Palmer Luckey

23:30You're inside the game itself and that it's indistinguishable from reality. That's obviously where this is going. And from there, I said, well, I only want to work on that. I don't want to work on the intermediary steps. I don't want to have slightly better color reproduction in my display, slightly higher resolution in the rendering engine. What do you think? And that was where I became obsessed with. But what do you think were the data points leading up to that that allowed you to have that epiphany? Pop culture. It was pop culture only. I loved science fiction novels. I loved science fiction film.

24:03And I really appreciate science fiction authors and creators in general because their job is to think about what the future will look like. And if you say, well, what's the future gaming? To someone who grew up in my generation, who grew up watching the Matrix, who grow up watching Yu -Gi -Oh, who grew up seeing all this. It was obvious. It's like, oh, obviously, that was the future. Later, I think I was able to back that up with you technical reasons. Well, here's why the ultimate gaming display would be a very much more start. It was just culture aspirational. I mean, look, it's like it's how many things have happened because science fiction depicted them, right?

24:42Like, you know, I love to start track growing up. And the version of the future that I envisioned included virtual reality. It's like, well, that's where we're all going. Yeah, it was very much driven by just like what creative science fiction had imagined about the future. How old were you at this time when you had a building my own virtual reality headsets that summer and they were terrible? I don't want to act again. Okay, I'm not retro guys all around 15. We were probably between the ages of 13 and 25 would be like the typical range. It was mostly high school students, college students, and people who are out of college, but not yet in the real world.

25:24We joked not back then. We didn't recognize this till later, but we often talked about how mod retro is basically like it was the lost boys. It was a bunch of boys who hadn't yet grown up. Yeah. Or and maybe who never would. And there were a few guys who never did grow up. They were like, there were these outliers, but it typically was it was people in school, people in college, or people who had not yet joined the workforce. Once you joined the workforce, you kind of got certified and transformed and now you're taking care of, you know, a family or a house and your bills. You don't have time to just work on cool projects and SSN.

25:58Are you homeschooled as well? I was. I was. Do you think that that also played into your open mindedness? Absolutely. I don't think that Oculus would have existed if I had not been homeschooled. And I was one of four kids. All of us were homeschooled at one point or another, but if some of the kids did better in public school, some of them did better homeschooling. I was the one who was homeschooled all the way through. It worked out really well for me. I'm definitely going to be homeschooling my kids when. Amazing. When people tell me, all Palmer, is it important that you homeschool your kids too?

26:31And my point to them is, I don't know if it's important that I homeschool them. It's just really important to me that I not put them into the school system. And well, everything else comes from there. Is it homeschooling? Is it something else? Entirely, I don't know, but I don't want to just cram them into the. The region system. Right. Yeah, I was lucky enough to be able to pursue my own interests. To spend a lot of time working on this stuff. Also, it taught me to manage my time. I think much better than I would have otherwise. I still had to do standardized testing and keep up with the certain level of knowledge.

27:02I couldn't just do whatever I wanted. But it was nice to say, okay, I can spend, I also started doing college courses when I was 14 or 15. How did that happen? So in California, high school students are allowed to attend community college courses. It's a lot. And you get to pay the normal community college rate, which is you nothing. It's highly subsistence. I imagine things that you want to learn. Things that I wanted to learn. So I joined the Long Beach City College Robotics team, for example. And the best part about that is that you can get high school credit and college credit at the same time.

27:37It's fully double dipping. And if I can pass a college algebra course, why shouldn't I get credit for you? Why should I do AP algebra in high school? Because AP algebra gets you college credit as well. So if I'm going to take the actual college course, shouldn't I also get high school credit? And so that's great. And what's cool is if you start attending community college courses when you're a teenager, you can turn 18 having done all your general education court units before you even graduate high school. And so now you can just transfer to a school that's in whatever your specialty is. And you can graduate in less than two years.

28:11Wow. Which is really cool. Really cool. So I've heard anyone mention this before. Oh, so here's the problem. It's very, very difficult for most people to actually do this. Why? Because the law says two things. First of all, that you are last in line for all community college courses. Meaning basically there's an enrollment date. Your enrollment date is a non as a high schooler opens up like a month after everybody else. So the problem is most of the courses, especially the ones you want, they're already full. They're already fully enrolled. And so I actually got extremely good at the art of persuasion because you can often petition into a course.

28:50If you show up on the day and you have the petition forming, like I want you to same day enroll me in this course, Professor. And if you show up to a class and not everyone shows up, you often get it right away. Sometimes you could work a deal with the professor and be like, look, I know that people drop this course, keep auditing the class for like the next week or two. And odds are enough people will drop that they'll be room for you. And then I'll let you late enroll into my course. So I got very, very good. I had to petition into every single course I took, every single one. So I got very good at researching, you know, for example, a professor who worked in, like for my geology class.

29:27I would read just, you know, read papers of the professor and then I could go and say, oh, you know, professor Dine, I loved your paper on you metamorphology in the San Joaquin Basin. And you know, I would so love to take your course. You know, that's how it works. So that was the first difficulty. Why you find out hurt people have to petition in. And I mean, kids these days don't even want to answer, you know, telephone calls because it stresses them out. Imagine telling them you need to go and you need to negotiate with the professor you've never met for each of your classes. The other reason is I think a little more sinister.

29:59It's that you can only sign up for college courses if your principal signs up to allow it. Why is that? The reason is because the teachers unions got really concerned because people were going in saying, like, why would I take my math course here? I'm going to go take it at a community college where it's better instructors, better hours. I can do night classes sometimes. And I get college and high school credits at the same time. That's great. But the problem is when you do that, then you don't take the high school course and the school loses proportional funding. And so what happened is the teacher unions managed to get a piece of legislation passed that says you can only take a community college course.

30:39If your principal signs off for that specific course. So every time you take it, you need to get a signature from your principal saying, I agree that you will not take this course here at my school and you will instead take it there. And most schools have a policy of saying they will only sign off if it is a course that they do not offer anything like it. So for example, they might allow you to take a robotics course. But like they might have a crapping robotics class. And you might have a world class robotics team in your town. And the principal say, our policy is that we'll not sign off in this.

31:09This was one of the reasons it was so great for me to be homeschooled. We had our own state affidavit filed our own homeschool plan. And my mom was my principal. So she could just sign up the sign of paperwork. So I would show up to enroll in the class. Like, here's my form saying that my principal has allowed me to take this class. Amazing. And I really hate this because it's one of the things like you turn 18 and all of a sudden you don't need this anymore. And I always hated growing up. There's all these things where I'm 16 years old. Why shouldn't I be able to go to the community college and sign up for a course?

31:39What? Why is it that the state is going to tell me, no, you are not allowed to be in this class unless you happen to be in one of the districts that will sign off. Because like most kids don't get to choose where they live, right? Of course, though. You could just end up in a district where your teachers just won't sign off. And what does that mean? You mean you're not joining the robotics team. It means you're not getting the opportunities that I did. Anyway, you can probably tell I've got beef with the traditional education system here because I often see them holding back kids like any kid.

32:08Any kid should be able to sign up for their robotics team, any of them. For sure. But but, but, but, but, but maybe you're right, and it is heartbreaking. Yeah. And I've had kids ask me for help with this. And my only advice then is you need to exit the school stack. How how can I convince my, you know, my school to let me do this? I say you need to exit the school system. They're not going to let you do this because it would it would set precedent. Did you ever get into battle bots? I loved watching battle bots. And I do you know it's back in Las Vegas as a permanent show. I would see it. How cool?

32:35How was it? I haven't actually been me and my friends have been planning to go and see it. But we haven't actually gotten there yet. You'll love it. So I mean battle bots. Do you remember robot wars? Yeah. Very. Yep. So I never participated in that. But growing up, I mean, it inspires you. And people want kids to be inspired by the right things. And I think there's all it's like, they want you to say I was inspired by, you know, John Glenn being an astronaut or that was, I was inspired by Greta to save the environment. Like those are acceptable things. Nobody wants to say my kid was inspired by the violent robots fighting each other.

33:07But when you're talking about young boys, like that's meeting them at their level. Like I've been a young boy, seven months old. And he's already learned like what his new favorite activity. He's only seven months old. It is to take one thing in his hand and then find something else. And hit it as hard as he can to make the loudest noise he can. And if it doesn't make a loud noise, he'll then try something else. And once he discovers, you know, like some thing that he can hit on the pan and it makes noise, he'll just do that. And he says, this is fantastic. I'm just smashing these things together.

33:38People have been doing that for millions of years. I mean, it's just, I think it's good to inspire people where they are because that's how they're going to go do something else. Absolutely. I've argued with parents about this. They're like, well, I don't really want to, you know, I don't want to encourage violence. I'm like, he's not attracted to the violence. Yeah. Like battlebots is not about violence. It happens to take the form of a competitive gladiatorial style combat sport. It's about the machines, the engineering, the power of man's will brought to bear on somebody else's, the output of somebody else's mind.

34:10It's a duel of the minds camouflaged as a physical battle. And I think even kids understand that. And that's why they find it. So I tracked it. And so I argue with them, I say, guys, like if your kid likes battlebots, they're not going to go be a serial killer murderer. They're going to go on to be like an engineer. They're going to be an engineer. Exactly. For me growing up, it wasn't battlebots. It existed when I was a kid, but it took a while to get around. But like I grew up going to demolition Derby. Yeah. Amazing. And my dad was a car salesman. And his car dealership, the guys would build a car for the Orange County Affairs demolition Derby every year.

34:48And so you'd have all these car salesman on their off hours, you know, welding on bars, you know, super up this car, build something like, you know, for me, that was a really, really fascinating thing. And it teaches it's so hard to make a kid care about how to calculate the failure point of a span when it's just a bridge drawn on a piece of paper. Yeah. But when it's welding a cage onto a car, and you know, you're going to see it smashing another car just like you saw last year. All of a sudden that stuff takes on a really real meaning. And you all of a sudden understand it and we'll understand why you should care.

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37:01When did you first get interested in the software side of things? Because I'm hearing a very physical world view from you. So here's my secret. I'm a hardware guy who took the hard knocks to finally acknowledge the value of software. I am not a software guy. I'm a quite poor programmer. I have a good understanding of software concepts of computer science concepts. And I've obviously worked with software my whole life, but I am not the guy who doesn't really a good job of that. And I know that sounds weird, right? Because the whole like Oculus, it was basically a hardware innovation that relied on a software innovation.

37:40And then even with my new company, Andrew, I mean, we're an artificial intelligence company building defense products. And we have dozens of products that are all built on our AI platform. I'm not an AI programmer. I couldn't contribute meaning to fill that. But we have more people working on software than all of our dozens of hardware products combined. And it turns out that that's where a lot of the value is these days. And it takes a lot of effort. These things are not easy to build. And so I'm a hardware guy trapped in a software world. Have you ever met Mark Andrews? You know, I mean, he famously said, you know, software is eating the world.

38:16And he was right. Now Peter Teele has his book Zero to One about bits versus atoms. And I'm much more in the Adam's side of the specialty than. So continue the Oculus story. Sure. So I start this company. Yep. I hire a bunch of money. 15. So I started building VR head just when I was 15. Okay. My first ones were awful. Yep. My second ones were awful. I built dozens of prototypes over the course of about four years. And when I was 19 is when I built my first set of prototypes where when I showed it to my friends, instead of making fun of me, they said, I get it now. I had a series of different breakthroughs that all culminated in a prototype.

38:58Do you remember what they were? Oh, yeah. Tell me what was the first breakthrough? So the first breakthrough was the one that I described where basically you do geometric predestortion in real time, in a shader on a graphics card. So doing in software, what everyone else had previously done in optical hardware. And is that how it's done in video games? VR video games. Yes. Yeah. So like, basically, I had figured out how to make lenses that were very wide field of view to make you feel like you're in the game and very lightweight. How do you learn about lenses? So when I decided I needed to build VR headsets, I decided I had to educate myself.

39:30Yeah, we were talking about I'm building a theory of feet. I needed to learn everything I could about optics. How do you start? How do you do that? So you start by just looking into the fundamental principles. So you read some of the college, you know, textbook level work. Then you want to say, okay, I've learned the basics. I understand the concepts of reflection versus refraction. I enter the idea of compound optics. I understand the a sphere versus spherical optical. You learn the basics. Then you need to say, okay, where are the people who are pushing the limits? Or who are the people even who disagree?

40:01Who are the people who are taking unconventional approaches? And to do that, you need to go into a published literature. You need to read academic studies. Would you reach out to people directly? I often would. A lot of that was available online. And so I was able to get studies. Sometimes they would be available in paid databases. And that I didn't want to pay for it. If you reach out to the authors of the study, they'll often send you a copy just because, you know, as someone who's yeah, you're interested. They're interested. Yeah. They don't make money off of the database. People do. And then I also started buying old virtual reality headsets.

40:32And at the time, they were really cheap. So like there was a system, one system that I bought that originally when it was sold to hospitals as a data visualization device. Like basically, you know, pre looking at 3D scans of stuff, they bought it for about $90 ,000 in the 1990s. And I bought it for less than $200. Wow. There are I mean, you're basically throwing this stuff away. Nobody cared about VR. No, it's absolutely. It's garbage to anyone else. It's garbage. And so I actually over the course of those four years, built up the world's largest collection of virtual reality devices, over 100 different devices.

41:06And this is a teenager. And it's so funny because now everyone holds on to that stuff. And it's like, it's not even that the prices have gone up. They just don't even sell it. And so I actually single handedly destroyed my hobby of collecting virtual reality here. But I bought this stuff. And the first thing I would do when I would get it is take it apart. And when you take something apart, you learn, you might not learn so much. If you took a part of your headset, you might not learn all that much. But when you've immersed yourself in the field, it's almost like you can see what they were thinking as you take it apart.

