Taking Your Startup Public with Thomas Healy

0:28Boom! Shake the room, Fire Nation. We'll talk about the startup journey, Forbes 30 under 30, youngest billionaire, challenges, struggles, and oh, so much more. And a big thank you for sponsoring our episode goes to Thomas and our sponsors. Over 41 ,000 businesses have future-proofed their business with NetSuite by Oracle, the number one cloud ERP, bringing accounting, financial management, inventory, and HR into one platform. Download the CFO's Guide to AI and Machine Learning for free at netsuite.com slash fire. Thomas, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.

1:11I think a lot of people think what drives entrepreneurs is the financial opportunity of where the company is heading. I disagree with that. I think if you're going after one of these more risky startups where you're really going out to change the world, make a difference in society, I think for that entrepreneur, there needs to be something different that drives you. I know for me, it's more about changing the world, creating a hopefully multi-generational company, something that can have a positive impact on society, on climate change. That's really the driver versus I think a lot of people think it's monetary driven.

1:47And I don't think that's the case for many of the entrepreneurs out there. I love that. And Fire Nation, we're going to be going through the process of taking your startup public. And you do have quite the startup journey, Thomas. I mean, you went from the dorm room to IPO. I want to hear that story. It's been a journey. I started this while I was in grad school at Carnegie Mellon and ended up dropping out to go pursue this full time. And to give you a sense of what the early days were like, I truly founded this out of my dorm room out of my apartment in Pittsburgh to the point where we had, you know, early employees in the company and we're running this out of my apartment.

2:26And, you know, when people would show up in the morning to come to work, they would text me and say, hey, I'm here. And of course, you know, you need a badge flight to get into the apartment. And so I would open my window, which was facing the street. I'd take my key fob, throw it out the window down four stories and they would catch it and then go in the building, come upstairs, and that would be the beginning of a day of work at Hylion in the very early days. And, you know, fast forward to 2020, it became a journey of getting to ring the opening bell at the New York Stock Exchange, going public, and, you know, a pretty surreal moment where I remember it like it was yesterday.

3:05You're going up the back stairs, going up to the platform of ringing the bell, and there are thousands and thousands of signatures on the wall of people who have been there before you to go sign or to go ring the bell. And they hand you a pen, you get to sign the wall. And then seconds later, the back of the platform opens up and you get to walk onto the stage of the opening bell of the New York Stock Exchange and get your 10 seconds of glory of opening the exchange. Well, that is fantastic, man. Thank you for sharing the story. Because so many people have that early stage of their startup. And sometimes, you know, we don't revisit that enough because there is magic there and we just can't let that go.

3:47Now, Forbes 30 under 30, youngest billionaire. I mean, these are incredible words to hear. Tell us more about these accolades. It's been a fun journey. It's been an amazing journey along the way. And, you know, it's obviously a wonderful accomplishment to get those. It also helps the trajectory of the company, right? when you can talk to people about having become a Forbes 30 under 30. I usually don't tell people this one, but I did get the accolade of the youngest self-made billionaire. I took it from Kylie Jenner, of all people. She was the 2019 youngest self-made billionaire. I think there was some controversy around hers, whether it was true or not.

4:28But then in 2020, when we were going through that going public process, We had a great run up in our stock. And through that, we got to about a close to about around a$10 billion market cap. And then due to my ownership in the company, that projected me into or projected me into becoming a billionaire, at least on paper. Right. I think that's one of the things that maybe often goes overlooked is, you know, yes, you own the stock in the company that on paper says it is worth a billion dollars, which is awesome. But at the end of the day, that ownership is still in the stock of the company. So it's just a step along the journey.

5:12There's still so much more to go accomplish. And as we're going to talk about here today, it can also change, right? We went through massive evolution since that time and have had to kind of reshape what the company is. Now, it's been fascinating to trace some of the journeys of CEOs. To your point, one of my favorite CEOs of all time is Michael Saylor of MicroStrategy. I just love what this company has been doing the past four years. But they were founded back in 1989. And then in early 2000, because of the dot-com bubble, went up to$345 per share. Billionaire a year later,$0.45 per share. Not a billionaire anymore.

