[Music]
what is the one thing that is surprised
to you about your life oh one thing well
well I certainly I’m surprised about the
whole thing I wanna see I certainly
didn’t expect to be to be 20 of these
things to happen honestly yeah I just
you know I know I wanted to be involved
in technology and in fact the only
reason I started a company back in 95
and here at company was because I
couldn’t get it there were only a few
internet companies and I couldn’t get a
job at any of them I try to get a job at
at Netscape and sent my resume and I
tried hanging out in the lobby but I was
too shy to talk to anyone and and
there’s like okay well I guess I’ll have
to start a company cuz I can’t get a job
anywhere thank you how should someone
figure out how they can be most useful
or whatever this thing is that you’re
trying to create what would what would
be the utility Delta compared to the
current state-of-the-art times how many
people it would affect so that’s why I
think having something that has a that’s
that has a mix makes a big difference
but affects a sort of small to moderate
number of people is great as is
something that makes even a small
difference but but affects a vast number
of people like the area yeah under you
know under yeah exactly I don’t know
every under the curve is would actually
be roughly similar for those two things
yeah so I noticed I picked up two kind
of themes from from what you were
discussing one was somewhat audacious
goals and the other was I don’t think I
heard use the word profit and anything
that you spoke of but you seem to be
each each thing is pointed
reinvigorating in industry or bringing
back space missions how much of your
success do you attribute to having
really audacious goals or versus just
not being focused on the short term you
know money coming in or investors I
personally I I one one does have to be
focused on the short term and money
coming in when creating company because
otherwise the company will
for dial so that I think that a lot of
times people think like creating company
is gonna be fun I would say it’s not
it’s really not that fun when there are
periods of fun and there are there are
periods of where it’s just awful and
particularly if you CEO of the company
you actually have a distillation of all
the worst problems in a company there’s
no point in spending your time on things
that are going right so you only spend
on things on your time on things that
are going wrong and and there are things
that are going wrong that other people
can’t can’t take care of so you’re like
the worst you have a filter for the
crappers problems in the company the
most pernicious and painful problem so I
wouldn’t say it’s it’s I think you have
to feel quite compelled to do it and
have a fairly high pain threshold and
there’s a friend of mine who says like
starting companies like staring at the
abyss and eating glass there’s some
truth to that we’re staring into the
abyss part is that you’re going to be
constantly facing the extermination of
the company because what most startups
fail it’s like 90 percent ugly ninety
nine percent of startups fail so I so
you that that’s the staring into the
abyss part you can’t so constantly
saying okay if I don’t get this right
the company will die and then the eating
glass part is you’ve got you’ve got to
do you’ve got to do the problems you’re
gonna start you’re gonna work in the
problems that the company needs you to
work on that promise you want to work on
and so that the that’s your knife
working on problems that that you’d
really wish you weren’t working on and
so that’s the eating glass part then
that goes on for a long time so how do
you keep your focus on the big picture
when you’re constantly faced with we
could be out of business in a month well
it’s just a very small percentage of
mental energies on the on the big
picture like you know you know you know
where you generally heading for and the
actual path is going to be some sort of
zigzagging thing in that direction and
try not to deviate too far from the path
that that you want to be on but you’re
but I don’t want to I don’t want to
diminish the I mean I think the product
the profit motive is it is a is a good
one if the rules of an industry are
properly set up so there’s only
fundamentally wrong with profit in fact
profit just means that people are paying
you more for the that whatever you’re
doing then you’re spending to create it
that’s a good thing and if you’re not if
that’s not the case then you’ll be out
of business and rightfully so
sure you’re not adding enough value now
there are cases of course where people
will do bad things in order to achieve
profit but but that’s actually quite
unusual I mean because because usually
the rules are set up mostly correctly
like not completely but mostly correctly
how do you spend your days now like what
what do you my time is mostly split
between SpaceX and Tesla of course I try
to spend it’s a part of every week at
open AI basically half a day at opening
I most weeks but other than that it’s
Tesla like what is your time look like
there yeah so that’s a good question
I think a lot of people think I must
spend a lot of time with media or on
business II things but actually almost
almost all my time I eighty percent of
it is spent on engineering design
engineering and design so it’s
developing next generation product at
that’s 80% of it you probably remember
this a very long time ago many many
years you took me on a tour of SpaceX
and the most impressive thing was that
you knew every detail of the rocket and
every piece of engineering that went
into it I don’t think many people get
that about you yeah I think a lot of
people think I’m kind of a business
person or something it’s just fine like
business is fine but like I really it’s
you know it was like it SpaceX Gwynne
Shotwell was chief operating officer she
kind of manages legal finance sales and
kind of general business activity and
then my time is almost entirely with the
engineering team working on improving
that the Falcon 9 and the
dragon spacecraft and developing the
most colonial architecture and that
Tesla it’s working on the model three
and yes I’m in the design studio took
very up half a day a week dealing with
the aesthetics and and look and feel
things and and then most of us week is
just going through engineering of the
car itself as well as engineering of the
the factory I do think that you know in
terms of creating a company you know
what Edison said what which was like
it’s 1% inspiration 99% perspiration is
true so a lot of it in creating company
is execution like you start off with an
idea and that idea is mostly wrong and
then you adapt that idea and keep
refining it and you listen to criticism
some criticism you discard the courier
try to discard the wrong criticism try
to listen to the correct criticism and
then engage in sort of recursive
self-improvement and constantly refining
it and making it better and you have to
work super hard and that’s very
important and then just keep making sure
you keep iterating on a loop which says
am i doing something useful for other
people because that’s what a company is
supposed to do you know a company is
just a group of people gathered together
to produce a product or service and a
company should only exist if that
product or service is truly useful to
customers this is really at the key of
Tesla it is a car that you will covet
that you want to drive that happens to
be very good for on the environment yeah
exactly I think this is sort of general
you know advice I’d give to people
starting company to entrepreneurs in
