Competing to Build the Fastest-Growing Energy Startup Ever | Base Power, Zach Dell & Justin Lopas

0:00If you're in the market for electrons and ours are the cheapest and most reliable, you're gonna buy them. The competitive advantage for us is a cost structure advantage. And the way we get to a cost structure advantage is through vertical integration and technology. It's doing the entire thing, so to speak, from customer acquisition through long-term maintenance of the battery on the home, every sort of aspect of the whole thing, as opposed to piecing together a bunch of external parties. We vertically integrate and develop technology to lower our costs. Lower costs equals higher returns at the asset level.

0:23Higher returns at the asset level means we pass on those returns to the customer in the form of lower prices. When the price goes down, you have more demand. More demand leads to more scale. More scale leads to lower costs. lower cost leads to higher returns there's your flywheel this is zach dell and justin lopez from base power i love this line violent execution when was the most recent time that you felt like you were violently executing uh so that was not a term that we coined it was it was coined by a third party uh and it's it's kind of we you know we we we we think more about this content of base pace and the the cadence with which we operate so we have a pretty intense bias towards action here um we do things with extreme levels of urgency um we don't like to wait around uh we had this concept i think justin articulates well where in an interaction with a counterparty the ball is either in our court or their court and we just like minimize the seconds that it's in our court and that allows everything to move faster and so uh there's not like oh yeah we were executing super violently yesterday at 10 a.m.

1:28like we every day show up and just do the thing and get to work and you know don't stop ever uh and you know try to make progress uh all the time uh at this pace that we kind of call base pace which is like as fast as reasonably possible without breaking too much you guys have screens all over your office they all have metrics on them i know that you're very conscious about which metrics to focus on and if it's a good metric it should be on a screen and And if it isn't on the screen, it probably doesn't matter. How do you decide like which metrics matter to you? You know, it's honestly, it's team by team.

2:00So if you look at, if you walk around the office and you see a team sitting under a TV that has a bunch of metrics on it, it is metrics that that team specifically cares about. And what you'll find for the most part, hopefully, is that if the metric is good, it's in green. If it's okay, it's in yellow. If it's bad, it's in red. it's like there's this concept in production where you want things to be super obvious and totally blatant if they're bad. And we have that same concept here with metrics on the screen. Which ones to focus on? It's up to the team leader. We have a pretty, I'd say our leadership style generally is like very high ownership on the individual team lead.

2:38And so Jared, who leads our software team as an example, is the one, him and his team, set what metrics they care about, what red means, what green means, and what yellow means in terms of each individual metric. And they need to be not only just a random metric just to see what's going on, but something that is actionable. So for instance, we have a queue of customers that are like, we say, in a bad state. This means like they fell off or we forgot about them in some way or we had a hole in the process or they fell out of the process in some way. That number should always be zero and therefore the only green number is zero.

3:12Everything else is red, which is bad. and that sits over our deployments team who handles the entire deployments pipeline as an example. Did you guys come up with that on your own? I've seen this at other companies and so it's also not, yeah, it's not something super novel, but I think we over time made it a key component to the culture. Jared, who I was mentioning just our software lead, set up the first few TVs in our first office, which was a house down the street here, and those TVs had very specific metrics on them. I think it's something that he learned at SpaceX if memory serves. Yeah, I think we try to take the best things we've seen from other companies, whether it's my background in finance world and Justin and Jared's background at SpaceX or other people who come from Ramp or Stripe or whatever it might be.

3:54And we say, oh, that thing that you brought is really good. Let's do more of that. Yeah. Right. And we try to just kind of make it our own. And to Justin's point, the company is built in a super decentralized way, where we have extremely capable leaders across all different functions, and they lead in their own ways. And we don't really tell them how to lead. We set North Stars. We make sure the company is all kind of speaking the same language. But we really rely on strong leaders across the company to identify these metrics, hold the teams to them, drive them towards outcomes in a way that is very self-directed.

4:27I know that you guys are only like two and a half years old. And I'm pretty sure I was talking with I forgot what his name is. But he basically said that in the last roughly 10 to 12 months, you guys have grown from like 40 employees to 240. Yeah. What has that been like? Because I know that typically a company can only grow at a few multiples every year, or else things start to really break. How has that been for you guys? Yeah, I mean, things definitely do break and that's accepted and understood. We obviously try to have them break as little as possible. But like we if you're not breaking something, you probably haven't pushed it far enough.

