This $3B Founder Is The Next Elon Musk

0:28You're like the whole milk version of an Elon Musk. have a really interesting guest. His name is Brett Adcock. I've talked about him on the pod a bunch of times. But let me explain why this guy's interesting. So he started a recruiting website that he sold for$100 million, which in most everyone's case, that's a massive home run. You're incredibly successful, which he is. But then he parlayed that and invested pretty much 100 % of his money into another company called Archer, which basically makes like unmanned helicopters. And then that went public at like a$1.5 billion valuation. And he started another company called Figure which is making humanoids.

1:06They're basically robots that can work warehouses and do human labor. The reason I wanted Brett to come on is because I just wanted to think and learn about how someone who's so unique, how they think and how they make decisions. And so Brett's really subtle. He's a low-key guy. He's not crazy high energy. He's not one of these guys who we have on who is a personality where they have a big personality on YouTube or Twitter or anything like that. He's subtle, man. The guy's humble and he's quiet. And I find that to be incredibly fascinating. My opinion, in 10 years, Brett is going to be in the running of however we think of these Howard Hughes, Elon Musk types of crazy folks who build these amazing world-changing things.

1:50Brett's going to be that. I mean, he's already up there, but I think he's going to be like that. and no one knows who he is now, or at least compared to some of those other folks. So what I want you to do is listen to this episode, particularly the last 15 minutes when we talk about his latest company. It's really fascinating. And I want you to tweet at me. My handle is TheSamPar, P-A-R-R. So the word the and then Sam and then Par. Tweet at me and let me know what you think about this guy and what makes people like him special. Because I'm really fascinating with these types of personalities. And I'm fascinating with how people can learn so much information so quickly.

2:25It's just really fascinating to me. So let me know. Give it a listen. His name is Brent Adcock. Let's start the show. All right, dude, let's just get right into it. The reason you're interesting to me is because you're incredibly successful. I imagine you're worth hundreds of millions of dollars. But you go all in on stuff. So you told me with this new company figure, you financed it for the first year and you put up most all of your money into it. I was like, what's your asset allocation for your personal portfolio? And you're like, well, I own Archer stock, which I took public. I own a house.

3:00And then I put some huge amount of money, which if you want, you could say into my company figure and I'm going all in on them. And I just go hard. I go all in. Is that right? Yeah, this has really been out of necessity. My career, when I started Bettery, I couldn't get anybody to invest in the business for the first almost three years. So I basically put all my savings into the company, took no salary for three or four years. How much savings did you have? You're 25. I think I had close to$200 ,000 I put into the business. And then I didn't take any salary for three years. that meant like had to pay for my own health care, food, rent.

3:44I was living in Manhattan. It was really expensive. In 2015, things got so bad that I had to borrow, I think it was$50 ,000 to pay for rent and survive. I had like credit card debt. I was, yeah, I was probably in the red, like negative$100 ,000 prior to the acquisition of Vetteri. Well, what did Vetteri exit for? $110 million. So that was a, that was a windfall, right? Yeah, that was great. I raised like a little over$10 million over like seven years. So had a large, you know, percentage ownership of the company. So, but yeah, overnight success from going from, you know, seven years of agony and debt to like having capital for the first time in a significant way.

4:32And then did you, I don't know if you're telling me these stories, like when you're, if you're goofing around or not, but you said that you put most all of your money into Archer, right? Yeah. So I started Archer in 2018, so called Archer Aviation. And we build electric vertical takeoff and landing aircraft. So these are basically aircraft, somewhat similar to a helicopter, but they're purely electric. And the goal is to use the aircraft to move people around cities. So the traffic's just like such a terrible phenomenon. nobody's really worked on traffic for a hundred years. So we were basically out there.

5:10I was out there trying to solve the traffic problem and kind of help, help the sustainability. The pitch coming out of veterinary was just, it was bad. Like it was, Hey, we, we need basically probably about a billion dollars, maybe more to get the market or we, or we don't make it. We're designing this new type of transportation system in the air. So instead of driving to the airport, you would fly. and it needs to be fully electric that nobody in history had ever certified an electric aircraft before. And I was coming off of software, you know, 10 years, 15 years of software. So that pitch did not really resonate too well in 2018.