5:53So it's pretty crazy to see how that can really change your fortunes pretty quickly. And then 2020 made a huge shift in the last four years. His stock is up more than any other stock in the world. He's had a complete resurgence, but it's literally been since 1989 working his little booty off. And speaking of challenges, you've had challenges, Thomas. I mean, you struggled, obstacles, challenges. Give us the top one or two that you faced and specifically the lessons you learned from them. When I founded this company in 2015, we were focused on producing electric semi-trucks. And that's what we went public on.

6:29That's what we raised, you know, the funds that we brought in, hundreds of millions of dollars when going public. That's what got us that$10 billion valuation. And today, we've actually exited that space. We've pivoted. So, you know, to walk you through that trajectory a little, we were part of that hype, the massive tailwind of electric. vehicles. Everyone thought that, you know, it was going to change instantly. You know, semi trucks were going to become electric overnight. And and then when when push came to shove, it all just took longer. It was costing more. There were less mandates that were put in place that everyone thought were going to be there.

7:07And so what we ultimately did is we said, look, why don't we pivot out of this space and pivot into a different sector that we were already in, which was power generation, we have a very unique generator that can produce on-site power. So think of like a micro power plant that sits outside your facility, powers an EV charging site, powers a data center, powers a hotel or hospital. And that's now the focus of the company. And so, you know, to make this change, just to walk you through it a little bit, I mean, we We had to do about a 70 % reduction in workforce. We completely shifted our burn rate and financial spend, reduced it by about two thirds and put this company on a totally new trajectory.

7:52That was one of the most difficult times through the company's evolution for twofold. One is you think about kind of the impact that you're having on so many people's lives and what's going on. I mean, that's extremely challenging as an entrepreneur. But then the second is you're making this bold bet that this new journey you're going down is going to be better than the last one. Now, thankfully, as time has gone on and we fast forward, many of our peers, the competitors we had in that electric vehicle space have gone bankrupt, are facing bankruptcy, are desperately trying to raise cash. It's a bad situation for many of them.

8:28So in hindsight, it was fantastic that we got out of that space and are in a new area of opportunity where, as I'm sure you're seeing, PowerGen is what everyone's talking about, especially with this AI gold rush that's going on. It's so true. And Fire Nation, I really hope that you're taking a step back to just learn from the obstacles and the challenges of individuals like Thomas here, who's been through the meat grinder, who's been there, who's done that, and who's come out the other side, still swinging, still figuring things out as he continues to drive forward. And we have a lot more to talk about around this topic when we get back from thanking our sponsors.

9:05It would be really nice if we could predict what the future holds for our business. Talk about saving a lot of time and frustration, but predictions are just that, predictions. Rates will rise or fall, inflation's up or down. Can someone please invent a crystal ball? Until we can actually see into the future over 41 ,000 businesses have future-proofed their business with NetSuite by Oracle, the number one cloud ERP, bringing accounting, financial management, inventory, and HR into one fluid platform. NetSuite gives you one source of truth, so you can have the visibility and control you need to make quick decisions.

9:39And with real-time insights and forecasting, you can see into the future with actionable data. If our businesses needed this type of software, I'd use NetSuite in a heartbeat, because whether your company is earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities. Speaking of opportunity, download the CFO's Guide to AI and Machine Learning at netsuite.com slash fire. The guide is free to you at netsuite.com slash fire. netsuite.com slash fire. Thomas, we're back. And over your journey, over your career thus far, you've weathered some pretty intense industry-specific curveballs.

10:18Tell us that story. Yeah, so I think from a CEO, perspective of going through this journey. It's been this consistent evolution of being the company's number one problem solver. And so in the early days of the company, when you've got five guys and a dog kind of a situation around the table trying to do things, you're wearing all hats. You're the technician out building wiring harnesses to working on engineering to also being the front with investors. As time goes on, your role evolves, but the one thing that doesn't is you're still the number one problem solver at the end of the day. And, you know, I think there's an Elon Musk expression out there of like starting a company is like chewing glass and staring into the abyss, right?

11:06There's a lot of truth to that. It's, you know, you're the person that is going to be faced with what is the biggest problem that others aren't able to solve. And that's your, your role day in and day out is to go figure out how to solve that problem. So maybe you're not the person out building wiring harnesses anymore, but you're the person that is trying to find that top talent. You're the person that is trying to get investors excited and motivated about what's going on. And so your role definitely evolves, but at the end of the day, you're still that problem solver. Give us the specific instance where you were thrown a curve ball within your industry, that you really had to go back to the drawing board and say, man, we've got to figure this out because if we don't, it's game over.