4:58It's kind of the general mantra that I have. Yeah. So in terms of headcount growth, we've been able to scale pretty rapidly because we've built out a really good talent network. We have a great talent team that's accolades of a handful of folks that have sort of unique skill sets in this area. and because of the press and all of the stuff we've been doing, we've gotten a lot of notoriety and folks that are interested in the company. I think also when we bring somebody in the office for an onsite or we talk to them on the phone, our passion for the mission and our passion for the subject matter comes through and the best people want to work with people that are passionate about what they're doing.

5:30And so that's also allowed us to attract folks. And look, we've also hired a lot on our front lines. So we have a team of over 100 now that's between our warehouse manufacturing location and our electricians. in the field and that's been you know somewhat easier to scale just from a numbers perspective just because uh there's folks sort of in those domains already and we're able to hire relatively quickly there yeah reflecting on it i think it's been made possible because we have a super strong leadership team that has managed big teams before and that leadership team was we're like you know all in the first 20 people and all of them except one in the first five people at the company right And so we hire these people.

6:10I mean, myself and Justin, Jared's our first hire, Dana, Cole, and then Dino, who came a couple months later. That's the leadership team. And they've all run big teams at big companies working on really hard things. And so you don't have to teach these people how to manage. And they know how to hire. And they know how to lead. And they know how to coach. And they know how to let people go when you need to let people go. And point them in a different direction or give them more rope and ownership and scope. And these aren't things that we have to go teach. They just know how to do it. And they've been here since the beginning.

6:40So they're just like super aligned with the mission, the vision, the strategy. And I think that has made it a lot easier to scale versus had we hired a bunch of very junior people early and then tried to like, you know, bring in senior people over them. And that would have been a little more difficult. So you guys like actively chose to not hire people early days for like slope, but more like for actual domain expertise. And I don't think it was that I think we just said we got to get the best people on the planet here. Like, where are they? And we went and found them. And they happen to, you know, and we're still doing that, obviously.

7:12But like now we have a lot of people, you know, the people in the seat that we need. And so we're going and finding, you know, filling other seats. But I think we just we just and I both spent a lot of our time in the first year of the company on hiring, recruiting, getting the best people in the door, convincing them that they should join us. And that has paid dividends is kind of more the point I'm making. Interesting. How much from the initial idea or plan that you guys created has kind of stayed true versus what's shifted? I'd say the overall theme and mission of lowering the cost of delivered electricity to humans and Americans has not changed.

7:48That's been a North Star for us for a while. How we get there certainly has changed, or to a degree at least has changed. We've learned a lot along the way in relation to how you access the electricity markets, how you position the product, what the product offering is. And frankly, I'd say the ambition also has grown as we've developed the company. When we started, we were like, okay, we're going to do some batteries. It's going to be great. And now I think we've really sort of seen how impactful that business model can be and is and really expanded the mission even more broadly to really just being this vertically integrated energy company.

8:22I think it actually hasn't changed that much. I think before we started the company, Justin and I spent a number of months kind of researching, iterating, questioning, learning. And then when we really hit the go button, if you go read the original memo we wrote, 10 pages on what we're going to do, how we're going to do it. If you read it today, that's basically exactly what we're talking about. Yeah. Yeah, I guess my point was more around the path in which we take to get to that end outcome certainly has. We've just learned a lot along the way. Yeah, totally. We've learned a ton about the shape of the problem, but the mission vision strategy has stayed basically exactly the same.