5:50You're like, we made a joke in the last pod where I'm like, if you drink a glass of milk with dinner, you're my type of guy. Like people were making fun of me from being from Midwest. You're like the whole milk version of an Elon Musk. You know what I mean? You're the Midwest version of an Elon Musk. But what the hell did you know about... I mean, software is easy in a sense. It's just code, right? No one's going to die if you screw it up. Or in most cases, no one's going to die. And if I talk to a guy who's doing computer engineering or computer science, I'm like, what the hell do you know about building a fucking airplane?

6:26You know what I mean? Did you know anything about that? No, I did not. I knew nothing. I just like I really wanted to do it. That doesn't make sense to me. Yeah. What do you do? That doesn't make sense to me. Like if I wanted to go learn about how an airplane is built, I guess I would like or a unmanned drone. I don't know what you want to call it. I would go I guess I would. Well, first of all, you have to have a high IQ to begin with, which I don't. But I would like what I what would I do? I guess I would call people who know what they're talking about and ask them what books do you read and then i would go and read the books and take lessons maybe i would go to like a college a few college courses i don't like it just seems like an impossible thing to learn and you learned it in how many years so yeah so here's what i did i um one is i spent a tremendous amount of time after vetery figuring out what i wanted to work on next i kind of fell into the recruiting marketplace space with vetery and I really wanted to be very thoughtful about what I wanted to work on.

7:24So I basically spent a large amount of time figuring out, okay, what is the right opportunity I want to spend my time on? And it was Archer. It was very clear to me I wanted to do the Archer aviation and build it. So the first thing I did is I basically built a spreadsheet and I called everybody I could think of in the world. So I think I made, I think that spreadsheet is about 300 people I connected with, whether they're at NASA or professors or working in industry at rotorcraft or airplanes. or turbofan development, whatever it would look like. And I just immersed myself and I wanted to know every technical book that was on the market.

7:58I wanted to understand how to build electric aircraft, like what are the components and what are the physics governed by in the space? And I probably spent almost six months in a room just making phone calls, like cold calling everybody in the world. What's that call look like? Hey, Mr. Conway, my name's Brett. Can you talk to me about helicopters? It's crazy, man. And like people, people will pick up the phone for you. Like, it's just like, you just got to pick up the phone and call and people will talk to you. People want to, people want to help. What was the most like breathtaking call you had or meaningful call you had?

8:32I did a, I did a meeting. So I, I, I, in addition to calling everybody in the world, the, the parallel track was I was going back to school. So I went back and like learned how to do like mechanical and aerospace engineering. and you know leading up to that i went to an event in 2018 i think it was 2018 it's like early 2018 at this point it was at this hyatt like like basically hyatt hotel in atlanta was hosting this like electric um aircraft design course so it was a lot of aerodynamics folks and uh folks in the industry that really wanted to understand the physics around electric aircraft i went down there and I basically sat for two days being lectured on how to build an aircraft, electric aircraft from scratch, how to think about the propulsion, aerodynamics, batteries.

9:23And it was just like all my heroes today, electric aviation. And one of the guys there was in his PhD at the University of Florida and said, like, me too, I'm doing my PhD in electric aviation. And I want to build a VTOL aircraft. And I go to the University of Florida. And I said, wow, I went to I went to undergrad at University of Florida as well. He's like, you need to come by ASAP and see our lab. I'm trying to build electric aircraft in a smaller scale, and we can help you. So I did this course. I got on a plane. I went down to Gainesville, and I met the head of the group there. And he's basically the head of all mechanical and aerospace engineering at the University of Florida.

10:02And he had this basically 12-person lab building these hobby-grade electric aircraft drones. And I said, I want to take this lab over and I want to just build electric aircraft. And this lab happened to be off of Archer Road. So I called the business Archer Aviation. What percentage of the Vetteri windfall did you put into this education portion as well as starting Archer? Oh, like all of it. Yeah, all of it. But what does that actually mean? Like, how are you living? Well, I was living off the cash. So I had just from Vetteri, just like paying my bills. I took no salary at Archer for two years.