11:47It is definitely our dilemma of 2023, where we had spent hundreds of millions of dollars building this awesome, frankly, electric semi truck, this powertrain, and to make an electric vehicle, make 80 ,000 pound vehicle that goes down the highway, move it over to being electric as opposed to using diesel. And we had units out in the field that we were running with our drivers, they were working. And we just saw that the industry was moving away from us. We saw that fleets that were saying a few years back, they would take units in the dozens, hundreds. They were now saying, well, maybe I'll adopt one or two of them to try it, to then see how it works.

12:28And maybe I'll buy more once regulations really forced me to. And think about that being in this situation where it's like you've invested many, many years, so much investment dollars into building the solution. And it is right there. It is ready for prime time. Engineering-wise, it's ready for prime time. But now the market is moving away from you. And we had two options. We could have either kept pushing forward and hoped that the public markets would have changed, that momentum in electric vehicles would have come back, or we could have exited that space and gone in a new direction. I think a lot of times companies fall into this trap of the easiest thing to do is to just keep doing what you've been doing That might be the most risky though And that's what we saw and that's why we pivoted out of that space went into power generation Have seen a positive shift in the stock price momentum Maybe not as quite as strong yet as the company you were mentioning earlier, but obviously That's our goal.

13:29We think this is an awesome industry awesome technology and there's so much for us to go accomplish. But if we hadn't made that tough choice of pivoting out of electric vehicles, I think there's a high probability we would have been in the same position as many of our past competitors, which is, you know, unfortunately, they're going bankrupt right now. And that's one of people's biggest frustrations with government is their inability to change, at least their inability to change with any kind of speed or alacrity. It just doesn't happen. It's so slow. Yes, we get the checks and balances, and that's important on some levels.

14:05But at the end of the day, this world is moving fast. You have to move fast. You have to adjust to what's happening in this world. I mean, man, a lot of people have seen the headlines with what happened with Deep Seek and how that just caused trillions of dollars of valuations to be flushed out the window in 15 minutes. And some of that flows back as an overreaction. But it's just such a fast-moving world. And that's why when you are an entrepreneur, keeping your finger on the pulse, you can adjust, you can pivot. And speaking of pivots, you made a company pivot from the powertrain to power gen.

14:38Share that transition with us and what it actually meant. Yeah. So the transition, I mean, maybe to get to the execution of it, it was unfortunately a reduction about 70 % of workforce. It was changing our spend from about 150 million a year to 50 million a year, bringing in new talent that knows this power generation space. And it just, frankly, a complete evolution of the company. But, you know, it was it was done in a strategic way. Right. So when we think back to it, we were in a position where we were starting the year with about 300 million of cash in our balance sheet. And so we were financially in a strong space.

15:19We knew we have an awesome technology in this power generation. And so it was that decision of let's go all in on this. Let's put our eggs in the basket of, we think the market is moving towards needing more power. You've got this boom going on in AI that I think everyone had for years been underestimating just how much power was going to be needed. We're now seeing that start to come to fruition that people are saying, hey, we need these massive, massive data centers in order to solve the AI problems that are ahead of us. And so that was the evolution, the shift. Now to your other part of this about, you know, it's there are experts in the space, right?

16:04Like, let's take Sam Allman, an expert in the space. And you mentioned DeepSeek. I think there's a quote out there, a video out there of Sam Allman saying like, oh, you couldn't take a startup that has, you know, a few number of people, tens of millions of dollars and come compete with open AI. It's impossible. You might as well give up now. I'm paraphrasing, but that was effectively the gist of it. And DeepSeek, from what I've heard, has gone and done that, right? They've created this model that can compete with much, much larger organizations with a lot more dollars in it. And so I think that's the beauty of startups is you can come in and shake things up, right?

16:44You think about things in a different way. You're moving at a different pace. You've got brilliant people sitting around the table. That's probably one of the biggest things is what the team that you create. And you can go do those things that people thought would be impossible, that would never be able to happen. That's powerful. Fire Nation, take notes on somebody who's been through the ringer and come out to the other side. And speaking of which, because of that, you, Thomas, have some pretty awesome entrepreneurial advice. We could sit here all day and talk about it because you've, again, been there, done that.