9:00What are the things that have like changed? What have those been? They're more tactical things like around like, are we a retailer or are we not? Do we partner with a installation company or do we do it ourselves? How soon and to what magnitude do we do custom hardware? They're all like, I'd say like, you know, 10 to 40 % changes. not like we were going to do nuclear reactors now we're doing batteries that's not the case that hasn't changed. If you could go back and do one decision differently than you did what would that be? Oh I got one for sure. I know what you're going to say. So we originally so we started with this product we call Gen 1 which is primarily off the shelf it's gotten more custom over time but it's only say 30 % custom and 70 % off the shelf product and our strategy that this is a mistake that I made was let's step have a stair step basically to custom hardware so we had this product that we call gen 2 very creatively named that was going to be like a white labeled custom designed for us but by a third-party hardware and then we were going to go into the gen 3 product which is what we're building today you saw maybe downstairs you're walking around that was like fully custom fully designed and manufactured by us and the original thesis was like we kind of crawl walk run the walk was going to be gen 2 and uh we realized um with a number of the facts in the ground changing and just as we developed this gen 2 product that really like the bed of the company needs to be gen 3 you gotta um as uh as i heard elon say and we say sometimes runner you got to burn the boats and just go to the go to the end thing um and we we definitely held on to gen 2 too long i i i personally was was a proponent of this and it was a it ended up being a mistake it was not a company killing mistake obviously it was uh something that we've learned a lot from and um we've been able to course correct and we lost you know six months or so worth of time on uh that's i that's like by far and away the biggest the biggest one there's been a ton of tactical other things along the way but that's a big one i know when the like model s production ramp or model 3 production ramp was happening in like 2018 uh there was just a whole bunch of fires all over the factory uh in fremont what have been the biggest like production hell moments for you guys yeah we're just on the production side we're just getting into that now with gen 3 so we're just starting to do the new production and like my ask it in a year yeah i would say like we're already feeling some of the pain just around like machine lead times and hiring enough people and negotiating the real estate deal and you know every the problem the hard part about production is not any one thing and you cannot point to one thing oh that's the hard part like let's just go solve that and then everything's easy it is the summation of all of the like small to medium size problems.

11:39That's what I would consider production hell. We had the same thing down in Brownsville at SpaceX in 2018, 2019, around the same time the Tesla guys were having their challenges. And we expect to be having those Q1, Q2, Q3 next year as we scale. But we've had our own version of that, I guess, even today with relation to deployments. So even though it's not like assembling the hardware, I guess it sort of is actually, but it's like at the customer site, that is production, just like physically producing the batteries is production. and that we've had all kinds of challenges with permitting interconnections hiring electricians how do you get enough vans like every little piece is like a operational challenge yeah for planning and stuff i know that like energy is heavily uh regulated and i imagine that this is one of those things where you have to just be incredibly good at thinking you know 12 to 24 months in the future and like what are those problems going to be and then like solving for them today uh what have those been like on the policy side um you know it's it's it's a fascinatingly complex industry that is heavily regulated, as you said.

12:37It's regulated primarily at the state level today and a little bit at the federal levels, especially here in Texas, though it's very state dependent. So a few sort of operational challenges have been around permitting and interconnections. We've basically solved the permitting one with a bill that was passed in the last legislative session that we strongly supported. And then interconnections is kind of the next big one. Basically, you can think of it like a permit, but it's with the utilities. on the sort of 12 to 24 months timeline or even further along. We're being very trying to be very thoughtful about what is achievable versus what is not.

13:09Energy market access, I think, is a broad topic is one that's quite interesting to us. In Texas, you can be a retailer and you can put a battery on your retail customers home and like directly access the wholesale markets after filling out a bunch of paperwork. Basically, you can't do that in almost any other state. So opening up that market access, I think, is kind of 12 to 24 month timeline. So is the like biggest bottleneck just basically figuring out how to do what you did in Texas elsewhere with those? There's a business model that works where we're partnered with utilities. In fact, we already have that going in not all of Texas's retail choice.