41:37You can imagine the conversations and the trade off. Say, oh, I see the choices. I see why he did this. He was trying to get that weight out from here up here because he didn't want to have to have a strap over the top of the head to counterbalance it. I see what he was going for there, not the choice I might have made. And you could kind of, and you see some good ideas also. I would see good ideas as well. You see what wouldn't work and what might work. And many of these people, you'd see their older work. So I would even buy multiple headsets. Maybe they were built by like, there's a company called Olympus.

42:08They have the Olympus eye track line. And you can actually see over time the design changing. And you could say, ah, they realized this was bad and that this was good. And a lot of this was just lost knowledge. There's nobody talking about it out in the public because it all happened decades earlier, not as an academic thing. It didn't go anywhere. It didn't go anywhere. And it was commercial. So it happened privately inside of these companies. Didn't go anywhere. And so like, you've probably read a book about the creation of the iPhone at some point, right? Your Steve Jobs. Never. No. Well, I'll tell you, there are dozens of books about it because the iPhone is a success.

42:41There's endless material. If you wonder, how did they decide to do this? You can educate yourself a lifetime over. Yes. But VR failed. And so all that material was forgotten. No books were written about it. Nobody did anything. You know, one of the other things I did was track down people who had worked in the VR industry in the 90s. And I met with them. And there was one group of people. They were, they were the people who were some of the original co -founders of a company called virtuality. It was one of the almost successful virtuality companies. They had gone bankrupt, but they had run of success selling virtual reality arcade machines to theme parks, casinos.

43:20They had some at Walt Disney World. And I managed to track down a couple of the guys who owned the assets, remaining assets of virtuality. And I met with them in an olive garden in Kansas City, Missouri. I just wanted to ask them a bunch of questions. Why did you guys do this? Why was this done?

43:42And then some of the intellectual property of virtuality to me because I'm looking at starting a VR company. At this point, I was 18 thinking about it. And their advice to me was to run, not walk, not just from them, but the VR industry. The same dude, you'll never raise money. Nobody takes it seriously. Everyone will think you're a cook. And they said that the real problem with virtual reality, we've learned is not that it will fail. It's that it will haunt you for the rest of your life. You will be that idiot who believed in virtual reality. And everyone will think you're a cooking nutter. And they said, we're lucky.

44:19We've managed to find a second career as commercial real estate broker. They escaped, but only by hiding their past. And so their advice was run, run. And I did think about that because here's two guys who experienced it. But I was just so obsessed with it. I just couldn't get away with format. And a lot of their advice ended being right. I struggled to raise money. People thought it was crazy. So Peter Teal's fund, founders fund. They were the first institutional investor to write a check into Oculus. They gave us $1 million before anyone else really believed in us. And it was a very interesting conversation because I was talking with one of the general partners, Brian Singerman.

44:59And he's basically beating me up and saying, well, there's never been a successful VR company in history. What makes you think that you're so special? And I think their final thinking was, okay, for Palmer to be successful, this has to not just be a successful company. He has to create a successful industry. Yeah, market. He has to create it. And it'll be the first successful VR company in history. Yeah. If he's right, it's because he created an entire landscape through this company, which is difficult. It's very difficult. It almost ever works. And I think their final conclusion was this probably isn't going to work.

45:33But you know what? Here's a million dollars. Why not? Because venture capitalists, their business model is, they're going for power law. They take risks. Yep. A few massive successes pay for a long tail of failures. And I think they said, you know what? We've got six billion dollars in our fund. We've got to invest in something, a million dollars, like one six thousandth of our fund that we need to invest this year. You know, it's worth that. And of course, I'll jump ahead to the end of the story. I ended up selling Oculus just two years later. Two years later. Actually, well, less than two years later.

46:08It was actually exactly 18 months. So you get a million dollars. That's right. 18 months later, you stole the company for what? 2 .3 billion dollars. So it's pretty unbelievable. It was the right technology at the right time. I mean, and like they invested because they saw my demo. I showed them my headset and they said, holy shit, this is incredible. This is the best VR we've ever seen. Their problems weren't with me or with the tech. It was just can VR in general even be a market. They had already rejected it. The market had rejected it. And they knew it was, and it's not just their money. They say, okay, well, you're going to need raised money from other people and you'll struggle.

46:43You're going to need to convince employees to kind of work for you. It's going to be a struggle. You're going to need to convince game developers to support you. That's going to be a struggle. So the lack of belief wasn't even necessarily in even the tech. It's like, you're going to need to convince every group of the gaming and tech society to believe in this. And we somehow pulled it off. You know, we pulled it off. Remember I said in the 80s and 90s, the people who were most excited about virtual reality were the ones who hadn't tried it. They'd seen the matrix or lawnmower man, but they had never they didn't understand how bad it was.

47:17We took the small marketing budget. We didn't buy billboards. We didn't buy TV ads. We didn't buy social media ads. We just went to game conventions. We went to game conventions, set up a booth, set up a headset, set up a game and said, come try this. Play the game. Play the game. Put it on your head, feel like you're inside the game. Our slogan at the time was step into the game. Yeah. And so we had our little little band or our little crappy booth step into the game. And we went to genie sales used it for gaming before. People had tried to use VR for gaming, but it's just the quality. Not even close.

47:50And so we were the first VR headset I think ever were the people who were most excited were the ones who had tried it. That was how we got people excited. We went to the game developers conference, which just happened in San Francisco, you know, 2025 version. We went to show go. I don't have a reason to. I actually, that's not sure. My company, Andrew has a recruiting team there because we're we hire people with that skill set, but I used to go every year for Oculus, but I just can't justify. It's the same. I used to go to Japan three or four times a year because all the game developers were there.

48:21And I don't have a good reason to go to Japan every year, which makes me sad. But yeah, that's how we got people to care. We showed it to them. They saw it. And then they once you tried it, you understood, oh, it's actually here. The time has come. Okay. And I have a controversial question. In here now 2025, did VR fail again? That is a fair question to ask. And I will take maybe the unsurprising position absolutely not. It is not failed. There is a narrative going around where people are like, oh, VR has has totally failed. But like, let's look at this in perspective, the Oculus Quest 2, the last version of the best selling VR headset, Oculus Quest.

49:02I guess now it's Metacrest. They just launched the Quest 3, but the previous version that they launched a couple years ago sold over 20 million units. I didn't know that. It outsold the Xbox. Wow. So I read even these game outlets like, oh, my God, VR is such a failure. I'm like, it's outselling the Xbox. It's it is the third best selling game console platform in the world. This one VR headset. Also, there's like PlayStation, PlayStation VR, PlayStation VR, the first one sold millions of units. And the second one has sold millions of units more. So I would say looking from where I started, where nobody cared, like for it to go from people think it's literally like a failure to it is one of the most successful console platforms in the world.

49:44And Apple has launched a headset, Meta's launch a headset. Google is now kicking off a new effort. Like, it's hard for me to look at that as a failure. Like the United States of America is only 350 million people. And they've bought like 35 million VR headsets. Hard for me to look at that as a failure. I understood. But I think where the failure narrative comes from and where it's fair is the hype level that people put out where they say, we're going to have this on a billion people. This is going to change computing. It's going to become the dominant computing platform. I still believe all those things, by the way.

50:17I believe that it will become the dominant computing platform. And not necessarily like big bulky VR headsets, but it's something, you know, like a pair of Oakleys you put on and they augment your view. They trans. It's some sometimes you'll be in VR. Sometimes you'll be in AR. Sometimes you'll have nothing. Augmented reality. So think of VR as I've been transported to a virtual world. Augmented reality is I'm putting directions, you know, for where I'm going in my view. I know this world, but I'm getting more information. It's like the heads up display in your car. Exactly. There's this old concept called the virtuality continuum.

50:47The idea is that AR and VR are not different things. They're actually different ends of the same spectrum. One that is fully virtual and one that is fully real. Like imagine I'm in the real world. And then I add one dot marker. That's a little bit here. Imagine over here. I'm in a game. But now imagine that I'm able to see my hands in the game. That's a little more augmented. And then somewhere here in the middle, imagine if we were sitting here, like we're sitting now. Imagine if around us was, you know, some arbitrary, I don't know what's a plate. What's a place you like? Italy. Italy. Suppose that we're sitting here and it's me and you sitting and we're in Rome.

51:24And then imagine that it is that it turns out maybe you're sitting here and I'm sitting in my house in Newport Beach. And we feel like we're sitting in the same place and in Rome. That would be, you know, it's a mix of virtual content, real content. And do you think that's something that's coming? I think it is absolutely coming. There's cool. I still believe it is. But the future computing, it just asks the same question again that I asked about gaming. Okay. What's the next version of this phone going to be? That's pretty easy. You're like, oh, it's a higher resolution and that the internet speed will be higher.

51:56And I guess maybe it'll be a little thinner. Better camera. Better camera. Right. Exactly. But then ask yourself, well, what's the final version of this? What is this going to be in 100 years? Is it still going to be like a rectangular thing that I put my, no, it's probably not like at that point. It's probably some data implant that gives you superhuman vision where you can also see in the dark so you don't run into things at night. And it's a lot of - Will there be a way to talk toward devices directly mentally without an implant? Yeah. So I mean, what will that work? That whole field you're talking about is typically it's either BCI, brain and computer interfaces or HCI, human to computer interfaces.

52:34There's already very compelling technology to do this without implants. Actually, a lot of this has been developed by some of my former team members who are still at Meta. They have a device that you can wear on your arm. And people think that it just detects your muscle movements, but it's actually much more sensitive than that. You can actually send it signals using your nerve cords that it can detect that are we have no motion at all. You can basically learn to use it as an arbitrary data link to control things type. That's where all this stuff is going in the long run. And eventually you'll, you'll, you'll probably wear some wristband or, you know, something - And it'll just read your - Essentially read your mind.

53:12It'll essentially read your mind. I mean, I'll be reading your brain directly. But to be clear, I've got this particular opinion that I haven't talked about too much. But I believe that technology has moved in the wrong direction as a result of the iPhone exclusively. What happened with the iPhone is that it was so easy to use that everyone wanted to make things that were similarly easy to use. I mean, you can hand it somebody who, and with no training, they could puzzle it out in about one or two minutes. And it was, it was just extremely easy to become proficient. And up until then, mobile computing devices, but also a lot of normal computing devices, they required a lot of practice to use.

53:54You probably took you a while to learn how to type, right? To how to type, well - I still don't know how to type. It takes hundreds of hours of dedicated practice to become a good type -ist minimum. But once you do it, it's a superhuman interface. It allows you to do it. You can type, you can talk extremely accurate, you know, it's an input and output stream reading is much faster than talking. And so computers up to that point had been a superhuman input device. They elevated what we could do. We could do things that were far beyond what we could do ourselves. Steve Jobs famously said, he wanted a computer via bicycle for the mind, to make you more efficient, faster, able to get where you needed to go with less effort.

54:30The iPhone, I think, was a detour on that. We're going to just make computing really easy to use. An iPhone is not a superhuman productivity device, right? You can spend hundreds of hours using it and not come even close to the productivity of a person with a full -size keyboard and a full -size mouse and a full -size monitor. And this has been true for applications. People stop making video editing applications for consumers that require a lot of learning. And instead of making really basic simple ones, and they're successful. And that's what TikTok is. TikTok is like Sony Vega Pro, collapsed into like five buttons and made extremely easy to use.

55:06And that's why millions of people use it every day. But there's only so much you can do with TikTok, right? It limits your creativity. There are creative limitations to what you can do with an easy -to -use platform that has a low skill ceiling. Where I'm going with this is, I'm a huge fan of technology that raises the skill ceiling for dedicated users. Like I'm a big fan of technology that if you're willing to put in the time, it can make you something beyond human capability. And I'm finally coming back around. Human to computer interfaces, HCI or BCI, Braini computer interfaces. I'm not excited about them for making computers easier to use.

55:43I don't mind if my BCI requires 150 hours of training to even begin to be competent. If that means that at our 1000, our 5000, I'm like a superhuman god of information control who can seamlessly convey things out of my brain and into the world with no barrier. Like that's, yeah, I would train for thousands of hours. If we start with the idea that language isn't specific enough, if we could skip the language step, right? What people want is the Vulcan Mind Meld, right? They want to touch hands and then just the full conceptual idea, go back for it, the emotions associated with it. And I think that that's where we can get.

56:27But not if we keep using devices that capped the skill ceiling extremely low to what can be done with no training. Nobody even bothers to make devices or applications anymore unless they can be taught to somebody in a matter of 10 minutes. And I think that is to the detriment of society. The best things that I know how to do, not just in tech, in anything, anything life, they're not things I was able to learn how to do in 10 minutes. Yeah. And usually with those things that are difficult to learn, over time, you find ways to make them easier to learn as well. That's right. Just naturally. I mean, look at how we used to train typists on type writers.

57:03We then invented better schemes. We invented typing programs that were much more effective. So the amount of time it takes to become a competent type us, for example, is an order of magnitude reduced to when we first developed that skill. I think it's also the same for surfing. So surfing used to require a lot more falling and a lot more, a lot more trial and error. But as people have turned it, I don't know if it's exactly a science, but more like a science. They've seen, okay, it's a waste of time to even have people try to surf this type of condition. Like they're just going to fail and they don't learn from it.

57:37We've been able to basically perfect it and say no, like we can train somebody to surf now in an afternoon. That would have been unthinkable in the 60s. In the 1960s, like, oh, we're just going to teach this guy to surf today. What? No, you can't do that. You have to be in the ocean for hundreds of hours. You need to be in the waves. You need to deeply learn to understand it. And you need to learn to body surf. But now we've kind of perfected that. Did you ever learn to surf? I did learn to surf. I did learn to surf. I mean, I grew up in Long Beach, California. So I'm not saying I was ever particularly good surfer.

