What is American Dynamism?

0:00American dynamism American dynamism American dynamism American dynamism American dynamism American dynamism American dynamism. American dynamism American dynamism American dynamism. A term coined by A16z General Partner Catherine Boyle just two years ago when she and David Yolovich founded the Furns American dynamism investing practice But since then, the term has truly taken on a life of its own. To some, it's a community of builders, to others, it's a spirit grounded in innovation, and some others might even call it a movement. In the words of Catherine herself, American dynamism is not a sector.

0:42It doesn't fit neatly into one vertical or portfolio. It is a philosophy that encompasses nearly every aspect of American life and leadership. She goes on to say that the American dynamism practice, invests in founders and companies that support the national interest. So that's more than just aerospace and defense. It's also public safety, education, housing, supply chain, industrials, and manufacturing. And last month, A16Z held its second annual American dynamism summit in the heart of Washington D .C. Hundreds of policymakers, founders, and funders showed up not only to celebrate our national interest, but also to have the hard conversations around what it'll really take to continue building for America.

1:26And while we can't wait to share some of these exclusive conversations with you soon, first we wanted to share this compilation of 10 voices coming together to share what American dynamism means to them. They also discuss what critical technologies they're watching along the way, and of course what might stand in the way of the next decade of dynamism. As a reminder, the content here is for informational purposes only. Should not be taken as legal, business, tax, or investment advice, or be used to evaluate any investment or security, and is not directed at any investors or potential investors in any A16Z fund.

2:03Please note that A16Z and its affiliates may also maintain investments in the companies discussed in this podcast. For more details including a link to our investments, please see A16Z .com slash Disclosures.

2:18All right, first let's meet some of these founders building across space, education, public safety, energy, and more. My name is Roel Sedu. I'm co -founder and CEO of Eradom. Eradom allows police and fired apartments to send drones directly to Naiwan calls, anywhere in their city in 90 seconds or less. My name is Ian Sedumit, CEO and co -founder of Apex. EPEX is a spacecraft manufacturer company, so we built something called the satellite bus, which is the core set of components that are required for any human -made object to operate and function in space. I'm Wyatt Smith, founder and CEO at UPSMET.

2:58I also was on an addition to combat America's Skullworker Shortage. We build technology to help expand more forced productivity for employers and create meaningful opportunities to flourish for a new generation of builders. I'm Doug Bernhardt, CEO and co -founder of Radiant. Radiant is a nuclear startup developing technology to mass produce nuclear reactors in a factory, 50 units a year that can be deployed anywhere in the world and serve as resilient backup power or prime power. I'm Chris Bennett, I'm the CEO and co -founder of WaterSchool. We help individuals start home -based child care programs.

3:30My name is Mitch Lee and I'm the co -founder and CEO of ARC. ARC makes high -performance electric watercraft and our mission is to electrify everything on the water. We will introduce a few more voices from here, but let's kick things off with the ultimate question. What is American dynamism? To sum, it means... American dynamism is about optimism. American dynamism is about utilizing America's best asset, which is our ability to develop new breakthrough technologies. American dynamism is being unapologetically proud of what we are capable of doing in America. But for some, there's also a personal side to the fuel behind American dynamism.

4:13Here is Rahul from Arabdom. American dynamism, I think, probably means a lot of things to a lot of different people. I come from an immigrant family, so my father and my mother came here right before I was born from India with the idea that they're going to build a better life in America than they could anywhere else. They came with little to no money, grew up in a hardware city in Los Angeles area, and originally my dad went to a couple of universities and learned how to be an engineer, and then they went into business together and built a business. And then eventually I'm asked a bit of a property portfolio to be able to provide me and my family in a great life.

4:50And to me, American dynamism is enabling anyone who wants to come to America to do something just like that to solve problems in their communities and be rewarded equally for those problems. Now here is Mike Slot. Mike is a U .S. Navy veteran of eight years and he's the founder of Shift .org and previous co -founder of TripSwap, which is now ID .me. Here's Mike's take on American dynamism. I think there's so much power in narratives. It's one of these new narratives that's really taken the nation by a storm and I think that it speaks directly to a whole new group of founders and folks that want to build for America, want to essentially protect Western values, want to see liberal democracies thrive, it really speaks to Reckless to them and says, hey, we need you.