13:40So we have that already that are going so that that will work. But there's like mechanisms in place that make that difficult in certain markets. And those are mechanisms or those are some barriers we want to knock down. As far as like leadership style and, you know, you're just personal evolution. I know Brian Chesky talks about you have to like grow ahead of your company. and so if your company is growing like 5x year over year and like headcount and this kind of scaling I imagine that's really tough how have you guys kind of managed that I think we just show up every day and try to do the best job we can and try to push the ambition of the company try to push each other we have the benefit of being surrounded by really talented people that teach us a lot both inside the company and outside the company and we set a really high bar for ourselves and there's no playbook there's no like oh I'm on level three of being a CEO I need to get to level four to unlock this new thing and then one day I'll get to level seven and um it's it's it's a not a straight line to figure out how to build a business like this and how to lead the team in an effective way and level up and be more effective and so I think the way we do it is very bottoms up it's like we show up every day we work really freaking hard we set really ambitious goals we push each other to do better we challenge each other um and you know good things happen but there's really no formula yeah i'd also add we really try to pretty aggressively and regularly seek feedback um how do you do that we just ask you just yeah like you just like it's not much more complicated than just being very explicit and asking um and and actually particularly timing the feedback is very important like i just had an interaction with you as a one-on-one you know on my team or whatever i'm like hey how did that went how did that go in the last five minutes like any feedback for me that I can be helpful on pulling out of you or mentoring or guiding or coaching or getting on your way more and and I think like everyone you know there's like a quote-unquote leadership style I actually think the best leaders identify the style that works best with the person that they're talking to at the time and tailors their style to that person you can't be one one-size-fits-all because it just won't work for everyone so yeah I also think feedback is a skill and it's not like hey ty i would like some feedback or i have some feedback to give you it's like hey are there behaviors that i demonstrate that you would like to see more of or that you would like to see less of or in this interaction what worked and what didn't work like kind of more specific like a click deeper specific questions where you can actually elicit real feedback um and i think being intentional about that goes a really long way what do you guys love about frank sleutman i think that he has a way of balancing intensity and focus and those two things are kind of where intensity and focus meet is like kind of just fantastic leadership but like where they you know they can miss right and you can have a ton of focus with you know not enough intensity you can have a ton of intensity with not enough focus and that's a problem and I think he he has you know I don't know him but I've read his book and listened to him uh uh you know talk and I think he has this way of crystallizing this like intensity and focus intersection that is really powerful I think kind of focusing on the intensity side I think he again don't know him just read a lot of his read and listened to a lot of his stuff um bringing the intensity every single day and being relentless about it uh is extremely important because as a leader and i've i've sort of noticed this over the last few years people sort of start to mimic you in a way uh both your like mannerisms and things that you say and words that you use but also like the way in which you carry yourself if you're happy most people are happy if you're upset most people are upset i saw this with with with elon myself working very closely with him and like what you bring in terms of intensity every day is almost exactly will be mirrored one for one with what your team brings.

17:44Yeah. On the focusing side, what have you guys had to say no to in order to just be laser focused on this? So much. I mean, this business is, you know, we're competing in the largest part of the economy. There's so much to do. There's so many things we could make. I'd imagine there's just a million distractions constantly. For sure. I mean, there's so many, you know, there's so many interesting things we could go build and Many of them we will build, but you have to, you have the discipline to prioritize and say no to things. Yeah. And especially given the team size and the capital position that we have now, there's like a lot of things that we could do.

18:16You know, we could do generation. We could do different retail products. We could go into different states. We could whatever. There's like a, there's like an infinitely long list. And some of those we definitely will do or should do. Many of those we should not do. And probably almost none of them should we do right now. because we need to be laser focused to zach's point on delivering on the goals that we've set out in the near term which is like build the most profitable and largest distributed battery fleet in the world when was the last moment that you guys had to jump on or individually had to jump on a plane to go solve some fire um i had to uh i i guess you could kind of call it last week but maybe a few weeks ago.

18:57Yeah. What was that? We are developing our next generation hardware. We have a small team out in the Bay Area that's working on a number of pieces of that and basically just like meeting with the team, working with them on a handful of things that like one of which was not going super well. And yeah, we also like we do this relatively regularly where we send folks out, myself included, out to the field to Dallas and Houston primarily or up north of Austin here to our installations, it's less about like, oh, there is something totally going wrong and we must go fix it ourselves right now, and more about just like staying very close to the work, to the actual physical work at hand.

19:37There's a, not to distract a ton, but there's this concept in the Toyota production system, which is like the, in my opinion, the like Bible of manufacturing called Gemba or Gemba, G-E-M-B-A, which is like go to see the actual thing, go to the actual place. They do this thing in Japan at Toyota called Gemba Walks, which is like management goes down to the line and like sees the actual problem. And we try to embody that culture here and have everyone from random software engineers, people in the policy team to everyone, almost everyone that starts, go and seize and install and really feels viscerally like what it's like installing batteries or packing it up in the warehouse or whatever else.

20:13Interesting. What about you? Well, not me specifically, but we often do this with suppliers where if we have a problem with supplier, we're just like, okay, let's get on a plane and like go to the supplier and just like sit down with them and say, hey, like this, this has to get better. The most recent one for me is like, we're trying to recruit someone for a critical path role that's super important. And it's like, hey, Ty, you know, you're an SF, you know, we should really spend some time together. I'm going to email you on a Sunday night and be like, hey, great news. I'm going to be an SF this week.

