Programming Sunlight: How Reflect Orbital Is Building Satellites to Redirect Light From Space (Ben Nowack, Founder & CEO)

26:39like you basically get no data from these things like they're you know they're going down like 20 30 000 feet and they have mud pulse technology which gets you like a couple bits per minute it's like crazy how low the data rate is or there's this like multi-million dollar fiber line that can go down the side of the pipe but then you have to drill a way bigger hole and then it's millions of dollars per weld so the idea here is just embed something on the side some you know electronics with a bunch of connectors um so you get like megabits per second and then you could do like seismic readings you can do pressure readings and you can figure out exactly where the oil is in the formation so you can get more oil per per well and i was like obviously i hated the the oil and gas industry i hated fossil fuels like i had tried to build a fusion reactor and stuff realized like you know fusion is not going to work so maybe fossil fuels is the only way for a little while so i'll try to make that better i also hate hypocrisy where like people drive to work in a prius and complain about the climate crisis and it's like you drove like you're driving a prius but it's still burning gas like what if we could make the oil and gas industry a little better like if you could make it even like one percent more efficient you're making a huge difference today a huge difference yeah that was kind of the thought and it's a startup it's not like a big evil oil company or whatever so i was like you know what this will be good um like maybe i can figure out a way um and again like we kind of figured out some some things that were cool um and then got acquired for that but you know it was uh it was a similar story and then after that i was like i'm done with startups i'm joining a big company that's fully there and then i joined zipline and zipline was like unbelievable like i absolutely loved zipline um but then i had the idea for reflect.

28:04Before we jump there, you said something that I, you know, reminded me of the fact that, yes, I read somewhere that you built like a basic fusion reactor in your basement or something like that in high school. You know, we've talked about some of the things you built, so I don't mean to belabor this point, but it is quite important in understanding why you ended up doing reflect and taking sort of a very alternative path to a lot of other folks when you think about, you know, how to increase energy usage for humans. What does it mean to build a fusion reactor in your basement? Yeah, the fusion reactor was one of those school projects that I was going to write a report on and get some credit for.

28:44I was like, oh, yeah, I think I can do this whole thing for like 1000 bucks. You know, you can look up a couple videos of people doing like Farnsworth fusers, I think like 14 kids had made one. And I was like, oh, that's super cool. Like I could be one of like these 14 kids that have made a fusion reactor in high school. And I just did it. It took like a month it was like a welding project like you buy a bunch of stainless flanges you buy a tig welder you like weld all the stuff together that's how i learned how to take weld you make a high voltage power supply you need like minus 10 mil you need negative uh 30 000 volts at 10 milliamps um you need like a bunch of high vacuum feed throughs you make this little thing on the inside you have to get deuterium that was pretty hard you have to register with the nuclear regulatory commission and get all of that but then the actual tanked like 300 bucks and then yeah you just like you put all the parts together it's i wouldn't say it's like particularly difficult it's just like a month of work why did that make you bearish on fusion the way you tell if if your fusion reactor is working is if it's making neutrons and you have to go and measure the neutron so there's a couple different ways to measure neutrons you can either do a neutron detection tube and a hydrogen moderator and it's it's basically like a geiger counter but it's specifically tuned for for neutrons um so when a neutron goes through it you know changes the charge in the tube and then you can detect that and get a count um the other way to do it is you have a again a hydrogen moderator and then a piece of silver and you can transmute the silver in silver 109 into silver 118 or something like that and then it decays with a half-life of 18 seconds so you can measure that half-life decay um and see if it's working and there's a couple other ways to do it um you also as you're running this thing you're getting bombarded with like oh man it was like 60 millisieverts an hour of x-rays um like and like i was hiding behind water because like what neutrons get slowed down by water but i was like trying to measure these neutrons and they're super hard to measure and i just started looking into like other fusion reactors that are out there and like yeah it's it's all basically like these neutrons and you turn the neutrons into heat and then you use the heat to run steam turbines and then like blah blah blah blah blah and i was just like having such a hard time thinking about how this was ever going to work i was like how would this ever work in reality like let's say i wanted to actually go and build the real fusion reactor because I kind of got into this fusion reactor because I was interested in energy and I was like this just doesn't seem like the thing like what would be the next step after this it's actually not that different like I knew this fusion reactor was going to be terrible and never going to produce power but I kind of realized the real ones are basically the same thing and they're struggling with a lot of the same problems and it's just so much less efficient than what the sun does the sun has a ridiculous amount of gravity and it just pushes atomic nuclei together there because of that and it does fusion and it's very efficient every time we try to do it on earth where we're like slamming these things together at very high speeds or confining them in these magnetic fields that are incredibly dynamic and very hard to stabilize um even at the national ignition facility where they do those giant laser pulses if the little sphere that they have is off by like the diameter of a bacteria it won't work it'll go unstable lasers have to be perfectly balanced so you just end up with these things that that have to be incredibly smooth and it's like you're basically trying to push two two springs together or two magnets together and they you know they always want to explode and it's hard to create the pressures necessary like it's hard to create the pressures in the center of the sun in this way and i just you know got into thinking about all of that while i was building this fusion reactor and all the challenges and all the radiation and and all the all the stuff about it and i was like man i don't know if fusion's the thing like it's really cool research i mean it was super fun to build the fusion reactor but i was like i don't know if this is better than just like a solar panel or better than just you know burning some some fossil fuels and i was kind of thinking like you know i burned a lot of energy i actually used like a whole megawatt hour of electricity in high school wow like my dad was kind of mad about that so i was like you know am i the problem with the world like am i just creating like all these problems am i making all this co2 like oh i made this fusion reactor and it's like actually even adding more co2 to the atmosphere it's like not making anything any better i was like man i really want something that will just work and i started working on antimatter a little bit um which is even harder than fusion but it's like a storable you know fuel source it's just like even deeper in physics and even even more removed from reality and then i kind of realized like i probably won't solve the energy thing it might be like much more difficult than i can do right now like i'm just going to do the normal job thing that's kind of when the spacex thing came out i was like you know energy is very hard like like super, super hard.