5:38We need people that have subject matter, expertise in healthcare and education and defense. And so I think that's been this powerful driver for essentially either a new group of founders, but maybe they didn't think of themselves as and someone's gonna build the next grade technology startup. But also, I think this is probably one of the most amazing trends to witness in real time, is you've got all these really accomplished name brands, second and third time founders. And that was a chance to be really mission driven and get at something that matters. It feel like you're part of something that's bigger than yourself.

6:10But it's not just founders embracing American dynamism. Here is Doug Beck. He's the director of the Defense Innovation Unit within the Department of Defense. And here's his take on American dynamism. What I think about most is us taking the incredible lessons of what built the Silicon Valley that I kind of grew up in professionally. This collaboration between the public sector, the private sector, both the founders and the funders, which was always part of Silicon Valley. And academia at the very cutting edge of thought brought those things together against a true imperative of national security first during World War II and then during the Cold War, that coming together of Americans from all those different disciplines is what built Silicon Valley in the first place and created this unbelievable asset that leads the technology for the whole world.

7:01And American dynamism now is about harnessing that same sense, that same energy, bringing it together now against the incredible challenges that we continue to face, the challenges to the international system upon which we all rely. And coming together across again, the public sector, private sector, and academia with our allies and partners in order to support and defend that international system with the next iteration of American dynamism at the speed and scale that's required to meet those future challenges. And to do it our way, that American way, not the way have our adversaries. Look, there's clearly a lot of excitement around American dynamism, but what are the most inspiring examples from these builders who are closest to the metal?

7:50Ian Cinnamon from APEX Space. Oh, there are too many decals, but what I would say is specifically within the space industry, the best example is seeing this new organization that only emerged several years ago called the Space Development Agency. It's part of the United States Space Force, they have spent over $10 billion in the last couple of years on spacecraft acquisitions, building a new proliferated warfighter, sweep of satellites in space that gives the warfighter communication capabilities, observation capabilities, and so much more. Seeing the United States push forward technology, push around standard acquisition processes to be able to launch dozens and eventually hundreds and eventually thousands of these satellites in orbit to build the U .S.

8:37own constellation is incredible. And I love seeing all that momentum. I love seeing both the established defense industrial base providing those spacecraft, but also newer companies playing in that field. Doug Brunauer now works on nuclear energy, but that wasn't always the case. I spent 12 years at SpaceX, so I always go back home. I think a great example is the Starlink satellites, over 5 ,000 deployed in the last five years. I think communications and energy are the two things that humanity will keep reinventing over and over again that really leads to new eras of technology development. And while Mitch now works on electric boats, the majority of his founding team also comes from SpaceX.

9:19I think the shining example of this is SpaceX and what they have been able to accomplish in terms of reducing the cost of getting one pound of material into space by using reusable rockets and doing that by rethinking the challenge of getting to space for first principles and we try to do the same thing at art a Lot of our team comes from SpaceX and we are definitely Focus on how do we bring the marine industry which is decades kind of behind in terms of technology into the modern era using batteries and electric power trainings and all of the modern advances in the automotive industry. But SpaceX was not the only company setting the example.

9:59Mike Slough of shift .org on Palantir's role in our defense ecosystem. The defense innovation ecosystem and getting the actual best technology to the war fighter hasn't really been ready or primed to scale up until right now. One of the way for hundreds of new companies, you can't look at many of these companies today and trace some of the origins back to Palatir. They did something that cut against the grain that wasn't investable by a bunch of B .C.'s back in 2003. And many of the founders have the next wave of great defense technology companies have roots in origin stories in Palatir. You certainly see that with some of the people who are building Andral right now, and that's sort of the next wave.

