see on Twitter, you had, uh, tons of Washington DC, uh, White House under secretaries.
• 2:52
  So they were, you know, you were hearing it directly from the horse's mouth in terms of policy and strategy for the nation.
• 2:58
  Um, lots of great presenters.
• 3:01
  You know, a lot of the famous well funded startups on X where they're presenting with, uh, you know, premium layouts and demonstrations, robotics, aerospace, energy, you know, physical AI.
• 3:13
  So I thought, uh, for a newcomer, it's probably a little overwhelming if you're not super familiar with the reindustrialized space.
• 3:21
  And it was also very selective.
• 3:24
  They don't have a ton of display space, so the, the things that are there are well curated.
• 3:28
  Um, my favorite part was just hanging out with all my X friends in real life.
• 3:33
  So- I, I, I heard somebody, uh, describe it as Nerdcoachella.
• 3:39
  Yeah.
• 3:39
  Yeah, it is definitely Nerdcoachella.
• 3:41
  You know that we are making noise.
• 3:43
  We got, we got, uh, protested, so that was good.
• 3:47
  You know what?
• 3:48
  The definitely, uh, definitely showing up on radars then.
• 3:51
  Yeah.
• 3:52
  So I mean- You know, for myself as like a factory builder, I couldn't understand why I got protested because as I would walk by the protestors, they would yell things at me and try and kind of bait me.
• 4:01
  They'd be like- I'm sorry that I'm trying to, you know, create jobs and improve the lives of people, my bad.
• 4:06
  Yeah.
• 4:06
  But I guess some, some people are making like autonomous weapons systems or something, so they didn't love that.
• 4:11
  But you know, overall, I give Reindustrialize a 10 out of 10 Yeah, they did a great job.
• 4:18
  And, uh, oh, I will say, if you wanna go, you better go next year because it is becoming kind of so famous and so large that it's attracting quite a bit of corporate activity.
• 4:32
  And so my biggest- I was wondering about that concern, yeah, my biggest concern for the conference would be that we were te- joking around, me and some of the other founders that were there.
• 4:41
  Uh, we'd walk into a certain of the after events or something and we'd say,"Man, there's a lot of sport coats in here." So there's a lot of directors and vice presidents from large corporations there, and, uh, that's, that was kind of maybe not the vibe we're going for'cause there's plenty of conferences where you can go on your corporate expense account and be a VP, right?
• 5:00
  Yeah.
• 5:00
  And, uh, have a good time.
• 5:02
  But I would like to see it personally a little bit smaller, a little more curated, only like true builders and, and very active, say, VCs.
• 5:12
  Um, but for founders it, it was like two to one VCs on founders.
• 5:18
  So the, the VCs are like walking around and they're...
• 5:20
  It was almost like, uh, they were trying to score some drugs.
• 5:24
  They're like,"Hey, got any founders?
• 5:25
  You know where we can find founders?
• 5:26
  Any found- founders in this room?" Founders Yeah.
• 5:31
  You know, I, I mean, that, that was one of the things I was surprised to see some of the bigger names, um, as attendees, uh, just kind of as the passive ex-observer type thing.
• 5:40
  Lot of, um, you know, kind of in the, in the ex-stratosphere, if you will, lots of great feedback from it.
• 5:47
  Um, but it seemed like there was a pretty big disparity in terms of, you know, your, your people that are walking in with boots that aren't polished and brand new, you know, wingtip shoes versus your sport coats, like you mentioned.
• 6:00
  It seems like it's a pretty big, um, divide there, and, and again, not, you know, the big guys have a place and everything, but I think historically reindustrialized it, a lot of it has been kind of that groundswell, um, kind of crowdfunded, if you will, mentality of the builders doing it.
• 6:19
  I, I'm curious from mostly people you engaged with- Yeah you know, what was your kind of feel on that?
• 6:26
  Yeah, the, the ideal way to do that conference would be to go in with, like, a, a million dollars cash and just rip seed checks the whole time you're there, right?
• 6:35
  Is, is as you see things that are interesting, any company there was automatically in the top three of their class for their category.
• 6:43
  You know, you had the Boom Aerospace and, uh, you had, uh, robotic companies- Chang Robotics, obviously.