33:02If I come up with an idea that that might address it later, I will definitely do that. So I kept thinking about it all the time. But I really realized like, wow, fusion probably isn't the future. It's probably something else, maybe antimatter, but that's even harder. And so was that, you know, you'd sort of been thinking about this for so long and, you know, had explored these other areas that you thought, hey, you know, I don't see this working. And then it was at Zipline that sort of you had a little bit of a what sounds almost like a eureka moment where you're like, hey, actually, I think there's I'm putting this in sort of air quotes, a simpler way of doing things.

33:38It's not simple to beam sunlight from space, but simpler than antimatter to make this happen. What was that moment like? Like what what clicked in your head that you suddenly thought, hey, this is viable? Yeah. By the time I was working at Zipline, I was trying to have creative ideas and I was trying to explore them very quickly. and basically see if they're a viable company or toss them out. And I had been doing that like probably for a decade. Like I'm honestly, since the Ben and Builds days, I just, every new idea I'd come across, I'd look into it, see if it was worth starting a company around.

34:11And I was doing the same thing as Zipline. And I would have like brand new ideas, like probably once a week and almost all of them don't work. So Reflect started out as that. I was basically watching this video on sunlight in Africa. And there was this project to move sunlight from the Sahara Desert to Europe. And they're going to spend like$40 billion doing it. And something just clicked in my head. I was like, oh, sunlight is a resource that you can move around and potentially get paid for. And I just saw it like it was oil or a resource in a way that I had never seen it before. And honestly, I'm kind of embarrassed I hadn't seen it that way before.

34:44It seems so obvious now. It's like, oh, if you could just move sunlight from here to here and get paid for that, you could create real value because you could move sunlight from a solar farm down here up to here. and you could make this one generate more power. So like in Germany, they'll make a third, a solar farm will make a third the amount of power it would make in Africa. So if you could move this in Africa to Germany, it would make triple the power. And if the solar farm was making$100 million a year, now it could be making$300 million a year. And I was like, oh, so somebody could maybe pay me like$200 million a year to do this.

35:17I wonder if I could do something like this for like$200 million a year or less. So then I started looking into all these different ways to do that and eventually ended on the Reflect idea. Yeah. And how did you start to like crunch through the credibility is not the right word, the sort of viableness of this, the viability of of this project where you were like, you know, one, you have to sort of validate it on some level on the scientific side. And there is this sort of rich history of, you know, maybe the Egyptians, but also, you know, in researching this episode, I learned about sort of the Russian efforts in the 1990s and stuff like that, which we can talk about.

35:51But also, you know, the viability on the economic side, just to say, hey, yes, maybe we can can beam this. But is there enough of a market for sort of full moon level, you know, and beyond? What was it actually like to to work through those questions? Yeah, the objective was very clear. Make electricity cheaper than the alternatives. The batteries are like 150 bucks per megawatt hour. Normal fossil fuels like a natural gas peaker plant would be actually around that range. But a combined cycle natural gas plant is like $56 per megawatt hour. Solar during the day is like 40 bucks a megawatt hour, maybe like 30 bucks a megawatt hour in some places.

36:28Nuclear power is like, you know, in the 140s to 150s per megawatt hour. So that's kind of like, you know, coal is like$109 a megawatt hour. So I was like, okay, These are like things to shoot for. Maybe you make something that's a little bit expensive at first beats batteries. Then you get better. You beat combined cycle, natural gas. And then you get a little bit better and you beat just solar during the day. Like, oh, man, if you can make something for like 30 bucks a megawatt hour, everybody is going to use that. So that's that was the goalpost. And I looked into what launch costs you would need, what satellite costs you would need, how thin the reflector would need to be, some of the designs.

37:00And basically, I just put it all into Excel. And it didn't work at first. Right. It's like, yeah, you can apply things wrong. And then like, you know, a week later, I was like, oh, I could do this like sun synchronous orbit thing. And then that completely improved the economics because instead of the satellite passing over once a day, you know, basically going through the day night cycle with the earth, it's like, oh, you can use the satellites all the time. Then you can serve hundreds of solar farms at once. So you can spread one satellites cost out over hundreds of solar farms, very large solar farms.

37:26That's like a huge breakthrough. And there were a couple of these. There was another breakthrough that actually was like a dead end path where I was trying to decrease the spot size with casagrain optics in parallel and that was like new because then you could serve a small thing in a city without having light pollution on the surrounding area it turns out there's enough big customers out there that you actually don't need to do that um so you can just delete all that stuff and keep a very simple satellite um but i didn't spend some time working on things like that a ton of different like you know crazy materials things like that that would completely change the economics like going from you know the mylar you can buy on Amazon to some of these space materials was a massive improvement.

38:04But really, a big grounder for the economics was NASA's ACS-3 vehicles. They're the solar sail satellites that had these super lightweight booms and this very thin material. And they had a certain mass and they had a certain size. And if you just made that thing reflective or something a little bit larger, the economics, you know, were very close to closing with a couple of these markets. So with just a couple of changes. It was basically workable in the right orbit and the right altitude and everything like that. So I was like, wow, this doesn't take any enormous breakthroughs. We've basically already built this thing.

