00:44:03 · Ty Morse
[00:44:03] S1: I think one of the least understood things is it's very important to ask the right questions. And I think prior to SpaceX, people were not asking the right questions as to how to get mass to orbit. And Elon was... From what I can tell the first person, it basically just optimized for this one key variable, which is how do you get mass to orbit instead of, you know, what does the US government want us to do. And then with that, he basically just went all in on this idea of just lowering launch costs with the understanding that, hopefully, there was gonna be a market afterwards. Mhmm. And it seems that, you know, with what he's done recently, it's effectively just scaling his own network of satellites because he's able to fill his own supply. How did you figure out what the right question to ask was for in, like, key KPI to think about when you were starting General Matter?
00:44:54 · Scott Nolan
[00:44:54] S0: Yeah. So the the way we realized the importance of enrichment was talking to the advanced reactor companies. And they not only said, hey. We don't have a source of fuel, but they said, even if we can get it, the fuel's too expensive. At these fuel costs, look at my economics. Look at how much of this fuel cost is driven by the fuel. And then if you decompose the fuel into the different steps, then enrichment was the biggest step. And so was just by digging into the problem and understanding where the cost structure was that we real... Like, for us, we realized that the key cost variable was cost per unit of enrichment drove the cost of fuel, which would drive the cost of nuclear energy going forward. I I think this was similar to the example that that you just gave at SpaceX where, you know, you go back to the nineteen nineties, satellites cost billions of dollars. Therefore, all that mattered about launch was that it was highly reliable, and launch cost, therefore, didn't matter that much. If you're paying 100,000,200 million dollars $300,000,000 for a launch, it is costly, but it is not the difference maker. What you need to ensure is that your launch succeeds. Fast forward to the 2000s, people were talking about microsatellites, smallsats. Those all of a sudden were much, much cheaper. $10,000,000, $1,000,000, not a billion dollars. And so now this $100,000,000 launch cost really, really mattered. And so if you want much more of these small satellites, yeah, we have to bring the launch costs down. Launch cost is really dollars per kilo, but it's dollars per kilo to an orbit, which is really like dollars per kilo times delta v. And so as commonly understood, it was dollars per kilo to low Earth orbit, but that was really dollars per kilo times some delta V. And so for us, the version of that that makes nuclear energy more affordable, makes advanced reactors really succeed economically, and makes their fuel lower cost is bringing down the cost of enrichment, which is dollars per unit of enrichment per kilo. And so you can take that one step further and make it dollars per... It's called SWU, it's the unit of enrichment, really dollars per SWU per kg. And so that's that's the metric that we really focus on, which is colloquially known as dollars per SWU, dollars per separative work unit.
00:47:20 · Scott Nolan, Ty Morse
And so it's basically how much does it cost us to reduce the entropy of a kilo of raw uranium, and the amount that you reduce the entropy is the amount that you're enriching it. [00:47:32] S1: What was the India index for enriching uranium? [00:47:36] S0: That is a great question. We haven't count... We haven't really thought of it as much in those terms. Like, the... In space, the idiot index is generally understood to be what's the cost of a thing compared to the cost of the raw material. So if a rocket costs $100,000,000 but [00:47:56] S1: the raw materials are $1,000,000 then it's $100,000,000
00:48:00 · Scott Nolan
[00:48:00] S0: That's right. Yeah. Yeah. So that's when you're specifically making hardware that then goes and launches and performs a service. In our case, the service that we're performing is enrichment. I would say it's commonly understood to be an energy input problem, so a little bit harder to get the exact idiom index on that. Like, how efficiently can you use energy to enrich? I think in the gaseous diffusion world, it was a lot of energy cost, and so that was the focus of how do we bring this down. But if you actually look at a facility that's doing enrichment, there's a tremendous amount of CapEx, upfront spend in fixed equipment that does the enrichment. And actually, the energy cost is relatively low. And so the version of your question is like the idiot index, as popularized by SpaceX, is a guide on how much should we be able to bring down the cost. And SpaceX has always said we can bring it down 10 times, an order of magnitude over time, maybe two orders of magnitude. Get it all the way down from that $100,000,000 not to $1,000,000 but maybe even lower if we can reuse this hardware and not throw it out every time. For us, the focus has been how do we make the most economical enrichment service in the world? How do we make it extremely safe and reliable but primarily scalable and lower cost? And that comes through really thinking through, how do you design a much, much better facility? How do you do better building construction? How do you make the guts of it better? How do you site in a better location? So on and so forth. And so we think there's easily potential for a 2x reduction in the cost of enrichment versus where it sits today and likely more, and there's a lot of ways you get there. You get there through designing your own technology, not using off the shelf. You get there through building your own in house EPC rather than outsourcing everything to a GC. Instead, manage your own subcontractors and run your own project. And maybe even site in a place with relative... To do those final optimizations, pick locations that have available energy at reasonable cost.
00:50:18 · Ty Morse
[00:50:18] S1: When you were starting out, because there's literally only one, like, operational enrichment facility that's just not, like, r and d focused in The United States, and you know that it's gonna take, like, a multiple multiple years, maybe half a decade in order to get this thing operational so you're actually producing your rich uranium. How much were you thinking you were gonna vertically integrate and try to do all in house versus, like, go find other suppliers and things and take learnings from other people that are currently doing it?
00:50:42 · Scott Nolan
[00:50:42] S0: Yeah. I think the intuition was that we would have to do it in house. That was almost out of the gates and almost an assumption. And we did question this a little bit, but it became very obvious that a lot of things we would have to do ourselves in house, really drawing on the lessons that we saw in the early days of SpaceX. And so our team comes from a whole mixture of places. There are people who worked at SpaceX and then went to work at other companies and wanted to get back something very mission oriented. Places like SpaceX and Tesla and Anduril, the whole tech world who has actually broken into incumbent dominated, high capital, government partnered industries. So that's the tech world. We also have people from National Labs who have seen the full range of the most advanced technologies, and then even people from other parts of the nuclear fuel supply chain who are very aware of how this works. And so combining that experience and just talking through how should we do this, really in the first months of the company, it was pretty obvious that there were certain things you could use existing supply chains for, but some things you would just have to do yourself. Those were pretty straightforward. I'd say the thing that we learned in the first year of the company that maybe is more surprising is that not only did you have to do that, but you really should design and build the buildings yourself. Not with every single piece of expertise, not with every trade inside the company, but you need to project manage your own project, not just for cost but for schedule. And the minute that you throw your building design over the wall and you say, Hey, some outsource firm, can you figure out what we want and design a really great building for us? There's so much that has to be explained in that process that it's unreasonable for someone else to figure that out unless you're... If if you're building a warehouse, if you're building, like, an Amazon warehouse, maybe it is so standard that it's just it could be done by someone else in a cookie cutter fashion. But when you're doing something more bespoke