• 6:51
  Ch- Chang Robotics was there.
• 6:52
  You had, uh, Kodiak Tech was there, but you, you also had, uh, Aaron Slodov and his company, and Zane Henisberger and, and, uh, his metal cutting business.
• 7:01
  And so you had for their categories, anybody you meet there is gonna be by default top three.
• 7:07
  And so, like I said, if you just walked in and whether it's 100K and you're doing$10,000 checks, or you had a million bucks and you do$100,000 checks, you could make yourself a nice little venture portfolio just walking around at Reindustrialize.
• 7:20
  So I mean, clearly, clearly the place to be.
• 7:23
  I was, uh, curled up in a ball for most of the week, you know, sad that I couldn't attend.
• 7:28
  Um, next year obviously it's on my to-do list.
• 7:31
  Um, but I, I gotta ask, what was your kind of biggest surprise or biggest takeaway from the week?
• 7:37
  For whether it's the people you were able to interact with, things you heard, or just kind of what your experience was.
• 7:44
  Uh, me personally, I was really impressed with the people that were there.
• 7:49
  You know, I was bop- bopping around with Michael Gumren, um, who...
• 7:53
  Big X guy.
• 7:54
  Got to hang out quite a bit with Mike Cernovich, you know, one of the, the heroes to all of us on, on X.
• 8:00
  Uh, A.J.
• 8:00
  Cortez, you know, was there bringing the energy.
• 8:03
  And so what...
• 8:05
  I'd say the thing I liked about it most was they really did try to bring it down to a Detroit level working class, as opposed to a Silicon Valley, you know, fancy dinner, or Wall Street steak dinner.
• 8:17
  It really had the feel of like a, like a big pretzel with, uh, the beer cheese dip and a PBR in your hand.
• 8:25
  And, uh, what was kind of hilarious was there was kind of two official beers of the conference that seemed to be at every serving, was Coors Banquet and Miller High Life So everyone- Champagne.
• 8:36
  Champagne or beer right?
• 8:38
  Yeah, so Colin, you would fit in great there.
• 8:40
  Um, I w- like I said, the, the biggest threat is that it gets overly corporate, you know?
• 8:46
  And that's the challenge with every growing conference.
• 8:48
  How do you keep the original magic that probably started in year one, multiplied in year two, and year three brought a lot of corporate act- activity?
• 8:56
  They're gonna have to work really hard on that to keep it kind of the dynamic place where innovation happens.
• 9:03
  If it gets much more corporate than it is now, you're gonna see a lot of tapering off of the founder types just won't wanna go anymore, and then there won't be any magic in the room.
• 9:12
  Yeah, I mean, I- some of those big, you know, industry shows very quickly turn into not really that.
• 9:19
  They, they lose the magic, as you say, and they just turn into it's a sales show.
• 9:23
  And a, a lot of the appeal of it is you're there with other builders.
• 9:28
  It's not just I'm being sold at every step along the way.
• 9:32
  It's problem-solving, it's solutions.
• 9:35
  And obviously part of that is, you know, the speaker series, they had really some impressive names on that list.
• 9:41
  Um, but what kind of surprised me was the number of, uh, speakers representing different government agencies, departments- Yeah what have you.
• 9:51
  What was your...
• 9:52
  I don't know if you had a chance to see any of those, listen to any of them.
• 9:56
  Um, if you did, what was kind of your takeaway from that?
• 9:58
  What was...
• 9:59
  Or rather what was your perspective on having that level of attention, you know, on something like- Yeah Reindustrialize and the movement?
• 10:07
  W- well, first off, I think it's a testament to the, the creators of Reindustrialize, that they draw in the federal crowd, right?
• 10:12
  That the federal crowd clearly knows we are to pay attention here.
• 10:15
  Important things are happening here, and if we wanna move our nation forward in reindustrialization, it's probably gonna start at the conference.
• 10:23
  Uh, so I- Yeah I think that was a great job they did getting the right people in the room.
• 10:27
  The, uh, uh, I'll say that the, I didn't go to many talks because I had so many friends there, and we actually did a ton of business out in the hallway or in the courtyard.
• 10:38
  Uh, there was free coffee everywhere, so it was so easy not to be in the room and just enjoy the free things while you work with your friends.