38:37Yeah. I mentioned sort of the Russian experiments in, I think it was maybe 1993 when there's this sort of quite famous Russian engineer from what I was reading about him. I can't pronounce his name. It's like Siramutnikov. uh yeah you you might you might know it there's an omnia is even hard to pronounce yeah exactly um uh which which translates to banner i read so it's this project called banner and they sort of managed to to create a mirror in space and and beam about a full moon's level of brightness back down to earth but i was reading about this project he tried for a really long time right to raise money to bring it to reality uh and it and it never worked you know i think people will know what's changed in some level, but on a really granular level, like what has changed from that era to today that, you know, makes that gap closable on the financing side, but also just, you know, launch costs, technology, all of these different inputs.

39:37Yeah, launch costs have gone down by, I think, 97x since then. You know, back then you were shuttle and they were a Soyuz mission. They were on the Progress spacecraft. So today we have SpaceX Falcon 9 launch costs. Rideshares are, you know, 6 ,500 a kilogram. A full Falcon 9 is 2 ,500 a kilogram. And Starship is going to be a lot cheaper than that once it's available. That was not around back in the 90s. The other really big difference is solar was not around in the 90s. There were about 200 megawatts of solar farms around the world. And our chief strategy officer has built like multi-gigawatt solar farms.

40:10We have nearly two terawatts of solar around the world today. So it's, you know, you go from 10 to the six to 10 of the 12 watts of installed solar capacity. So it's it's just completely insane. The difference in solar. So Zanamia was launched without solar in mind at all. They actually had a mine fund them for their first mission. And yeah, so it was pretty interesting. It was just lighting, like lighting up Siberia. Fascinating. No way. Yeah, that was kind of the impetus. And it's actually pretty similar for us. like we're huge in Scandinavia, like northern areas, really, really like the idea of sunlight.

40:48I mean, you know, unsurprisingly, so it's unsurprising that the first satellites were from Russia, where it's super cold and super dark in the winter. But yeah, it was really just to light up areas. And I mean, the reason it didn't work like with anything, it's usually the funding like, and that's been a thing like even in high school, like if you can find the funding, you can usually build the thing. Zanomia was able to find funding for this this first mission, they launched a second mission and the second mission honestly it was a kind of a stupid error like not saying that it's impossible for everybody else to do something like this but they basically deployed the antennas before they deployed the reflector so the reflector just like hit the antennas and then ripped up and then that killed the entire program um and it's like common in space for things like this to happen because the you're so constrained and it's it's very easy to make mistakes like this and and yeah that basically just killed the entire program so they had one mission that went up and they had one demo it was on the progress spacecraft which was going to dock to this you know the mirror space station and they deployed it and they basically had like one pass over the earth to test it it was it was just cloudy on that day and it wasn't bright enough to break through the clouds obviously if you're bright enough you can break through the clouds or if you have enough passes you can get a day that doesn't have clouds and they weren't able to line those two things up either so they basically just didn't get a chance to show that it worked at all there's some cool pictures of it in space but but that's about it and yeah since then nobody really had picked it up i mean this this has been an idea since the you know the 1920s um overthrote heard about it in a book um as soon as rockets worked like it was shortly after the first liquid rock engine worked um somebody wrote a paper about like mirrors in space that are going to light up the world um and it's it's kind of been a thing like here and there at nasa and and places like that.

42:29But nobody's really done it apart from the Russians. So, you know, we've now sort of, I think, fleshed out the core concept here. And to sort of go back, you have this eureka moment, you bring aboard one of your zipline sort of colleagues, Tristan Semelhack, and and raise funding. What was it in Tristan that like felt like the right partner for you that you know, you guys sort of felt like you had the rapport to do something like this? I mean, Tristan is on the same wavelength at a level that's that's pretty hard to describe. I mean, you can describe it with stories and examples. But we'll just like see the exact same situation and have the exact same thought, like just the exact trajectory after that.

43:09And he is he's just incredible. So Tristan was a high school student working full time at Zipline on one of the most important problems there and doing exceptionally well on that extremely important problem and everybody there knew who tristan was they're like oh my god this fucking kid like works circles around me like i can't believe it um like like and he's just completely insane and and just so good and as soon as you meet him and work with him you're like oh you see it immediately just like do that and that and that and that and he can explain this in that way and like pull out this insight from this impossible thing and like really just like find the path in the complete darkness like tristan is amazing all in high school and he knew me from my youtube videos back in the day so he was like oh you're ben and builds like we should be friends and honestly he probably wouldn't have been friends with me if that wasn't the case um because like he was like he was like mega famous like as this high school kid like he was awesome and and yeah we just became friends at zipline um we started like basically walking around like every day after lunch and just like talking about the various problems we're solving we're on different teams there we would go on like hikes together and stuff we ended up like in the same friend group and yeah just became friends um and then yeah after i left the blind to start reflect you know i was working on it for a little bit and tristan actually went to stanford he got into stanford and was doing the thing at stanford he got through a semester and a bit more and he was like and the reflect was kind of taking off then he was we started working together a little bit more and he was like you know what i'm gonna drop out and just join you ben like this is totally the path and I mean the rest is history really like he added so much value so much clarity to reflect like immediately started like cutting out things like actually it was him that he cut out like the you know the casagrain optic thing like simplified the entire technology like totally simplified the pitch basically invented the lighting market as well and it's just like you know me and him since then you you've raised I think somewhere you know let's say 35 40 million dollars from from folks like Sequoia and Lux and so on.

45:15One of the interesting quirks in your cap table is that the former founder of Robinhood, Baiju Bot, was one of your early investors and then sort of created a competitive company that has since pivoted sort of in your same space. Was that something that you were aware of when he joined? Did that create any friction or are you sort of of the opinion we need as many things in space happening at the same time as possible? Yeah, we were definitely aware of that before he joined. We were having a ton of conversations about how to do space, solar, and all of that. And he was just super excited about us, really cared about more companies building cool stuff in space and really making money in a brand new way, right?