general is really focus on making a
product that your customers love and
it’s so rare that you can buy a product
and and you love the product when you
bought it
this is this is there are very few
things that fit into that category
and if you if you can come up with
something like that your business will
be successful for sure but it is
generally true that innovation comes
from questioning the way things have
been done before yeah
and if in the education system you’re
taught not to do that that will inhibit
entrepreneurship those colonies
elsewhere in the solar system and
ultimately extend beyond the beyond our
solar system and and so there’s the
defensive reason of protecting the
future of humanity ensuring that the
light of consciousness is not
extinguished should some calamity before
earth that’s the defense of reason but
personally I find the more the word what
it gets me more excited is is the fact
that this would be an incredible
adventure maybe like the greatest
adventure ever hmm and it would be
exciting and inspiring and they need to
be things that excite and inspire people
yeah you have to be you know reasons why
you get up in the morning it can’t just
be solving problems it’s got to be yeah
something something great is gonna
happen in the future
yeah people want to be more like you and
therefore the fate of humankind I think
it would be great to have more Elon
Musk’s what do we need to do to become
more like Elon I don’t know if it’s I
there’s a friend of mine he’s got a
great saying about creating a company it
creating turnable the company and have
it succeed is like eating glass and
staring into the abyss so I mean what
tends happen is it’s sort of quite
exciting for the first several months of
starting a company and then then reality
sets in things don’t go as well as
planned customers aren’t signing up the
technology or the part isn’t working as
well as you thought and and then can
that consumers be compounded by a
recession and it can be very very
painful for several years frankly
starting a company you advise some
people to have a high pain tolerance do
you fear that maybe an in this
generation or the the younger generation
that they don’t have that perseverance
and grit to take on these really tough
challenges I think some people do and
fit but no I think it is definitely true
that I mean maybe there occasionally
companies that get created work where
there’s not an extended period of
extreme pain
but but I’m not aware of you know very
many of such instances so but I do think
that the the new great entrepreneurs are
born of every day
and will continue to see amazing
companies get built
yeah but I would definitely advise
people there’s not any company to expect
a long period of quite high difficulty
but let me slung is people stay super
focused on creating an absolute best
product or service that really delights
their end customer like if they stay
focused on that then it should basically
if you get it such that your customers
want you to succeed then then you
probably will all right you have to
focus on the customer delivering for
them yeah make sure if your customers
love you you will your odds of success
are dramatically higher I mean I think
this this there’s a lot of things I mean
I sort of I mean certainly you know
listen listen more to critical feedback
I mean like a lot of things I’ve learned
in college actually were pretty helpful
I mean the think the physics approach to
thinking is very good like the first
principles approach and you applied that
broadly yeah applying the first
principles person to thinking it is I
think a good way to figure out a
counterintuitive situations and you know
stuff that look that I was that was
really a helpful thing to learn whereas
there’s many things that need fixing in
the world and students here probably can
think of a long list many of which you
could probably imagine solutions to
using the physics first principle
approach but has there been any
framework or idea of you used to filter
out what you don’t do what you don’t
pursue I mean sort of follow that in
what it initially was you know I won’t
you go back to like college centers
working on energy storage technologies
for electric vehicles mm-hmm and that’s
what I was gonna pursue at Stanford
actually it was what work on like
advanced capacitors and batteries
improve the energy density for electric
vehicles and then the internet was kind
of happening it was today like the
internet was happening like back in 94
95 and and I wasn’t sure if what I
worked on in the PhD would actually be
useful hmm so I was like I was really
concerned that if I lying
timing or what was your intuition
meaning I think like okay could be
academically useful but not practically
useful like I thank you you could result
in a PhD and adding some leaf to the
tree of knowledge but then then
discovering that well it’s not really
gonna gonna matter
like that’s you know is it is it gonna
be a good enough thing to actually be
used in an electric vehicle I wasn’t
sure I mean so it was like I was
uncertain as to whether success was one
of the possible outcomes like I thought
maybe it was but I wasn’t sure and and
then I thought well if I watch the
internet get built while I’m doing this
that that that would be really
frustrating there’s a sense of that
eminent timing like that was the time
for the internet and maybe yeah other
stuff could wait or be on the back it
was it always there is like one day I’ll
get back to that or was it just that’s
what probably I’d get back to it and did
end up doing that but yeah I thought
sort of the the inner always was
happening it like really taking off all
the most people weren’t aware of it in
95 and and so I figured like electric
vehicle technology energy storage
technology will there’ll be some sort of
natural progression in that and I could
come back to it later but the internet
you know it was it was really that was
the moment to really do something
although in 95 it wasn’t obvious that
you could actually make any money on the
Internet this was like not nobody until
Netscape went public I think at the end
of 95 Edmund nobody even thought there
was like you could make a valuable
company on the Internet wasn’t obvious
as it seems now yet like now it seems
really obvious but back then it was not
at all and and then the internet it’s
also helpful because it’s anything to do
with software is a low capital endeavor
so I didn’t have any money
and just had a bunch of student debt but
but software you can just write like by
yourself
and you don’t need a lot of atoms like
you don’t need a lot of tooling and
equipment and so it’s like capital
intensive so the ability to start a
company if it’s software related and
it’s the first company is much much
easier and it seems obvious now but of
course the easier place to start and
then as you gain more of a personal
reputation and have more personal
capital as some Mary Ann I know SpaceX
was almost what was entirely funded by
Elon for its first period partially from
you know in an era when others probably
wouldn’t have funded it in those arrived
two days oh and actually I mean the
precursor to to SpaceX was not that the
idea wasn’t really to create a company
it was it was to try to figure out why
we hadn’t gone ten people to Mars okay
going from PayPal so the next thing I
was sort of thinking well is there some
way to reignite the dream of Apollo that
says you do you have a useful company so
you know in a high-growth scenario you
have a lot more inputs for for future
outputs so you have negative cash flow
and like a profitability and which we