10:42I don't know. Something like that. Like just a zero, like cover insurance type thing. And, you know, I made like, I went from like having nothing to like having tens of millions of dollars after tax. So it was, you know, it was a lot of money. I just didn't need, I didn't need almost any of it. So I wanted to work on this new thing and nobody would like, I couldn't even get meetings. at one point a guy introduced like a the guy that runs like general catalyst joel and um he called my pitch disrespectful what do you say he was like it was like mid it was like right when covet hit and uh i got a big introduction from him uh from like one of my investors mark laurie introduced me to joel he's like this is the best guy you got you got to talk to him and i got on call joel and he's just like i got to stop you right here man this is the most disrespectful pitch I've ever seen.

11:37We have people dying because of COVID. It's like the hospitals are filled up and you're asking me for money? Like for like, for this like flying car idea? Like, what are you talking about? It's just not possible. Like, why would you be doing this? And I said, like, I'm running out of money personally. Like I need somebody to fund this or we're also like, no, I know, I know COVID's bad, but the business is going to die. And this what you do you fund companies like this is why i'm calling you like this is um and yeah i would say probably to stay the worst phone call i've ever taken so i sold my company three years ago and i had the same thing where i like i didn't i was i was just barely getting by and then overnight things changed and i was like i'm gonna spend six or twelve months just like seeking planning i'm gonna figure out what because i don't i don't know if you took time off but i took like three months of normal 20 or 40 hour work weeks and low stress.

12:34And I was like, all right, cool. That's what I needed. I felt recharged. I need to get back to it. Except when I went back to it, I was like, have you heard of Ikigai? It's like this Japanese concept where there's like four rings that overlap. And one of the rings is like, what does the world want to pay for? The other ring is, what does the world want? The other one is what do I enjoy doing? And then what am I great at? And like, ideally, you find something right in the middle. Because if you find something that you're great at, that you have skills that but the world doesn't want to pay for it, that's just like an expensive hobby.

13:10If you find something the world wants, and they're willing to pay for and you're good at, but you hate it, that's just like a crappy job. So like, you want to find something right in the middle. So I was like, what am I skill that and basically, I thought of it like, I'm just gonna use my skills and what do I enjoy? And I'm just going to try and do something slightly better. And I think that's the pretty rational way to go about doing things like most people are, they're like, I don't want to do too hard to outside of my realm. What interests me about you is like, you're kind of an alien, like you like, we're like, all right, the software thing, this veteran thing, it worked.

13:45I don't know if it worked as good or as you wanted it to or not. I don't know the full story. But you just like took a total 180. and you're like, screw the 15 years of internet experience that I'm doing. I'm going to do aviation hardware. I'm going to do a totally different thing. What do you think is unique about you that makes it so you don't actually want to go the easy route? Because I know at Vetteri, I think you built the email marketing software. That's a very narrow niche. And you did something not even within it within that niche not even related to it and you took the totally different route what do you think is inside of you that makes you do that because i find that fascinating i think at the end of the day i just want to want to wake up with like a amazing future that's exciting and inspiring are you motivated by money not really no um i think if i wanted to make a lot of money i'm probably in the wrong field you know i think like the like there's like a risk reward balance in startups like i think if if it was just about money i think i'd be basically probably back in software still i think going and doing these projects i'm working on now are just probably the probably the surest path to losing everything when you're starting figure um like you know you read about elon musk and he's like well i put everything in he's like i was sleeping on couches and it's like well the couch was like sergey bren you know it was like his couch which probably isn't like a normal couch you know it's probably the couch in the living room of the guest house and you just don't want to go use the king-size bed but like when you're starting figure are you ever worried about running out of money and losing everything that you've earned i basically almost went um personally bankrupt last year the figure what what yeah tell me that yeah so when i left archer i had basically you know all my asset all my money tied up into archer like just had like and you you can't sell that as an officer right yeah or as like insider yeah we were like you know i i made it pretty uh clear when i started the business and even when i went public that like me as the like i as a founder and ceo i'm not selling stock we're pre-revenue i told the board this i told all of our investors this i even put a million dollars in the SPAC pipe as we went public at$10.