58:06But did you enjoy it? I did enjoy it. The problem for me is that I was I was captured by technology. So I was an outdoor kid until I discovered how awesome computers were. And then I became an indoor kid. I don't want to say I stopped going outside, but like maintaining proficiency and surfing. It takes a certain level of investment. Would you say you're obsessive? Yes. I'm an obsessive person. Yeah. Sometimes that's good and sometimes it's bad. Yeah. If you want to accomplish something, it's really good. That's right. That's right. If you want to build something, it's what it takes. It is. I mean, that's I think in some of this is like it's a creator versus consumer mentality.

58:46There's some people who are like, oh, you know, but like I think they they they look at people like me and say, oh, you're a workaholic. And my point is it's not the act of working that consumes me. It's the nature of the work itself. Like I enjoyed it. It's engrossing and I I I mean, I'm immensely satisfied by it. But there's a lot of people say, but Palmer, you have all this money. Why do you still work? You stole your company from billions. I would never work. You you're just obsessed with making more money. I have to make you guys. It isn't the money because I just have plenty of money. Yeah, you like to build things.

59:19I'd love to build things. And they're and I'm not saying there's anything wrong with having a more consumer mentality. Like there's people say, if I had your money, I would go retire to an island, my tie -in hand. I'm like, you know what? That's actually totally reasonable. But there's a there's a whole continuum of people in the world and just different people want different things. Yeah. And many people who think they want that get that and then quickly realize, hmm, this is kind of empty. It's true. I mean, my my grandpa was a pilot for United Airlines. He knew he was like me. He liked what he did.

59:52Hard charger. He was a hard charger. And when he retired, he became a he got his pharmacy license. He became a pharmacist, specifically a prison pharmacist. He was basically like a sub I know this sounds crazy, but he was basically a substitute teacher prison pharmacist. So prisons need pharmacies, right? They just do. They need people to dispense the drugs. You gotta have all the right licenses. But imagine that you're a prison that has a pharmacist who needs to go on vacation or imagine that your pharmacist trips and falls down the stairs and needs to go to the hospital themselves for a week.

1:00:25Well, all of a sudden you need a you need a substitute. And so that's what my grandpa did. And he found huge meaning in that work. And then he had other friends who your boys, they were tired and then they realized they didn't have anything to do. And then some of them went back to the workforce and some of them just went crazy. Yeah. And some of them died. Yeah. People die early when they have no purpose. That's right. I think it's really important to have that purpose. And I mean, there's a group chat called the Bee Boys Club. It stands for billionaire boys club. It's a people who have sold a company for at least a billion dollars.

1:00:59And about half of the Bee Boys are obsessed people like me who are like now on their second or third company and just loving it. The other half are people who are cruising the Mediterranean on their yacht. They're hanging out in Monaco watching F1. And it's so fascinating that you can have such a disparity between people who like we obviously all had it in us to do it. Yes. And then I think it's when you get the money is where you find out what someone's true nature is because there's some people where they were doing it because they loved it. But also because they wanted that financial independence and the money once they had it, they had what they really were looking for, which is financial stability.

1:01:41And there's nothing wrong with that. My grandpa always stressed to me that financial independence is one of the best goals in life. Not being wealthy independence. The idea is to achieve the level of wealth that allows you to say, I don't have to work today. Not have a boss. To not, I don't have to have a boss. If you have a boss is do this thing that you for your principles to just root to have the power say, no, I'm independent of you. I am not going to do it. And you can fire me. It doesn't matter. I'm perfectly fine. And so that was that was for me in early goal was a goal of Oculus in building the companies to sell the company.

1:02:21No, it was the opposite. I honestly felt like I had forever. It was your baby. I thought I'd have it forever and just I mean to be totally honest, if you start a company to sell, you start a company where there's buyers. There's lots of a big laundromat companies that buy laundromats. There's lots of big tech companies that buy compression algorithms. There's lots of hardware companies that buy new display technology. There's nobody to buy a VR company. There's no market. I assumed that I was just going to be this crazy guy tilting at this windmill. And I saw a very high probability would fail.

1:03:00But at least I would have got to do it. I would have got to do it. I would have gotten to for at least a few years work on my passion, which was trying to make the best for to reality the world's ever seen. And I knew that if it did work, we would create an entire industry. And if I've been creating it to sell, I would have picked something different, which feels like there's something to learn there. Yeah. Was there any emotion involved in selling it? There was some emotion, but it might not be what you imagine. I mean, usually when you sell a company, they take over your company and they like that.

1:03:31That's it. When Facebook bought Oculus, there were two elements of the acquisition that made it to the Renown Negative emotions, or at least very few. The first is they said, you'll be a wholly owned independent subsidiary. You'll get to make the calls. You decide what to do. You're going to keep getting to go make this happen. Now, okay, so that sounds great. That's good. And the other bit, they originally offered us $1 billion. And we said, no, because we just weren't interested in selling. They came back and said, okay, two billion. We said, no, we just weren't interested in selling. Because I, at this point, like 18 months in, when we started the company, it seemed crazy.

1:04:07Nobody believed in us. 18 months in, because we'd gone all these game conventions and showed it to everybody, everyone believed. All the top game developers were making games for our platforms. All the gamers were excited about what we were doing. So we, we, we, we, we had convinced people. But the thing that really convinced me was when Facebook came back and said, okay, not only will we buy your company for two billion, in addition, we will commit to giving you a billion dollars in research and development funding. How? Minimum for the next 10 years. That's incredible. So to me, I'm running the numbers.

1:04:42I'm like, well, shoot, how many VR headsets do I have to sell to get a billion dollars of research? And they were willing to do this because they saw it as a long -term investment in the future of computing. I mean, I would need to sell millions and millions of VR headsets at a huge profit margin, which is hard. Yeah. And I, I calculate, like, at our margin at the time, we're like, we were making 20, you know, $20 a headset. I was like, shoot, I'm going to have to sell like hundreds of millions of headsets to get this amount of money. Yeah. It's just not going to happen. And so as a guy who really wanted to push the state of the art forward, that was, that was an unimpossibly good offer, $10 billion in research and development funding to do whatever I wanted, however I wanted, which is all you want to do anyway.

1:05:25And then, and now all of a sudden, I was going to have $10 billion to do with instead of a few million dollars. And so that was really what motivated me. I remember really explicitly, when there was an email thread after Mark had made this proposal to us. And someone said something like, well, they say that they care about it and they do that. But like, you know, who's to really say what would, what how things will go in the future? And I said, look, if Mark is playing us, then he's Van Halen because I mean, he was, you know, masterful, right? It would have been like, he came in with exactly the thing we wanted to hear.

1:05:59Yeah. And, and was just lying about it. And I, I couldn't imagine that. It was very clear that Mark did also believe in it.

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1:07:39Did you see a life for VR past gaming or did you think gaming was the ultimate play? No, I knew there was a huge past gaming. Actually, before I started Oculus, I worked for about eight months in an Army Research Lab on a program called Brave Mind. I don't know if you've ever heard of it. But I have. You might have. What would I have heard of it? So it's based in Los Angeles at the ICT Mixed Reality Lab, which is an Army affiliate research center. Between the US Army and the University of Southern California, it's basically the ideas to bring Hollywood type technology and work on military problems.

1:08:17So the Brave Mind program was using virtual reality exposure therapy to treat veterans with PTSD. The idea is that you could train them to mitigate their physiological responses, reduce their dependence on medication, improve their quality of life. And so I was working on that even before I started Oculus. I wasn't like an important guy in the program. I was a lab technician. But I knew from that experience alone, VR was going to be huge beyond just gaming. I was personally most motivated by gaming. But there was another factor that made gaming the right place to start. At the time that we started the company, the only computers that were capable of running virtual reality at a high enough frame rate to make you not get sick were gaming computers, very, very high -end computers with high -end graphics cards.

1:09:06And so who owns gaming computers? Well, gamers. Exactly. And so you could say, well, wouldn't it be great if we could make this to help relaxation or meditation experiences or like virtual travel for your grandma, but your grandma doesn't own a gaming computer. And so all of a sudden, for her, the price to buy into VR is thousands of dollars. She has to go buy a $1 ,500 gaming PC and all these accessories. And then buy a VR headset. Where as the buy -in for a gamer is a few hundred dollars. And which is a much more reasonable thing. And so we always knew that as technology progressed, it would become more accessible.

1:09:45And in particular, we invested very heavily in what we called standalone VR technology. So building VR systems that had their own processing on board so they didn't need any external computer. And that's what became Oculus Quest. At the time that I was fired, it was called Santa Cruz was the internal name of the prototype. And we just started showing it publicly. A virtual reality headset that did not need a computer. It rendered all of its own imagery using specialized chips on the device itself. And that was a crazy thing back then. But now most VR headsets are independent. You don't need any kind of PC, much less than gaming PC.

1:10:23Lots changed since 2012. Yeah. Getting fired was not part of the plan. It was not part of the plan at all. How did that change things for you? It was interesting because it had nothing to do with virtual reality. So I gave $9 ,000 to the wrong politician to give money to if you live in San Francisco. I was immediately then put on leave. They tried to find some way. Weasen they could fire me. There was a whole internal investigation. Honestly, I thought they were going to find something on me because you work in a place where you're in charge of a thousand employees for three years. You assume you did something against the rules at some point.

1:10:59But they did a whole internal investigation and they concluded I never violated any Facebook policies. And so then they had to let me go for no reason at all. There's like, well, we can't come up with a reason, but we don't want you around anymore. It was purely political. It had nothing to do with my work performance. And that was very frustrating because I think it would have been a lot easier to stomach if it had been for doing something. Or even if it had been something I did even at work. Even if I just rub someone the wrong way at work, but it wasn't. It was purely outside of work that upset them.

1:11:34And I'd already been thinking about what I would do if I weren't doing VR because I really wanted to work on something that was impactful. So I had decided quite a while earlier that if I were going to ever start a new company, I wanted to work in the national security space. And I wanted to apply technology that I thought was important like augmented reality, virtual reality, artificial intelligence. How did you pick that? Well, part of it was what I said earlier. I had worked on this Army program brave mind earlier. And so I knew just how bad the government was at developing technology that could really make a difference for men and women in uniform.

1:12:15On the battlefield and off the battlefield. And I know it seems hard to believe today. But if you rewind back to like 2014, 15, 16, 17, all the big tech companies were very, very much in bed with China. They all thought they were going to get into China. They're going to make a lot of money in China. They were making censored versions of their products for China. China was a manufacturing base. So manufacturing base for hardware companies, an investor base for all tech companies, media companies too. And the Hollywood in particular saw them as a market, right? It's a growing economy. A lot of people.

1:12:54Lots of people. And so tech saw them the same way. They said, you know, maybe China is not a huge part of my business today. But I imagine that in a few years, they might be the largest part of my business. And as a result, tech companies refused to do any work with the United States military. Not because they were, you know, they thought it was on ethical to do so. It was a business decision. They said, I'm, I'm not going to worry the US military because if I do, China won't let me make money. And I got really worried about this because I saw it as a very dangerous experiment that we've never run in this country.

1:13:25What happens if you completely divorce our most innovative American technology companies from the United States government? This is never happened in history. You always had a very close relationship. I mean, that's where Silicon Valley came from. It's where microwaves came from. It's where the all the more that they destroyed. It's where GPS autumn, exactly. And this was a very recent thing. And I said, shoot, this is like, this is actually very dangerous experiment to run. Because if it goes the wrong way, we're just going to be a irreparably far behind dictatorships like China, Iran, Russia, who are heavily investing in technology for military applications.

1:14:10And so I've been thinking about this for some time to be honest. If I had not been fired, I think I would have been happy to keep working on VR for the rest of my life. I had said so many times. But if I was not going to be allowed to work on VR, then I knew what I wanted to work on. Do you ever consider buying Oculus back? The problem that you have with that is Mark Zuckerberg truly does believe in VR. And they are. And just the virtuality continuum. I mean, he changed the name of Facebook to meta because he believes in the metaverse. The idea of this virtual world that exists parallel to alongside and enmeshed through the physical world.

1:14:53He believes the future of computers is that the future of communication is that the future of the internet and social media is that. So I guess the point is when you say, could you buy back Oculus? It's really could you buy meta? And I need to check right now. But I think Mac has a market cap, something like $500 billion, $600 billion. I don't have that much money. Yeah, he wouldn't sell the thing that he believes is the future of the company. It's just not not practical. Do you believe it's the future? I do. I think different people maybe disagree as to the timeline. But something really strange would have to happen.

1:15:30I think for augmented reality and virtual reality to not be the end game. Like virtual reality is interesting because it allows you to have literally any kind of experience, any kind of interface without physical limitation. And so any, I imagine if you said, oh, the future is not, you know, it's not AR. It's actually, you know, it's actually phones. So my AR would allow me to simulate any type of phone you could ever imagine. If it's good enough, which it will be. And at some point, AR and VR will be distinguishable from reality and their quality. So if I can simulate literally any type of physical device, any type of user interface, any type of environment, how could it be that some small subset of that capability is going to be the thing that actually we're using?

1:16:17I just don't see it. We already living in a simulation. There's a classic question, right? Are we living in a simulation? I think that if we are, there's insufficient data to determine it one way or the other so far. There's lots of very interesting thought experiments. And one of the ones that I've always liked, it's not based on data. It's more of a logic puzzle based on probability. It's okay. Do you believe VR can ever become for an individual person indistinguishable from reality? And some people don't believe it. I knowing the tech, I just can't imagine a world where it's impossible. It will happen at some point.