currently have a Tesla but in the long
term of course that has to be that that
has to be fixed they can’t be negative
cash flow and long term and that there
needs to be a net positive output which
is sort of profits in the long term but
in the short term win this high growth
that that that doesn’t it isn’t the most
sensible thing when you have this thing
that every employee and customer knows
is the purpose of the company how do you
see that flowing through to benefits for
the company I think having a purpose
suddenly is going to attract the very
best talent in the world because if if
people can if there’s something that’s
intrinsically enjoyable and the branch
rewards are good but then also it’s
something that’s gonna genuinely change
the world and that’s I think that’s a
pretty powerful motivator and but I
don’t think you like everything needs to
change the world you know you know
honestly like there’s lots of like
useful things that people do and
I mean I think really it should be like
a usefulness optimization like just
sailing is what I’m doing as useful as
it could be
did you tell Matt the goal of an
organization or go in general yeah and
you know just even if something isn’t
changing the world if it’s making making
people’s lives better I think that’s
that’s great and you know if even if
some things like making only people
sighs only slightly better but it’s a
large number of people then kinda like
the area under the curve is it’s quite
good and that mathematical first
principle the point utility in numbers
like I mean like one can see like so
like is like some app really making
people’s lives better if it’s better but
if it’s affecting a lot of people even
in a small way then yeah that these sort
of area is good mmm it’s always really
tricky to predict the future all right
some of its pretty obvious like
computing power is gonna be just crazy
and the really the big change is the
cost of computing power hmm not so much
the sort of circuit density sort of the
Moore’s Law thing but if you if you look
at say what is the actual dollars per
instruction and and that that is draw it
I mean that that that cost is is
dropping exponentially are you think
about it like a connect you’re making a
computer just you’re rearranging silicon
and copper you know so one out on a
little chip and once the capital cost of
the development and the the chip plant
is paid for the accurate I mean the
marginal cost of a chip is very very
tiny so I think we’ll see massively
parallel computers and computing power
and storage being you know as really as
much as you want and it’s interesting I
to start with that like if I I don’t
know what else to predict but as a
foundation for sure this seems like the
safest starting you know premise but
then what does that ripple through to
and feels like genetics in AI which you
mentioned an autonomous driving
space related topics I mean just
ubiquitous computing everywhere like
like AI is gonna be incredibly
sophisticated in 20 years
hmm the when they first it like it seems
to be accelerating and that the tricky
thing about predicting things when
there’s an exponential is that an
exponential looks like looks linear
close up and and but it’s actually it’s
not linear so and AI appears to be
accelerating that’s what I can see for
that do you look at autonomous driving
and point a is like the Siri like
functionality as you have guideposts
well I have to debate about someone like
is AI accelerating or not and the like
you think well what’s the y-axis you
know if you’d if it’s accelerating your
T on the x axis but what’s what the y
axis is it well thought about that I
think you could have a recursive y axis
so that if at any point in time your
predictions for AI are coming sooner or
later that that actually would help to
find whether it’s accelerating or not
whatever that axis was so you mentioned
is immersive access like so if in any
given year if you if you find your
predictions are going further out or
coming for the ripple coming closer ran
that that actually you know it was one
way to think of acceleration because
like like it’s otherwise what’s the
what’s the quality ripple quantitative
measure mmm a I um EDI I can certainly
see that with with autonomous driving
you know three years ago I thought it
was ten years away mmm and at two years
ago I thought it was five years away now
I think it’s three years away or less
than three years away Wow
so any when you say away like like like
released to market available for a
consumer adoption because as opposed to
prototyping you know I mean like think
back the technology works there’s a sort
of second question as to when regulators
would approve it yeah yeah yeah yeah
but but like a look at that technology
works as a general solution so like
that’s fun was driving like Reyes
crossed it anywhere so it could be
sooner and for point things like highway
only or in hi only we’re already in
public beta with this Tesla so we’ll be
hopefully in the next several weeks
releasing to to all of the cars that
have the auto pod hardware which is all
cars booking like roughly the last 12
months and so for sure your Vickers
computing AI that’s beyond anything like
the public appreciates today I think
will have most of the new vehicles being
produced being electric and will be
probably have the super majority of
energy being produced being sustainable
so I think I think we’re on head of
solar primarily and you’re my really
Sola yeah I think that those are sort of
some good things like will be hopefully
on a good path for sustainable energy
sooner is always better but I think by
2035 I think will be substantially like
what most of transport most of new
energy being produced will be
sustainable broadband everywhere
broadband everywhere yeah and hopefully
a hopefully a small base on Mars so
spoil city on Mars in 20 years yeah well
ok fine town village Hamlet
and that’s exciting I mean that I could
get people fired up about the future
yeah I do
I agree exactly I mean for sure for sure
Mars and sustainable transporting like
those items I couldn’t think are really
they miss the same energy those are I
think really cool things I mean in terms
of getting excited about I mean it’s I
think we’ll probably start seeing like
Moore’s like truly sidewalk activity
like a human brain interval like like a
look range of your interfaces like that
there’s a long inside the AIS that are
purely yeah yeah I think so it’s the
only way we can relate to I think you
know never covers yeah and there are
amazing things happen like happening
these days like this they’ve been able
to figure out how to do an artificial
hippocampus in rats and monkeys and and
now they’re looking at at doing that to
solve severe epilepsy
about half of severe epilepsy cases
originating app so hippocampus and by
having sort of an artificially augmented
hair company of a campus they can
actually solve believe the severe
epilepsy cases other board members asked
maybe they cheering up kind of method
with some quoting Bill Gates or somebody
that said you know if you haven’t failed
and you’re not learning understand
that’s a paraphrase of the quotes and I
remember your reply and I have it
written as a quote because I want to put
it on a placard given the options I
prefer to learn from success a great
comeback and so I guess at least cure is
in general what do you think of the
Silicon Valley mantra fail fast fail
often or as Esther Dyson says always
make new mistakes as if failure is the
crucible of learning yet curious if you
had any further thoughts on that and
that maybe off-the-cuff comment you made