20:41I'd love to have lunch. You let me know when's best. I'm not going to be an SF, right? I'm just going to be an SF when you tell me you're available. I'm definitely done that I've done that where you like say, you know, someone that's out of country and you're like, hey, I'm flying to London this So I do a lot of that when it comes to kind of deal-making and and You know when it's when it's winning time you just like put on the winning hat and like do whatever is required to win What was the last moment where you did that and something that should have been impossible just magically happened because of it I can't share all my secrets so you know nothing nothing immediately comes to mind I think you know one would be our base factory one we really wanted to have production and engineering close to each other and the office is in downtown Austin and there's not a lot of factory space nearby we spent a lot of time kind of agonizing over man are we going to put this factory out by the airport it's going to be really far from engineering and we basically figured out a way to negotiate a deal across the street to allow us to put production you know two minute walk from our engineering team which I think had you asked us you know mid midsummer early summer like is that possible we would have said no effing way you know in our wildest dreams and we just made it happen and yeah that was that was pretty great part of the role of the person that's in charge or the people that are in charge is basically constantly trying to like push up timelines um for base pace i imagine that you constantly want base pace to be accelerating how are you doing that yeah i think like there's two there's basically two levers to pull in schedule one is to like remove stuff that you were otherwise going to do and the other is to like work faster or harder or more hours um there's like a limit to how much you can do the latter there's only 24 hours in a day a human has to sleep at least six of them so like you're you're already limited to 18 like that's kind of and and realistically people don't work 18 hours every single day all the time people work hard but but but there's also like how long is the person with the company and all that so like want to be respectful of that so anyways we already we i think we turn the we turn the um the how hard you work dial to the max in sort of like long-term sustainment mode so then the other thing that you can do to pull in schedule is like reduce work basically dscope um and this is like uh something that i learned from from elon at spacex is like deleting parts, deleting processes, skipping steps where they're not otherwise needed is like far and away the fastest way to pull in schedule.

23:11Also, you can parallel path things. So, for instance, we're doing our safety certification around our system today. And like normally you do like do one test, then do the next test, then do the next test. And instead, we're like, why don't we just do all the tests at the same time? So now a serial path schedule goes to a parallel path schedule. We just you just ask the question is like, do we need to do that thing? And oftentimes the answer is no. so we don't do it and then if we do need to do it it's like how can we shorten its timeline automate it or put it in parallel with other things yeah the other trick would be uh and this is kind of a jaredism would be giving things like a specific date that you want to deliver so most companies would be like we're going to do this in q3 or we're going to do this in february or we're going to do this you know on some point in the future right like we're going to do this on November 3rd.

23:56Right. And then it's like, okay, XYZ happened. The day has slipped by three days, by four days. Right. And just tightening the kind of measurement or making it more specific, I think really helps drive urgency. Yeah. How do you align everyone to kind of like understand exactly what the why is in any given moment? Um, I think this is a hyper mission driven company where if you walk around the office and you ask people like, Hey, what's the mission here? Like everyone will tell you affordable, reliable power. Like in some way, Some people say lower the cost of electricity for all. Some people say affordable, reliable power.

24:30And everyone kind of feels that and knows that. And there's little things like we do a monthly all hands, which is probably more frequently than most companies where we talk about our North Star goals. Right. We have like three goals and they're tied to metrics. And we put them at the top of the all hands document. Everyone stares at it and we talk about it. And then, you know, we write this very detailed monthly update that goes to the whole company. It talks about what do we do? What do we not do? Are we making progress? We're not making progress. I give a presentation every quarter called engine of success, which is like what we call like how we win Right.

24:58It's our playbook for how we win And everyone is kind of indoctrinated in that engine and they understand how the engine runs So I think it's a disproportionately large part of our culture relative to other companies Just given the business that we're in as the how do we win? Thing changed over time a lot or not really not really the way we've articulated it has gotten better, I think but I think I was probably a little too technical on some of some things and I've kind of like made it a little more easy to understand as the team's gotten bigger but no it really hasn't trained I think we have a very Actually quite simple business strategy It's just in it to flywheel and you have to kind of understand how the flywheel works How do you guys think about like building a competitive advantage that no one else can compete with?