16:09And so personally, I was like, I'll put another million dollars in here at$3 billion valuation to show you guys. That's all I got. And when I left Archer in April of 2022, I had 12-month stock lockup. This is public. There's an SEC document for this. And so I couldn't sell. majority of all my stock was fully locked up until April of this year. So I had some percentage I could sell over, over some time series. I could sell a certain amount of stock limited by certain volumes of the market cap. So there wasn't just that much volumes a year ago. So I was selling some stock to fund figure and the stock went from like, when I left the stock was at five or six bucks.

16:55It went to like a dollar 80 end of last year, earlier this year. and I was just like I don't know if I can get to I don't know if I can get to 12 month mark which was that 12 month mark was April of 2023 that's like April you know April 18th 2023 promised land like I can sell a limited stock no volume restriction all stock lock up which which I'm you know I have a bunch of stocks still here I'm not selling right now but like um but that was the point where i needed to get to and i thought you know i was underwriting seeing that stocks at three four five six seven dollars like no problem i'll be able to get there and we were building a team teams out like was that you know 40 or something like that we're building we're spending like millions on hardware bigger was that 40 yeah we were like we were within six months we were at seven figure a month burn half figure and i was just like it was like sell stock transfer to bank account uh transfer it into the company pay payroll it was like how fast can we get that done and it was like a full system of like trying to get the like not hitting the limits every day on stock selling uh getting the cash into the bank account and putting money into figure and um and i wasn't you know this was like there was a recession we were in the banks were going bankrupt it wasn't like it was a pretty market for series a or capital raising it was the worst market since we've been in since the financial crisis uh from a from a fundraising perspective i had a stock like stocks going down like 75 and i was just like i'm running out of cash so i'm in my same i'm in my hampton group and i'm like everybody's like what's your you know more some most important thing you're doing right now it's you know talk about i'm like i'm running out of money i'm like might not make it what did they say what was their feedback i i think they were i thought i think they thought i was a maniac i think everyone thinks you're a maniac i mean like i've talked to a lot of people who know you that's what fascinates me about you but what fascinates me about you is that your hand you handle stress differently like i i've toured your factory and you were like smiling and like jumping around like you uh like it seems like you're like jolly almost i don't know you're showing me the shit i remember going to your factory or your office and you're like check this out we got the knee working and like you see like a knee or ankle I don't know what it was like you see some something of the robot and you and there was like 18 or 10 people just sitting around and it felt like I was hanging out with like buddies in a garage like just watching you guys finally figure out how to work like a remote control car or something like ridiculous and it seemed exciting though like I remember being there and I met like I have to be part of this and it was exciting but I didn't I know that you go all in on things I didn't realize how close you were to running out of money like I don't understand how you deal with that like what's your wife saying when you're like hey we might file for bankruptcy personally in the next couple months yeah I think it's even worse like we I had a second mortgage on my house to go through it no way what did she say yeah so I also in the category of like you know people thinking I'm a maniac my wife she's been with me for 15 years now through all of this like we lived in you know thousand dollar a month apartment in New York we had to downsize to to get through the veterinary stuff um to you know to now Archer and figure um she's great like she's she's a warrior she like believes in me and she has total faith in what we're doing and I don't take these things lightly like I really these are like planned exercises I need to go through um and i've been been through many near-death experiences i mean archer like like what i went through a figure was probably like a tip of the iceberg to what i went through at archer last like five years like archer was just uh you know a going public was just like a recipe to get sued and we were going public to the spack process we you know as soon as we priced the SPAC deal, the market turned on SPACs.

21:05It was, it was just a roller coaster. Um, so yeah, I just, I've been through many exercises like this before, and I think I can weather them pretty well now. I don't know anything about like business finances. I remember when we started our company, I didn't know the difference between cashflow and revenue, which was like a pretty big deal. You need to know that. I didn't know what that was until like three years into the company. And I was like, I thought cashflow and revenue were the same thing. I don't understand how to read a balance sheet. I don't know how to do any of that. So I'm taking classes right now to figure that out.

21:35And I was googling stuff. And I found this website. It's called streetofwalls.com. So I went to Street of Walls. And there's these amazing articles where you click start training. And there's like, it looks like a book. So if you're on your computer, go to streetofwalls.com. So there's like introduction, there's like, what does an investment bank do? There's like, How do you do a discounted cash flow analysis? There's all this stuff. And I scroll to the bottom. And I always click the About page. And there's a link that says, File this site and author on Twitter. And I clicked the Twitter. And it was you.