• 10:43
  But what I would say the biggest takeaway I had was a very practical explanation, um, by one of the undersecretaries about, um, Pax Americana- And the, I was previously not aware of that.
• 11:01
  So to get to hear it from the horse's mouth that the US is sponsoring, you know, people on X love t- talk about Shenzhen- Right in China.
• 11:09
  They were basically talking about creating that off-shoring industrial park that some manufacturers need in the Philippines, and using the Philippines as a strategic partnership basis for US manufacturing.
• 11:24
  So I found that- Yeah, I think that's what...
• 11:24
  They're, they're planning a 4,000, I think it's like 4,000 acres or something like that.
• 11:28
  Huge from raw material to production, raw material processing to production of, you know, finished goods type stuff.
• 11:35
  Huge, huge opportunity.
• 11:37
  Yeah.
• 11:37
  And, and what I saw there was that model, if done correctly, could go all over the world, right?
• 11:45
  So you could open up another one, you know, just not far away in Indonesia.
• 11:50
  You could open one up in Greece, you know, and have a European, uh, base where you're manufacturing items to be included in the broader US supply chain.
• 12:00
  So I thought that was a, a really compelling takeaway to see that, yes, we have tariffs, right?
• 12:07
  We are using those to promote reindustrialization.
• 12:10
  We have bilateral trade deals.
• 12:12
  Um, the government is working very hard to help us win on trade.
• 12:17
  Some manufacturing, we've been having this debate, doesn't necessarily belong in the US because we only have so many workers, and we're trying to save it for the highest value, highest impact things.
• 12:27
  Either critical materials that we need to manufacture in this country for sovereignty.
• 12:32
  But for things like, you know, consumer electronic devices, I'm not convinced those need to be made in America entirely.
• 12:39
  And so if we have friendly nations that are, are partnered with us on a long journey and we create a, a, uh, investment paradigm that's good for American companies.
• 12:48
  We do live in a global economy.
• 12:50
  If we didn't, we could go ahead and close our seaports right now, right?
• 12:53
  But we love our ports, we love our roads and rails.
• 12:56
  Those, that infrastructure is largely moving things that were produced overseas and brought in or taking our items out to market to the global market.
• 13:04
  So, um, that for me was the biggest takeaway, was just to kind of hear that.
• 13:09
  And that broader discussion came up in the AI for society conversation.
• 13:15
  You know, they were, they were trying to talk about AI for society, and the government's response seems to be that- They're encouraging all friendly nations with the US not to try to rip out and replace what the US has built with digital infrastructure.
• 13:31
  So we have kind of- Interesting global, global tools, like a Google would be a global tool that people around the world use.
• 13:38
  Microsoft, uh, we have more modern tools like, uh, OpenAI or Anthropic that build on top of that internet layer and that software layer.
• 13:47
  The message from the government was very clear.
• 13:49
  For nations that want to do trade with the US, it's a fool's errand to try to replicate the great tech stack that we already have.
• 13:56
  They should be building the next thing.
• 13:58
  So you remember in crypto is you had your Web2, and then we needed to get to the Web3, you know, to build the next layer on top of crypto.
• 14:06
  For AI, they were encouraging countries not to try to compete with the baseline that the US has set, but to find the next leap and to focus their smaller resources.
• 14:16
  Like, all the trade partners we have are smaller resource economies than what we have.
• 14:20
  Build on top of that and create the next thing on top of AI or the next thing on top of, uh, autonomous systems or defense, you know, whatever it may be.
• 14:31
  Um, so I thought that was a pretty good message.
• 14:34
  It was also very clearly kind of a form of mercantilism that the government- Yep is taking, which is, well, you have to buy from our big tech companies just like our, our allies have to buy from our defense companies.
• 14:47
  So they seem to be trying to keep the world open for business for the great American companies that already exist, and then encouraging those other nations to, to go to the next level.
• 14:57
  And I actually thought that made a lot of sense because I, I do believe there's a growing movement to kinda replicate the China model where they just look at everything we have, and they build a Chinese version of it, whether it be- Copy and paste Uber, Amazon, you know, whatever it is that they're building, a Tesla.
• 15:13
  They were telling the other countries,"Don't try to do that.