out there I mean there are there are
many that’s true I mean I think it’s
sort of there’s like some entropic basis
for this like there are many more ways
to fail than to succeed so you do have
to explore I mean particularly for a
rocket there’s like a thousand ways that
thing can fail in like one way it can
work so you could you could have a lot
of rocket failures to explore all the
ways in which you could fail a bit but I
do you think that one great thing about
smoking valley is failure is not a not a
big stigma so it’s like if you if you
try hard and it doesn’t work out that’s
okay
like you can
learn from that and you know do another
company and it’s not a big deal
I think that’s that’s really one of the
great things about Silicon Valley
interesting do you also I’m curious if
either on the well it seems to me that
on the system design side you can
accommodate a likely failure of sub
components and so much of the elegance
of let’s say a Falcon 9 or a falcon 9
heavy there’s an ultimate incarnation of
this vision of how the rocket should be
built to say hey parts will fail thing
but here’s how the system can succeed
and I’m curious if there’s any other
thoughts along that how to how to
accommodate anticipated failure and then
also maybe in a like in managerial II is
there ways that you motivate the team
either an advance of failure to coach
them on a this is going to happen or in
the aftermath of failure to get them
fired up to solve it and move forward
when it might be dark times and like for
example you know she’s like failure to
launch
you know exploding on the pad you know
there’s all these it’s a very visual
it’s public spectacle when you have a
setback in the rocket industry I’m
curious how you manage around failure I
mean it I think it’s it’s like quite
quite painful and difficult
honestly and it’s it feels terrible the
company’s sort of looking to you know me
to you know rally them and so I do yeah
alright honestly feel super bad like a
punch in the gut yeah yeah remembers
almost like a tight like the stages of
grief I remember it yeah I mean it’s
just I mean it’s particularly with
rockets it’s it’s just a really quiet
space is hard and rock is tend to fail
unfortunately and even when you’ve got
it like a lot of really smart people
working super hard to minimize the
probability of failure it’s still it’s
still there and it’s and it’s you know
it’s it’s quite significant people have
asked me like well why why Rockets you
know especially hard and and you know
part of it it’s like everything has to
work the first time like there’s there’s
no you can’t do a recall you can’t patch
it it’s got it’s like nine minutes to
orbit or it’s over and and then the that
you you know what you can’t you can
never test the rocket completely in the
environment that it’s actually going to
experience easy you can’t fully recreate
something that’s moving super fast in a
vacuum
on the surface of earth like you can
only really record recreate that on in
space so the limited the simulation
tools alright is that a limit of the
simulation tools today yeah absolutely
the if the if there’s any error between
the simulation and reality and there’s
always some amount of error then then
that that can result in a failure it’s a
really really tricky one it’s like in a
software analogy it would be like if you
have to write a whole bunch of software
modules and you can never run them
together
and you can run them on the target
computer like like when you’re testing
them you don’t have to test them
individually and not in the actual
computer that they’re gonna run on
gotcha then you put them put all the
modules together run it for the first
time in a completely different very
different computer and it has to run
with no bugs that is difficult these
software analogies to rocket design are
deep on the modular reuse there’s many
of these like those who are in familiar
with it’s not like this is an aerospace
engineer by traditional training coming
but but is in fact radically changing
industry I think applying ACS
perspective to industry after industry
I’m like how would how would you know a
computer scientist or a physicist
approach the problem which often times
the solution very unlike the industry
incumbents there’s there’s a certain
elegance to it at least from the outside
what do you look for in design and
related if you’d like what do you look
for in art design might be more
immediately relevant I mean you you you
want to make something beautiful you
want to trigger whatever whatever
fundamental aesthetic algorithms are
like it in your brain you have I think
some intrinsic elements that that
represent beauty and and that that
trigger the emotion of appreciation of
beauty in in your in your mind and I
think that these are these are actually
relatively consistent among people I
mean not completely some people like not
everyone likes the same thing but there
are there’s a lot of commonality and and
and there yeah and they’re there but but
I think it is important to combine
aesthetic design with functionality I
could say like what was really hard
about say the Model S or the model acts
was to combine aesthetics and utility so
to balance the two you can make a car
look very good by giving it sort of
certain proportions like you’re making
it sort of low and slim and and if you
if you do that the utility is
significantly affected so the big
challenge with the set of Model S was
sharp regarding how do we get five
adults plus two kids gonna have a
seven-seater the big challenge with the
like with with es was having a car that
had a high utility and looked good and
the same with the X so like it like with
the to make a sports car look good is
relatively easy but to make a sedan look
good or an S you look good is because
quite difficult and I think another
principle is you want to have it feel
bigger on the inside then it looks on
the outside mm-hmm
and that that’s also a really hard thing
to do and then you really pay attention
to the little details the that the
nuances of design and shape and form
function and the way it looks in
different lights and when something’s
off the little thing how do you
experience that never drives me bananas
yeah I mean it’s and it the problem is
like if you you can train yourself to to
pay attention to the tiny details I
think almost anyone can although it this
is a very much double-edged sword
because then you see although it’ll
become and then little things drive you
crazy
so but like most people don’t they don’t
see they don’t consciously see the small
details but they they do subconsciously
see them like you do sort of your mind
takes in a gestalt of the overall you
know the overall impression mm-hmm and
and you you know if something is
appealing or not even though you may not
be able to point out exactly why hmm
and it’s it’s the summation of these
many small details so most of us
experience that as a oh I think that’s
ugly or I think that’s beautiful or like
wow
elegant but ya can’t break it down you
mentioned something in passing like you
can train yourself in this though yeah
you can train yourself I think you can
make yourself pay attention to to why
you’re essentially bring the
subconscious awareness into conscious
awareness I wish I could do that how do
you do that just just pay really close
attention almost like a meditation on my
object I’ve been trying to find the
details like why do I not like this is
that what yeah just look look closely
and carefully mm-hmm
and therefore any given object it’s but
it’s geometry as if there’s always something wrong somewhere all the time
what is the one thing that is surprised