1:16:54Maybe it'll take 10 years, maybe it'll take 100, surely a thousand years from now will have figured that shit out if we're still around. And if you believe that, then the next obvious question is, well, if you are sure that we can build VR that is impertinent, that is indistinguishable, what are the odds that you're living in a base -level reality right now? Like, if it's possible in the future, wouldn't it have been possible, if you're a simulation, wouldn't have been possible in the past? What are really the odds? Because imagine a world where we build perfect simulation, we all live in a giant simulation, or maybe just one person is.

1:17:26Maybe everyone is our personal simulation. And then imagine that simulation. There's a simulation. And that level is a simulation. If you believe that perfect VR is possible, how likely is it that you're in the base -level reality? And it's kind of hard to argue with that one. But there's no data to really support it. And of course, there's one conclusion you could take away from that, which is that we will not be able to build VR technologies in indistinguishable. Like, you're familiar with the idea of the great filter. Oh, there's this concept, the great filter. It's basically, there's just problem.

1:17:59If life is random, and if life can spring to life randomly, why is the universe not full of life? Why is the... You don't know that. So we don't know that it's not full of life at some kind. But why is it not full of life like ours? I mean, we make a lot of radio waves. They travel out of the universe. If there were intelligent life all over the galaxy, there should be just a huge amount of background radiation. We should be able to detect something. The great filter is the question, what is stopping that from happening? What is the thing that's stopping there from being intelligent life radiating signals all over the galaxy?

1:18:37And there's many theories. Like, one theory is that species typically don't develop. Like, maybe there is life all over the universe, but it usually doesn't develop to the point where they have radio waves. Another is that one... Why would radio waves be the thing? It's like, maybe that's our thing, but that doesn't mean it's their thing. It could... And that's part of it. It could be that most... Maybe they're either... Maybe we don't have the receivers that pick up whatever their thing is. These are questions that go into the... into the great filter. Like, one of the theories is that they're communicating in some extra -dimensional level that...

1:19:10Like, maybe we've spent way too long muddling about with radio. And normally they go straight up to, like, psychic telepathic, multi -dimensional communication. And we're tuning in on the wrong dial. That's... That is one of the great filter theories. Another theory is that any civilization that invents nuclear weapons, extincs itself very quickly. And so, maybe there are briefly pockets here and there, but we don't see it everywhere because they all just wipe themselves out. One of the other theories is actually virtual reality. It's that eventually they develop sufficiently and they all just plug themselves into VR and they don't bother emanating radio waves or exploring the galaxy.

1:19:48They're just insular and in their own planet. And it's one of the things that a lot of theories for why this might be. But we don't know. There's not a thing. You can only really speculate. So, I see a lot of similarities between the... Are we in a simulation question? And why don't we in detect intelligent life? Is it because there is no intelligent life? Oh, here's another one you might like. One of the theories is that societies that develop quickly realize that maybe it's not a smart idea to radiate in this space because you're announcing to everybody, here I am, I'm a threat, I'm a developing society that might come for you in your resources.

1:20:27And it could be that everybody who emits radio waves just gets whacked out of existence by extraterrestrial powers who don't want any competition. And that's what most of the 1950s movies, sci -fi movies are, that's the story. Mm -hmm. And there's some pretty smart people who look at things like our search for extraterrestrials when we're listening, but also broadcasting and they're saying this is the dumbest thing ever because anyone that could get to us, anyone who has the technology to get to us, probably not going to be good news for humanity. Of course, we want to believe that they're going to be advanced in morality and that they're going, but the problem is our version of morality is uniquely human, right?

1:21:10It's not even a matter of, it might not be a matter of morality to them. It might be that we are like ants to them. Like, what if that's really the level that they see us on? It's not even immoral for them to just wipe us out. One of the great filter explanations is that we are living in a simulation and that that's actually why we don't detect anything. It's all just a simulation and why would you simulate, endless simulations out there if you don't need to? Will there be a time when the virtual reality experience can happen without wearing a device like a communal location where everybody gets to beam to another place?

1:21:52The technology to do that is certainly physically possible. There's even systems that can do this to a certain degree today. What it comes down to though is that most of the schemes to do so aren't as good as just wearing a pair of glasses. And remember, it doesn't even have big pair of goggles. You can, like, even being able to wear like, you know, a pair of oak leaves is a huge step over trying to do it without them. Like, there's a few ways to do this. So like, one of the science fiction favorites is go straight to the brain, right? You pipe all the information right into the brain. The problem is the parts of the brain where we do that type of visual processing are very tight clusters.

1:22:34It's actually very hard to stimulate individual neurons inside of it from the outside. It's hard even with implants to do it. They're so tightly clustered that really they only want to talk to each other. It's very hard to activate individual neurons without activating the ones that are around them. And effectively, it's a resolution problem. The matter is so dense. It almost be like saying, do you see that giant huge pile of salt over there? I want you to reach in and grab the one in the middle, but you can't disturb any of the others. It's a very difficult problem. For that reason, I'm generally a fan of VR schemes that don't go straight to the brain.

1:23:12They just clip on the end peripheral nervous system. So our hearing, our sight, our touch. And then if you're going to do that, I've got to get light into my eyes somehow. And there's some really wild schemes. I've heard people say, well, you could use like focused x -ray beams to activate rods and cones on your retina. And you could have like, everyone could be walking around and you have x -ray beam firing at everybody, drawing images on their eyes. But then why wouldn't you just put the x -ray projector on a pair of lenses? Or just put a display projector and just project photons into their eyes just like the real world does.

1:23:49It turns out like what we have is already really good. It's probably best to just copy that. You build a system. It's a way to have the glasses without glass where it's projecting onto your eyes, but from locally. You mean like, so you're pairing pair of glasses? But they don't have any lenses. No lens. Yeah. It's projecting at you instead of reflecting. So there are, you can make transparent lenses. That is something you can do. So I can make a thing where I'm wearing transparent lenses that are still projecting into your eyes. But did you say projecting into your eyes or is the screen that your eyes are focused on?

1:24:23It depends on the display technology. Yeah. Like if you're using, there's something called a virtual retinal display where it basically usually uses a scanning laser kind of like what you're talking about coming off of a thing that's on glasses. And there's no display in the whole thing. It's just basically painting an image through your lens onto the retina. So like, you know, an old CRT TV, you know, it goes to zoom zoom zoom zoom zoom. Imagine a laser that paints an image like a CRT does. So why would you be the last to be necessary for that? The problem for it is that if you want a wide field of view and you want to be able to rotate your eyes, it needs to be able to paint it from any angle.

1:24:57So imagine like imagine this. Imagine I made something where it shoots in from here and I don't know any lens. But what if I rotate my eye over here? Now I need light to be coming in from this angle. I can't shoot light, you know, from here that comes into an eye that is pointing over this way. Whatever your scheme of projecting the ray in needs to physically cover the angle at which your eye can rotate and look in any direction. More or less. There's ways you can get around that. For example, X -ray beam thing I told you like you that doesn't need to go through your eyes lens. That could get X -rays to go through your head and you know focus on your eye.

1:25:34But like that's crazy shit. Nobody's ever done this. It's a hype. It's a thought experiment. Another one is people have proposed what they call light field displays that create projections of light that are correct from all angles. And there's been a theory where you could make a room where all of the walls are light field displays. And basically imagine a world where like if I'm looking this way and now I look this way, the wall over here is now projecting the light field into my eye. And so you get a full light field room. You could do that. But there's actually things that a light field room can't do for you.

1:26:08Is the sphere kind of like that? The light field room idea? It's a little bit like that now. It's a little different than it's it's not 3D or capable of you know doing things up close to you. But yeah, like yeah you're right. It surrounds you. It surrounds you. But like here's a thing the sphere can't do. What if I'm playing a game and I want to be holding a sword? The sphere can't do it. It can't draw an image of a thing attached to my hand. Let's say that I just want to do real one. I'm imagine I'm a knight. I want to be wearing gauntlets. The sphere can't wrap virtual imagery of a knight's gauntlets around my hand.

1:26:40Whereas if I'm wearing glasses, I can absolutely do that. In fact, there's things that do it today. So there's just limitations. If you really want pure VR, the best way to do it. I know everyone wants to get away from glasses. But at some point it's still the best way. Exactly. It's not that you couldn't do it. It's with all the trades. Glasses are going to end up being the best way. And I think they'll be very slim glasses. You could also there's a company, several companies actually making augmented reality and virtually contact lenses where you can have a contact lens that flips on and off.

1:27:09That's interesting. There's another whole area which is companies working on implants for your eyes. They're focused right now on blind people. So imagine people who have some severe form of macular degeneration. There are ways where they can implant a display in their eye. You know, it's then that it's hooked up to a camera and it gives them their sight back. Of course, once you build this, it's also a VR system. You could pipe in a view that is not from a camera, but rather rendered by a computer. So I think probably for the next couple of decades, at least implants are going to be for blind people.

1:27:45But who knows? Maybe we'll begin to implant someday.

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1:29:28Who is John Carmack? John Carmack, one of the smartest people in the entire world. He is a genius who deeply understands the nature of hardware and software and how they work together in tandem. He's kind of the father of modern gaming. So he created doom. He created quick. He created the modern 3D game engine, the modern first -personer. He's the guy who basically made the foundations of the game industry as we know it today. And not just created like he had the idea. Like he personally coded it and then was at the top of his game for decades after that. That's covering what he's best known for.

1:30:10These days he's working on AGI, artificial general intelligence. The idea of building an AI that can self -learn, it's super intelligent, it applies to anything, it can do anything, it's not specialized. He's been working on that for a few years now. But in between those two things, he actually worked together. So back when he was still working on video games, he actually found out about my Oculus Rift prototype reading about it online and asked if I would lend it to him. And I lent him one of my prototypes and he had been trying VR stuff for years. And he immediately went online and said, this is the best virtual reality he had said the world has ever seen.

1:30:49This is by far the most impressive system that has ever been conceived. Was that before you sold and before you this was like right as I was starting the company. So I was 19 years old time. His endorsement was a huge deal. In fact, him saying that caused Sony to approach me and offer to buy me out, hire me and let me run a virtual reality research lab in Santa Monica. They said, we will put you as 19 year old kid in charge of Sony play stations virtual reality research division. That's how good it was. And he and he showed it to them. So he had this prototype and Sony would have fired you to.

1:31:27So this is interesting because I don't think they would have fired me for several reasons. This is a fun hypothetical to explore. So first of all, Japanese companies, much less prone to firing people. They instead will they'll take away your work duties. They'll make you they'll assign you to sit at a desk and do meaningless busy work. They basically try to get you to quit by making your job just really, really awful. But not like awful like they'll scream at you. Just you sit at a desk and do nothing. And eventually you'll talk about you'll tap out. Yeah. That's that's the Japanese way. So that's one reason they wouldn't have fired me.

1:32:02But the other reason is at the time, all of the 3D and VR R &D work was being funded out of the budget for the Sony Liverpool office. So in the UK, they had an office focused on high frame rate 3D rendering technology. This was the team that made for example, the PlayStation 3D monitor. They were the entity in Sony that was doing all the programming to add 3D TV compatibility to PlayStation 3 and PlayStation 4 games. And so that was what was funding all their 3D and VR efforts. And if you can believe it, they offered me this job in guess it would have been July of 2012. But I thought about it.

1:32:50I actually turned them down and then they doubled their offer to me in terms of compensation. And I turned them down again. And then less than a month later, Sony Liverpool was shut down by Sony corporate. Wow. And so if I would have done it, it actually, it's a, I wouldn't have gotten to the point where I would have fired. I would have been laid off because what they wanted to do was not just hire me. They wanted to acquire all my technology. So imagine a world where they acquire my technology and then just do before we're able to prove it, before we're able to get it anywhere. Shut it down. Yep, shut it down.

1:33:22It was just a decision by Sony corporate in Tokyo. You know, the three stuff's not really making enough money. Shut it down. We've given them enough shots. There's a world where all my tech was trapped in Sony. They bought all the rights and then I was never able to use it again. How do you think the world would be different if you weren't fired from Facebook? Oh, man. I mean, I probably am no different than anyone who's been fired in thinking that they, things would be better off if they had. You know, I'd be doing things. If I was still there, thing, you know, the things would be a lot different.

1:33:56But I'll tell you what I believe. Yeah. I think a lot more VR headsets would have been sold. Yep. I think the market would be a lot healthier and more self -sustaining. I think that I would have focused less on the audience that I hoped to have in the distant future, which is like the mom, you know, doing virtual travel to Rome, the grandma doing virtual cooking lessons. I would have focused a lot less on that audience. And a lot more on the, I would have doubled and tripled down on the audience that did exist, which was gamers. Yeah. Get all of them. Get everybody. Instead of out selling Xbox, out sell everything.

1:34:36Be the dominant thing because how am I going to get to a billion ordinary people who have a very high bar for just for them to spend their money. It needs to be very high quality. It needs to be something they need in their lives. Something they would rather buy this than that. And VR just isn't there for the average person. They are better off spending their money probably on something different. A gamer on the other hand, like his options outside of VR get back to that story I told earlier. You have a screen. Yeah. What are you going to get a bigger screen, bigger resolution? That's it. That's what your future is going to be.

1:35:11And so, yeah, I would have focused very much on capturing the audience because it's also a matter of how much you spend. You know, there's something called the CAC in lots of industries, but including the tech industry. Customer acquisition cost. What's your CAC? And your CAC can be driven by marketing spend, so TV ads, social media ads. It can be driven by going out and paying celebrities to use stuff that then turns into people want to buy. But you blend all of your costs together and divide it by the number of people that you attracted. That's your CAC. How many dollars per person did it take to attract that customer?