• 15:15
  Focus your resources on going to the next level." And that actually makes sense if you look at a smaller economy and, and what they can promote through innovation is they should be going to the next level, not trying to rebuild what we have today.
• 15:28
  Well, I mean, uh, you, you look fundamentally a- at the US.
• 15:32
  W- we should not be trying to rebuild manufacturing an industry of 40, 50 years ago.
• 15:38
  Makes no sense.
• 15:39
  Right.
• 15:39
  We've got to progress to, you know, next evolution of it, the, the, the next best, next better type thing.
• 15:46
  So I mean, i- it's encouraging a- and I think positive to have that same message of,"Don't build what we needed yesterday.
• 15:54
  Build what we need in 10 years." That's where the focus needs to be.
• 15:58
  Yeah.
• 15:58
  Um, so that's great.
• 15:59
  And, and the factory example is perfect, Colin.
• 16:03
  'Cause we are reshoring a lot from overseas, right?
• 16:06
  We're reshoring- Mm-hmm.
• 16:06
  And, and I see this happening daily now.
• 16:08
  Um, I just got hit with my first steel delay, right?
• 16:12
  Ooh.
• 16:13
  So we're, we're going through a bunch of steel ordering right now for a new plant, and we're being throttled by the mills who can't run our, our, uh, wide plan shapes and various structural shapes, you know, with any sort of normal schedule.
• 16:25
  They're so backed up.
• 16:27
  So what, when we do reshore, to your point, it shouldn't be what got built in, say, China, and has been serving the US supply chain for the last 30 or 40 years.
• 16:35
  It should be the next generation of that, which is what my company tries to do is, is look at what...
• 16:40
  We're looking at what needs to be manufactured, not the way it was manufactured somewhere else.
• 16:47
  So I guess on that note, looking maybe a bit more specifically at the robotics piece of it, um, or rather around that discussion, I mean, obviously AI I'm sure was huge co- topic there, big, big piece of, um, everybody's attention on the daily.
• 17:01
  Um, but I guess, uh, calling it the physical AI or whatever the buzzword is this week, um, what were you seeing in terms of robotics?
• 17:11
  Not just on kind of the utilization of it in some of these facilities or what people were talking about, but what was, uh, kind of the, the feeling or, or sense you got from any discussions there around just general appreciation of its role as we move forward into next phase of industrialization in America?
• 17:30
  Yeah, let me, let me just put a pin in AI for a minute.
• 17:33
  So what I witnessed, and my observation was that AI as a pure play was really about the fourth bullet point at Reindustrialize.
• 17:43
  The top three would've been robotics- Technology energy, and defense.
• 17:48
  But what was true about the top three companies, whether it be a robotic company, defense, you know, defense tech, or, um, energy, was that they were all AI embedded, right?
• 17:57
  So every company had a story about how they have AI in their product, or they're using AI to, to have faster speed to market, better customer service, whatever that might be.
• 18:07
  So I think, I do think the big takeaway from Reindustrialize is that we're kind of post-AI.
• 18:12
  It was not an AI conference.
• 18:14
  People had a good understanding of AI.
• 18:16
  Every single founder I met was using AI in their product, but they were focused on manufacturing products.
• 18:22
  Um, so it's very aligned with, I think, the way you and I think.
• 18:26
  The, um, in, in terms of robotics, I'll say there was two paradigms there, and it really almost led to s- two separate social circles, okay?
• 18:35
  And it was really funny to see.
• 18:37
  So there is still, and I, I can't figure it out for the life of me, this dominant RaaS model, robots as a service, where you can measure robotic deployment in terms of monthly recurring revenue, annual recurring revenue.
• 18:52
  And so a number of companies were saying,"We're a RaaS robotics company." And I was like,"Dude, we can't work together." And of course, I, I probably had, uh, 12 robotics founders stick their business card in my pocket so that they might be, have a meeting with Chang Robotics or be included in one of our factory designs.
• 19:12
  And I'm like,"Man, I'm not even introducing you to my clients unless you drop the RaaS thing." And to their credit, I did have three RaaS, uh, companies that I liked their tech.
• 19:23
  I was, like, looking at their technology.