to you about your life oh one thing well
well I certainly I’m surprised about the
whole thing I wanna see I certainly
didn’t expect to be to be 20 of these
things to happen honestly yeah I just
you know I know I wanted to be involved
in technology and in fact the only
reason I started a company back in 95
and here at company was because I
couldn’t get it there were only a few
internet companies and I couldn’t get a
job at any of them I try to get a job at
at Netscape and sent my resume and I
tried hanging out in the lobby but I was
too shy to talk to anyone and and
there’s like okay well I guess I’ll have
to start a company cuz I can’t get a job
anywhere thank you how should someone
figure out how they can be most useful
or whatever this thing is that you’re
trying to create what would what would
be the utility Delta compared to the
current state-of-the-art times how many
people it would affect so that’s why I
think having something that has a that’s
that has a mix makes a big difference
but affects a sort of small to moderate
number of people is great as is
something that makes even a small
difference but but affects a vast number
of people like the area yeah under you
know under yeah exactly I don’t know
every under the curve is would actually
be roughly similar for those two things
yeah so I noticed I picked up two kind
of themes from from what you were
discussing one was somewhat audacious
goals and the other was I don’t think I
heard use the word profit and anything
that you spoke of but you seem to be
each each thing is pointed
reinvigorating in industry or bringing
back space missions how much of your
success do you attribute to having
really audacious goals or versus just
not being focused on the short term you
know money coming in or investors I
personally I I one one does have to be
focused on the short term and money
coming in when creating company because
otherwise the company will
for dial so that I think that a lot of
times people think like creating company
is gonna be fun I would say it’s not
it’s really not that fun when there are
periods of fun and there are there are
periods of where it’s just awful and
particularly if you CEO of the company
you actually have a distillation of all
the worst problems in a company there’s
no point in spending your time on things
that are going right so you only spend
on things on your time on things that
are going wrong and and there are things
that are going wrong that other people
can’t can’t take care of so you’re like
the worst you have a filter for the
crappers problems in the company the
most pernicious and painful problem so I
wouldn’t say it’s it’s I think you have
to feel quite compelled to do it and
have a fairly high pain threshold and
there’s a friend of mine who says like
starting companies like staring at the
abyss and eating glass there’s some
truth to that we’re staring into the
abyss part is that you’re going to be
constantly facing the extermination of
the company because what most startups
fail it’s like 90 percent ugly ninety
nine percent of startups fail so I so
you that that’s the staring into the
abyss part you can’t so constantly
saying okay if I don’t get this right
the company will die and then the eating
glass part is you’ve got you’ve got to
do you’ve got to do the problems you’re
gonna start you’re gonna work in the
problems that the company needs you to
work on that promise you want to work on
and so that the that’s your knife
working on problems that that you’d
really wish you weren’t working on and
so that’s the eating glass part then
that goes on for a long time so how do
you keep your focus on the big picture
when you’re constantly faced with we
could be out of business in a month well
it’s just a very small percentage of
mental energies on the on the big
picture like you know you know you know
where you generally heading for and the
actual path is going to be some sort of
zigzagging thing in that direction and
try not to deviate too far from the path
that that you want to be on but you’re
but I don’t want to I don’t want to
diminish the I mean I think the product
the profit motive is it is a is a good
one if the rules of an industry are
properly set up so there’s only
fundamentally wrong with profit in fact
profit just means that people are paying
you more for the that whatever you’re
doing then you’re spending to create it
that’s a good thing and if you’re not if
that’s not the case then you’ll be out
of business and rightfully so
sure you’re not adding enough value now
there are cases of course where people
will do bad things in order to achieve
profit but but that’s actually quite
unusual I mean because because usually
the rules are set up mostly correctly
like not completely but mostly correctly
how do you spend your days now like what
what do you my time is mostly split
between SpaceX and Tesla of course I try
to spend it’s a part of every week at
open AI basically half a day at opening
I most weeks but other than that it’s
Tesla like what is your time look like
there yeah so that’s a good question
I think a lot of people think I must
spend a lot of time with media or on
business II things but actually almost
almost all my time I eighty percent of
it is spent on engineering design
engineering and design so it’s
developing next generation product at
that’s 80% of it you probably remember
this a very long time ago many many
years you took me on a tour of SpaceX
and the most impressive thing was that
you knew every detail of the rocket and
every piece of engineering that went
into it I don’t think many people get
that about you yeah I think a lot of
people think I’m kind of a business
person or something it’s just fine like
business is fine but like I really it’s
you know it was like it SpaceX Gwynne
Shotwell was chief operating officer she
kind of manages legal finance sales and
kind of general business activity and
then my time is almost entirely with the
engineering team working on improving
that the Falcon 9 and the
dragon spacecraft and developing the
most colonial architecture and that
Tesla it’s working on the model three
and yes I’m in the design studio took
very up half a day a week dealing with
the aesthetics and and look and feel
things and and then most of us week is
just going through engineering of the
car itself as well as engineering of the
the factory I do think that you know in
terms of creating a company you know
what Edison said what which was like
it’s 1% inspiration 99% perspiration is
true so a lot of it in creating company
is execution like you start off with an
idea and that idea is mostly wrong and
then you adapt that idea and keep
refining it and you listen to criticism
some criticism you discard the courier
try to discard the wrong criticism try
to listen to the correct criticism and
then engage in sort of recursive
self-improvement and constantly refining
it and making it better and you have to
work super hard and that’s very
important and then just keep making sure
you keep iterating on a loop which says
am i doing something useful for other
people because that’s what a company is
supposed to do you know a company is
just a group of people gathered together
to produce a product or service and a
company should only exist if that
product or service is truly useful to
customers this is really at the key of
Tesla it is a car that you will covet
that you want to drive that happens to
be very good for on the environment yeah
exactly I think this is sort of general
you know advice I’d give to people
starting company to entrepreneurs in
general is really focus on making a
