00:12:01 · Saurav Shroff
People talk about how AI data sets are the solution because, you know, solution to needing lots of AI compute because they have infinite scale, and this is true. More or less they have infinite scale, once you have infinite, you know, pseudo infinite launch capacity. But to get there from Falcon nine, you need five x cheaper cost and 10 x higher scale just to get to the baseline, and then you need a 100 x scale to get to, you know, appreciable capacity, and and a thousand x scale to get to really serious capacity. So so rocket like Falcon nine is limiting, and it's limiting because it's too expensive, and it's too slow to launch. The thing that limits its... That makes its cost high and the rate of launch low is the fact that the second stage of the rocket is not reusable, which is to say it gets thrown away on every launch. So, to launch it twice, have to build two second stages, which is time consuming, and to launch it twice, you have to build two second stages, which costs money. So, the solution to this problem that is known and has been known for decades is to make both the first and second stage of the rocket reusable. So, in simple English, rockets that are useful for deploying AI data sets are defined as rockets whose first and second stage are reusable. Right now, there are exactly two companies on Earth that are seriously developing a two stage to orbit, fully reusable rocket. One of them is SpaceX, who we already described has roughly no incentive to sell services. And the second is a company called Stoke Space, which I think is an amazing company that is also developing a rocket of similar... Categorically similar performance, although it's a bit smaller, which doesn't really matter. And so it is for this second stage of the future where we are immensely scared. Because, if you look at the optimal sort of the game theory optimal logic for each participant in the market, it's as follows. First, SpaceX has a rocket that works. Let's say they have star... Let's say Starship works in about a year. So let's say SpaceX has a rocket that works. They have no incentive to sell, they deploy their own data sets because super intelligence is valuable. Great. If another company makes a rocket, and that rocket works, and the other people who are also building rockets, and by rockets here, I'm talking about useful rockets for data sets, so reusable ones.
00:14:22 · Saurav Shroff, Ty Morse
The other reusable rocket makers are not selling services, then the game theory optimal to sit... The game theory optimal choice for them is the same. My rocket works. I have no incentive to sell it. Scale AI data sets because super intelligence is valuable. Then if another company builds rockets that it works, their logic is the same. So it's it's for this future that we're worried. [00:14:45] S0: So, basically it's never optimal for any of these companies to sell launch once?
00:14:49 · Saurav Shroff
[00:14:49] S1: Yeah. On- on an instantaneous And basis, this is as soon as multiple companies start selling launch, this dynamic changes. So, really you just need two companies that are selling launch, and for a long time we thought the launch market is gonna be solved because SpaceX sells launch, so it just takes one other person or company to come along and also sell launch. So, you sold launch, we'd be in good shape. But we went from one hoping for two, down to zero hoping for one, but when we're at zero, nobody wants to be the first. And so, our solution to this problem is, it's very simple, and this will be my first time saying this on record, which is that we have a date in the back of our heads, where if the launch market doesn't fix itself, we're gonna go build a launch company. And, the reason that we have to do it is because, we want our customers to be successful. So for those who are listening, who haven't had... Who don't know about us, we supply mass produced components, including the world's lightest space solar panel to companies building satellites, including those building AI data centers in space. And because we want our customers to be successful, and because they have no way of being successful in the present world, there's date in the back of our head, and there is a clock that is ticking towards that date. And if something doesn't change, like SpaceX entering the market, or multiple players competitively bidding large volume launch contracts, and offering reasonable prices like 200, 300, or heck $500 a kilogram, we will go build the launch company and sell that product. And and and the reason is for the betterment of the world. Because we think super intelligence is something that everybody should have, not just a couple of companies.
00:16:33 · Ty Morse
[00:16:33] S0: When you're thinking through the decision to... Like, this business alone is hard enough. Like, it's very, very difficult to build one space company. How did you kind of map the logic in your head for even thinking about doing a launch company as well?
00:16:51 · Saurav Shroff
[00:16:51] S1: So first of all, I don't wanna understate the difficulty. Like there's a phrase, it's not rocket science, and that phrase exists for a reason because rocket science... Well, rocket science isn't actually that hard, but rocket engineering and manufacturing is extremely challenging. I would say it's like, it's less math and more logic, and you said, did you math the logic? There wasn't a lot of math, there was mostly logic. I mean, a little bit of math, like, okay, what would rocket look like? How big would it be? Where would you launch it from? These types of questions, but it's mostly logic, like, the the logic is like, okay, super intelligence is being made. You could make a bet that it doesn't need to scale, in which case we have no problems, right? We don't need to scale, the ground is sufficient, Deploy all your data centers on the ground. Every sappy. Okay. That that would be one bet. That doesn't really seem very likely. In the more likely case, where we do need to scale, the ground doesn't work, space becomes better, And then if you just go through the logic of what happens in that scenario, which seems to me like the likely scenario, it's quite grim. It's like, you have this like sort of standoffish market with like massive companies, and I'm not against big companies, okay, I'm not socialist, but I am against like, futures where technologies are... Don't... Aren't... Like important technologies aren't competed. Right? Like like, I mean, you could get a little political and make some comments about like Medicare and stuff, like, I don't need to. Like, if superintelligence is good enough to do most people's jobs and, you know, society looks like a society that's, like, supported by UBI, like, do you want that superintelligence to be owned by one company that is, like, effectively in government? Like, I'm not saying that will happen or that that's anybody's intention. I'm saying, I don't think we want that. And I looked around. I asked every launch company how much launch they would sell me and for how much, discovered that the market is completely fucked, and, wanted to do something about it. And and and and it's not like I have. I'm just sounding the alarm that it's a problem.
00:18:54 · Ty Morse
[00:18:54] S0: There's this, funny line, everyone has a plan until they get punched in the face. Yeah. And I got to imagine that the AI data center punch is effectively both, like, a great blessing and a great curse, which is there's, like, infinite demand in space for solar panels. And ironically, you will not be able to put any of your solar panels up in space. So how did you kind of go through the period where you realized this was kind of a fact, and how did you kind of change direction in that period?