25:42Well, that's a great question because it ties to the flywheel. So So the competitive advantage is tied to the thing that you're selling, right? If you're making Diet Cokes, your competitive advantage is something different than if you're selling electrons, right? Electricity is a commodity, and the best electron is the cheapest electron. So the competitive advantage for us is a cost structure advantage. And the way we get to a cost structure advantage is through vertical integration and technology. So the way we think about this is we vertically integrate and develop technology to lower our costs.

26:10Lower cost equals higher returns at the asset level. higher returns to the asset level means we pass on those returns to the customer in the form of lower prices lower cost electron price the electron goes down presumably in a commodity market when the price goes down you have more demand more demand leads to more scale more scale leads to lower costs lower cost leads to higher returns higher returns leads to lower prices there's your flywheel right so that's the competitive advantage is if you're in the market for electrons and ours are the cheapest and the most reliable you're going to buy them and that's how we win and and i would add the way in which we get to that cost advantage is through vertical integration as zach was mentioning it's doing the entire thing so to speak from customer acquisition through long-term maintenance of the battery on the home inclusive of logistics and warehousing and manufacturing and design and brand and every every sort of aspect of the whole thing as opposed to piecing together a bunch of external parties there's successful businesses that do the piecing together thing we think that the sort of the strategy that zach outlined is is uh best equipped when you do everything in the chain in the value chain yeah on the vertical integration point um how did you guys initially like start out versus now on how much you're bringing in house and at what points does it make sense to just bring the entire thing in house versus just some of the components yeah we've definitely stepped into it over time you know we didn't start on our first installation was not with a base electrician as an example because like a we didn't know what we what we wanted from a hiring standpoint and b we wanted to learn so we like hired an electrician off of craigslist it's a not great story actually um it's a funny story no longer he no longer works works with us it's just a random guy that jared actually found on craigslist there may not have been sober uh yeah unclear we never worked with him again yeah right but anyways like you you you start by outsourcing um very simply to like to learn right especially because back and i definitely don't have all the answers for sure but like we also didn't have a background in these areas specifically and frankly a lot of our early team and all of our team today actually doesn't we're like learning and thinking about things from first principles and so we start you start outsourcing and then when you've learned the trade so to speak whether it's electricians or we did the same thing for warehousing we started with third-party logistics firms and we have all of it in-house we learned how they do it we learn what good looks like and what bad looks like we build up a team we build up the internal tooling and processes and then we go do it ourselves um i think that goes for almost everything like not everything everything like we don't we didn't make the chairs we're sitting on right like so there's you know you we didn't build this building right there's there's things that you are best left other people your business succeeding and there's things that are like started we didn't do anything ourselves we had a we had a white labeled rep we had third-party hardware we had a third-party installer i guess we acquired the customers ourselves and we just knocked on doors and we're like hey would you like a battery um and because we had to learn what we wanted to make right and so I think and also there's another version of the company where we sat in a lab for two years and perfected the perfect thing and that's not our style I don't really get any contact with the enemy sort of situation exactly like you got to get in the field get your hands dirty start doing the thing learning taking some punches and then you know you you can start to build knowledge and experience and you try to figure out what you're gonna do such that you can vertically integrate in an effective way had we started designing our custom battery on day one we would have design something probably pretty crappy because we didn't actually know what was required.

29:29I know like Sam Walton would go to like, I think it's like distribution centers that were in the center of multiple different Walmart locations and just talk with the like truck drivers at 5am before they went out and delivered to everywhere and got like a pulse for the company. And I also know he would he like bought a plane at one point and basically flew around to decide where to you know, where did the traffic meet and where was the most logical place to build a Walmart? Yeah. How have you guys kind of kept a pulse, you know, keep on knocking on doors even as the company's scaling? Yeah, I mean just get on the phone customers like talk to them like customers will still email me My emails is exactly based power company calm You can figure it out pretty easily and they'll email me and they'll have feedback and we'll talk to them or I'll like, you know Our energy advisor sit over there.

30:11I'll go hop on the phone with some of the customers and hear from them directly You can't replace getting that direct feedback from the customer and in the early days Cole and I are head of growth did a lot of the door knocking ourselves and walk door to door and knock on the door say hey You know was last time you had a power outage. Okay, great. Well, let's make sure that never happens again By the way, what are you paying for electricity? Oh, we're gonna cut that by 10 % right? Like having the conversations with people super helpful and then little things like I still Every meal my wife is annoyed by now, but like we were out to dinner and I'm like by the way like What's last time you had a power outage and who's your power company?