17:16You figured things out. You struggled, obstacles, challenges. But I just want the top. the number one piece of entrepreneurial advice that you can give our audience today? Number one advice is you just have to get started. It comes down to that. So many people get into analysis paralysis and, hey, I have this idea. Let me try to map out the whole trajectory of where this company will be in the next 20 years. And the reality is you can't do that. I mean, you can't predict what's going to happen tomorrow, right? We were talking about DeepSeek. The whole market shifted overnight because of this startup that is using way less power, way less compute to get the same end result.

17:57Allegedly. Good point. I have not been there to fact check it. But, you know, no, that's the exciting thing. Or that's the advice there is like you just have to get started because until you get into the thick of it, until you become an expert in a space, you can't map out that trajectory. And even once you are an expert, you don't know what's going to happen tomorrow. And so the best thing to do is start on the journey you're on. We started in electric semi trucks, and now we're a company focused on power generation. But it all comes down to we did start. There were those days of being in the dorm room, throwing the key out the window to people, you know, coming up to my apartment and working for a day.

18:38and you figure it out as you go and you make nimble decisions on the fly about what's the best trajectory to take the company in. And hopefully you get to that point of getting to go ring that opening bell at the New York Stock Exchange and taking your company public. And in a lot of ways, that's just a small step along this evolution of creating an awesome company. What a story, what a journey. And I mean, as you can hear Fire Nation, Thomas still has the energy and the excitement. So there is more to come, much more to come. So if Fire Nation is listening, Thomas, and they really want to connect with you or your company, what is your call to action for our listeners today?

19:22Go to hylion.com, H-Y-L-I-I-O-N. You can learn all about the technology there. You can reach out to us there as well and be a part of this journey. You can also go buy stock. It is a public company. So H-Y-L-N listed on the New York Stock Exchange. Up 6 % today. Let's go. It's a good day in the market, but a lot more to go do ahead of us here. Very cool. And just to kind of be clear for Fire Nation, this like, well, like, I'm interested, but like, what am I learning if I go to this website? Like, who does this call to action make sense for? Like, what should Fire Nation be looking to do or to accomplish with this?

19:58From a company standpoint, our focus is obviously to bring people in who want to be a part of this journey with us. So there's multiple ways to do that. We are actively hiring, right? That's one area. You can go find that on our website. We are always looking to bring in new investors, new people to be a part of this journey. And that goes both from like the large institutional investors to we've got an awesome following of retail investors as well. There's another channel out there. It's Discord. I'm sure a lot of your listeners are probably on there. There is a Hylian channel on Discord run by an awesome group of retail investors who are following us all the time, daily.

20:40It's amazing, actually, to see how much happens in that Discord channel. And they're being a part of this journey with us. They're seeing how this market's evolving, how we're bringing these solutions forward. And so there's actually a lot that your listeners can go participate in. Big time. And just to kind of really reiterate the point and bring it home, in just one sentence, what is your company's mission? We are disrupting power generation, enabling the concept of on-site power to run data centers, EV chargers, and bring us to a cleaner and hopefully more economical future as well. Brother, come down to Puerto Rico.

21:20We need you desperately, desperately. And Fire Nation, you're the average. of the five people you spend the most time with. You've been hanging out with TH and JLD today, so keep up the heat. And for links to everything we talked about, visit eofire.com, type Thomas in the search bar, and the show notes page will pop right up. And Thomas, thank you for sharing your truth, your knowledge, your value with Fire Nation. For that, we salute you and we'll catch you on the flip side. Thanks for having me on. Hey, Fire Nation, a huge thank you to our sponsors and Thomas for sponsoring today's episode.

21:50And Fire Nation, what can 4 ,000 of the world's most successful entrepreneurs teach you? How about how to achieve financial freedom and fulfillment? My first traditionally published book, The Common Path to Uncommon Success, is a revolutionary 17-step roadmap that will lead you to the lifestyle you've been dreaming about. This book took me 10 years of accumulating the genius of the world's top entrepreneurs. And you can get it all in one place when you visit UncommonSuccessBook.com. I'll catch you there or on the flip side. Over 41 ,000 businesses have future-proofed their business with NetSuite by Oracle, the number one cloud ERP, bringing accounting, financial management, inventory, and HR into one platform.

22:31Download the CFO's guide to AI and machine learning for free at netsuite.com.