Invest Like the Best with Patrick O'Shaughnessy
· Palmer Luckey
[00:00:00] S1: There are people who are not looking at it that way. I think there's been some defense startups where they are getting into the really crowded areas of the market. Or worse, they're working on things that they think are important, but The Pentagon disagrees. I won't name any names specifically, but I'd say like the entire category of defense startups building things that are for door kickers to better clear buildings. Yes, there is a need for door kickers to clear buildings. But The Pentagon doesn't see that as their biggest problem. They don't even see it as on the list of their top 50 biggest problem. They feel like, "We got really good at that. We have the tools. We have the tactics. We're the best in the world at clearing buildings with door-kicking soldiers, and we don't need to get marginally better at that." Same thing with Congress. Congress does not have an appetite to spend a lot of taxpayer money getting slightly better at something that they believe is irrelevant to a fight in the Pacific, that is irrelevant to a great power conflict with China across long ranges. And so I've seen people who say, "I'm a Navy seal and I know that we can do way better at this. The other people out there aren't making great stuff. And I know that this can be a powerful technology." Ideologically, I am aligned with them. I think that they're right, we could be building much better things for that group of people. They have historically gotten much worse gear than they should have. But as a practical person who wants to have impact, I know that's not where I'm going to have it. I know that I'm not going to have a huge many billion dollar impact on that industry given that the people in charge of running that side of things are not going to agree that it's worth investing in.
· Patrick O'Shaughnessy
[00:00:00] S0: So you built Lattice. Now the world is catching up. Everyone wants to build an AI platform system. What have you learned about building one? What are the components of it? What do you think about AI at large, the cost associated with compute and AI? All of these big things you've been working in for a while, and now it matters to everybody. So what would you contribute as the lessons that you've learned there so far?
· Palmer Luckey
[00:00:00] S1: It's been a double-edged sword, I think. We've been working on AI for defense since literally day one. That was the whole pitch. The second page of our pitch deck was a quote from Vladimir Putin. He was talking about artificial intelligence, and he said, "The country that wins in this sphere will become the ruler of the entire world," which I love. It's a very James Bond villain quote. On the one hand, it sounded crazier at that time because AI wasn't hot seven years ago. There were people who were interested in it, but it's obviously not even a 0.01 of the attention that's being dedicated to it today. The flip side of that is now that everyone is saying they're AI, all of a sudden our message is getting diluted or, "Hey, we've actually been doing AI for defense for almost seven years now." And now everyone is changing to say, "Yes, our systems are all powered by AI. It's all AI-driven." Some of that's true, some of it's not. Now it actually is less differentiated than we were. You have to now get very clear about what the difference between a real usable, fieldable AI system looks like versus strapping together ChatGPT with whatever your quadcopter thing is and saying that it's going to change the world. I do think what's been helpful to us, though, with members of Congress, people in The Pentagon, even investors has been the explosion of firsthand understanding of how powerful AI can be that's been driven by these large language models. Obviously, the things that we are building that fuse data from thermal vision and radar and signals intelligence processors, that then calculate optimal weapons pairing against that target, very different use of AI than a thing that you tell to write a poem about your car. But the fact that every member of Congress has been able to use ChatGPT, the fact that all these people in The Pentagon have seen and used systems, doing things that they never believed a computer could do has, I think, expanded people's minds in general towards the possibility that maybe people can be replaced by AI in certain use cases, maybe there are areas where computers really can do a job as well or better than a person. A lot of skeptics, I think, have changed their minds because they type something into ChatGPT, it did something for them, and they said, "Wow, computers sure are amazing these days.
· Patrick O'Shaughnessy
[00:00:00] S0: What has AI most unlocked?
· Palmer Luckey
[00:00:00] S1: The most important thing that it has unlocked for us is ability to scale. People focus on use cases where AI can do better than a person or even better than a team of 100 or 1,000 people at some one specific task. I think a lot of the more interesting use cases are where you can do as good of a person but without a person having to do it. Let's use an example. Let's say that I'm going to deploy 1,000 autonomous cruise missiles. Those are going to be a lot more impactful than they would be if I had to have 1,000 people trying to remotely pilot 1,000 systems and tell them what to do, how to do it, have all those data links active. I guess it's using AI to do things that would be impossible to do otherwise, either for real technical reasons like bandwidth or just for practical reasons. We don't have thousands of pilots that we could dedicate to such a task. For me, I think that's the biggest thing AI enables. I'm less focused on the superhuman, super intelligent side of things and more, "Hey, this AI that's running my autonomous helicopter, is it about as good as a pretty good helicopter pilot? Okay, that means that I can have one soldier managing a fleet of 25 airframes himself and just telling them, "Hey, I need you to clear this area. I need you to find this target I'm looking for. I need you to fly ahead of my convoy and watch for anything." Now he doesn't need 25 pilots and 25 helicopters to do that. That's what I'm most excited about. And it's really important in a world where I think quantity is going to have a quality all of its own in these types of weapon systems. The best way to defeat a lot of our adversaries' defenses is not through building a small number of exquisite systems. But quantities that are so large, they can't possibly stop them. And it's especially important in a world where militaries are struggling to recruit. They're trying to be more cost effective. They're trying to put less money into salaries and disability payments and more into systems that are going to be fighting the adversary directly, robotic systems. For example, the United Kingdom has said that they want to, over the next few years, reduce the size of their Navy by 30%, 30% personnel reduction. And because of that, they are doing things like dedicating one of their two aircraft carriers to being an autonomous aircraft launch system.
· Palmer Luckey, Patrick O'Shaughnessy
In other words, they want one of their carriers to only launch autonomous systems. You don't have to have huge numbers of people to run and maintain these traditional manned systems. If that's the world we're going to live in where we need to ramp up the number of systems but also ramp down the number of people, the only thing that can fill the gap is automation. [00:00:00] S0: What do you want Anduril to become? I mean you've come a long way. This answer would have been interesting seven years ago, but…