10:45I think you see this opportunity starting to open up where, and I think one of the reasons why defense feels like an investible category is partially certainly driven by current events. This actually looks like a whole new sector that has traditionally been dominated by slow moving incumbents with incentives to essentially drive up the cost with really low margin services. Now there's this opportunity to essentially translate all these areas of super low margin services into high margin softwares delivered at lower cost to the taxpayer. Now in the last few decades we saw how exponentials like Moore's Law, decreasing launch costs, and unlocks in biological sequencing have resulted in a flurry of technologies.

11:30But today we're also seeing many other exponential technologies inflict. So let's hear what technologies this group thinks will play the biggest role in defining the next decade of dynamism. To set the stage, we've got NOND Mulchendani. NOND, by the way, was the first -ever Chief Technology Officer at the CIA. And here's what technology's he's paying attention to. Having had a 25 -year career in emerging tech and in startups, the idea of bringing that energy and focus from startups to government, military, and intelligence work is the new concept of American dynamism. We track 11 to 15 different emerging tech areas at the agency.

12:15And what's exciting about it is every single one of those areas is absolutely red hot with new innovation, new startups and companies. And I feel it's going to have a huge impact on what we do in national security. And just by definition, emerging tech means they're going to be surprises and advances that come out of nowhere. They're going to surprise us. I think each of them is at a different level of maturity. And so things like AI or biotech, I think are ones that are probably going to surprise us the most in the short term. But there's exciting stuff happening everywhere. Fusion, space, nuclear, I think all 11 or 15 of these areas, I think we're doing incredible work in all of them.

12:54Look forward to all the exciting things coming out of them. Now back to Ian Cinnamon. It really comes down to the combination of different technologies. It's not just about how do we onshore more manufacturing to the US. It's not just about how we're using design for manufacturing principles to build these spacecraft at scale. And it's not just about the software that we're doing to ensure that all the different components are interoperable. It really is the combination of all three of those and bringing those together is what lets companies like APEX actually operate the pace and scale that we're trying to achieve.

13:28We're also seeing really important inflections in energy and luckily Dr. Catherine Huff spent time with us breaking down what she's seeing there. I'm the Assistant Secretary for Nuclear Energy in the United States Department of Energy which means I oversee our nation's research and development programs around civil nuclear power. I think we're seeing a lot of companies take apart business models and project strategies and reinvent them in a more agile, modern way to build a known technology like nuclear power in cooler and quicker manner. So I think meeting the moment is going to take some real creativity and we're seeing that in advanced reactors that involve all kinds of salt, metal, gaseous coolants and fuels that are dissolved in those liquids or made a teeny tiny tristructuralized of traffic coded particles, those innovations are going to really change the operations of nuclear power going forward.

14:30Dr. Huff was not the only one with energy top of mind. Batteries and generally speaking electric power trains understand how the electric grid operates. Ensuring we're not reliant on other countries for energy. Unsurprisingly, another big topic was artificial intelligence. Here's Chris Bennett, Mike Slough, and Rahul Sadoop. AI, holy moly. But AI is capable of, I really don't think that we're really prepared for it. There's a lot of fear around AI, but I think that it's pretty normal for folks to be afraid of emerging technologies. But on the other side of that fear, there's personally a lot of excitement.

15:08What we're going to be able to do with computers is going to really revolutionize the way we all live. And the way I think of it is just really important that we're constantly educating our leaders educating people who are living in our different districts on the power of technology, the power AI, and helping folks see the positive sides of it, helping crawl a lot of the fear that exists there. The clearest UCIC is a combination of video and AI, and using video and AI to understand what's going on in our classrooms, understand what sort of early interventions children need, understand what sort of coaching providers could benefit from, and using technology to capture that information and then also provide those suggestions later on.

15:51Yeah, I think I guess a lot of people will talk about AI. I certainly feel strongly about that as well. Particularly, I'm a data three. We're dealing with like our own educational challenges at home and very much feeling like that there's parts of not just in my family, but broad spots of America where little kids are getting left behind. And so to think about a world where every kid can have their own private tutor who's endlessly patient and endlessly kind, and wants to help them get up to speed. That's one of those things that you feel like we're at the customer breakthrough, like a real meaningful like step function, like step forward.