45:57Like space has been so boring for so long. It's been telecoms, some Earth observation, and a lot of defense stuff. And, you know, the Mars pitch and all of that. But really, it hasn't had commercial businesses in Leo that are just making money. He was interested in developing those. he had always been interested in space like we bonded over that we bonded over our love of technology and it just made sense um and then yeah we knew we knew he was interested before he joined um and we're just honestly super excited to work with him um a bit closer i mean yeah beiju is pretty awesome i love hanging out with beiju i would say it's a competitive technology but the like really a rising tide raises all boats like we're all booking the same launch we're all increasing launch demand we're all going to drive down the cost of rockets we're going to get better at building satellites.

46:39I don't see us as competitive with other space companies either. I don't see us competitive with other energy companies. I think these markets are all in the trillions and there is a ton of value to capture and we're all capturing pretty different pieces of the value. We may be all kind of bundled into the same bucket right now because we're just starting to grow. But as we grow a lot more, I think it's going to be very clear that we're in entirely different industries and the entire space industry is so much bigger than anybody thought. It's interesting to me that his company, Aetherflux, feels like it's sort of pivoted more towards orbital data centers.

47:11And it feels like that's going to be a trend as we see demand in AI. You must have considered for a moment at least like, hey, are we running the right race? Should we be changing tack? Why did that not make sense for you or not interest you? I think everybody's probably going to pivot to data centers in space except for us. um i like tweeted about this recently and it's the same thing right there's very few good businesses in space most of them are just defense companies and defense companies like missions like yeah that's definitely in the billions um it's it's cool and it's super cool and it's like great money and the government loves you and you can be you know the government can be a great customer it's not the same as like the iphone right it's not the same as the the internet it's not brand new It's not changing the world.

47:59It's not doing all this stuff. Data centers in space. I mean, it's AI, right? So it's like, obviously, it has all the AI stuff. And it's potentially a cheaper way to do AI. So that's pretty cool. And there's a ton of AI hype right now. So I think it's super easy to raise money for something like that. And theoretically, it could be cheaper than a data center on the ground eventually, which is pretty cool. And like, I think Yuan's pitch where it's like, we're going to build the mind of a sentient son. That's pretty awesome. I think as a tagline, pretty amazing. Yeah, I think our species will eventually do that.

48:31It's kind of the thing to do long term. It's just, you know, when do you do it? Do you do it right now? Do you do it in 50 years? Do you do it in 100 years? Being early is the same as being wrong. I think Mark Andreessen says that, like, you know, can you make your company last while it's insolvent for 50 years? Like, that's gonna be pretty hard to do. Like, I haven't been a liquid business for a long time. And I think Elon's willing to do things like that. You know, he's like, we're going to Mars, we'll figure it out. Mars had no market. Like, there's no market on Mars. How is that ever going to make money, right?

49:01That was always the question. That's kind of why I didn't really want to stick around SpaceX. It's like, I don't know if this Mars thing, like, is really going to work. And Elon was like, I don't care. I'll figure it out. I think he's kind of doing the same thing with data centers in space. If you do the math right now, you can rent an H100 for like$1.33 an hour. That's like 40 bucks, you know, a day. That's very little money. Like, even with quite good solar panels, it would take like a couple decades to pay that back. So we're not going to do data centers in space. when that changes we might um but right now i mean our our mirror is like lighter than those gpus that like takes less power and we can make in the thousands of dollars per hour instead of a couple dollars per hour so it's just so much better it's obviously way harder to build um it's way harder to raise money for because people don't think it's valuable yet but we're going to show them that it's valuable we think we can do that we already thought we could do that we're already like biting off that problem.

49:54We're just continuing on the exact same path. And I think everybody will maybe pivot to us once they realize our thing makes sense. But obviously, they're pretty excited about data centers right now. And it's not just Elon, right? It's Google, it's NVIDIA, like planets doing it, like new businesses in the space are really exciting. For a lot of these folks, it feels like the, you know, it's hard to say lowest hanging fruit, given it is still a really complex thing to do. But it's sort of, you know, a natural evolution or a natural thing to want to try when the market's pulling in this direction.

50:23And there'll be compute in space. You know, there's like$1.33. Like, we're not just going to do like normal H-100 stuff. Like, you know, maybe you take a picture and then you do some AI on it and then you send it down. Like, I think there are applications for AI in space. And there's many examples of that happening. And I think everybody's going to engage in that a little bit. And it'll slowly develop. I guess I'm not worried about this becoming something that humans can do. And I think we'll probably do some AI in space for some applications, for some reasons. I'm sure everybody's going to do it.

50:49To some extent, it's just, you know, the full on Elon thing. You know, we're sticking to the reflectors. Yep. Yep. There's been like plenty of folks that are skeptical about reflect being able to be viable. And perhaps I'm just like too much of a congenital optimist in a venture sense. But to me, like that's sort of a necessary byproduct of like any legendary outcome, I suspect, is that, you know, it's kind of a bullish signal. if there's like a bunch of people who think this is impossible or not viable, because I think, you know, there's a really easy way that people get locked into a certain form factor of like, hey, this specific version doesn't work if I run the numbers, when the reality is like, I suspect you're making a thousand little micro adjustments and tweaks along the way that mean the final form factor of what this looks like ends up being very different.

51:39And so I'm curious, as you think about that, like, you will have, of course, seen folks who think, hey, you're not going to be able to get enough brightness to make enough money from this, or you're going to be able to get some amount of sunlight, but there's not going to be enough utilization on this or whatever it is. What are the pieces that you think folks tend to miss most about where this is headed? The performance of the mirrors is quite significant. As you mentioned, the value of even dim sunlight is also insane. And the ability to add the satellites together, I think is also a really big one.