• 19:24
  I was like,"That's super cool." They came and they whispered.
• 19:27
  They said,"Hey, listen, we'll just sell you a system, but you can't tell other people." And I was like,"Okay, well, that, that's actually what I need, is I'm probably gonna spend my clients' CapEx dollars on the robotic solutions we install.
• 19:41
  So if you'll do that deal for me, I can, I can consider you." What I can't do is a RaaS model where my clients don't own it and they're on a forever OpEx.
• 19:51
  That's, that's for me.
• 19:52
  I mean, uh, it, the, and that, that in my mind, that model, I, I get why there's appeal to it.
• 19:58
  I think if you come from that SaaS background, I can certainly see that appeal.
• 20:03
  But for anybody who has been in industry and, and businesses that have distinct CapEx, OpEx budgets, th- they don't want that OpEx budget, you know, growing and on, on the line for ad nauseam.
• 20:17
  When it's CapEx- Yeah you get your depreciation.
• 20:19
  You, you get preferential accounting treatment that has a material effect on it.
• 20:24
  Like, they want CapEx dollars for a reason.
• 20:28
  So- Yeah a subscription to a robot doesn't do anything, even if you say,"Oh, but maintenance or..." They don't care.
• 20:33
  They, they, they- Yeah need those CapEx dollars, and that's where I think, you know, hopefully some of your discussions, uh, you know, y- you're able to impart some wisdom or perspective that helps individuals see that perhaps that business model needs some readjustment for really getting into industry and production side of it.
• 20:53
  Yeah.
• 20:53
  Yeah.
• 20:54
  What we're really promoting,'cause, you know, keep in mind I run a venture fund too, we're up to 11 portcos now.
• 20:59
  Ooh.
• 21:00
  And so, you know, I'm talking to founders that we've invested in all the time.
• 21:03
  Chang Robotics, separate from that, we've got eight or nine distinct holdings on our corporate balance sheet.
• 21:09
  So, you know, call it a cohort of about 20 founders that I talk with routinely, and we have skin in the game with them.
• 21:16
  The number one thing that I push with all of them is to have a hybrid revenue model.
• 21:21
  So the, the short answer is the customer's always right.
• 21:24
  So if the customer's trying to give you a pile of CapEx, in other words, pay for the system upfront, why would you argue with that client, you know?
• 21:32
  And a lot of these RAS, you know, Silicon Valley kind of roboty companies, they do that.
• 21:37
  They say,"No, no, no.
• 21:38
  That's not our business model." And it's like, well, I'll tell you what my business model is, is- Make money doing great work for our customers, getting paid fairly for it, and turning a profit so that we can tithe to ministry.
• 21:52
  That is our business model.
• 21:54
  And so I don't understand a company that wants to be on a forev- forever negative EBITDA because they have to eat the entire cost of a hardware deployment and then recover it one month at a time into infinity.
• 22:08
  It just doesn't make sense to me.
• 22:10
  And I think- Yeah if you look at the data, this is a bit of a pivot from reindustrialized, but if you look at the data There is no retention factor for customers that go with a RaaS rental model.
• 22:23
  They could change one budget cycle to the next, and then you're out on the street with a bunch of assets you hadn't paid off yet if you're the robotics company.
• 22:31
  So I don't find that to be industrially robust, and the other thing is the RaaS usually comes with super weird data privacy requirements- Yeah where the, the rental company owns the data.
• 22:44
  Zero serious manufacturing- Not happening are letting that data walk out their door.
• 22:48
  That's not- No a serious plan.
• 22:50
  No.
• 22:51
  All right, so you, you had this bucket of the RaaS folks.
• 22:54
  What was the other side of it?
• 22:55
  More of that traditional CapEx- Yeah you know, I'm gonna sell you something.
• 22:58
  Com- companies that are either currently positive...
• 23:01
  I was walking around with a robotics founder, uh, who was EBITDA positive, and every time we were, we'd be holding court and we'd, you know, get a little group around us no matter where we went.
• 23:12
  And every time the VCs would come over, we'd go,"Hey, just full disclaimer, EBITDA positive." And they would just scurry away, right?
• 23:19
  They're like,"Oh, EBITDA positive." Run, run off into the shadows.
• 23:21
  We could never invest in a profitable company.
