00:40:12 · Saurav Shroff
[00:40:12] S1: Yeah. So, first of all, I should just clarify one thing quickly, which is that we are focused on bringing up production of and shipping to customers the best space solar panel ever made because they've placed orders, they've given us down payments, we've given them a schedule, and we need to uphold to the promises we make to anybody, especially our customers, especially. So we are focused. You are right that roughly half the factory will be for production of solar modules, and the other half will be for the scale production of other products, most of which... All of which actually have not been publicly released. But I'll give you give you my rationale for building them. So first of all, a data set or really a satellite bus of any kind has about... I mean, you can slice it up in various ways, but it has about 10 major components. Solar panel, I won't list all of them. So solar panel has an attitude system that points a satellite, has a thruster that propels the satellite and allows it to change its orbital altitude or inclination slightly, and a few other things. And when we entered the solar business, the satellite solar business with Starpath, we quickly learned from our customers that it was pretty fucked up market. Right? Like, there are very... There are effectively no vendors. There was no... There were lot of people doing sort of, like, half assed, not that good quality production in house for their own relatively small volumes, and there were no great products on the market as defined by the things that we talked about made products great. Made made us make the... The things we talked about make a solar panel great for space. Low cost manufacturer, lightweight, aka low cost launch. So we learned that pretty quickly. And just through simple curiosity, we also learned that the situation for most of the other things that make a satellite bus, and especially in the case of an AI dataset, were in an equally not good position. In other words, if you wanted to make an AI dataset, and you needed, you know, a 100,000 thrusters and you needed them to cost... You know, we said the dataset should be $800,000. You want the thruster to cost, you know, 50,000, 80,000. That's not a product you can buy. Okay? Nobody will sell it to you.
00:42:25 · Saurav Shroff, Ty Morse
And it's not just like that nobody will sell it to you today, which is sort of obvious, like, okay, it's a very cheap satellite. No. Okay. Obviously, nobody's gonna sell you, you know, parts to make a dirt cheap satellite today, but it's also the case that if you went to the vendors who were selling those components, who are selling those components, and you asked them, hey, I wanna buy a 100,000, and I I wanna put money down today. What unit economics what unit economics can you achieve? They're, like, not even up to up to the challenge. Like, could argue, like, the dev cost for a satellite is in the hundreds of millions of dollars for the first time you make it, and this is, like, a well supported fact by the fact that, like, you know, the Starlink v one costs about around that much, and so all these satellite startups that spend, you know, hundreds... Few hundreds of millions of dollars building satellite, and if you approach a satellite components vendor and say, hey, wanna buy a 100,000 thrusters, I'll give you a 100,000,000 up front, which is certainly enough money to develop a great thruster. They're not even up for the challenge. And by by by up for the challenge, mean, are willing to sell components, in this case thrusters, but in in any... This applies to all the all the components at a price that actually works for a data set. [00:43:45] S0: The, like, idiot index is just retarded.
00:43:47 · Saurav Shroff
[00:43:47] S1: Yeah. The idiot index is off the charts. In the case of space solar, I've seen idiot indices in the hundreds, which idiot index is like the ratio between the cost of the materials and the cost of the finished good. The idiot index on this product here is, you know, like six at our highest volume price. So if you buy if you buy a huge volume from us, we will sell it to you for six times cost of materials, and that doesn't mean it's a six times markup. That means it's... The materials cost us a, you know, let's just say a dollar, they don't, but it's a dollar, and then the, you know, process and rent and labor costs us like a couple more bucks or 3 or 4 more bucks, and we'll sell it to you for 6. That's like an unheard of factor in the space industry. It's just like, this doesn't doesn't happen. So why do we decide, and you know, another products that we're gonna be building here, I know you've seen some, but none of them are public. But the the basic gist is, there are there are about 10 components that make up a dataset, and we are making more than... And right now we make one of them very well, extremely well. The best in the world. We will be making more of them too. And the reason why is because we want our customers to be successful. And so if we're selling our customers, you know, if we have a if we have a $8,000,000,000 contract with our customers to deliver them a huge quantity of solar for a data sack constellation, but they can't be successful in making that data sack constellation because there's nobody who can supply them with stuff that they need. We want them to be successful, and we don't want them to go out of business or drop the contract because they can't do it. So it's as simple as like, it's the same conversation as Rocket. It's like, all, like, all of our motivations come from, you know, the feeling that number one, we need to earn our customers' business by providing them with a great product. And number two, once we've earned their business, we need to make sure that they're successful in every way that we can. And part of that is the most obvious thing, just delivering on time a good quality product, which we're very quite anal about. And then the second thing is looking around and wondering, you know, what else can I do for you?