52:17I think people miss that constantly. You can just keep adding satellites together and keep increasing the power. You can have 4000 satellites working together at one time, you get to have 10 ,000 satellites working together at one time, you don't have to have the satellites talking to each other to do that. You just have them all pointing at the same spot at the same time so it's kind of it's extremely parallel it's like jensen hong talks about like this thing called stupidly parallel where the best parallel systems are ones that take very little interaction between all the elements it's the same thing with these satellites they'll just point to the same spot it's really simple they don't have to know where the other one is it's not like a formation flight so i think that's one that people miss um i think people also miss the like that you can go all night if you keep adding these rings um some of those rings are kind of special but i don't know i think people miss that one pretty often I think the other one that people miss, I think some people think we're just like reflecting light and not changing where the satellite is.

53:09So we're just kind of like lighting up the whole back of the earth or something. We're definitely not doing that. You know, one satellite hands a spot off to another satellite and it's over a very tiny, precise little area. And like the satellite is rotating the entire time. We're able to do that. We've designed the satellites from the ground up to be able to do that. They have huge reaction wheels and all of that. so they fully rotate every time they're passing over a customer and we can fully like move the spot we can even move the spot while we're serving like you know say there's a really big music producer that's writing a song you can move the spot back and forth like as the song is is hitting so it can be like like when the music hits and everybody's freaking out and then like the music comes off and then we move it back on we can do things like that you know track moving objects you can do all this stuff you can move the spot around cities and areas like that so you can avoid different places.

54:01There's ways to actually like keep the satellite on the spot and then cut it off. So you don't have a line going between two cities. So you're not lighting it up. There's just a ton of different things that you can do with these flexible tools. If you focus on building, you know, the brightest, most specular satellite, that's extremely dynamic and performance and very retaskable and infinitely retaskable. And all of these retasks come for free. It's all just reaction wheels. It's, you know, solar powered motors. So I think that's a pretty big one. like people get confused about our altitude. I mean, there's all kinds of space things like spaces is this place where it's just so easy to overthink everything because it's really hard to actually test in reality.

54:36But, you know, our vehicle has a full on prop system. You know, we have we have full on radios. We're like a full fledged satellite. You know, it's a couple million dollars to build one of these satellites. It's fully featured. It does all the stuff and it does all the stuff exceptionally well so that it can serve its boss as well. Yeah, the multiple constellate or the multiple satellites at once piece sort of, you know, at constellation scale, I think is so interesting. And maybe the analogy is it's sort of almost as if you have 100 people with a torch pointing it at the same spot, right? Like your brightness suddenly increases a lot when that happens versus 100 times brighter.

55:09Yes, literally. And on the piece on, you know, I actually haven't, maybe this didn't come up as much while I was researching, but the sort of market for this lower brightness version of things, you talked about this, you know, at the top. And And again, now, like, where is the market pull coming from there? You know, is it like mining companies like the, you know, the Russian version? Is it music performing artists who are, you know, creating an incredible concert atmosphere? Like, where's that that demand from that makes you feel like, hey, actually, this thing that we once thought was going to be just an experiment as, you know, our first three satellites is is going to be economically viable already.

55:51This one is actually a lot deeper than most people realize. we have electricity because we wanted to light homes up and even before the invention of the light bulb like rockefeller standard oil that whole thing was for lighting homes it was it was lighting and heating homes that's that's why we were pulling petroleum products out of the ground and then we realized there was this byproduct of home heating oil that was super volatile gasoline that you could use for cars and it was like oh wow we have these cars that's how we got into oil um and before that you know it was candles and stuff like that it was just like lighting up areas and then the light bulb was similar it was like oh like i want the ability to light a home without a gas lamp because gas lamps are kind of smelly and all of that like i wonder if there's a way to do that you know thomas edison all these guys like you know nicole tesla they were working on light bulbs to light up homes without using oil um and when they did that there was no power grid like the first electrically lit homes it was um jp morgan's house was one of the first ever and i had a generator in the basement and the walls were full of all these crazy wires that would like light on fire constantly the neighbors hated him he built it i think it was in manhattan and the neighbors absolutely hated this guy because he was running this generator all the time which was super loud like the dynamo on it was incredibly inefficient like it was crazy um and people hated it and he was like oh man i don't know if this thing is going to work like he had seen a demo of it at this mansion he was like i want this in my house but then when to put it in his house he was like not happy with it he was constantly complaining about it he was like these light bulbs kind of suck like this generator is awful and it caught on fairly slowly for a little while um it was pretty bad the point there is it was lighting homes before energy and yes it was a couple decades later that they actually started putting in the power grid and they were like okay we we got to get rid of these generators in people's basements let's do a power grid and then it was the whole like ac versus dc thing and all of that um and then everything took off and a lot of this was funded by by like jp morgan like he was just like a futurist um after kind of seeing this stuff happening and but people like hated lights like people were like these things are going to ruin our lives like these things are going to completely change the world you're going from candles to this like nobody's ever going to sleep you're going to ruin everything um and obviously we look back on on electricity and the invention of the light bulb is a pretty deal these days um it ended up mattering a lot we're the same thing like our lighting market is replacing light bulbs effectively it's the new version of light bulbs you don't need a light bulb anymore you just need to hit a button on a phone and then you can get the same exact thing and all the negative stuff that people like people say about us you could also say about light bulbs um you know oh it's light pollution oh it's like ruining the night sky oh it's keeping people awake people choose to install light bulbs in cities um for various reasons you know for safety so you can walk around it feels good when you go to time square at like 2 a.m i loved time square everybody who lives in new york hates time square i when i lived in new york i loved time square i don't know why i loved all the light bulbs like i lived in hell's kitchen for a bit um and it was super fun and when i would walk around at night like it just felt super vibrant it felt like the city that never sleeps it's like oh there's so much energy there's so much excitement here you know that sort of thing like people put light bulbs in for for that sort of feeling and you can do the same thing with our satellites imagine walking around time square and it's lit up by satellites it's going to feel super cool or any city right and you and we can adjust the brightness i think the other thing people miss is it's fully dimmable so we're not going to be sunlight at night right you can be you can be three lux you can be 0.1 lux you can be moonlight you can just be you know basically the light and security cameras turn on and you can just see areas you're not going to trip over something you know like a nightlight it could be nightlight brightness that's very important and people miss that so we can you can tune us a lot more you can also turn our light on and off a lot more and it's much more even than normal light bulbs so when you have normal light bulbs the the actual street lights themselves um will be you know some distance apart and they'll be super bright they'll be brightening the ground to like 40 lux but then in between the street lights it'll be like you know three locks nine locks you know the dark skies folks say three locks is all you really need usually it's it's over bright here and it's it's just very uneven lighting so we can just light up the entire area to one even brightness.