• 23:24
  So, um, either all of the companies that had a traditional mo- like a, a traditional CapEx based model or a hybrid model where they'll do either a finance or a CapEx for their clients, they were all lightning focused on how to get profitable.
• 23:43
  You know?
• 23:43
  And one of the, one of the icons of that we talked about recently would be, uh, Jim Belousik with Sen Cut Sen.
• 23:49
  Yeah.
• 23:49
  I had the chance to meet him and show him some of my, um, manufactured items that we're building with, uh, Chang Robotics and, and there's a couple of them.
• 23:58
  He said,"Yeah, please set a meeting.
• 23:59
  We wanna, we wanna have a good look at those'cause that could be a great fit for us." But that would be an example of get profitable, and then when you do take investment, you're a lot more in control and it's a lot less dilutive.
• 24:11
  And I'm not saying investment's a bad thing.
• 24:14
  Um, it certainly serves a purpose, but any business should have a clear path to profitability.
• 24:19
  That's just my opinion.
• 24:20
  This, this isn't the, uh, Zerp era anymore.
• 24:22
  You- Yeah you gotta, you gotta have a path to, to actually making the dollars and cents.
• 24:28
  So, I mean, that, that's obviously encouraging.
• 24:31
  I know there's a lot...
• 24:33
  I, I saw some posts the other day, I think, about, um, you know, people b- h- not understanding the margin and the actual revenue piece of manufacturing.
• 24:46
  And yeah, it's obviously we've talked about it a million times, very CapEx intensive, so are plenty of software, you know, businesses too, and just hard tech i- in general as well.
• 24:57
  But, you know, the, the opportunities are there, and there's arguably a clearer path, I think, to revenue and profitability for manufacturing companies.
• 25:06
  I mean, the demand is, is there, there's no question about that.
• 25:10
  It's making sure the dollars go to the right places though.
• 25:12
  So that is a- Yeah, two, two kind of big observations I'll leave as a takeaway.
• 25:17
  This was, um...
• 25:19
  I don't think it was addressed well enough at Reindustrialize.
• 25:22
  Well, the first, the first one is not a...
• 25:23
  The first one is a compliment to the city of Detroit.
• 25:26
  We could not have had better weather.
• 25:28
  So it was like, it was what they call a Chamber of Commerce day in Detroit the whole time we were there.
• 25:33
  So it's like sunny skies, clear blue skies, very kind of mild evenings.
• 25:39
  Um, and so they, the city just knocked it out of the park.
• 25:42
  I'm sure they set that up for us with perfect weather.
• 25:45
  Every restaurant we went to was great, you know, just great customer service, very safe and secure feeling downtown.
• 25:52
  You know, I, nobody- D- Detroit has done a, a remarkable job kind of turning- Yeah things around there the last two, last, what, 15, 20 years.
• 26:00
  So that's, that's awesome to hear.
• 26:02
  Yeah, and then in terms of what wasn't really addressed is for the would-be profitable manufacturing company, that requires a lot of capital investment to get, you know, real assets built, installed, the factory up and running There still is not a good funding solution.
• 26:21
  You know, on X, I call it the SBA Supermax.
• 26:24
  Yeah.
• 26:24
  I think the SBA should let, let loose$100 million debt instruments for anybody that will sign up.
• 26:32
  Uh, as you know, SBA instruments come with a personal guarantee from the founder, so that would be me and that would be you, right?
• 26:39
  Yeah.
• 26:39
  And I think both of us have enough confidence in what we're doing that if we wanted to take on that level of debt, we would sign up for it, and we'd be personally on the hook.
• 26:48
  Yeah.
• 26:48
  Um, the venture crowd, the early-stage crowd, the seed round crowd, they generally hate that.
• 26:54
  They want investors to hold the bag, and they can just walk away if it doesn't work out, right?
• 26:58
  There's no recourse from an investor that buys early-stage stock.
• 27:01
  If it doesn't work, it's over.
• 27:03
  Um, but for the convicted founder, you know, I, I think of people like Kaya Rhodes building Anatar, uh, AJ Cortez building Athenor.
• 27:14
  Um, they have conviction in what they're doing.