1:35:46And when you're trying to attract people who barely need your thing, you might spend hundreds of dollars convincing each person. But when you have somebody who already really wants what you're doing, your CAC might be a dollar or nothing. Anyway, I just feel like there's a lot of the... When I left, right before I left, there was something I said about our marketing efforts. And this was... I had already been... I was being fired, but they hadn't quite deactivated my badge yet. One of the last things I said to the marketing team was, you need to get some people in this room who drink Mountain Dew, not Starbucks.

1:36:20Yeah. Because there's way too much Starbucks here and not nearly enough Mountain Dew. And I don't even have to explain it. You anyone can hear that and be like, I understand exactly what that is. Did you grow up drinking Mountain Dew? I did. Of course, I'm a gamer. Gamer's drink Mountain Dew. It's just... What was your order at Jack in the Box? So my favorite Jack in the Box item was unfortunately just continued a long time ago. It was the Turkey Bacon Cheddar Melted Sandwich. It was so good. You had your crispy bacon, a ton of cheddar cheese, and then a ton of smoked turkey on sourdough bread.

1:36:56Then they would grittle and it had this Chipotle mayonnaise sauce too. It was really great. They don't make that anymore. The sourdough steak melt was my favorite second favorite thing. Also discontinued if you can believe. I don't get what it is. But I really love Jack in the Box. Egg rolls, pork egg rolls. Have you ever had those? I never had those. You should try. It's actually legitimately competitive with egg rolls. You would get in a really great Chinese restaurant. And in many keys, I think even better. What? I mean, they're deep fried. So that helps. But I mean, yeah, you probably probably looked up that Jack in the Box.

1:37:31One of my favorite last... Well, I grew up eating Jack in the Box as well. So I heard that you ate Jack in the Box like, okay, we grew up in a solar environment. So I grew up in Long Beach, California. And the Jack in the Box was the place where all the delinquents hang out. So you know, like the kids smoking weed. And it was not the good part of town. But I loved Jack in the Box. And when I was, you know, living in a trailer, I ate a lot of Jack in the Box. Because I know it sounds crazy today when fast food is so expensive. But back in the 2000s and early 20s, fast food was was cheap. It was legitimately cheaper than buying groceries.

1:38:06And I ran the numbers because I was trying to get get by like one of the coolest things that happened to me as a teenager. It felt to me like I had won the lottery. Jack in the Box used to have a loyal customer program. And managers could hand out these little cards purely at their discretion to any customer they wanted. Typically loyal customers who came in a lot. And it gave you 10 % off of your order at Jack in the Box. Any order 10 % off your order. And it could be combined with all other promotions. So if you had a buy one, get one free. Yeah. 10 % off that one that you're buying. If it was, if you had one where you know, it's, oh, it's not a $5, you know, combo.

1:38:47It's a $3 combo. You still get 10 % off. And so I got one of those cards and it felt like I had won the lottery. And every time I go in, you know, I'd roll in with my card, flip it out. Oh, yeah. I'm a loyal customer here. And unfortunately, they discontinued that program by the time they discontinued it didn't matter. By the time they discontinued it, I was already a billionaire. But I got to tell you, you know, for emotional, you were connected to it. They were in the club. Yeah, I was in the club. I was, I was, I was, I forget, what did they call it? It was like the valued customers program.

1:39:21It was something like that. I'll often dig it out. I still have the card. They didn't take it away from me, but I'm hoping that fast food actually comes back around to being cheap. It has a lot of things going for it. First of all, the portion sizes tend to be smaller. Whereas like, all of garden, a lot of food gets plated, but not eaten. So fast food, they, they're tensed to not be much food waste on the consumer side, but also not much food waste in the kitchen. They don't have spoiled stuff that they're throwing out because they, they go through so much volume and they have such a continuous supply chain.

1:39:51They call it just in time delivery. Jit, basically things get delivered in, ideally, like just as they need them. They don't have tons of stuff just sitting on a shelf that you go bad. And so their food waste is very low, which then brings their food cost way down. Their utilization of their energy is very high. Like when you make something in your oven, you're heating up that whole oven to make one thing, and then it cools down when a fast food place or like I imagine if you were going to fry something, I mean, you're going to heat up a whole that of oil, probably to deep fry like a few things.

1:40:24Yeah. There, that same heat energy now gets put into everything and it keeps going and it's very high utility. So the energy costs, the food prices, the waste, it's actually much less at fast food. And so I'm actually pretty bullish that if we can get the right dynamics going in our country again, healthier ingredients in them, healthy, healthy ingredients. And then I think the big game changer is going to be autonomous food delivery. Right now delivery food costs a lot because you're paying for a guy to drive a car around it. It's a whole, I mean, it's a whole ask, you know, multi -ton vehicle to bring you a burrito.

1:41:00That's crazy. When you start seeing this automated drone delivery stuff actually take off, the energy cost of the delivery goes down by literally 100 times. The price of the delivery can go down by literally 100 times. So imagine a world where you know, for me to build a burger, I have to go buy beef. Some of which, you know, has expired of the grocery store that's packed into the price of the cost. Some of which I might not use, that's got to be factored into the cost. I've got to buy all these condiments and I've got to carry those eventually. Some will go bad or you know, like they're buying in bulk.

1:41:30I think within a few years with autonomous food delivery, we might be able to have healthier, better, food made fresh fast food style delivered to your door cheaper than you'd be able to make yourself. So this is one of my wacky future predictions is in the future, kitchens will be strictly for rich people. You will not dedicate a huge chunk of your apartment or house to having a huge kitchen to prepare food. This food will just be available. Yeah, exactly. You'll be able to get it whenever you want it immediately at a very high level of quality, you know, basically on demand. And the only people who have kitchens, it'll be like people who have, I don't know, what's like an indulgent rich person thing, stereotypical record player.

1:42:14A record exact. It's for cable. It's the person who enjoys the process. They're not trying to listen to music. They're trying to engage in the hobby specifically of playing vinyl records. They know the thing thing. If you're trying to eat, food will come to you from the robot where they'll shoot the burrito missile in your yard. And if you're, if you want to cook, that will be a thing that you do and it'll still be a thing. But no, no, it's a little dystopian, but it just, it seems, it seems likely that that's where it's all going. What's the first thing you ever remember building? It depends on your definition of building.

1:42:45But the first thing I remember is like a thing I made was I had realized at some point in working with my dad on cars that shorting battery terminals was bad, right? You know, you have your sharks, sharks, sharks, and then if you have something that hits the terminals and welds itself, you know, it'll get really hot and you can start a fire. And I realized to myself, oh my god, I could take this principle and I could use it to build a lighter that is purely electric. And so what I did is I took a paper clip and I bent it in a wacky, weird way around the negative terminal of a nine volt battery, just a little, little, little, little one.

1:43:28And I bent it so that you could push down on the, you know, the bent other end touch the positive terminal. And then it would make the paper clip. It was a very thin paper clip, very, very hot. But of course, that will burn your finger. And so I added a blob of probably JB welds, some kind of what is that? JB weld is an epoxy that's often used for automotive parts. It's very, it's high temperature resistant. I see. I do. What your finger was touching wouldn't get hot. Exactly. And I put, and I put part of a, of a clothespin on top of it so that it was wood insulated glued to the metal. And I could touch it down.

1:44:05It would make the metal very hot and you could touch it to things in light them on fire. And it worked. That was the first thing I ever made that I conceived of myself. I done like things were really, I didn't like little kits. Like, oh, I put together the balsa wood airplane with the rubber band. That was the first thing I wear. I came up with it. I did all of that. I went to rocket camp. But that electric lighter was the first thing I ever built myself. And I think I was, I probably would have been six or seven years old. So, I don't know. I think that's pretty sharp for a six -short to come up with.

1:44:32Super. One of the other things I built early on was a, it was a stun glove. So it was a glove that you wore that had two spring -loaded pins on the punching face. And then I wired those to a with really, really horrible, you know, nine -year -old soldering to a capacitor that was charged up by a disposable camera. So basically I took a photo flash capacitor, used a disposable camera, started to charge it up from a little AA battery. And so it would charge it up. And if you touched both terminals to your skin, it would give you a massive electric shock. Knowing what I do today, it was ridiculously dangerous because it was 330 volt photo flash capacitor.

1:45:14Massive amps are what kills you. Volts are what hurts. Amps are what kill. Wow. And so like tasers are like millions of volts, but high -neighamperage, because Amperage can't, yeah, Amperage is what kills you. They want very low amps. So it wasn't until years later that I truly understood how dangerous it was. It was extremely, like if I ever would have touched one terminal to this side of my body and the other to the other and caused it to get low across my heart. Yeah. Extremely high chance it would have stopped my heart because amps kill. And your heart can be disrupted quite easily there. But I didn't know.

1:45:48I was nine years old. I still have that love. And so I've got a whole bunch of my wacky inventions from when I was a kid. So cool. Okay. So the Game Boy is an old game that you modded and made new. If you were to make a game from scratch with no reference to the past, what would that game be? A game from scratch with no reference to the past. Something something totally new. Totally new. You could make the game of your dream. What would it be? So I had this idea of a game where severe consequences for playing it incorrectly. Why? Whatever you define incorrectly as our inherent part of the experience.

1:46:31You're talking about repercussions. Reparcussions. Yeah. Like exactly because in the real world, what you do has severe repercussions. You can't just do whatever you want. And I know in a game is why I want to do whatever I want. Well, sometimes constraints are what makes something interesting. So I imagine this. The original idea that I had was what if you made a game where when you die in the game, it destroys the VR headset that you're playing with. And you can never use it again. It's almost like a version of Russian Roulette, not as deadly. And the idea would be rather than it being based totally on chance.

1:47:02It would be based on your decisions. Imagine an MMO RPG. I don't know what that is. A massively multiplayer online role playing game. Like World of Warcraft. Yeah, you have some concept of World of Warcraft in your mind. Like Dungeons and Dragons, but it's on the internet. Have you ever played Dungeons and Dragons? No, I'm not. Oh, you're missing out. I play Dungeons and Dragons every week. Really? Oh, yeah. Oh, yeah. I play as a Will. Have you played it for many years every week? For many years with the same group of people. That's great. We all get together. I'm a wizard named Nollrim V who's from Atlantis.

1:47:30And he's trying trying to find where Atlantis went and bring it back. That's his backstory. You didn't give him that backstory. No, no, I didn't. No, he's my character. I created it. He's his, and he's Nollrim V because he's actually one of at least six wizards that are all identical clones of one another who have totally different personalities. But he's one particular wizard of the bunch. And there might be more. Yeah. But he just, he only knows of six and he's the fifth. Anyway. No, and is it only fun or is there more? Do you get something from it besides entertainment? Oh, I think so. I mean, kids get something out of smashing blocks together.

1:48:07And I think adults get something out of being creative and playing pretend. It's not how people usually frame it. But that's what you're doing. And they're creative thinking, thinking on the fly. It's using different muscles and you use it in everyday life. You run a business. You don't get to exercise those same muscles. Anyway, so, okay, imagine, okay, you've been to a Renaissance festival. I have. All right. Imagine a Renaissance festival, but it's on the internet and it's in VR. And anyone, you do your live action role playing as knights and rogues and wizards and, and whatnot. Imagine a game like that today.

1:48:49How do you think people behave in it? Well, they act nothing like they would act in the real world. They engage in extreme character. They play a character. And also people, they're just, they don't think about what they do. Because if their character dies in the game, you'll just respawn. You're back and you're playing the game again. So my thought was, well, how would people act if you had one life? It's a game with one life. You'd probably act very differently. For example, you would probably be more likely to collaborate with other players. You'd be more likely to say, let's all get together to go on this dangerous quest because any one of us does it.

1:49:22That's it. We're going to lose and we, we locked out of the game forever. Let's say towns were safe places where you're not likely to get killed. You would really think twice about leaving town. You're like, okay, I'm going to, but before I leave town, I'm not just going to wing it. I'm going to go, oh, let me go see. They'll be trying to kill the dragon. And if I die, I'll just respawn and go try buying different potions. Like, no, I'm not going to plan this out. I'm going to, I'm going to really, really give this my all. And my thought was that it would force a totally different type of thinking that most games just don't force you to engage it.

1:49:54It would, it would be more like real life, regardless of the quality of the graphics or the fidelity of the, of the simulation. It's reality of a different kind. Exactly. Where there's consequences for your action. And that, and also like, you play in games, there's lots of people who are griefers. They're just out to ruin the fun of everybody else. They just go out and they kill people. It's really easy to do that when there's no consequences, right? Like, oh, sure. They might kill you instead, but you'll respawn and you do it again. Yeah. But what if all the griefers said, no, no, getting into a fight with another character for no reason, 50, 50 shot.

1:50:25I'm the guy who loses and I'm locked out of the game forever. Yeah. So that's kind of the background. You can see where there's going. I want to build a game. Yeah. The original idea was interesting idea. The original idea was like a headset. Right. Then there was a more extreme version. We're like, what if you tied it to something that was even more valuable in a headset? Because you could buy another headset. Here's my crazy idea. What if it was a game where when you log in, part of it is you have to give it the passwords to all your social media accounts. And if you die, it wipes out your entire digital persona.

1:50:56It's a full digital death. That's great. Wouldn't that really raise the stakes? That's great. The first moment you're in that game, you look around, you're like, okay, like I am on my game. I am. I am. And like, you see a threat? It's not like, oh, it's just something. I, well, okay, I'll go over and fight. You're like, oh, shit. That thing's coming to me like, I'm going to run away because I don't want everything to fall apart as a result. The problem is, of course, I love this idea of this game. Who would actually play it? I don't know. And I don't know if you know this, but I actually took this to its extreme at one point.