16:25I think we're also in an interesting time from a technology standpoint where a lot of the solutions to solve for defense or public safety or energy, anything that's important to the American household are starting to come from shared threats. Well, that's AI or below cost of compute, the ability for companies to innovate more quickly and iterate more quickly. So I can't one thing where I feel like, oh, the next 10 years is just going to be about defense. I think that we're in a position where the underlying capabilities of being able to focus on things that are important to America are going to allow for many focuses to be able to go equally as far.

16:58Some of the other technologies that I say beyond AI is mapping back to what's happening in the defense industry right now is you have an environment that's dominated by five really big incumbents. They essentially, you know, $0 .80 on every dollar. The acquisition budget is going to go to one of these five primes and there's this entire set of capabilities that a company like an Andral or a pepperists or a shield AI like they're going to need to be able to deliver these capabilities to really reach the breadth and scale that is required to be a prime contractor for the United States Department of Defense.

17:34So that creates this also an opportunity where there's actually not a hundred but maybe a thousand companies to be started in these niche technical focus areas that you know, maybe they aren't venture scale or venture size tam at least today to the naked eyes. We look at them right now, but there are hundreds of not over a thousand of these really small areas of capability, you know, the ability to sense underneath the ground, the ability to provide power to obscure bases all over the world to be able to communicate underwater. And there's a lot of these either technologies of capabilities that have been delivered essentially just a much, much higher cost than it takes to actually solve a real problem for a military end user.

18:19That served in the Navy for a little while. I was in like a fairly technical career. And I think that one thing that's changed from the military end user perspective is I hated the software that we use. It was not consumer grade. It took on average, we literally timed this at our unit 40 minutes to start a computer and send 20 mail. And so, that's just an example of I'm pretty excited for like wanting to be here and sort of the next wave of AI, but I'm really excited as to see some of these really basic kind of stupid problems to be solved by some of the technologists that are coming into this space.

18:55What a great reminder, even though artificial intelligence is top of mind, there are still so many simple problems across the country just waiting to be solved. And that wasn't it. Throughout our conversations on the ground in DC, we heard about so many other important opportunities, including the intersection of software and hardware. Advanced re -actors. Connid to be at the edge. Automated factories. And of course, our supply chain. Here is Mitch Lee. We are dependent on the supply chain that we have for the boats that were producing. I get very excited about the classic companies coming up that help us make our manufacturing more efficient, help reduce the cost of the batteries that we're putting into our boats, help advance the frontier in terms of what electric motors are capable of.

19:46I get very excited about all of these opportunities, upstream of where we're at right now, where you can improve our supply chain, you can improve our costs, you can make what we're doing increasingly possible and compelling from a customer experience. There are tremendous number of opportunities just waiting for the right battle. And despite so much opportunity, unfortunately none of this is a given. American dynamism is far from guaranteed. Here are some of the challenges that this critical group sees along the road ahead. Back to Mitch and Ian. There are no shortcuts in the type of work that we're doing.

20:26You can't just from a very first design build something that is performant and electric and low cost and competes. There are no shortcuts to do that on the very first try. The reality is you need to assemble an incredible team. You need to motivate that team with ecupelling mission. And then you need to actually put in the work over the next years to go develop the core technology that enables what it is you're trying trying to go do. It took SpaceX many years to accomplish what they were doing. It has taken us several years to get to the product that we have in the market today. And I expect for the whole class of American dynamism companies, there are no shortcuts.

21:13This is hard work. It takes sweat equity in order to be able to accomplish what we want to accomplish. And it's still motivating them the less. Space is really hard, right? When you put an asset up into space, it's usually a one -way trip. You're not able to go out there, fix it, so it really has to be right in the first time. And coupling that perfection with the idea of we want to move faster, be more agile and take risk, is something that is always very, very difficult. So, specifically with American dynamism in the space industry, seeing that risk -possure and that risk tolerance shift, not necessarily away from traditional risk of our zero space into this new space world, but the combination of the two and the meeting of the minds is going to be really critical.