product that your customers love and
it’s so rare that you can buy a product
and and you love the product when you
bought it
this is this is there are very few
things that fit into that category
and if you if you can come up with
something like that your business will
be successful for sure but it is
generally true that innovation comes
from questioning the way things have
been done before yeah
and if in the education system you’re
taught not to do that that will inhibit
entrepreneurship those colonies
elsewhere in the solar system and
ultimately extend beyond the beyond our
solar system and and so there’s the
defensive reason of protecting the
future of humanity ensuring that the
light of consciousness is not
extinguished should some calamity before
earth that’s the defense of reason but
personally I find the more the word what
it gets me more excited is is the fact
that this would be an incredible
adventure maybe like the greatest
adventure ever hmm and it would be
exciting and inspiring and they need to
be things that excite and inspire people
yeah you have to be you know reasons why
you get up in the morning it can’t just
be solving problems it’s got to be yeah
something something great is gonna
happen in the future
yeah people want to be more like you and
therefore the fate of humankind I think
it would be great to have more Elon
Musk’s what do we need to do to become
more like Elon I don’t know if it’s I
there’s a friend of mine he’s got a
great saying about creating a company it
creating turnable the company and have
it succeed is like eating glass and
staring into the abyss so I mean what
tends happen is it’s sort of quite
exciting for the first several months of
starting a company and then then reality
sets in things don’t go as well as
planned customers aren’t signing up the
technology or the part isn’t working as
well as you thought and and then can
that consumers be compounded by a
recession and it can be very very
painful for several years frankly
starting a company you advise some
people to have a high pain tolerance do
you fear that maybe an in this
generation or the the younger generation
that they don’t have that perseverance
and grit to take on these really tough
challenges I think some people do and
fit but no I think it is definitely true
that I mean maybe there occasionally
companies that get created work where
there’s not an extended period of
extreme pain
but but I’m not aware of you know very
many of such instances so but I do think
that the the new great entrepreneurs are
born of every day
and will continue to see amazing
companies get built
yeah but I would definitely advise
people there’s not any company to expect
a long period of quite high difficulty
but let me slung is people stay super
focused on creating an absolute best
product or service that really delights
their end customer like if they stay
focused on that then it should basically
if you get it such that your customers
want you to succeed then then you
probably will all right you have to
focus on the customer delivering for
them yeah make sure if your customers
love you you will your odds of success
are dramatically higher I mean I think
this this there’s a lot of things I mean
I sort of I mean certainly you know
listen listen more to critical feedback
I mean like a lot of things I’ve learned
in college actually were pretty helpful
I mean the think the physics approach to
thinking is very good like the first
principles approach and you applied that
broadly yeah applying the first
principles person to thinking it is I
think a good way to figure out a
counterintuitive situations and you know
stuff that look that I was that was
really a helpful thing to learn whereas
there’s many things that need fixing in
the world and students here probably can
think of a long list many of which you
could probably imagine solutions to
using the physics first principle
approach but has there been any
framework or idea of you used to filter
out what you don’t do what you don’t
pursue I mean sort of follow that in
what it initially was you know I won’t
you go back to like college centers
working on energy storage technologies
for electric vehicles mm-hmm and that’s
what I was gonna pursue at Stanford
actually it was what work on like
advanced capacitors and batteries
improve the energy density for electric
vehicles and then the internet was kind
of happening it was today like the
internet was happening like back in 94
95 and and I wasn’t sure if what I
worked on in the PhD would actually be
useful hmm so I was like I was really
concerned that if I lying
timing or what was your intuition
meaning I think like okay could be
academically useful but not practically
useful like I thank you you could result
in a PhD and adding some leaf to the
tree of knowledge but then then
discovering that well it’s not really
gonna gonna matter
like that’s you know is it is it gonna
be a good enough thing to actually be
used in an electric vehicle I wasn’t
sure I mean so it was like I was
uncertain as to whether success was one
of the possible outcomes like I thought
maybe it was but I wasn’t sure and and
then I thought well if I watch the
internet get built while I’m doing this
that that that would be really
frustrating there’s a sense of that
eminent timing like that was the time
for the internet and maybe yeah other
stuff could wait or be on the back it
was it always there is like one day I’ll
get back to that or was it just that’s
what probably I’d get back to it and did
end up doing that but yeah I thought
sort of the the inner always was
happening it like really taking off all
the most people weren’t aware of it in
95 and and so I figured like electric
vehicle technology energy storage
technology will there’ll be some sort of
natural progression in that and I could
come back to it later but the internet
you know it was it was really that was
the moment to really do something
although in 95 it wasn’t obvious that
you could actually make any money on the
Internet this was like not nobody until
Netscape went public I think at the end
of 95 Edmund nobody even thought there
was like you could make a valuable
company on the Internet wasn’t obvious
as it seems now yet like now it seems
really obvious but back then it was not
at all and and then the internet it’s
also helpful because it’s anything to do
with software is a low capital endeavor
so I didn’t have any money
and just had a bunch of student debt but
but software you can just write like by
yourself
and you don’t need a lot of atoms like
you don’t need a lot of tooling and
equipment and so it’s like capital
intensive so the ability to start a
company if it’s software related and
it’s the first company is much much
easier and it seems obvious now but of
course the easier place to start and
then as you gain more of a personal
reputation and have more personal
capital as some Mary Ann I know SpaceX
was almost what was entirely funded by
Elon for its first period partially from
you know in an era when others probably
wouldn’t have funded it in those arrived
two days oh and actually I mean the
precursor to to SpaceX was not that the
idea wasn’t really to create a company
it was it was to try to figure out why
we hadn’t gone ten people to Mars okay
going from PayPal so the next thing I
was sort of thinking well is there some
way to reignite the dream of Apollo that
says you do you have a useful company so
you know in a high-growth scenario you
have a lot more inputs for for future
outputs so you have negative cash flow
and like a profitability and which we
currently have a Tesla but in the long