1:00:03You can select three lux, you can select 10, you can select 0.1, whatever the city wants. We can turn it off. You know, you could have like three lux at 7pm and then like two lux at nine and then like 0.1 at 10 and then nothing after. Or, you know, you could have 10 lux all night. Whatever you want, you could select and we're fully programmable, right? It's just how many satellites are working at once. That's really easy. That's flexible. Our software just does that in like, you know, two math operations. yeah and we can do it for any area you know the city of los angeles is is very big but actually takes 70 different spots to light up the entire city so you know you can do different regions with different amounts of light um you can add the light together you can do light that's not just you know two spots overlapping you can do like half overlapping where like the center different brightness on the outside you can like basically build shapes like we could draw a picture of a dog with our satellites like with the light on our satellites like i mean it'd be really big but Like we can do all this stuff and you just can't do any of that with streetlights.

1:00:56It takes like months to build streetlights. You have to trespass on everybody's land. You have to build all the stuff. If you want them to like turn off at night, you have to like put in all these sensors or all these switches with us. It's just a couple of buttons. It's like, you know, it could kind of be the same as like a calendar, like a Google calendar where you just like have the different time with the different brightnesses on it. So it's going to be much simpler. We're going to allow people to light up more areas. The other cool thing is you can just hit a button and turn us off if you want.

1:01:21It's not like, oh, we built all these streetlights, we got to use them. The sentiment changes for the community. We can just turn all the lights off. It sounds almost like municipal lighting and, you know, that sort of market is maybe like one of the more attractive sort of beachheads for you where you see, you know, folks being excited to experiment with that, to see, you know, what that experience is like for people in their city. Is that a fair reading or are there other ones that you think like, yeah, look, that's a very visible use case for the consumer. But in reality, like the first, you know, three sort of customers we have to serve are, I don't know, solar farms or, you know, defense applications or whatever it might be.

1:02:00Yeah, municipalities are definitely not our hungriest customer. Our hungriest customers are folks having emergencies. So if somebody falls overboard in the middle of the ocean and, you know, helicopters are on the way, you can just hit a button and be there in 30 seconds. You can see the entire area around you. You don't actually have to wait for the helicopter anymore um if you're like lost hiking in the woods like in the middle of the mountains in the freezing cold you can't see anything your headlamp dies but somehow your phone still has like five percent charge if you can get a signal out we can light up that entire area for a couple hours and then you can see you can get back we can do things that are just otherwise completely impossible um if there's a natural disaster if there's like a fire that's going on or something like that we can be there so you can fight the fire at night i remember when the LA wildfires happened, they weren't fighting the fires at night.

1:02:46We could potentially help change that, you know, set down a spot, you say, here's where the emergency is happening, and we can be there. And that's definitely where you start. Like those, those applications matter so much more. The municipalities, we don't expect to happen for a long time. Like, yep, I think I'm very excited about them happening. But really, it's going to be the hungry customers first, they're going to be the laggards, the early customers will be the search and rescue operations, these critical things. As you get in a little bit later, then you start getting like northern regions um you know like folks up in alaska folks in scandinavia um in these really northern towns where you know there's some valleys where it's it's dark for like four months and we can provide a little bit of sunlight give people something to look forward to um we got so many applications from these northern places saying like even just a tiny bit of sunlight like once a week would make a huge difference in my life like the whole town would go together for it like it would be so exciting um i would love something like that you know we'll absolutely be lighting those places up Even with the first satellite, we're going to be lighting up a couple of these towns.

1:03:43You know, those are maybe the, you know, the first set of customers. When you think about, you know, at maturity, does that become the time when, you know, solar farms do become sort of the biggest chunk of customers in your estimation, just because there's, you know, the demand for that? If you can deliver that energy consistently at a, you know, sufficient brightness at a, you know, valuable or at a decent enough cost, like, or is that no longer as big a piece of the puzzle for you? The lighting market is, you know, in the tens of billions per year, potentially in the hundreds of billions, too, if you're in the right markets, and you're starting to like grow new things.

1:04:20The energy, like we spend$2 trillion a year on electricity and globally, and about eight or more on including all the fossil fuels that we use in like cars and things like that. So it's an enormous market. Agriculture industry is actually similar in size, It's up in the trillions. It can increase plant growth and things like that. But really, it's these behemoth markets like solar, energy, and agriculture that are going to be like our long-term moneymakers. Yes. The thing is, you need a lot of satellites to open up those markets. You need thousands of satellites in space. And they also need to be quite cheap, right?

1:04:58You're competing with commodity electricity prices. You're competing with solar. You're competing with combined cycle natural gas. You're competing with nuclear. You're competing with batteries. Nuclear and batteries are pretty easy to compete with. But like you are competing with these things for cost and competing with something for cost. It's really hard. Your thing has to be really cheap. You got to be really good at building these satellites. They have to be really cheap. Launch costs have to be really cheap. You have to be launching a ton of things. That's expensive. It's really expensive to make enough things that they become cheap.