00:45:53 · Saurav Shroff, Ty Morse
So it's like a hospitality mindset almost, which is like, I know, like, almost sounds dumb. It's like, what do you mean? It's business. Isn't it supposed to be, like, super cut and dry? But it's like, not... For me, not really. It's very... It's a... From a hot... It feels like... Feels the same as the reason why, like, you know, I'd offer to make you tea after dinner. It's like, oh, what else can I do for you? And, you know, the first thing I can do for you is is give you a great solar panel, and then if I if I notice that I think there's something... Well, it's not very good at cooking, okay? The first thing I can I can do for you is give you a great solar panel, and then if I notice that there's something else that I need to do for you, my thought process is, well, what else can I do for you? And that's the impetus between... Behind a lot of these products. Now past the hospitality phase and in the execution phase, it's very different. The mindset is more like, okay, we've decided to do this thing. What's the schedule? And let's get the damn thing done. And so it's not it's not a very hospitality like mindset when when we're executing, but when we're thinking about what to do, it totally is. [00:47:00] S0: I know that the biggest push for building a moon base is going to, I think, be the mass driver on the moon, which is just basically pumping out. Am I completely off on that? [00:47:13] S1: I think you could totally be right. It's it's not something that strikes me as like completely obvious. Feels like
00:47:13 · Saurav Shroff, Ty Morse
[00:47:13] S1: I think you could totally be right. It's it's not something that strikes me as like completely obvious. Feels like [00:47:18] S0: the most obvious, like, first valuable thing that the moon is able to drive? [00:47:22] S1: I would say it's probably not the first valuable thing. I would say it's probably the first very valuable thing. Right. The first valuable thing on the moon is a product you could call novelty. So, like, if you can bring humans there, you will certainly find a lot of humans that are willing to pay to go, you know, if it's safe. I mean, obviously, it's safe, and if the price is reasonable. Like, probably in the $10,000,000 per trip price, you'll probably find, like, at least a 100 people who wanna go. And probably in the $1,000,000 per trip price, you'll probably found... Find, you know, thousands of people who wanna go. And then if you can get the price to a 100 k, which is like, it's kind of pushing it in terms of like what's physically possible, like, I mean, if you just assume the Starship is perfectly free, SpaceX sells at no margin, it only costs fuel, even then it'll cost around a 100 k. [00:48:14] S0: There's no demand pricing of people can, you know, only a small number of people can go.
00:48:14 · Ty Morse, Saurav Shroff
[00:48:14] S0: There's no demand pricing of people can, you know, only a small number of people can go. [00:48:19] S1: Yeah. I'd I'd say the price probably lands in like sort of $500,000 range in the long term. And at that price, there is there is certainly, like, a pretty high amount of demand. Like, enough demand to create a base, enough demand to fund a a lot of flights. It will not look like United Airlines, but it will look like probably how United Airlines looked when airplanes were brand new. [00:48:44] S0: One of the really interesting things that I'm thinking through in this conversation is you mentioned that there's effectively... Or there's effectively going to be zero limit on the amount of intelligence, I believe, that people want to use, which means that if people... You know, SpaceX can put satellites up in orbit that generate intelligence, it creates this amazing demand pull forward where it's like effectively, is the maximum scaling rate that you can build these starships? That is the thing that you should do. [00:49:16] S1: Or fly the starships. [00:49:17] S0: Yeah. Fly the starships, build the starships, whatever. Build the launch pads, all the stuff. Yeah. Whatever that maximum possible rate is, we should, you know, march down that rate. Yeah. Because there's always going to be demand. Yeah. And this is like not a guarantee with anything other than just GPUs in space. And so, ironically, it's like both bad short term because, you know, there's so much demand for it, and great long [00:49:42] S1: How term is that bad?