term of course that has to be that that
has to be fixed they can’t be negative
cash flow and long term and that there
needs to be a net positive output which
is sort of profits in the long term but
in the short term win this high growth
that that that doesn’t it isn’t the most
sensible thing when you have this thing
that every employee and customer knows
is the purpose of the company how do you
see that flowing through to benefits for
the company I think having a purpose
suddenly is going to attract the very
best talent in the world because if if
people can if there’s something that’s
intrinsically enjoyable and the branch
rewards are good but then also it’s
something that’s gonna genuinely change
the world and that’s I think that’s a
pretty powerful motivator and but I
don’t think you like everything needs to
change the world you know you know
honestly like there’s lots of like
useful things that people do and
I mean I think really it should be like
a usefulness optimization like just
sailing is what I’m doing as useful as
it could be
did you tell Matt the goal of an
organization or go in general yeah and
you know just even if something isn’t
changing the world if it’s making making
people’s lives better I think that’s
that’s great and you know if even if
some things like making only people
sighs only slightly better but it’s a
large number of people then kinda like
the area under the curve is it’s quite
good and that mathematical first
principle the point utility in numbers
like I mean like one can see like so
like is like some app really making
people’s lives better if it’s better but
if it’s affecting a lot of people even
in a small way then yeah that these sort
of area is good mmm it’s always really
tricky to predict the future all right
some of its pretty obvious like
computing power is gonna be just crazy
and the really the big change is the
cost of computing power hmm not so much
the sort of circuit density sort of the
Moore’s Law thing but if you if you look
at say what is the actual dollars per
instruction and and that that is draw it
I mean that that that cost is is
dropping exponentially are you think
about it like a connect you’re making a
computer just you’re rearranging silicon
and copper you know so one out on a
little chip and once the capital cost of
the development and the the chip plant
is paid for the accurate I mean the
marginal cost of a chip is very very
tiny so I think we’ll see massively
parallel computers and computing power
and storage being you know as really as
much as you want and it’s interesting I
to start with that like if I I don’t
know what else to predict but as a
foundation for sure this seems like the
safest starting you know premise but
then what does that ripple through to
and feels like genetics in AI which you
mentioned an autonomous driving
space related topics I mean just
ubiquitous computing everywhere like
like AI is gonna be incredibly
sophisticated in 20 years
hmm the when they first it like it seems
to be accelerating and that the tricky
thing about predicting things when
there’s an exponential is that an
exponential looks like looks linear
close up and and but it’s actually it’s
not linear so and AI appears to be
accelerating that’s what I can see for
that do you look at autonomous driving
and point a is like the Siri like
functionality as you have guideposts
well I have to debate about someone like
is AI accelerating or not and the like
you think well what’s the y-axis you
know if you’d if it’s accelerating your
T on the x axis but what’s what the y
axis is it well thought about that I
think you could have a recursive y axis
so that if at any point in time your
predictions for AI are coming sooner or
later that that actually would help to
find whether it’s accelerating or not
whatever that axis was so you mentioned
is immersive access like so if in any
given year if you if you find your
predictions are going further out or
coming for the ripple coming closer ran
that that actually you know it was one
way to think of acceleration because
like like it’s otherwise what’s the
what’s the quality ripple quantitative
measure mmm a I um EDI I can certainly
see that with with autonomous driving
you know three years ago I thought it
was ten years away mmm and at two years
ago I thought it was five years away now
I think it’s three years away or less
than three years away Wow
so any when you say away like like like
released to market available for a
consumer adoption because as opposed to
prototyping you know I mean like think
back the technology works there’s a sort
of second question as to when regulators
would approve it yeah yeah yeah yeah
but but like a look at that technology
works as a general solution so like
that’s fun was driving like Reyes
crossed it anywhere so it could be
sooner and for point things like highway
only or in hi only we’re already in
public beta with this Tesla so we’ll be
hopefully in the next several weeks
releasing to to all of the cars that
have the auto pod hardware which is all
cars booking like roughly the last 12
months and so for sure your Vickers
computing AI that’s beyond anything like
the public appreciates today I think
will have most of the new vehicles being
produced being electric and will be
probably have the super majority of
energy being produced being sustainable
so I think I think we’re on head of
solar primarily and you’re my really
Sola yeah I think that those are sort of
some good things like will be hopefully
on a good path for sustainable energy
sooner is always better but I think by
2035 I think will be substantially like
what most of transport most of new
energy being produced will be
sustainable broadband everywhere
broadband everywhere yeah and hopefully
a hopefully a small base on Mars so
spoil city on Mars in 20 years yeah well
ok fine town village Hamlet
and that’s exciting I mean that I could
get people fired up about the future
yeah I do
I agree exactly I mean for sure for sure
Mars and sustainable transporting like
those items I couldn’t think are really
they miss the same energy those are I
think really cool things I mean in terms
of getting excited about I mean it’s I
think we’ll probably start seeing like
Moore’s like truly sidewalk activity
like a human brain interval like like a
look range of your interfaces like that
there’s a long inside the AIS that are
purely yeah yeah I think so it’s the
only way we can relate to I think you
know never covers yeah and there are
amazing things happen like happening
these days like this they’ve been able
to figure out how to do an artificial
hippocampus in rats and monkeys and and
now they’re looking at at doing that to
solve severe epilepsy
about half of severe epilepsy cases
originating app so hippocampus and by
having sort of an artificially augmented
hair company of a campus they can
actually solve believe the severe
epilepsy cases other board members asked
maybe they cheering up kind of method
with some quoting Bill Gates or somebody
that said you know if you haven’t failed
and you’re not learning understand
that’s a paraphrase of the quotes and I
remember your reply and I have it
written as a quote because I want to put
it on a placard given the options I
prefer to learn from success a great
comeback and so I guess at least cure is
in general what do you think of the
Silicon Valley mantra fail fast fail
often or as Esther Dyson says always
make new mistakes as if failure is the
crucible of learning yet curious if you
had any further thoughts on that and
that maybe off-the-cuff comment you made
out there I mean there are there are