1:05:26It's easy to say like, oh yeah, we'll just like mass manufacture these. So many companies say that and like a lot of them fail because of it because it's actually way harder than they realize. you need to be making money with a small number of things in order to have the ability to make a lot to get cheap you can't just like spend a billion dollars and like make a ton of things and make something cheap you need to be able to do something useful with like like maybe like a couple hundred thousand dollars or maybe one or two million right um and you need to be able to make money like that so that you can actually get to the the bigger markets and then you're not just like i need a billion dollars for this crazy project you're like oh we're expanding and our revenue is that I so we're also spending this money.

1:06:01And that's really why the lighting market is so important is because it gives us a way to build satellites that are expensive that we are testing. And some things aren't going to work, but it's going to be okay, because we're making so much money off of these lighting markets that it's that it's fine, like the margins are so high. We're not mentioning exact pricing yet. But you know, some of these satellites are the price of like a few expensive lawyers, like it's in the 1000s of dollars per hour. I love that as a comparison. Yeah. That's such a funny cop. It's a Zoom call with a couple lawyers.

1:06:33You know, which Zoom call with a couple lawyers can be like, you know,$5 ,000 or$10 ,000 an hour. And, you know, if you're doing that like 15 % or more of the time for, you know, a couple of years, it's in the, you know, it's a few million dollars per year. So the satellites can make back all their money in just a couple months. And they'll last for five to seven years. It feels like it's a super novel technology or at least a very novel manifestation of it. But you're following a very tried and true strategy, right? You're starting with this lighting market where you can do something that no one else can do, at least in this sense.

1:07:07And there's really strong demand and you can charge some sort of premium for it. And then you're unlocking these things where you're competing against everyone else on price, but the market is more or less unlimited. And so, you know, sort of grand strategy style, grabbing each new opportunity as you as you build into it. Yeah, totally. Yeah. It's start with something that's that's brand new for the world that people pay for the value they're getting. And then when you get good at that, then compete with things we're already used to. Let's transition a little bit and talk about how you run the company.

1:07:38You know, I always think that a lot of the founders that I end up being most excited by, they maybe do things that are not super usual. And so I wonder, you know, culturally or operationally, like what are the things about, you know, how Reflect runs that might be super different to Zipline, for example, or SpaceX and that are really core to your culture? I'll start with the things that we do similar. The first one is we really prioritize top talent. That is extremely important, like keeping a very high talent bar and making sure those people stick around and making sure you really only let people in who meet a certain talent bar.

1:08:15like is this person's reflect quality? Is this person's basics quality? Is this person's zipline quality? That was always a question that we were asking. And that's definitely the case at Reflect. We want to be just incredible and surrounded by incredible people all the time who are excited to be working on this stuff, who are at the top of their field, who are really the best and brightest, who are often like a prodigy in high school. Like that whole thing, like we're really looking for those folks. I think that's critical. When you have a team of those folks, you really want to enable them to do the best work of their life.

1:08:42And honestly, you will stop at nothing so that they can do the best work of their life. Like once you have a room of those people, it almost like happens naturally. You're just like, oh my God, I don't want anything to be in this person's way. And it just happens immediately as soon as you hire the right people. If you hire somebody who's bad, you almost want to get in their way. You're like, please don't do any work. I don't want to look at it. Yeah, how can I put roadblocks here? Yeah, but as soon as you get somebody good, it's like, dude, like I'll give you$5 million. Like I'll do whatever it takes to like keep you working on this thing.

1:09:12and and the SpaceX and Zipline did this really well like you basically felt like money was free when you were working there as an employee as soon as you like had a project that you needed to work on you're like this I want to build this thing it's going to cost as much they're like cool here you go um I worked in another couple startups that didn't do that they were kind of too broke and it was hard to do anything and it felt bad um so we enable people to buy things um quickly as quickly as possible like come here you say you need to buy something this is important for your job. Here's the reason why.

1:09:40All right, here you go. Here's the money. Like when our chief engineer joined, I think he spent like, you know, a couple million dollars in the first week. In equipment? Yeah. And it was basically like, you know, four months of work that we weren't doing that he just did in a week. And it's like, if people aren't spending money, they're not making progress, right? So you really need and you need to spend it on the right things. Like you have to check that. But you want there to be no friction as soon as this is the thing to do. And I mean, that's a big thing with personal projects as well, right?

1:10:06Like, as soon as you get the money, like you're able to build the thing but then you have to go and spend the money and i i really learned how to spend money when i was building all these projects in high school it's it's the fuel that that fuels everything being built um and how you spend it's really important like you can spend money on the wrong things and lose money like you really don't want to do that but you know doing in the right way is is definitely important um but a lot of times the right way is just really fast like and it's funny how often people mess this up if you buy something and it's the wrong thing and then you got to like buy it again and then it's also the wrong thing again and you got to buy it again.

1:10:38Each one of these cycles is basically a week long or potentially longer. You know, it's coming in the mail from from whatever company. And then you try it. It doesn't work. And so you can burn a whole month just buying the wrong thing a couple of times. And that's a month of like the entire entire company's burn rate, which can be in the millions of dollars per month. And that is unbelievably expensive. What you should have done to save money is buy all six of them immediately, get all six that week, try them all out, pick the one that's the best, throw the rest away. Usually that's the cheaper thing to do.