22:11You wrote me. You made this website. And I was like, texting. This is pretty funny. I was texting you ahead of time. I go, Hey, I know you took a company public. I don't know anything about finances. How did you learn how to do it? And you're like, Oh, I actually taught myself how to do it. And then I did most of the preparation work for the IPO. And I was like, that's amazing. And you didn't even tell me you had this site where it was like a whole site of your learning and education. What was the site? What is streetofwalls.com? Yeah, so when I went to college, I enrolled in industrial and system engineering, also finance.

22:45This is not something I also talk about a lot, but I basically did a few years in finance after school before doing the startup life. Why don't you talk about that? Was that embarrassing? It just doesn't, the pitch doesn't, isn't great. Like, I think like people just don't like hearing about finance folks. And I also didn't really enjoy it. Like, I think, you know, I look at those years of saying, man, I wish I was like spending more time doing technology development. And I was working full time, but building startups and stuff on the side. And I just look at that saying, like, I think it was helpful in some ways, but like, probably net net like would have been more important just for me to dive in and start building businesses full-time um so i was at you know in school somebody gave me this book it's called like the fast track to like investment banking management consulting and trading and i read it and it was like you know people are going to finance like drive ferraris they just like do so well and they make 150 000 after school and i was like i was dead broke in college like taking out loans to pay for school and i was like man i'm gonna go this is how i'm gonna you know make some money start my career and i i went into an interview with goldman sachs and i just i just whiffed like they asked me like um some accretion dilution you know uh like mna modeling and lbo questions or leverage bio questions and i just i didn't know anything and they're like you know i think the guy was nice he was like listen you just you have to have a certain like bar of understanding of finance finances he's like this is such a disrespectful interview yeah this is playing this the second time you're disrespecting people constantly yeah exactly and um it's like you're like wasting my time and i was like man like um i'm not really learning how to do this stuff in college so i'm just gonna have to go learn it and um you know i was learning that i just started like writing notes and writing about it and um when my brother actually went to finance my brother works at a private equity company now i was like i'm just gonna repackage all these notes It's I'm going to put them online and also give them to my brother.

24:50And I'm like, like, when I'm, where am I going to use them again? And that was the genesis for a street of walls. We've, I think I've gotten like 30 million views of that site for the last, like, you know, 15 years, which has been, which has been great. Like a lot of folks have been like, this has been my primary reason I've gotten a job. And, but you know, as you can see, I've, I've had, it's been a nickel on it and over a decade. how did it get traffic? I mean according to SimilarWeb it's still getting 100 ,000 or so people a month coming to it. It's all organic SEO. That's insane. I mean that's kind of a lot, right?

25:26I mean for such a high this would be an expensive term to rank for. Yeah, these are like there's thousands of pages of content there with good original content and it's just ranking high on Google. You wrote all these? I wrote all those articles, yeah. Were you going to turn this into a business? yeah i saw at one point i was making like five thousand dollars a month selling those interview guides like like like one year out of college it was great i mean it was like a 98 margin business all right well when you're in that position what's stopping you from going full-time on that because if i'm broke and i'm 24 and i'm making five grand a month i'm like this is the thing yeah i i didn't i i strongly believe like i i strongly believe i need to touch like the mass market and um to have like significant impact in technology you need to have like um a either a lot of people using your product or very few that use it like really like it a lot and i just felt like the products the services i was starting were just um not important enough for my time so in the pod we on this pod we talk a lot about like ideas and like different opportunities in terms of vetery what opportunities did you see that you guys weren't able to pounce on that still exists one of the things we did is um you know so what so i started the battery at the nyu incubator um and um one of the guys there handed me a book one day and it's like it was it was the book it's a predictable revenue book uh which is basically like an outbound lead generation marketing playbook he said hey you need to read this it'd probably be pretty helpful for battery um and uh those guys it was actually tap commerce those guys sold for like over 100 million to twitter uh so it was brian the founder there and um i ended up reading the book it's like this is great we need to like replicate this system fully end to end so i started like working on um writing this uh outbound lead generation uh process and we ultimately gave it to um basically a person that's here with me today.