many that’s true I mean I think it’s
sort of there’s like some entropic basis
for this like there are many more ways
to fail than to succeed so you do have
to explore I mean particularly for a
rocket there’s like a thousand ways that
thing can fail in like one way it can
work so you could you could have a lot
of rocket failures to explore all the
ways in which you could fail a bit but I
do you think that one great thing about
smoking valley is failure is not a not a
big stigma so it’s like if you if you
try hard and it doesn’t work out that’s
okay
like you can
learn from that and you know do another
company and it’s not a big deal
I think that’s that’s really one of the
great things about Silicon Valley
interesting do you also I’m curious if
either on the well it seems to me that
on the system design side you can
accommodate a likely failure of sub
components and so much of the elegance
of let’s say a Falcon 9 or a falcon 9
heavy there’s an ultimate incarnation of
this vision of how the rocket should be
built to say hey parts will fail thing
but here’s how the system can succeed
and I’m curious if there’s any other
thoughts along that how to how to
accommodate anticipated failure and then
also maybe in a like in managerial II is
there ways that you motivate the team
either an advance of failure to coach
them on a this is going to happen or in
the aftermath of failure to get them
fired up to solve it and move forward
when it might be dark times and like for
example you know she’s like failure to
launch
you know exploding on the pad you know
there’s all these it’s a very visual
it’s public spectacle when you have a
setback in the rocket industry I’m
curious how you manage around failure I
mean it I think it’s it’s like quite
quite painful and difficult
honestly and it’s it feels terrible the
company’s sort of looking to you know me
to you know rally them and so I do yeah
alright honestly feel super bad like a
punch in the gut yeah yeah remembers
almost like a tight like the stages of
grief I remember it yeah I mean it’s
just I mean it’s particularly with
rockets it’s it’s just a really quiet
space is hard and rock is tend to fail
unfortunately and even when you’ve got
it like a lot of really smart people
working super hard to minimize the
probability of failure it’s still it’s
still there and it’s and it’s you know
it’s it’s quite significant people have
asked me like well why why Rockets you
know especially hard and and you know
part of it it’s like everything has to
work the first time like there’s there’s
no you can’t do a recall you can’t patch
it it’s got it’s like nine minutes to
orbit or it’s over and and then the that
you you know what you can’t you can
never test the rocket completely in the
environment that it’s actually going to
experience easy you can’t fully recreate
something that’s moving super fast in a
vacuum
on the surface of earth like you can
only really record recreate that on in
space so the limited the simulation
tools alright is that a limit of the
simulation tools today yeah absolutely
the if the if there’s any error between
the simulation and reality and there’s
always some amount of error then then
that that can result in a failure it’s a
really really tricky one it’s like in a
software analogy it would be like if you
have to write a whole bunch of software
modules and you can never run them
together
and you can run them on the target
computer like like when you’re testing
them you don’t have to test them
individually and not in the actual
computer that they’re gonna run on
gotcha then you put them put all the
modules together run it for the first
time in a completely different very
different computer and it has to run
with no bugs that is difficult these
software analogies to rocket design are
deep on the modular reuse there’s many
of these like those who are in familiar
with it’s not like this is an aerospace
engineer by traditional training coming
but but is in fact radically changing
industry I think applying ACS
perspective to industry after industry
I’m like how would how would you know a
computer scientist or a physicist
approach the problem which often times
the solution very unlike the industry
incumbents there’s there’s a certain
elegance to it at least from the outside
what do you look for in design and
related if you’d like what do you look
for in art design might be more
immediately relevant I mean you you you
want to make something beautiful you
want to trigger whatever whatever
fundamental aesthetic algorithms are
like it in your brain you have I think
some intrinsic elements that that
represent beauty and and that that
trigger the emotion of appreciation of
beauty in in your in your mind and I
think that these are these are actually
relatively consistent among people I
mean not completely some people like not
everyone likes the same thing but there
are there’s a lot of commonality and and
and there yeah and they’re there but but
I think it is important to combine
aesthetic design with functionality I
could say like what was really hard
about say the Model S or the model acts
was to combine aesthetics and utility so
to balance the two you can make a car
look very good by giving it sort of
certain proportions like you’re making
it sort of low and slim and and if you
if you do that the utility is
significantly affected so the big
challenge with the set of Model S was
sharp regarding how do we get five
adults plus two kids gonna have a
seven-seater the big challenge with the
like with with es was having a car that
had a high utility and looked good and
the same with the X so like it like with
the to make a sports car look good is
relatively easy but to make a sedan look
good or an S you look good is because
quite difficult and I think another
principle is you want to have it feel
bigger on the inside then it looks on
the outside mm-hmm
and that that’s also a really hard thing
to do and then you really pay attention
to the little details the that the
nuances of design and shape and form
function and the way it looks in
different lights and when something’s
off the little thing how do you
experience that never drives me bananas
yeah I mean it’s and it the problem is
like if you you can train yourself to to
pay attention to the tiny details I
think almost anyone can although it this
is a very much double-edged sword
because then you see although it’ll
become and then little things drive you
crazy
so but like most people don’t they don’t
see they don’t consciously see the small
details but they they do subconsciously
see them like you do sort of your mind
takes in a gestalt of the overall you
know the overall impression mm-hmm and
and you you know if something is
appealing or not even though you may not
be able to point out exactly why hmm
and it’s it’s the summation of these
many small details so most of us
experience that as a oh I think that’s
ugly or I think that’s beautiful or like
wow
elegant but ya can’t break it down you
mentioned something in passing like you
can train yourself in this though yeah
you can train yourself I think you can
make yourself pay attention to to why
you’re essentially bring the
subconscious awareness into conscious
awareness I wish I could do that how do
you do that just just pay really close
attention almost like a meditation on my
object I’ve been trying to find the
details like why do I not like this is
that what yeah just look look closely
and carefully mm-hmm
and therefore any given object it’s but
it’s geometry as if there’s always something wrong somewhere all the time
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