1:51:30I built a virtual reality headset as an art project that actually kills you if you die in the game. That's like it. You, you actually die when the game over screen comes up. It blows up your head. And I made it as an art piece to illustrate the, because I've been fascinated with this idea of, you know, games that are more realistic with realistic consequences. And that would be the ultimate version, right? Like now you're really going to want to make sure you don't. I want to make the argument for the benefit of this game in society, which is in the shooter games, it's the opposite of protecting yourself.

1:52:07It's like life is cheap in a shooter game. That's right. Life is very cheap. And if you spend a lot of time in a shooter game repeating over and over the fact that life is cheap, it's not such a stretch that when you get into the real world, the idea that life's a little more cheap than it was before you started playing the game. Sure. And a game where, you know, violence has, it's not so you say there's no violence in it. Like, you know, I want to go out on my fantasy adventure and slay dragons, but I like the idea that even in a collaborative environment, your life and the life of the people you're with is something precious to be preserved.

1:52:41It's a valued commodity in the game rather than a disposable gameplay element. I remember there was some story I read about how the the army would look for gamers for certain jobs. Sure. I believe for like for for predator drone operators. Yeah, they were familiar. Exactly. Yep. No, absolutely. So anyway, that is the game that I would love to see. Totally separate from that. What I actually want is my favorite game of all time is Chrono Trigger for the Super Nintendo. It's a Japanese role playing game where you travel through time trying to save Earth from a well, I guess I can spoil it. It came on the 90s.

1:53:21It's been a long time, but yeah, there's an alien being called love us. It's we don't know that if we're playing the game, you have to get to that level. You have to get to that level. You find out as you play the game and the mystery unveils itself. But basically in millions of years in the past, so the real story is the impact that killed the dinosaurs was actually Laos, which is just one, you know, like how pine cones have like the many seeds. Laos is like one of those seeds off a pine cone. There's there's a being that reproduces by shooting out spores that fly across the universe until they hit a planet.

1:53:57Basically, the impact that killed the dinosaurs was Laos landing on Earth, smashing into the crust. It digs to the core of the planet and rests for millions of years absorbing energy from the core of our Earth. And then the story is eventually, you know, in the modern day, Laos emerges to destroy the planet and, you know, shoot out its own spikes and then to complete the reproductive cycle. And so you have to travel through time trying to stop Laos. And so you go into medieval times, you're going back to caveman times, you're going into the distant future of a ruined world to get things from that ruined world.

1:54:34And it's cool because it has a 14 different endings. It's very, and you get different endings depending on what you did, how you did it, what you did in the past. Did you save that person? Did you destroy that airship, you know, and it's a, it's my favorite game of all time. So if I could make a game that was not something totally new, it would be to bring that game back for for a new generation because it's pretty dated. It's from 1996. Yeah. What would be different about your version than that version? I think it would be very hard to improve on what is near perfection from a gameplay perspective and from a storytelling perspective.

1:55:08It's a great story, dozens of interesting characters. Amazing soundtrack. But I think you would update the graphics, update the soundtrack just to be more, more what people want these days. But probably the most more thing is make it available on modern platforms. If you want to play Chrono Trigger, you have to own a Super Nintendo. And those went out of production two decades ago. Yeah. And a lot of the ones that are around today, a lot of them have failing components. It's actually quite hard to track down things. Actually, that was one of the reasons I made the Mod Retro Chromatic. Like it's actually kind of hard to play Game Boy games these days.

1:55:39Yeah. You have to track down a Game Boy that is still in working condition that doesn't have problems with the, like a lot of them have audio problems these days due to degradation of the components. So like if you want to be a Game Boy gamer, you either need to be a techno head like me who can take apart and repair old systems or you need to pay a bunch of money to buy a Game Boy from somebody who knows how to do that working. If you wanted to go buy a Game Boy color today, that's been fixed up and put into good work and condition, you could easily spend $200. And kids aren't doing that. So I got to ask you, were you a fan of the Game Boy when it came out?

1:56:17Absolutely. And I've never been a gamer. My only game experiences with the Game Boy Tetris. Only Tetris. I didn't play any other games. When you'll notice with Mod Retro Chromatic, we bundled it with a new version of Tetris. We could all. So why Tetris in all the games? It's because the original Game Boy, there are millions of people who aren't gamers who nonetheless loved Game Boy and loved Tetris. Yeah. What is it about Tetris? I think it's a universal game. You know, you should try to get Alexi, the creator of Tetris. He's still around. Oh, he's still. He's absolutely. So I saw him a few months ago.

1:56:55Mod Retro was sponsoring the Tetris Classic World Championship. So it's basically like a, it's a competition for people who play. Yeah. Yeah. Tetris on the Game Boy. On the Game Boy. Yeah. And Alexi was there. I mean, he's, I don't know if you know the story at all of Tetris. I don't know anything about it. Oh my God. So there's kind of a fictionalized, but largely correct version. You should check out. I think it's called Tetris. It's a movie about it. Alexi is a computer programmer working in the Soviet Union. It is a Russian game by Russian developer and the song, do do do do do. Yeah, it's actually a Russian folk song.

1:57:30And so he is just like this genius programmer who built dozens of versions of this puzzle game and then hit on this magical formula that everyone loved. He ends up licensing it to Nintendo. It's bundled with every single Game Boy in North America. Like it's, it is a crazy story. Anyway, I love games where you have that universal human experience. Like there's a picture of Hillary Clinton sitting in Air Force One playing Tetris on a Game Boy. I don't think Hillary Clinton is a gamer. Anyway, I can remember it getting in the way it worked because it was super addictive. Jeff Bezos has said the exact same thing.

1:58:04He said when you play Tetris, it starts to reprogram your brain. And even when you stop playing, you are still seeing the blocks falling and it feels like you're still about it. Yeah, it's one of those incredible things. Yeah, one of the reasons I wanted to do that particular game on that particular console is because it's so universal. It's like Mod Retro, we're doing some other stuff. We're also doing it in 10 to 64. I don't know if you were ever in 10 to 64 guy. It sounds like not. But I don't know if the game ever had was palm, the first palm. But I'm so glad that we started with this. I mean, I've been working on this project as a side project for years.

1:58:34It's been it's the coolest thing. But I'm so glad it's one that's so universal because everyone's in the world. I love it. Are you spiritual at all? I am very spiritual. I'm Christian and I have been my whole life. Cool. Do you go to church? That's a complicated one. I went to church for a very long time. And then my wife and I were unhappy with the doctrinal direction of the church that we were attending. And so we left that church and we're kind of looking for a new church. But also this was like right around when our son was born. And so right now our dilemmas we need to find a new church that is doctrinally sound before my son is old enough to figure out that he's not going to church.

1:59:16But he's only seven months old right now. So he's a little you got a window. Got a little bit of a window. Do you pray? I do. Beautiful. Are there other failed technologies like VR that you're aware of that are due for refresh? Absolutely. Not all of them fit exactly the same mold. Like nuclear is not exactly a total failure in that it has sort of remained in use by a handful of customers like you know, military uses them for submarines. But the reality is in the United States at least we stopped building new nuclear reactors decades ago. It was a failed technology and I think it's coming back around and it's going to make energy so much cheaper which in turn is going to make a lot of goods cheaper.

2:00:04I mean a lot of the inputs to or even like our agricultural system like all the nitrogen fertilizer that we make very energy intensive to make. And so cheaper energy is going to make our food cheaper. It's going to make our cars cheaper. It's going to make basically everything gets cheaper when you make energy cheaper. So I think I think nuclear is a one whose time has really come back around. Another one is actually artificial intelligence. I know that sounds so dumb to say today when everyone agrees that it's hot. But if you just rewind a few years, I started the end roll in 2017 and the name of my company is Androle Industries the acronym for that is AI.

2:00:41And we want that's on purpose. That's on purpose. It's because our core mission was to build autonomous systems based on artificial intelligence for the military. So for example, building autonomous fighter jets that can take the place of a manned fighter jet and save the life that would have been lost otherwise. To kind of make robots the tip of the spear that's taking the brunt of the impact rather than the people. And when I started the end roll, we couldn't even talk about AI. Like when we were fundraising, wouldn't say a word about AI. When we were talking to the press, never say a word about AI.

2:01:17Obviously we were building like our core product is something called lattice. It's the AI brain that powers all of our fighter jets and submarines and missiles and everything. But you couldn't talk about AI because AI was like VR. It was this failed technology that was seen as forever in the future, never in the present. And if you think it's going to change everything, you're you're like a crazy person. And people might agree that like, oh, AI is going to work someday. Like a hundred years from now, we're going to have C3PO. But if you said, oh, no, it's right now, people thought you were nuts.

2:01:48And so we had to hide what we were and just actually make products based on AI. Now that AI is cool, now we get to talk about it and admit what we're doing. But I would say that was another. You were always doing it. We were always doing it. But you asked if there's other failed technologies. I went straight from one failed technology. Yeah. Straight into another failed technology because I looked at it and I said, you know what? We actually can build it working the AI. Like the tech is actually finally there. And you don't want to talk about John Carmack. Yeah. hugely influential to the games industry.

2:02:18Basically created everything. And Oculus never would have gotten to where it was without him endorsing. And by the way, I ended up hiring him as the Oculus CTO a year later. So he worked with me for a few years. Amazing. But then John Carmack before I did decided that AI was the future again. So like back when I didn't even think AI was a real thing. I was still folks totally on VR and he says, no, I'm going to start spending my time on AI. That's where I think the future is going to be. But there's a lot of technologies like this. A lot of ideas like this that people have just written off as written off as nonsense.

2:02:51I think genetic engineering is another one of those. People, they always jump to Jurassic Park. But I mean, it's going to be a huge part of our future. If we're jamming and drought less likely to wreck everybody, then there's a lot of people who treat who treat genetically modified stuff as like this crazy mad science stuff. We we we should be making it just part of everything. Does Andrew have a mission statement? Oh boy. So we do. I think it's to to radically transform our national security through the application of advanced technology. If we've changed the wording a handful, a handful of times, it's always been a version of that.

2:03:33It's always been a version of that. I think at one point it was of American national security. But you know, what I take a broader view of our national security, like I would apply it to basically the Western world, the free world, the democratic world, whatever you want to call it. There's there's a group of countries in the world where we don't always get along and we don't always, we don't don't always. What are the rules of like, are you allowed to sell weapons to great questions? Other country. I don't know how any of that works. So we can only sell to people that the United States government allows us to sell to.

2:04:07It's totally up to them. Sometimes that comes in the form of them saying, we will allow you to sell to them if they want to buy it. Other times it's the US coming in and saying, we are going to help subsidize it. Slash buy because we want someone to have this capability. For example, imagine if there's some nation that we're working with and their air fields are critical for our national security. The United States military has a strong incentive to make sure that they have air defense systems that keep those runways from getting blown up. And so they might come in and say, we are going to invest in this.

2:04:38People outside of the defense industry rarely ask me these questions. But when they do, it's usually in the context like, well, Palmer, like, what, what, what countries would you sell to? And what would you not? How do you determine that? And the point that I always make to them is you shouldn't want that decision to be up to me because I am the top executive of a for -profit private corporation. And if it's up to me, maybe you like my list. Maybe I make a list and you say, oh, that's great. I love the list to people you sell to. And I like, oh, and I hate all the people you want. But why would you want that list to be up to a billionaire executive?

2:05:15You should want that to be decided by government officials who are elected by the body populace and are accountable to them. Who, when they make bad decisions, can be removed through an election. You can't remove me from Andrew All, if you disagree with my decisions. You can, you can, you can maybe vote for somebody who will not buy my stuff, but you, you can't remove me. And so the point I made to people is if you believe in democracy at all, then you have to believe that the right path is to let the democratic process guide what we sell and to who and then hold people accountable when they make bad decisions.

2:05:48People say, Bob Palmer, you know, like what about the war, you know, in Afghanistan, what about the war in Iraq, where those just wars and my point is thank goodness we can hold the politicians who are responsible accountable or not. Thank goodness we have the ability to hold them accountable. Imagine if the decision to sell a lot of those entities weapons had been just up to a bunch of executives who needed to make their quarterly profit. That would have been a disaster. So I don't want to say I abdicate our responsibility. It's more I forcefully ridden. I just want to know what the rules are.

2:06:18Oh yeah. And I forcefully reject even the idea that I should have even any choice. And do the rules from the government ever change? Like do they say all the time? Like in World War II, Russia was our ally. Yep. Well, I mean, here's another example. We just sold a bunch of F 35s to Japan. How crazy that we've gone within a lifetime. Like people are alive who have seen we growing the second world war. Yep. Against Japan. Because of Pearl Harbor. Because of the way it's how much it's wild. We've gone from Pearl Harbor to selling them our most advanced weapons and working with them. And I don't know if you track this side of politics, but I don't.

2:06:58Japan is a mending article nine of their constitution in a way that will allow them. So their constitution prohibits them from engaging in offensive military operations. Their military is called the JSDF, the Japan self -defense force. And so they are prohibited by their constitution from owning weapons that are designed for offensive applications. Of course, there's a lot of overlaps. I'll fight her jet for defense is very similar to fighter that for offense. But there's some things they haven't been able to have like aircraft carriers, long -range missiles. But because of the rising threat of China, China is now saying that they want to take parts of Japan.

2:07:33They're saying that Okinawa, they have a historical claim that shouldn't belong to Japan. China also wants to take Taiwan. And so Japan is saying, you know what? We need to change that. And it's so wild because they're constitution. You know why it has those limitations? It's because we made them as part of their surrender. It's not, they didn't choose it. We forced it on them. And now we're saying, yeah, that's great. We want you guys to be a partner with us. We want you to help keep China at bay. We want to help deter them. And so I guess the point I would say, is that things are always changing and you nothing has ever said in stone.

