00:00:00 · Ty Morse, Keller Cliffton
[00:00:00] S0: Today, I'm sitting down with Keller Cliffton, the co founder and CEO of Zipline. Zipline is a drone delivery startup, and I think the biggest like drone delivery startup in the world. Yep. Yep. You guys have done a total of 2,800,000 ish deliveries to date, and then you just announced that you're aiming to do like a million a day in two and a half years. [00:00:19] S1: With one partner. [00:00:20] S0: With one partner. And so I want to kinda start this off, like, don't know if people realize how insane that number is. So I wanna start us off with, what does this ramp actually look like over the next thousand days?
00:00:30 · Keller Cliffton
[00:00:30] S1: Well, you know, we're here in the factory where we're gonna be producing all the aircraft that are required to make that happen. The in- the- the internal perspective on how we make that happen, I mean, Zipline has been growing incredibly fast, and we- we obviously operated outside The US for the first eight years of the company's history. Last year we finally got full regulatory, this kind of unprecedented regulatory approval from the FAA. We launched in The US at scale, and the system just grew exponentially fast. I mean, grew 10 to 15% week over week most of last year and this year. That's growth in terms of flight volumes and in terms of revenue. As a result, we made an operating plan at the beginning of this year to scale the company to a million deliveries a day as fast as humanly possible. And we built this factory in order to achieve that goal. The problem is that as we've been scaling across some of these metros in The US, some big companies have been looking at what Zipline's doing saying, hey, like, that would be very valuable infrastructure for our customers. So, case in point, you know, you mentioned Uber, and Dara, you know, showed up here four weeks ago, looked around the factory, talked to us about, like, we ran some numbers on a calculator, and he was basically like, I'll take all of it. Because, know, a million deliveries a day was the entire capacity that the company was planning for at that point when we signed partnership. You know, as a result of that, I mean, we- Zipline needs to do a lot more than just serve Uber. We have a lot of other amazing customers. Some of the biggest companies in The United States rely on us. And so, it means that just six months after setting that plan, the plan is now being thrown in the trash, and we're now having to set a way higher target of the total number of deliveries that we need to achieve per day, two and a half or three years from now. It has a lot of implications. It means that even though this, you know, factory that we're sitting in, I mean, you've to walk around it is, you know, it's it's big. We're gonna need to go five or 10 times bigger than we were initially planning. You know, the other implications are that when you see this technology growing in the real world, it actually sort of feels...
00:02:28 · Keller Cliffton
Just having now two years of observing how customers use automated instant delivery, we're realizing it's totally different customer behavior than we were previously expecting or or or you kind of saw Also. Well, so, I mean, first of all, keep in mind, like, this is already a huge market, right? Like, you know, there are these very big companies, the big marketplaces, as well as, you know, more traditional retailers like, Walmart or, you know, Amazon. I mean, when you look at all instant delivery in The U. S, there are about five and a half billion instant deliveries being done every year. And that's just instant, not, not including more traditional, like, two day or parcel delivery. So that's a very large market and, it's not even including outside The US. But the crazy thing is that if you were to just look at the customer buying behavior that we're observing in Dallas, in Houston, in Cleveland, and, you know, these cities where Zipline initially launched, and then extend that buying behavior to the rest of The United States, there would 55,000,000,000. Incident deliveries, not five. So it's like, you see customers who are instead of ordering a couple times a month, are generally ordering every single day. And it's just a result of having access to a system that is 10 times faster, extremely reliable, totally safe, magical customer experience, and less expensive on top of that. You know, customers change their behavior. And actually, you know, interesting analog to Uber, in that I remember in the early days when Uber was launching, people would say, Oh, well, even if Uber is only- it gets- grows to be 50% of the taxi market in San Francisco, it's only gonna be a $20,000,000,000 company. And obviously, the thing they had wrong is today Uber's more than 10 times the size of the taxi market in San Francisco. So you make a new kind of service that's magical in a lot of ways, customers totally change their behavior around it.
00:04:08 · Ty Morse
[00:04:08] S0: I was watching one of the interviews of Travis probably like three or four days ago, and he was talking about the user behavior of Uber. And he's like, people, when they have a car available at their fingertips, they kind of change their behavior in how they interact with the city. And so he was like, we can't even predict exactly how much each user is going to use our product because they keep on using more and more over time. And this almost feels like the exact same analogy again, where someone uses the, you know, like instant delivery and then suddenly they use it like twice next week and three times. Like last week I bought multiple things on DoorDash in the, you know, in the same like two hour period in two separate deliveries, and I was like, this is exactly the use case for Zipline.
00:04:49 · Keller Cliffton, Ty Morse
[00:04:49] S1: Yeah. I think that's right. I mean, Travis was very, you know, farsighted in that prediction. You look at, like, what happened with Uber, I mean, he was exactly right. Like, all of these new- I mean, people now commute in Ubers, You never would've done that with, like, the traditional taxi industry. And so that's obviously like a giant market expansion that was kind of unlocked. And in this exact same way, mean, Zipline, you know, when you- when- when I'm spending time with customers in these different markets, I mean, you meet a dad who has like five kids and he's ordering from Zipline, a couple times a day, they'll order multiple things, like, even over the course of an afternoon or evening. You know, 80 year old grandma who's ordered from Zipline three fifty times, in the last year. I, you know, just posted on X yesterday this funny video I saw of, like, it's basically a rooftop, like an apartment rooftop frat party that's happening in a I saw this. Yeah. It's like the 7th Floor rooftop pool deck of like all these kids just hanging out listening to loud music in their swimsuits, and they're ordering Zipline, and Zipline is delivering directly next to the pool on the 7th Floor of the apartment building. And so you kinda realize like, woah, these are just totally new kinds of, like, different ways of engaging with delivery. [00:06:00] S0: Something that I also loved about that video was there's like very few products where everyone just kind of is astounded by, oh, this thing actually exists. [00:06:09] S1: Yeah. What the hell Yeah. Am I looking
00:06:09 · Keller Cliffton, Ty Morse
[00:06:09] S1: Yeah. What the hell Yeah. Am I looking [00:06:10] S0: On that video, every single person had stopped what they were doing whether they were in the pool or like sitting on the side to just look up at the drone delivering some package. And my bet is that has like a very strong emotional reaction, suddenly they wanna go, you know, use the service themselves. [00:06:22] S1: Yeah. I mean, a lot of the, you know, one of the reasons we've been seeing this crazy growth, I mean, you know, a lot of these different, you know, we're, we're sort of launching like neighborhood by neighborhood in these cities, and a lot of these neighborhoods, I mean, you know, take a guess, like there's a, I mean, some of these cities, we have more than 50% of all homes ordering from Zipline. There's just like insane levels of customer adoption in just six to eight months, and you kinda ask, like, how is that happening? And the reality is, it's a very visual product. People love, like, people are using it when they're at soccer practice, and, like, one of the moms will be like, I'm gonna order, you know, whatever, Gatorade and oranges, and then have it delivered right here, and, like, the entire, like, you know, you have a 100 people, like, what am I seeing? And, you know, and then they can download the app and use it themselves and get their first delivery that night at home. You see, you know, birthday parties, like, it's, you know, it's a hit. You're delivering to people's backyards. I think that, yeah, the- the- the product is inherently viral, I guess, is the short version.