1:11:09So we encourage people to do things like that and actually think about the entire program cost, including your engineering costs and payroll, which is usually the most expensive part of the company as part of it and operate a lot faster like that. So anyway, that's the second one that we do to keep people going. And yeah, I think the last one is really like making sure that the company is all aligned and focused on the same thing. You know, you have the right materials, people are investing in the right amounts of infrastructure. You don't want to spend all day doing documentation or things like that but there's a lot of really simple infrastructure that's that's great just like a spreadsheet that says everybody's ownership and exactly what people are working on what they should be doing obviously like making schedules things like that you know having everything in cad like you know signed off a drawing a formal drawing review process um all that sort of stuff is really important um to keeping everybody aligned on the same page like you know doing work that they're they're proud of um and really making sure that you're catching mistakes when you're building a satellite you have to catch a lot of mistakes like you know people make mistakes naturally and you You need to build a system that is naturally good at catching these mistakes before they make it into the vehicle.

1:12:09What has been the biggest surprise of building this company? And what has been the hardest day of building it? The biggest surprise has been what an exponential curve feels like in an organization. Like our headcount has been exponential, like completely exponential. We were 14 people in July. Now we're 51. We were seven people this time last year. The year before that, we were two. the way that feels is is like completely impossible to predict uh it feels so much better than you would think and the thing with exponentials is they always get steeper right and it's always like oh my god things are happening so fast and then a month later it's like oh my god they're happening even faster yeah that was completely unforeseen i did not expect it it's incredibly incredibly rewarding i love that um the hardest day i mean i've had a lot of hard days like particularly so i was just in a garage like i actually started reflect when i was like living in a van i was living in a van while i was working at zipline it was honestly great i could just like live anywhere i loved living in a van uh i i was in like this garage for a while and i had initially raised like fifty thousand dollars um from rick burton who's on fantastic and was you know working on reflect for a number of months it was like like eight months in or something like that had like 300 bucks in the bank like literally 300 left and i had just had this huge breakthrough with the technology where the whole thing got a lot simpler and i was like should i go back to zipline like should i continue doing this and you know some days like you start doing the math and you like make a mistake and you're like oh wow it's way less valuable than i thought and then it comes back and then it's like so there's this whole like couple of days there where it was like pretty gnarly all of a sudden like i just found the problems in the math it's Like actually started working out really well.

1:14:00And then I was just like, you know what? I can do this. I'm just going to go into credit card debt and just send it. And then I just started like buying tools. And I was like, yeah, I'm going to figure out how to raise money. I'm going to start buying tools. This is going to work. I know I can do it. I know I can build this. Like I'm going full throttle. And then like a month later, I raised$350 ,000. How much debt had you gone into? Oh, like$50 ,000 credit card debt. I actually, this is hilarious. I had$21 left of of credit card debt like I the 350k came in like I couldn't buy like I could almost not buy a sandwich but it wouldn't have worked if I didn't do that I was like there it was a decision I was like and it was kind of partially because I like had done all the bend and build stuff I was like you know I can just like finish this this is like so close I know it's so close I know I can do it um and I know I just need to keep building stuff because like if if I'm going to ever get out of this it's going to be because I built something that was valuable and the only way to do that is to spend money people wouldn't fund you at that point they were they were they wanted to see more proof before before they would take a bet on you a little bit yeah it also wasn't packaged quite right like there was like one critical test that i had to get done before i could go and raise raise the capital what was that what was the the sort of like threshold that you were you were pushing towards it was it was a bunch of ground tests um with mirrors and the performance of the mirrors um actually like measuring the power on a little thing.

1:15:24Yeah, it wasn't the hot air balloon test. It was way before that. It was like actually a year and a half before that. It was like all these little ground demonstrations measuring the quality of the mirrors and all that. How did you sort of maintain your poise during that period? Like did every day just feel like you were in a dogfight or, you know, were you able to sort of block out the noise for yourself? Yeah, I was just living in this garage, sleeping on the couch, you know, getting DoorDash, Thai food just sitting at a desk you know just kind of working away I felt like I mean it was pretty isolating um but it was it was kind of fun I was I was kind of having a blast like making stuff you know I was like wow I really might be ruining uh my my finances here I didn't want to tell anybody about it I was kind of embarrassed honestly like I know my friends are pretty rich or whatever like had done well at their companies and stuff so I was like I don't want to tell anybody that I'm in a credit card debt that's that's pretty embarrassing um but apart from that honestly I had been training for years for things like this even at SpaceX I lived in a Miata for like four months just because I was like I want to like if I ever go homeless like I was like I'm if I start a company I know it's going to be crazy and that like maybe I'll run out of money at some point and have to be homeless um and I had been thinking that for like five years before this so I felt like I had prepared for it and trained for it I mean it's kind of similar so I I climbed Denali like the highest mountain in Alaska in 2017 when I was in college and one of the things I did to prepare for it like because I was like kind of worried about sleeping on the sleeping pad on Denali I was like oh what if I can't sleep on that thing and I get like bad sleep and I like can't hike and then I like die or something and then I was like oh what if I just started sleeping on the sleeping pad at school and and that's what I did so I just slept on the sleeping pad for six months before sleeping on Denali and then when I went there I was like oh wow the air is way cleaner here than Boston.

1:17:19And it's like quiet and I'm on the same exact bed and it was just perfect. And I didn't worry about it at all. I got like the best sleep of my life when I was on Denali because I was just completely used to the sleeping pad. And I kind of see the same thing in a lot of things like this. Like I was, I was kind of ready to be, you know, homeless, scrappy, like in credit card debt. I was prepared for it. I knew it was something that everybody else would look down on. Like everybody else would look down on just like sleeping on a sleeping pad every single day. But I had been doing that for a reason.

1:17:47And it paid off. I'm such a believer in the fact that every great company has multiple of these near death moments. And I think it's amazing, you know, what you had to go through and power through to get to this point. So, you know, usually I like to ask a few wrap up questions, but I actually think that was just kind of the perfect place to end it. So with that, I just want to say thank you. I really enjoyed this so much. And I think what you're doing is so awesome. Yeah, it was a blast to talk. Really appreciate it. That's it. Thank you for listening to this episode of The Generalist Podcast.

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