2:08:05Like I would love to see a world where China, which is today our largest strategic adversary, economic adversary. Everyone believe that? There are people who disagree. I think there's people who think that Iran is a bigger threat because they're irrational to a larger extent. Like China's only willing to start a war if they think they have a good shot at winning it. They're only willing to invade Taiwan. If they believe there's a very good chance, they'll successfully take it. Iran, on the other hand, due to their political and theological dynamics is more willing to win by losing. They'll start a war that they know they can't win.

2:08:42And that's very, so there's people who rashly, they think Iran is a bigger threat. There's also people who point out that Russia is actively engaged in, you know, an invasion in Europe. So it's pretty, there are people who say Russia is obviously the bigger threat than China. China's only hypothetically might invade democratic nations. Russia is literally doing it as we speak. And I'm sympathetic to that argument. But big picture China has the economy to really matter. Like they have the population and the economic means that manufacturing means, I mean, they're brilliant at building technology.

2:09:14I was part of the problem. I built millions of virtual reality headsets in China. That's where all my factories were when I was at Oculus. So generally China's our biggest, our biggest adversary. They are at odds with all of our friends in the area. Like they want to take over the Philippines. They want to take over Korea. They want to take over Taiwan. They want to take over Japan. We'll see what happens with Vietnam. They probably don't want to try that again. The last time they tried to invade Vietnam, it didn't go so well for them. But they've got ambitions. And I think it's totally possible that within our lifetime, we can see China change and have them turn into a Japan.

2:09:48What's the trick about China? Is they're not radical against the United States? Like Chinese people, they like America. They like American culture. They like American movies. They like American music. There's a reason that our media does so well there. And so it's not like Iran, where America is seen as like, you know, theologically repulsive at odds with how the universe wants humans to live. That was always the case. No, no, no, no, no, that was recent in the 1960s. Exactly. Exactly. Iran is managed to stay so socially conservative for so long. It's hard for me to imagine how they come back at least anytime soon.

2:10:26China, if they had different political leadership, I think that they'd love to be an American ally. The average Chinese person has no beef with America. The people of a beef with America are the members of the Chinese Communist Party who don't like our interests that contradict theirs, like them wanting to take Hong Kong, them wanting to take over Taiwan. But what's interesting about China too is most of China is not a member of the Chinese Communist Party. I don't know if you know this, but in Germany, you really had to be aligned with the Nazi Party during World War II. And the Soviet Union, you needed to be aligned with communism.

2:11:01You weren't really allowed to have. You didn't opt in. In China, it's actually not like that. The cease no most it's I want to say it's like 25 or 30 % of people are in some way a member of the CCP. And they are not pressuring the rest of China to become a member. Most Chinese people are actually quite apolitical. They just they want to get by, they want to make money, they want to provide for their family, they're not that different than most Americans. They like America generally and they don't really have strong opinions as to where they should be invading or not. And so it's very interesting that China has created that dynamic because it's much easier to imagine how they how they change in the future.

2:11:36You don't have to flip like 100 % of society. You just need to flip the 20 or 30 % that are that are members of the CCP or or not. Let them keep believing that America is awful. That's fine as long as 70 or 80 % of the country changes their mind. So I'm actually quite hopeful. I would love to see them become like Japan, ideally without a world war in between. Yeah. That's the rub. How is the business model of your company different than the munitions companies are bold? So the way that Andral works is very similar to the way that most companies work, not defense companies, but just check companies in general.

2:12:14We use our own money to fence companies work differently than most companies. Yeah. Oh, absolutely. Well, again, let me, let me talk about how defense companies work. So most defense companies work on what's called a cost plus basis. So they get these cost plus contracts from the United States government, which pay you for your time, your materials, your costs, and then a fixed percentage of profit on top of that. So they might say, so the more it costs, the bigger their percentage. You immediately identified exactly the profit. The incentive is it's to go more. It's just it's to buy it build the most expensive thing.

2:12:50Yeah. To pitch the most expensive thing. Yeah. And then even once you win, you often actually make more money when the contract takes you twice as long things break all the time and you need to replace them. You actually make more money. And the reason there's a lot of reasons for why we do cost plus. It really boils down to we needed to nationalize production of war material during World War II and basically have all of our automotive and industrial factories build tools for, but we didn't want to nationalize them because that would have been communism, which was politically unpenable at the time.

2:13:22Imagine that I'm Ford and you say, hey, Ford, bill me a tank. Ford might say, I have no idea how much that's going to cost. I've literally never done it before. Yeah. At least not in a long time. Yeah. And the government said, okay, okay, we'll pay you literally whatever it costs and some profit on top to make it worth your while. And so if it goes on to like, don't worry about it. We'll you'll be taken care of. And that is a reasonable way to pay for tanks in the middle of a world war where you're fighting for your life. Short term emergency. But to keep doing that for then decades, you end up growing a very, very toxic dynamic that costs taxpayers hundreds of billions of dollars a year in waste.

2:14:01So like actually the, I you asked what our mission is to take corruption not even waste really. There's a lot of corruption as well. I mean, you asked what our mission statement is, which is transforming national security through the application of ants technology. But the first page of our pitch deck to investors said, androle will save taxpayers hundreds of billions of dollars a year by making tens of billions of dollars a year. The idea is to not just make money, but to kill legacy problems. It's to go and say, I'm going to replace this thing that costs 10 billion dollars a year with something that costs less than a billion a year.

2:14:39And you end to do that over and over and over until we can take this money and spend it better on other things. So that's a table. Is it easy to do based on how overblown the old model is? Sometimes I think it's so radical in the, to the duty like, here's what our business model is. We spend our own money to build a working product. And then we sell it. Yeah. Of course, that's like, that's the way Jack in the box works. That's the way that music labels were. Everything works this way. But the way everything works is radical to the department of defense. They just culturally, it's hard. And they also have certain cultural objections to it.

2:15:17Imagine you make something for one dollar. And you try to sell it to them for two dollars. They're going to say, well, wait a second. That seems really unfair to the taxpayer. You're going to cost you a dollar. Why should I pay you two dollars for it? Meanwhile, they're probably paying some other company a hundred dollars to make the same thing up. But basically, there's all these rules around that were designed to limit the problem. Basically, there were all these laws passed to limit the amount of profit that you can make. And it was to try and keep cost in control. But then once you start spending your own money, those laws are still around.

2:15:57Like, well, no, we won't let you make more than five percent profit margin. And I explain, guys, I can't run a business where I run my own money, my own risk. I do everything that I have to have to have to have, like, I will fail from time to time. And you're selling it to them for way less money. For way less money. And so that is the biggest problem we run into. What are some of the products in the new company? I mean, we build all kinds of hardware systems. They're all powered by the same AI called Gladys. And what does Gladys do? So Gladys is kind of the AI brain that operates all these different systems.

2:16:32And you train Gladys to do what it needs to do for a particular system. So for example, Indoor will make among other things autonomous fighter jets, autonomous submarines. These are real fighters, but without a person in them. And that means there's a lot of ways to put this. Could a person get put in them? No, because we've built them around not anything a person. Not anything a person means you don't need the space for a cockpit. You don't need the life support systems. You can, for example, do maneuvers that might kill a human pilot. But there's a lot of advantages to not having a person in it.

2:17:06Exactly. Also, they're not getting killed, obviously. So like what you're trying to do is build an AI that can pilot that submarine, operate it sensors, also fly this fighter jet. So we make autonomous submarines for the Australian Navy and also the United States Navy. But like on the fighter jet side, in particular, the idea is not to have them fighting on their own. Yeah, the Air Force calls the program, Will Wingman. So their formal name of the program is CCA, the collaborative combat aircraft. The concept is to have several CCAs for every manned pilot. So imagine I'm a pilot. I'm flying my F -35.

2:17:43I now have a whole wing behind me behind you. So behind me. But then I actually am probably going to push them out in front of me because that way they have all these, they have the same sensors I do. They have the same weapons I do. Now, if I'm flying out there and waiting trying to find something, I can send these guys out. They're the front line. And so when somebody comes across our radar, I can sense them and then even tell my wingman, my AI wingman, to take shots at it way, while I'm still way out of range. Can the other party not know which is the one that's man? Exactly. You want them to be confused as to which is which because if they do know, they're going to want to go for the manned pilot because that's how they cause the most damage to the United States.

2:18:24The other interesting thing about it, I mean, you've seen Top Gun. I'm not, but you never seen Top Gun. Well, I will tell you, Top Gun is not really a war movie. And that it's about guys learning how to fly fighter jets. And they have a whole book of maneuvers and tricks that they can use because you have to manage your energy in your speed. You only have so much. You have to make sure you don't run out of altitude and get too low to the ground. Now, you run out of ways you can maneuver. You need to make sure that you don't run out of energy, that you don't run out of altitude and that you don't get in the wrong position because you might end up in a position where you manage to shoot a guy down, but now he's going to kill you too.

2:19:03And that's not a win. There's also separate from that book of maneuvers that we've been developing since the dawn of man flight. A book of maneuvers you can't do. It's the maneuvers that leave you with not enough altitude, not enough speed in a bad position. Some of them are extremely powerful maneuvers that will get you the kill, but you're probably dead at the end. Yeah. You probably see where this is going. Yeah. Once you have AI fighter jets, you can take those tactics and you put them in your playbook. You say, yeah, we're all working together. And you know what? I prefer to have all my AI fighter jets live.

2:19:40But if I need to, I can now sacrifice one for them. You have to sacrifice your good. You have to sacrifice your ponds. Yeah. I mean, imagine playing chess and you couldn't sacrifice your ponds. It would work. And that can have real impacts, even not just against fighters. Imagine you're trying to get into an area. Like imagine you're trying to take out the launch of a nuclear weapon. You need to get to this facility. And if you don't destroy this facility, they're going to be launching nuclear weapons. And it's protected by surface -to -air missiles, ringing the entire facility for hundreds of miles out.

2:20:11No way can any man fighter getting close enough without dying. Like if you can get close enough to shoot a missile at it, they can get a missile at you. You're both going to die. Imagine if you could come in with a huge number of autonomous fighters and you could have unmanned fighters go in, destroying those surface to air missile capabilities, clearing a corridor for you to go in and actually strike the nuclear launch facility. You can do that without losing human life. And so that's it's extraordinarily tough. Do you think of it like a video game? I think most of the people who think of things like this like wars of video game that the people who just they haven't been close enough to it, haven't had enough experience with it.

2:20:52When you work with these customers every day, and like, not just hypothetically, like, Andrew has our systems deployed in combat all over the world. We have our systems protecting military bases all over the world, critical infrastructure all over the world. We're in off -and -off operations. What business do you have out in the world? Nobody's ever asked me that. Let me think.

2:21:13It's in the thousands, but it's one of those things where it's not like thousands of fighter jets. So like for example, we also build a system called Anvil. It's a counter drone drone. So it's a drone that basically flies out and then accelerates to 188 miles an hour and runs into other drones and knocks them out of the sky. We have a whole bunch of those on military bases all over the world protecting bases from drone attacks and those are used every single day. Bases are getting attacked every single day. Is that true? The United States is continuously under assault and you might not hear about every attack.

2:21:46I don't hear about that. Well, there's a few reasons for that. One is that it's so normalized. Like some of these bases in the Middle East, they're attacked so frequently that it just starts to turn into noise. Two, when nobody dies because companies like Anderl successfully, you know, our tools successfully stop the attack. Like nobody dies, no harm, no foul. Like if you want to read like defense publications, you'll find the news. But there's also attacks where they happen. And imagine that there is an attack that has an impact. Maybe nobody dies, but it destroys them equipment. We don't necessarily want to go out into the world and announce attention, everybody.

2:22:24The autonomous drone attack from these people successfully destroyed a billion dollars in equipment on this airfield. Because in doing so, you like they might not know you're inviting more and trouble. You're inviting more trouble. And they might not know, right? They might have been taking pot shots. They got lucky. You don't want to go tell them what you did. That just worked. You should do more of that. And so there's actually an incentive to downplay these things. But US troops are under attack almost every single day. Wow. In one part of the world or another drone attacks in particular have been on a huge upswing.

2:22:59We want a billion dollar contract with Socom Special Operations Command to do all of their counter drone integrations. We just want a 600 and something million dollar contract with the Marine Corps to do the same thing for them. Drone attacks are turning into a huge problem. How much competition do you have in this area? Tons of competition. Really? Tons of competition. But most of it is quite old school companies. All the rest of them are cost plus. Most of them. Yeah. So with CCA, the collaborative combat aircraft, loyal wingman, we were competing to build AI powered fighter jets against Lockheed Martin, Northrop Grumman, and Boeing.

2:23:35People who make people who make fighter jets. That's what they do. And we beat all three of them. And this was after the CEO, I won't say which one, but with the CEO of one of those companies, and been going around telling people that Andrewl had a 0 % chance of being selected. And in fact, none of them were selected because we had the most credible manufacturing plan. We had the most credible technical plan. We had the most credible plan overall to get to having thousands of unmanned fighters deployed on a time scale that is relevant to keep China from trying to invade Taiwan. That's really what it's all about.

2:24:12The goal is not to beat China in a war. It's to make it clear that a war would be too painful for them to even consider. We want them to look at what we have and say, oh, shit, well, it's through strength. They call it. I think it's a powerful doctrine. Because wars almost always start when one or both sides disagree as to the outcome. Both sides think they can win. If one side is not that one side has to know it will lose, if China isn't sure it can win, if they say they won't attack. No, nobody wants to start a war that's a 50 -50 coin flip. Because if you do that, there's a 50 % chance you get what you want and a 100 % chance that you eat the pain.