30:39And you know, what are you paying for electricity? And you know in ubers and you know that kind of thing you'd have to like just live and breathe this stuff and it's fun I mean, this is what we do for fun. And also like little things, but we have this cool part of our company culture where everyone eats lunch together. We have like sacred lunchtime on everyone's calendar. You probably saw it today from 12 to 1230. Like everyone goes in the backyard, sit down and have lunch. And I think Jess and I both try to make a point to sit down with people who we know less, right? They just joined the company or they're working in the warehouse or they're working in the field and they happen to be at the office for lunch that day, sit next to them and we're like, hey, how are things?

31:15What are you seeing? What are you learning? And those are incredible opportunities for us to get this like, you know, bottoms up first firsthand information. Yeah. I think as companies grow or big companies generally do this, even small companies, especially the leadership or management team will have this sort of like separation from the real thing, what's actually going on, whether it's the customer or problems on the production line or our warehouse employees, that sort of thing. Layers of fog in between them and the people they should actually be engaged with. And it's like, you kind of default into that actually, because it's like more comfortable.

31:44You don't have to worry about the problems as much. It's sort of like less mentally taxing in a way. But that's terrible. Like we really strive to not do that. You want to be like as viscerally close to, you know, what's going on on the road, so to speak, as you're driving as much as possible. You don't want like 17 layers of sort of like, you know, damping in between you and the road. What have been the biggest things that you guys have shifted just by talking with some guy at a restaurant or in an Uber, you know, about their situation in life? that one's best for you I think I don't know there's any one thing uh that was like oh I met this person and they told me the thing we have to change our strategy it's more that it shines a light on what people care about and what people think about um but in our business it's pretty clear like people want their bills to go down and their lights to stay on and it's pretty damn simple but like that's what they want um so I think there are a bunch of little things actually For example, like when you sign up with this, you have the option to schedule a call with one of our energy advisors and they answer your questions.

32:46And some people who are less, you know, technology literate, they get confused in the flow. And they're like, oh, am I scheduling my install? Am I scheduling my call? And like getting that piece of information is like, oh, we should make this clear. Right. Like we need better education up the funnel. And maybe we should send an email out when someone signs up and says, hey, like this is just a call. that's going to help you answer your questions. And then we're going to get those little things like that that are like in the email copy, in the way that the website flows and the buttons that you click, the title, you know, the subheading on the photo, like these little things matter.

33:19And that's really what you get from those conversations. It's not wholesale product changes. It's like small iterations that increase conversion rates and make this whole system more efficient. And dogfooding the product yourself also, like our head of growth, Cole, we installed on his parents' house in Dallas and we opened up the Dallas market. and like he took like extremely detailed notes of everything that the electricians told him because because we were we didn't tell him that that it was it was him and uh did a little like sort of undercover boss secret shopper type work uh and that goes a long way like last time i was in houston uh one of our members matt like i went to his house and i sat in his living room for like an hour and i just hung out with him just chatted with him about the product and his experience and his feedback and um that kind of you know just first hand conversation is so valuable i think Todd Graves from Raising Canes like green lights every single piece of like every reel that goes out on Instagram before something goes out and his company's worth like 20 billion dollars how much are you guys going to try and stay in the details and like which aspects of the details do you want to be focused on as the company scales yeah I I would say we will not be doing that or at least I'll speak for myself I would I would probably agree you'd probably agree Zach it's less about I think being in the details and being super controlling are two very different things right like I I would categorize that maybe as some somewhat negative way it's just like that's being controlling um i think what actually matters is that you know what's going on can do or at least help or mentor the person that is doing the thing um and certainly when there is when there are problems you like know enough to be helpful being in the details is not good in and of itself just because it's like cool whatever what matters is how you can use that to help the team um and yeah there are certain things that we have strong opinions on and we'll voice them but like back to this sort of distributed leadership concept.

35:02Like we like highly trust the group group leads, we call them to make decisions on their own. We'll check in and we'll be a thought partner or whatever else, but we are not like checking every Instagram reel that goes out. We'll have opinions and happy to share them if you want to bring them up, but we're not. Yeah, said differently, the people who are making those decisions are way better at making those decisions than we are, and so we're not going to get in their way. Now, if we have opinions, we will tell them and we'll challenge them and poke them and prod them. And that's the benefit of working together and working in a bullpen.