• 27:17
  They need a lot of capital to build, to buy hard assets like factories and, and manufacturing equipment.
• 27:24
  Yeah.
• 27:25
  Um, there still is no good funding solution for that$100 million debt instrument.
• 27:32
  And of course you can't take a, a...
• 27:35
  We're investors in Anatar, so I can talk about this one a little bit.
• 27:38
  You can't go to Anatar and say,"Let me give you a$100 million Series A," because then you'd be buying 50% of the company or something with that capital, and the founders- The, the economics just, just don't work for anybody.
• 27:52
  Yeah.
• 27:53
  Yeah.
• 27:53
  But if you w- if the SBA opened up a portal and they said,"Hey, Kaya Rhodes, for somebody like you, we'll give you 25, 50,$100 million in debt if you'll agree to repay it or be personally on the hook," I don't have a doubt in my mind she'd sign the loan docs tomorrow, because she believes that much in what she's doing.
• 28:13
  And so that's kind of the gap, is the banks h- are not in that business, and they need that trailing financial profitability.
• 28:22
  So it's a bit of a chicken or the egg- 100% is how do we get these, these new technology manufacturing companies up and running in the absence of taking on a$100 million financing round from a venture company?
• 28:37
  So, I, uh, is it, I mean, obviously there was the VC crowd there.
• 28:40
  Sounds like maybe, you know, opportunity is to bring in, um, so some more of those non-traditional or alternative, uh, financing type entities next year for, for Reindustrialize.
• 28:52
  Um, sounds like it'd be obviously a big, big opportunity there.
• 28:55
  Um, but overall, I mean, appreciate the l- the, the rundown of it.
• 29:00
  Sounds like it was an amazing event.
• 29:01
  Everything I saw on X, um, and obviously streaming their, their talks looked like a blast.
• 29:07
  I'm looking forward to next year.
• 29:09
  Um, any last kind of takeaways from you?
• 29:13
  Um, you know, favorite part of it, if nothing else?
• 29:17
  I, I'd say the favorite part is what happens in the hallways.
• 29:21
  You know, if you, if you catch, if you go to Reindustrialize, you catch five or six talks, I mean, those are, like you said, those are high-level talks with high-level people.
• 29:30
  That will probably be enough homework.
• 29:32
  Um, the rest of it is who you can meet there, you know?
• 29:35
  And, and you do have to work.
• 29:37
  It's a pretty large conference.
• 29:38
  It's a few thousand people, so it's not like you're just gonna bump into everyone you wanna see.
• 29:43
  You gotta see a person, ask them who they know and, and kinda spiral out.
• 29:46
  But we did a pretty good job of convening, I'll call it the ex-superheroes, and so we would meet for a couple hours a day and, and as we h- stood together, there was a little gravity and new people would walk up and introduce themselves and you'd say,"Oh, I've seen you." So, you know, at one time we had probably 10 really crazy founders all standing together, and that's, those moments are priceless because- Oh, absolutely you can't, you can't recreate that and we would never be in the same city for, for the same reason at the same time ever, uh, if it weren't for a conference like Reindustrialize.
• 30:20
  So my hat's off to them and I, I will probably be writing them some specific feedback on thing, proactive steps they can take to keep the magic alive,'cause next year you're going and we want it to be better than what we had this year, Colin.
• 30:33
  You know what, it, it sounds like it was just a all around awesome event.
• 30:38
  You know, appreciate, uh, you giving us the rundown on it and I'm certainly looking forward to it next year.
• 30:43
  Um, and to all of you listening, you know, thank you for tuning in to another episode of the Reforge podcast.
• 30:49
  Whether we're talking robotics on the factory floor, you know, industry shows, policy that actually moves the needle, or the next generation of American makers, our goal is always the same, to prove that reindustrials- reindustrializing America isn't just possible, it's happening right now and it's pivotal.
• 31:05
  So if you enjoyed this episode, make sure you subscribe and follow the,@thereforgepod everywhere.
• 31:10
  Check out thereforgepodcast.com for more, and until next time, keep forging the future.
• 31:22
  Thanks for tuning in to the Reforged podcast.
• 31:25
  Make sure to like, subscribe and follow us on all of our social media at The Reforged Pod.
• 31:30
  We will see you next time