21:57But also, Wyatt Smith, Dr. Huff, Rahul Sedu, and Mike Slough remind us of how important it is to keep an eye on the right time horizon. Some of the biggest challenges to the future of American dynamism is our own creativity, what we believe is possible and allowing things that are more short term or more divisive to block us from doing things that are hard and ambitious and important is the biggest internal challenge we need to overcome. I think especially in the context of nuclear power access to patient capital as we look towards big capital projects that last for a hundred years like nuclear power plants that access to patient capital is critical to give a runway to those really important investments that are going to change the future eventually.

22:44Well, I think in the next decade of course capital is a challenge. Right now it feels like it's trending in the right direction to be able to focus on innovating within America. Politics is might be a bit of a spicy take but that's a challenge too. The winds of where the American consumer wants to focus their money or where the enterprise wants to focus their money tends to change potentially. Outcome is based on who wins the presidential election or what the sentiment is going into the midterms tends to affect that household feeling of not just how you feel inside about being patriotic intrinsically, but how willing you are to go around your neighborhood and be proud to be an American that day.

23:23And I think that we're in a position where that can be in flux potentially depending on some of these outcomes and when there's a situation where it is in flex, I think it kind of puts the brakes, you know, it's a butterfly effect that affects the American dynamism and investing in it, where if people aren't proud to solve problems through a country and Bill, we got there and boasts about solving those problems and go recruit for those problems and get money for those problems, that I think that could make a pretty big impact. And I can't say that I've ever felt that there's stability there. I think another challenge, particularly with AI, but certainly nuclear and other technologies as well as uninformed regulation or premature regulation, where you have to wonder, like, where are some of our policymakers getting their advice from?

24:08How do they understand what good looks like? Technology is so much more fluid today. So it is really hard to state in simple terms. It's really hard for folks who aren't living in breathing and obsessed by it, just how fast things are moving. There are things that are possible today that weren't even possible six months ago. And so how do you stay current? That's a big challenge and we're going to try to figure out we have to figure out how to overcome that. Now that brings us right to our calls to action. Every single one of these founders is busy at work on their mission. But there are also endless other missions just waiting to be pursued.

24:47So here is their call to action for fellow Americans. First up, Chris Bennett. How do we bring all American citizens along for the ride? With the advent of AI, with more adoption of technology, I think there's a good amount of fear around the folks who have less access to this technology are not involved in the creation of the technology, or our shareholders in the creation of the technology. And I think it's going to be really important for us to really be thoughtful around how do we continue to support Americans, especially those in need from a medical standpoint, or from a social standpoint.

25:21or from an economic standpoint and continue to think about solutions that really incorporate everyone. Here's why it's meant. Right now across the United States, there are over one million openings in Builder Economy Jobs. This is in construction. Roughly 12 % of GDP is driven by manufacturing really the industrial backbone of our nation. At the same time, there's more than 15 million people who are languishing and often low income, low dignity, unskilled work. And so that matching problem is one of the technology you can play they grow and helping solve. In order to fill those roles we need to create opportunities for people to be mobile and then ways for existing workers to be more productive.

25:59And it's very important that we invest in opportunities for people to learn, to grow, to evolve, not just as children but as adults because that's a great dynamism and an economy and a labor market to tackle the big challenges of the future. Mike Slough. If you have experience in education, if you have experience and defense, If you have experience in healthcare, there's never been a better time to start a company that attacks those problems directly. Like that subject matter expertise, it's earned. It's not something that you can read in a book or listen to a podcast or come to a couple of events.

26:35That's yours. And finding the right folks to partner up on and make your vision, then like conversely for the folks who maybe do your successful second or third time founder and education or healthcare defense, It's really important to you and you're going to take your A -plus technology game and go try to Transform an industry that would mean a huge deal to America. Again, it's not something you can listen to a podcast about Military vets talking about their jobs. You have to go in there and actually be with them and embed with them. The military, you're specifically and the technology community that have so much to offer to each other.