27:33So Lee Randossio gave it to her and said, hey, can you go figure out how to build this? So she brought on an engineer and we basically built this outbound lead generation software system that basically ended up powering all of battery. So that was basically like, how do we put contact information to people and basically do this cadence of emails out to folks to basically drum up leads? And you can do this for both customers. Where'd you get the emails? We built an offshore team of like 300 people in the Philippines. And we did it all by scratch. What does that mean? Going to LinkedIn or something and just building email lists?

28:06Yeah, like you can basically finding the right people based on job titles. And then there's a process where you can use to find emails pretty well. Like there's, you know, there's a lot on GitHub. There's a lot of, you can get the emails through Facebook pretty easily. There's basically a process where you can basically back into somebody's personal email address. There's also like databases you can use that a lot of folks use. So we would get emails, plug them into this machine and go. and we basically built this like huge engine that would power like millions of emails we were doing per month and then um i think it was like in early 2013 2014 there was like this startup emerging um which is outreach and we demoed it we're like this is the same exact thing we just built internally you know outreach now is like a four or five billion dollar company and we're like watching outreach scale up we have a product that this is literally built internally ourselves that we're just using ourselves at the time we thought it was a little bit better so we didn't use outreach that was more customized for what we're doing everything else but it was really funny to see us you know me go out and build like a hundred million dollar company when internally we had a four billion dollar company sitting internally so there was there was a few of those that happened through the life of better that were it was just interesting to see and I think that goes back to my same theme which is like be very thoughtful like so so my my time now is haunted by am I working on the right things do you think that was the wrong thing I think better it was the right thing for me at the right time but it was definitely not the right thing to do it was definitely the right call to get into Archer next and the figure and um I use it as a learning lesson to say what happened with better is I fell into it I fell into it from street of walls I fell into it because I built up this huge database of traffic from like from from content and then i used that to help build and bootstrap the marketplace with vetery it wasn't as if i like i was in college when i kind of the stuff started and said um i want to go do recruiting this is where i'm going to spend the rest of my life in it just i just fell into it and um happened to work out really well and i think i wouldn't have been able to start archer if it wasn't for the vetery acquisition so you know i think i think looking back, it was something I would have done again.

30:21But I use that as a lesson to say, I do have a choice on what to spend my time on and everybody does. And it's the most present asset you have because we don't have that much time left.

30:49for us to be able to easily wire transfer, pay all our different vendors and suppliers all around the world. And the old way with our more traditional bank that shall now be named, I try it online, it would say no, it would freeze my account. Then I'd have to go in, book an appointment, speak to a specialist who would try to upsell me on something I didn't need. And then finally after 30 minutes there, then they charged me 50 bucks for the pleasure of that terrible interaction. And now with Mercury, I just go online, push two buttons and I'm done. It's such a seamless experience. It's very intuitive.

31:16Everything's under one place. They basically took all the things any company would need for their financial tech. And they made it super easy to use and put it into one platform. So highly, highly recommend it. If you're not using Mercury, I question your judgment. So that's it. You've heard it on My First Million. For more information, check out mercury.com. Mercury is a financial technology company, not a bank. Check show notes for details. What was the math that you saw or like the graph or whatever that made you want to start figure? Like what was there a signal where you're like, oh man this can be the biggest company in the world because i think you sold it to me you go we're we're either gonna screw up and go bankrupt or we'll have a very small exit or it's gonna be a hundred billion dollar company or you said something like that where it was like this is gonna be the biggest thing ever or total failure but what did you see that gave you the idea that this could be the biggest thing so so what we're doing here figure is we're building humanoid robots These are robots.

32:13When we say humanoid, I mean it looks like the human form. So it has legs, arms, hands. We're not trying to look like a human, but we're trying to do everything a human can do. And when you look at the world today, if you go out in the world and look at everything you're doing, it requires a human interface in the physical world. So the equivalent to, I always make an analogy is when you use the internet using a keyboard and mouse, and you can interact with all the internet. You can use a keyboard, your fingers are like your little keyboard and mice. You can basically interact with all the digital world.