2:24:56Yeah, it's a bad deal. It's a bad deal. So we don't need to make it impossible for them to win. We need to make it where they aren't sure. I think we're not in that place right now. Right now, they are feeling pretty certain. There's a reason that you have G out there saying, I'm president for life, I do what I want. Before I die, I'm going to reunify with Taiwan. He thinks they can get away with it. China has 350 times more shipbuilding capacity than we do. For every warship we can build, they can build 350 of them. It sounds almost impossible, right? But the reason for that is that they also have a huge commercial shipping industry, whereas we've lost our shipping industry.

2:25:36So we have almost no shipyards remaining in the US. China is building all the ships for basically everyone on the whole planet. Where do you make your stuff? We make our stuff here in the United States. All of it. Not all of it, because there are some things that we make with partners in their nations. So for example, a major customer for our AI -powered submarines, Royal Australian Navy. But the Royal Australian Navy. So you make those there? Those we make. Exactly. We make those in Australia. And that makes sense. Absolutely. But everything we make for the United States, we make in the United States.

2:26:08And most of what we make for the rest of the world, we make in the United States too. And I'll tell you, it's really, really hard to make stuff without leaning on China, because everything's in China. It's so easy to make stuff in China. If I had no national allegiance and I had no sense of patriotism, I would move to Xinjiang tomorrow and just start making stuff. Like, so actually the moderate are chromatic. Made in all North America. Wow. It's not made in China. I could have made that in a tenth of the time if I had just gone to China. They would have been so much easier. Is there a possibility that over time America can get back its manufacturing base?

2:26:43Absolutely. The problem that we did, I mean, it's a million problems. But what we did is hollowed out our country by allowing China into the World Trade Organization and allowing American companies to outsource manufacturing to China without penalty, without import tariffs, without any reason to not do it. Why wouldn't you, if you're allowed to just send it to another country where you're there. Everything's cheaper. More to dirt cheap and there's no environmental regulations and no labor laws. Why wouldn't you do that? And we've been able to get a bunch of cheap shit over the last 50 years as a result.

2:27:15Like that, that is helping the United States. We would, everyone's able to buy cheap TVs and cheap cars and cheap stuff because of China's rise. The flip side of that is that there's no more manufacturing in the United States. And so if you're a smart kid coming out of high school and you're deciding what you're going to do with your life, you are never going to become a manufacturing process engineer. You're never going to say, you know what I want to make is injection molding equipment. You're going to go work on Wall Street. You're going to work on Google. You're going to go to where the economic opportunity is because that's what most people want to do.

2:27:48Most people, they want to take care of their families as best they can to the best of their abilities within the opportunities available to them. There's very few people who say, no, I'm going to go work at a lower paying job with fewer prospects for more likely to land off because I really love manufacturing and industrial equipment. It happens, but not rarely. And so what happens is fewer people even know how this shit works. The people who do are either a lot of them are very old. A lot of our manufacturing expertise we do have. It's like the leftovers. These are people who are in their 50s, 60s, 70s who are now retiring or close to it.

2:28:25And for us to bring back manufacturing in the United States, we have to undo all those incentives. We need to change it so that a smart kid does want to become a manufacturing engineer. And I'm, you know, this will get back into politics, but I've lend generally lean libertarian. I'm a little ale libertarian. I'm generally a fan of free trade. But what we've had with China and others is not free trade. They don't let us into their markets. Like when I was at Facebook, I wasn't allowed to sell Oculus Rift headsets into China even though they were made in China. They wouldn't even let me sell to their people because they locked out all these American companies.

2:28:58They don't want us making any money in China. What we had was not free trade. It was a one way money express way straight into China and nothing comes back out. And that's one of the reasons even though I'm a libertarian and it's very much against libertarian doctrine to believe in tariffs. I basically feel like we've, we made a bunch of really bad decisions and had unfree one way side in trade. The only way to do that I think is some sort of terrifying. We have to basically go to it's and tariffs aren't just about the other countries tariffs are about signaling here going to investors banks and saying if you invest in like imagine 19 year old Palmer lucky but for manufacturing I want a bank to meet with that guy and he says I want to start a factory to build this thing that American needs and there's tariffs on the Chinese one so I know that I can beat them even though China has slave labor and coal power.

2:29:49You want the bank to say you know what? We believe in that we will give you a business loan for 12 is long but if you don't have a tariff on that they're just going to say no you're going to fail China will just beat you because they have no labor laws and their energy is dirt cheap because they burn more coal than anybody in history ever has. So yeah I fall on the side of some problems take decades to create. Yeah they take decades to fix. It isn't going to be easy. It is going to be painful. You do think it's possible. I think it is possible and I think it's necessary. If we can't make the things that we need to maintain our quality of life then we are actually just subservient to our to our adversaries.

2:30:27So I imagine for you to build the things you build you must spend a lot on R &D. Well we sure do we we put all of our profits back into R &D. Yeah. The most defense primes put about 1 % to 3 % of their revenue back into what they call IRAD internal research and development. This is different from CRAD which is customer research and all so this is IRAD is where you pay it yourself. And we're all puts every penny we make back into IRAD. We are continuously researching developing new things putting every penny we make into making new stuff. Based on that can other companies copy your stuff and not have to do the R &D?

2:31:03Yeah not always there's some things where it's hard for them to copy us. Yeah. But a lot of what we do the concept itself is kind of the crazy thing like we build this new product called Roadrunner. It is a small micro fighter jet that can take off and land vertically with two thrust vector jet engines. So it basically takes off and lands on its engines. So it's your height. Yeah it's it's it's it's it's a little bigger than it's man size. It's man size wider. And so it's basically a teeny tiny fighter jet that can take off without a runway fly out somewhere shoot down an aircraft and then come home and land right there.

2:31:43It can even operate from the deck of a small ship. Most systems to shoot down aircraft are rocket powered. Yeah. Because they can launch instantly and they're very fast. A lot of people when we started working on Roadrunner said we wouldn't be able to build an aircraft that can take off fast enough because jet engines usually take a while to start like a full minute so you don't have them bind and fail. Basically you'll never be able to start fast enough and you'll never be able to make it reusable and still maneuverable enough. And so people just told us it wouldn't work. People in the government told us they didn't think we'd be able to do it.

2:32:14So we used all of our own money to develop it was at about an $80 million development program and we went from first drawing like idea to combat validation meaning it was actually used in combat by a customer in less than two years. Wow. That's because we used our own money. If it was a government program it never was gone that fast. But we cut all the red tape by using our money. It's a way that the other companies can't compete with you. Well but so spending our own money yes that's really where it is. Here's the thing we proved you can make jet engines that start in just a few seconds. We proved you can make a reusable missile that is very cheap and so doesn't use your nine volt lighter to get it to start.

2:32:51No we have to use a very fancy system to get those engines started. As far as I know the fastest starting jet engines in the world. Wow. I've done I've searched high and low and I've not found anyone who's ever done it faster. If it does exist it's some kind of classified program. But us releasing that system and showing it has made it where like if people want to copy it they're going to have to do a lot of hard work. But we showed that it was possible. Exactly and so now it's a lot less risky. They could say you know what it's going to be expensive to copy it. Yeah but it's worth doing because now we know it works.

2:33:20Yeah and then you know what there's companies that are that are copying it. There's companies that are trying to do exactly what we did and so the key there is we just need to keep investing. And so like we're working on a new version of Roadrunner. It's even better. It's even faster. Eventually there is going to be a supersonic Roadrunner. So imagine a tiny jet that takes off from you know a parking lot a ship and then turns into a supersonic attack aircraft and then comes home and lands right there to be refueled. I mean that's it's going to take a long time for anyone to catch up with that.

2:33:52What have you learned about warfare since going into this business? I've learned a lot about warfare but I think like especially what I've learned is it's the conditions that lead to warfare. One of the things that's really stuck with me about the invasion of Ukraine for example when I was in Kiev and we've had we've had weapons and people in Ukraine since the second week of the war. So we've been involved from the very beginning and one of the things that struck me when I was in Kiev training guys on how to use some of our weapons platforms. This is earlier in the war. It's that the Russians that invaded Ukraine really truly thought they were the good guys but not because of a real disagreement as to what makes someone good.

2:34:41It's that they were just lied to. They've been told by their media and by their TV and by their politicians that Ukraine was basically ruled by Zelensky who is a puppet of the West and we were actually just using which so funny isn't it funny now to like look now now today he's running all these political problems but they were saying oh he's a puppet of Donald Trump and he's a he's a puppet of the West and you know he's literally just there installed dictator that is running Ukraine and they told all these Russian troops that the people of Ukraine would welcome them as heroes. They say they want to be liberated.

2:35:17They desperately want you to come in and so a lot of the guys who went into Ukraine from Russia they went there thinking this was going to be a week long special operation. They went in with a week of clothes and a parade uniform. They literally thought they were going to be parades for them. My favorite example of this is there was a Russian pilot who got shot down in his Kha 'o 52 attack helicopter. They were trying to take over an airfield at the Antonov aircraft company corporate airfield and they got shot down by the equivalent of their national guard. He crashes. What do they find in his flight bag?

2:35:51They find about three days of clothes, a parade uniform and 50 condoms because that is what this guy thought he was going to need after the way to celebrate. They were literally told the Ukrainian women they they're going to be all over their rescuing them. They're rescuing them and they hate Ukrainian men because Ukrainian men are all joining the military because they're tools of Zelensk. Crazy shit. The wildest thing I've learned, the biggest thing I had not realized is yes weapons are an important part of controlling the battlefield but the most powerful weapon is control of information with your own population because I guarantee that when China invades Taiwan or the Philippines or Vietnam or wherever they go.

2:36:42They will be the good guys. They're going to come with some story. They're going to tell they're going to say you're freeing these people. They desperately want to be freed. Their women are going to be all over the place. You better bring some condoms. I mean that's the information war. The information war is the true new battlefield that I think people have not fully yet understood. How do you imagine the future of warfare? How will it be different in 10 years in 2050? I actually have to feel like I feel like we have a pretty good handle on it for the most part. Like you look at something like like the CCA program.

2:37:16Right now that's just prototypes and then it's going to turn into your real aircraft and then it's going to turn into thousands of real aircraft. Those aircraft are going to we're going to be using them for a long time. Like this is not they're not doing it for like one year. Think about like the F -16. We're still using it. Decades on. I think in 30 years they're still going to be using CCAs. It might be a different variant but it's going to be pretty similar stuff. So I think the future of the battlefield is pretty well understood. Long will be much less manpower. Much less manpower. A lot more autonomous systems.

2:37:50I think also a lot fewer boots on the ground in general. Not just manpower but even I think the types of wars that have people on the ground for decades at a time. I think they're going to fall out of fashion. I think part of that is technology. The other is just politics. You're like post -Vietnam. America was weary. We were not going to get into another war like that anytime soon. It was politically impossible. It wasn't until 9 -11 that you had all of a sudden a renewed willingness to you know fighting a bunch of guys with AK -47s out somewhere in the world. I think that we are in a similar dynamic today.

2:38:29People saw the war in the Middle East drag on. For decades we spent trillions of dollars fighting. We didn't get even a fraction of what we hoped to get out of it. We didn't build an enduring democracy in the Middle East. You know we really messed it up. I think that probably for the next 50 years the United States is not going to be the world police. We are not going to send hundreds of thousands or millions of troops to go save someone's ass. I think we're going to go from being the world police to being the world gunstore. We are going to give our allies everything they need to turn themselves into prickly porcupines so that nobody wants to step on them.

2:39:09Nobody wants to mess with them. But we are probably not going to send our people to go die for them doing it. I personally am a big fan of that development. Is it possible that we could get the technology of defense so good that everyone is defended and there's no there's no reason to try an attack in the future. That is the dream. That is the dream. Now I think there's place there's edge cases where it falls apart. Can we stop China that way? Yeah I think so. But imagine like you have an ISIS style group or al -Qaeda. What do you do about guys who say when I die in this suicide bombing I get to go to hang out with 72 virgins.

2:39:52How do you stop that? It's really difficult. There's always going to be irrational actors, edge cases, extremist groups. Something I'm really terrified about is also biological weapons. What happens when a nation's state can for example build a tailored biological weapon that is only lethal to a particular ethnic group or maybe they think it's only lethal to a particular ethnic group but actually it kills everybody. Or maybe it mutates and then it starts killing everybody. These are the things that I'm really worried about. It's one of the reasons you asked people agree that China is our biggest threat.

2:40:25Now Iran, some people think it's a bigger threat. To be specific Iran has specific religious and ethnic enemies. They can kind of boil down their enemies into a very particular group. One thing that's terrifying is what if Iran without taking credit because they don't want to get nuked. What if they don't take credit but they do cause a biological weapon to come into being, you know, if they took credit then they get wiped out. But what if they didn't take credit but they say, ah, you know, praise me. This is just such an incredible great thing. But of course they actually made it happen. How do we fight that?

2:41:04That's what people who are working on this problem. It's not one that I'm deeply involved in myself. I don't have any specialty in biological weapons. I only know what people tell me but they're really smart people and what they tell me has me, has me combination of spooked and hopeful. So who knows? Maybe someday we're going to end up with a whole bunch of nanobots in our blood watching out for these engineered viruses but we've got to figure out something. Yeah. I am a techno optimist. I am so optimistic about our future on basically the front of every technology. You look at transportation, energy, biology, medicine, even entertainment.

2:41:40Everything is looking really good right now. And I don't think it was even that way even 10 years ago. There's been, there's been so many breakthroughs. There's really no area of technology where I feel like our lives are not going to be made significantly better over than of course the next 10 or 20 years. So amazing. For all of the people who feel like everything's going to shit, I think we're going to be looking back in 20 years as we're eating our 10 cent jack in the box burritos given to us by burrito cannons and drones. And we're going to be in our in our $5 ,000 cars charged up by nuclear reactors.

2:42:10I think we're going to be looking back and saying, oh that was a little tough for a while there but we really came out the other side of it.

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