Y Combinator Startup Podcast
00:29:26 · Philip Johnston, S2
[00:29:26] S0: I'm gonna tell my mom, who's very religious, why she said I'm a prophet. [00:29:31] S2: But I think that's cool. I mean, and the other thing that's fascinating to me is that your background, if you go in your LinkedIn, is not very legible that you would be in space. But you had a background previously doing software and physics and then went to business, but nothing there that set space. [00:29:52] S0: Yeah. So for people who don't know my background, spent the first five years of my career as a... An engineer on the software side, studied math and physics before that, undergrad and masters. And then I went to McKinsey more on the commercial product side. But I actually ended up doing a couple of projects, with National Space Agencies on different satellite missions, and that's where I really started to notice the launch cost coming down very rapidly. Actually, I had another startup before this. And, yeah, when I left that one, decided, okay, if I'm gonna do another startup, it has to be something I'm, like, very passionate about. And yeah, for my whole life, I've been very passionate about space. Because I don't have a space engineering background, realized, okay, I'm gonna need the world's most kick ass space engineers. And actually, this is where I give credit to YC. I was kind of blindly following the YC advice. I was like, okay. The first thing we need to do before coming up with an idea is get the most incredible space engineers in the world on the team, essentially.
00:29:52 · Philip Johnston, S1
[00:29:52] S0: Yeah. So for people who don't know my background, spent the first five years of my career as a... An engineer on the software side, studied math and physics before that, undergrad and masters. And then I went to McKinsey more on the commercial product side. But I actually ended up doing a couple of projects, with National Space Agencies on different satellite missions, and that's where I really started to notice the launch cost coming down very rapidly. Actually, I had another startup before this. And, yeah, when I left that one, decided, okay, if I'm gonna do another startup, it has to be something I'm, like, very passionate about. And yeah, for my whole life, I've been very passionate about space. Because I don't have a space engineering background, realized, okay, I'm gonna need the world's most kick ass space engineers. And actually, this is where I give credit to YC. I was kind of blindly following the YC advice. I was like, okay. The first thing we need to do before coming up with an idea is get the most incredible space engineers in the world on the team, essentially. [00:30:48] S1: This is before you even knew what you wanted to do in space. All all you knew at that point was that, like, launch costs were gonna come down dramatically, and there were gonna be cool stuff to do in space. Yes. And you wanted to find some space people to do it with. [00:30:59] S0: Yes. Literally. That is literally it. Yeah.
00:30:59 · Philip Johnston, S3, S1
[00:30:59] S0: Yes. Literally. That is literally it. Yeah. [00:31:02] S3: But it wasn't a vibe of, like, oh, can you please build this crazy idea that I No. No. It's like the reverse even. Like, I'm going to figure out the commercial part. [00:31:10] S0: Yeah. Exactly. My pitch to Adi and Ezra was essentially, if you have any ideas that would make sense if the launch cost was 10 x less than it is today, I can figure out everything else around that besides the building the satellite piece. [00:31:26] S1: How did you how did you find them? How did you recruit them? [00:31:29] S0: So Ezra and I had grown up in the same place in The UK. I didn't... I should be frank. I messaged like a a lot of space engineers. Maybe 10 of them took a call, two of them said yes. That's [00:31:39] S3: all you need. You don't need, like, a 100 people to do it. You only need one or two.
00:31:39 · S3, S1, Philip Johnston
[00:31:39] S3: all you need. You don't need, like, a 100 people to do it. You only need one or two. [00:31:44] S1: So, Philip, during the batch, the way I thought about StarCloud was that it could only work if you were able to make it cheaper per unit of compute than like ground based compute, and I think you will, but it's occurred to me since then that like, it's not actually clear to me anymore that that is necessary for Starcloud to succeed. I'm curious if you think about it the same way, because since the batch, we've learned that AI data centers are becoming politically incredibly unpopular, and it seems not unlikely to me that it will soon become like basically de facto impossible to build AI data centers like anywhere, at least in like a democratically high-tech country. Like, I'm curious, like, how you think about that, how it affects your plans for the company. [00:32:24] S0: Yeah. A 100%. And this has moved faster than I was expecting as well, to be honest. You know, we've just seen New York now blocking data centers construction. You know, for reasons which are not grounded in science, really, you know, it seems like more more like vibes than anything else. Building these things in space will definitely be much easier from a regulatory perspective. [00:32:45] S3: So let's do some myth busting. You... There are a lot of misconceptions about certainly water and data centers, but also power. You know, what are some of the things that come to your mind?
00:32:45 · S3, Philip Johnston
[00:32:45] S3: So let's do some myth busting. You... There are a lot of misconceptions about certainly water and data centers, but also power. You know, what are some of the things that come to your mind? [00:32:58] S0: With water specifically, water is really actually just a function of power. You can call data centers with no daily consumptive use of water if just throw more power at the problem, essentially. That is what all of the data center companies are now proposing. It's very unlikely that any data center company proposes any any data center that is gonna be consuming daily amounts of water. [00:33:22] S3: And there is actually evidence that you can have closed loop systems that consume very little water. Exactly. Think the analogy is like, if you ran a burger shop, like, a fairly large data center with, like, hundreds of megawatts would consume about the same amount of water as, like, a McDonald's. Yeah. It's like, it's really, you know, a non issue, but it's unbelievable that they're repeating this so much. [00:33:47] S0: Yeah. Yeah. They do use a lot of power, though, and so most new power projects for data centers right now are being built with natural gas generators, actually. And so there's certainly some people that are pushing back on on those. [00:33:58] S3: I mean, you know, one of the arguments is that as data centers get built, they sort of compete on the grid, which is kind of not true. I mean, people [00:34:07] S0: are pretty bad. If if you build a new power project for it.
00:34:07 · Philip Johnston, S3
[00:34:07] S0: are pretty bad. If if you build a new power project for it. [00:34:10] S3: Right. Which is generally what people are doing. Exactly. Just can't get enough power from from the grid. So... Yeah. There's also some evidence actually that adding data centers increases the capacity of the grid, and then prices actually come down over time. That being said, you know, it's sort of a perfect storm. Like, we need intelligence. We need data centers. It's become basically a national security issue, you know, for America and for the West to have access to intelligence as sort of the most important tech tree of the next hundred years. And so for tech policy to sort of put us back into the stone age and possibly lose the war for us, that puts StarCloud in a different position in terms of bringing compute and AI and power online. [00:34:57] S0: Yeah. For sure. It definitely puts us squarely in the national security bucket at that point. [00:35:03] S3: I mean, thank you so much for fighting for the West then. [00:35:07] S0: We're doing our best. [00:35:09] S3: So as one of the fastest growing unicorns in YC history, and to do it as a hardware company, do you have any closing thoughts for people who are, you know, looking at space, looking at hard tech as a thing that they wanna work on? Like, you know, what have you learned, and what would you tell the, you know, just starting out version of yourself based on where you're at now?