32:44The physical world will last several hundred years we built to interact with the human body. So we have like door handles, we have tools, we have stairs. Everything around us was built for a human interface. And so when you look at what we're doing here is we're trying to build an automation solution to do physical labor. How do we get into the world and do human-like tasks? And when you look at the market for human-like tasks, it's half of GDP. So GDP is roughly$70,$80 trillion. Half of that goes to human labor to pay wages every single year in the world. and it's roughly half or so for you know for if you go to any company or any country in the world it's roughly half a gdp and what we've seen now is we've seen this like we've seen like these emergent properties happen in in in kind of the space we operate here that are allowing us to build and do this this decade we have hardware from like um that that is that is capable of being built to do human-like tasks.

33:47And then from a software perspective, separately, we have software today and we have AI systems today that can basically understand like semantically what's going on in the world and do human-like applications from a software perspective. So here at Figure, at a high level, the biggest company the next 10, 15 years in the world will be AI-powered humanoids. that like that's for sure going to happen the question is like what groups are going to do that well i think elon must let me find this quote i have this quote here i think he said um tesla has a robot i think it's called optimus so elon says it will probably cost less than twenty thousand dollars to build and it will be a bigger business than cars so like it's going to be huge um and so you you just looked at that math and you're like i have to go all in on this but what's the business model like you you rent them out to people or you sell them to people what do you do yeah you can do either i mean this there's a there's definitely a similar capex model that is very similar to how we like buying buy cars today where you would want to you know buy the asset it would have a certain amount of depreciable life um you'd have to like pay for servicing and maintenance and then there's another model which is like operating model which is we're calling robots and service which is a leasing model so you basically be able to put robots into say, you know, warehousing or manufacturing related applications, and you would charge basically a monthly fee for that work.

35:14And that would be a kind of a lower price per year that you would pay, but ongoing. And so we, you know, here at DigEar, we're pushing the robot as a service operating model. We think it's the way to get costs down and make it affordable to the masses. And, but some of the initial conversations we're having with clients too, is that they're, you know, interested in buying them because they've been buying robots for, you know, a decade so i think we're open to kind of getting out of the world what um we're seeing here is we're seeing the ability to get these robots over time with a high enough volumes cheaper than like a mid-price car um and then if that robot can last four or five years before it's fully depreciated um the cost should be pretty affordable for the even for the home we should be able to put robots in the home for you know several hundred dollars per month i was talking to my family members i was they're like who you're talking to tomorrow i was like man it's the guy brett he builds a humanoid it's like they're like what the hell you know what the fuck is that i'm like well it's i'm like you know how like amazon workers do this stuff it's gonna do that and then like inevitably the answer is like oh so he's gonna put everyone out of work all right that's cool what's your rebuttal to that like how do you think about that like you know you seem very like altruistic and you're like you're like, I want to save the world.

36:30So what are these people, what are they going to do? And when are they going to lose their jobs? So what we're seeing from like a labor perspective is that the amount of people in the workforce is starting to shrink. So we have like roughly 3.3 billion humans working in the world. A big chunk of that is the baby boomers and the retiring out of the market. And then from, you know, from the other side, we're basically having roughly a little over one child per household at this point. we're well under the replacement rate for humans, which needs to be like about 2.2 births per household. So we're like, we're not putting more into the bottom, the top of the funnel.

37:08We're not putting any more in and the bottom of the funnel, we're retiring out. So we're basically shrinking the labor force. So when we walk into, I think the conventional wisdom is what you say. It's like you walk into one of these like big, big companies and they're like, we're worried about you taking our people's jobs. Like how are we going to message this? Like, what are they going to do? that is complete 180 from what we see with boots in the ground. If you actually do the work of walking into a company that's big and you ask them their number one problem, they'll say employee headcount and retention.

37:38So we walk into these warehouses, manufacturing, retail, whatever, and we walk in and they're telling us that 15 % of employees don't show up day to work. They're saying they have two to 3 % weekly attrition, 50 to 150 % annual turnover. The working conditions are harsh. It's really hot in the summers. It's cold in the winters. You have to walk miles per day. You have to pick a lot of items per hour. It's a lot easier to drive an Uber in this condition than be in these facilities. So when we walk in these clients, They have a labor crisis going on and they need help ASAP and they can't figure out how to automate these more dexterous and human-like tasks.