00:28:31 · Saurav Shroff, Ty Morse
From like, you know, like Africa or, you know, some weird... Like, every single ingredient can be bought in every single country, can be made in, like, hundreds of countries in the world. Super commonplace materials. The processes are also very simple, and we know that it is the absolute thinnest that it can be because if it were any thinner, it would reach a limit of thinness where it would be physically impossible for it to be anything but transparent. In other words, it is so thin that if it were thinner, it would be see through, and something that is see through is not a solar panel by definition. So, if you guys wanna take a look at it, I have one here. This is what it looks like, and, you can see it's like, you know, roughly speaking as thin as piece of paper. This one is a little bit thicker than a piece of paper, by about 20%, and, it's unbelievable. I... This is a is a piece of paper that you can roll up, and it generates electricity. [00:29:28] S0: So, I guess this may be a slightly crazy question, but how does the thickness of the solar panel, because most solar panels that I've seen are incredibly thick, like Yep. An Why does this work?
00:29:28 · Ty Morse, Saurav Shroff
[00:29:28] S0: So, I guess this may be a slightly crazy question, but how does the thickness of the solar panel, because most solar panels that I've seen are incredibly thick, like Yep. An Why does this work? [00:29:39] S1: If I told you everything about how it works, I wouldn't be doing my job very well. So I can't. I will correct one thing about what you said, is that a... The average solar panel on the ground looks like it's an inch thick from the outside because it's got this thick aluminum frame around it, but if you took the aluminum frame off, it would only be a few millimeters thick. So we're talking about this solar panel being like the thinness of a piece of paper, and the average space solar panel being the thinness of like 10 or 20 or maybe 30 pieces of paper, so like a small stack, know, like a... Not not even the height of a pad of sticky notes. Okay? Like thinner than that. So it's not like we're talking about like an inch to a paper, we're talking about like a small stack of paper to a piece of paper, which at the scale of an AI data set really, really matters. Like it is, I mean, it it is probably the case that a satellite with this product at a 200 kilowatt class scale will be like one third of the weight than a satellite without it, and oh, by the way, way cheaper. [00:30:35] S0: Right now we're sitting in, a massive new warehouse that's like a 130,000 square feet you're gonna basically turn on your first like major production line. [00:30:44] S1: Yeah.
00:30:44 · Saurav Shroff, Ty Morse
[00:30:44] S1: Yeah. [00:30:45] S0: And forgetting that who knows how the hell you actually even secure launch. Yeah. You are building ahead of now, by the way. Right. Right. How are you thinking about basically building ahead of capacity? You said something like there's roughly five megawatts worth of demand for solar panels in space today, and you're going to build this for 50 megawatts of capacity. So how do you think about that?
00:31:09 · Saurav Shroff
[00:31:09] S1: Yep. Okay. Great question. So we are sitting inside, Starpath Megafactory LA. This building is, near Long Beach. That's a 130,000 square feet, you said. And in about five months, this will turn into a 50,000,000 watts per year fab for Starlight Air, which is the name, the brand name of our ultra thin, low cost solar panel, and a few other products that, we can talk about a little bit later. If you add up the wattage, meaning the power of every single satellite launched including Starlink, it sums to something like 50 megawatts here. If you don't include Starlink, it's like five megawatts here. So the question is, you know, you might ask, okay, why are we building a 50 megawatt fab that's 10 times bigger than demand? Why why would we why would we do this? It seems like, you know, it seems like we spent 10 times too much CapEx. It seems like, you know, big mistake. Why why would we do this? And the answer is quite simple, which is that, the demand that is being forecasted to us by our customers, who by the way are not all, you know, like sometimes people be like, my demand... The demand I'm seeing from my customers and then the customer is like a start up. Okay? And and we we have we have customers that are start ups too and that that's that's fantastic. We we sell to them. Absolutely. But when I'm talking about demand that's being forecasted, I'm talking about from companies who currently spend billions of dollars on data centers. Okay? So the demand that is being forecasted to us by our customers is so immense that, and it grows on such a steep exponential, year over year, quarter over quarter, whatever you want to call it, that it leaves us with two options. You know, so your demand demand is growing on a smooth exponential roughly, and it's very, very steep, and your supply, as in your capacity, grows in steps. So your factory comes online, and then you have the same capacity for a little while, and then another factory comes online, and so you're building basically this like staircase shaped graph, it's like step shaped graph of capacity, and you have you have roughly two choices. You can either build the steps above the exponential, so here's the exponential, and here are the steps of factory one, factory two, factory three, etcetera, or you can build it below.
00:33:32 · Saurav Shroff
And there is one governing word that comes out of every conversation with every customer, and it is not quality, which is important. It is not weight, which is important. It's not cost, which is important. It is capacity. The the questions that our customers are asking us do include those first few things, quality, weight, cost, but mostly include how much capacity do you have in year x, in year x plus one, in year x plus two, and we're talking about numbers that are so immense, they're almost hard for me to comprehend where I am working on building one of the factories right now. Like, like, numbers are like, okay, this is a 50 megawatt factory, that's 50,000,000 watts. Our customers are saying, how fast can you get to 75 gigawatts a year? That is 1,500 times the scale of this factory, which is the largest building I've ever leased in my life by an order of magnitude. And so if we wanna tell a compelling story to our customers that we actually will have the thing that they want, which is capacity, we need to have more capacity than our customers want today. I mean, it's like, it's as simple as that. You wanna sell a big you wanna sell a big amount of stuff, you better show a big amount of machines that can make a big amount of stuff, even if it means you're spending, you know, an extra $50,000,000 on CapEx in a year where you could have gotten away with with with spending like 5. Right? Like... So so the the opera... The operating word of the next ten years for us, not for the whole world, but for us, infrastructure and industrials providers for data centers in space, is capacity. And the capacity required by our customers is so gargantuanly immense that, like, I cannot even understand what they mean. Like like, if we want... Which we won't. If we wanted to do it in LA, which we won't, we would have to lease every building between Long Beach and the 105. Every single one in order to fulfill the demand that our customers wanna see in five years. Now, obviously, we're not gonna do it in LA, we're gonna do it in Texas where, you know, like, it's easier to build, the regulation's more friendly, but, your question was, why are you building 10 x the capacity of what your customers want? And it's because the thing they want is capacity, even if they're not buying it next year.
00:35:55 · Saurav Shroff, Ty Morse
And between building capacity ahead of the curve and building capacity behind the curve, it is the smarter business decision to build it ahead. And for those saying, which nobody was really saying, but if you said like, you know, what about the cost of capital, etcetera, etcetera? I would say, well, what about the cost of losing? [00:36:16] S0: So if you think through basically what your biggest bottlenecks are, you get the lease here, you start filling it out with a bunch of different machines, you have the lineup in, I don't know, six, eight months, [00:36:26] S1: something 2027. [00:36:28] S0: Great. So it's about six months. What does the scaling process look like from going from one factory with a 130,000 square feet and, like, 50 megawatt production annual output to, like, a gigawatt? [00:36:43] S1: So incidentally, 1.2 gigawatts is the size of our next fab, which is called Starpath Austin Giga. Austin [00:36:50] S0: Why Giga did you choose, like, that amount versus a smaller amount? Like, what... What's the logic?