EP 140: Blake Scholl (Founder and CEO, Boom Supersonic) on Why Supersonic Flight Failed & How Boom is Bringing it Back

Blake Scholl, founder and CEO of Boom Supersonic, is leading the boldest effort in decades to bring back commercial supersonic flight—this time with product-market fit. We talk about what went wrong with the world’s first try at supersonic commercial aircraft (launched in the 70s), why Boeing hasn’t introduced a new plane in over a decade, and how Blake’s startup is building a jet that flies 2x faster than today’s aircraft—without the sonic boom. This episode is a crash course in engineering ambition, regulatory dysfunction, and what it takes to defy gravity and incumbents. (00:00) Intro (00:40) The History and Evolution of Aviation (01:12) The Rise and Fall of Concorde (05:25) The Impact of Government and Founders on Innovation (08:57) Regulatory Challenges and Business Models (26:53) Boom's Vision for Supersonic Travel (47:10) Building Trust with Regulators (48:16) Challenges in the Aerospace Startup (49:36) Recruiting Talent from Unlikely Places (55:47) The Importance of Mission Success Events (01:01:52) Developing a Custom Jet Engine (01:22:54) Reindustrialization and Economic Strategy (01:34:42) Conclusion and Final Thoughts Executive Producer: Rashad Assir Producer: Leah Clapper Mixing and editing: Justin Hrabovsky Check out Unsupervised Learning, Redpoint's AI Podcast: https://www.youtube.com/@UCUl-s_Vp-Kkk_XVyDylNwLA 🎙 Listen to the show Apple Podcasts: https://podcasts.apple.com/us/podcast/the-logan-bartlett-show/id1606770839 Spotify: https://open.spotify.com/show/5WqBqDb4br3LlyVrdqOYYb?si=3076e6c1b5c94d63&nd=1 https://open.spotify.com/show/5WqBqDb4br3LlyVrdqOYYb?si=3076e6c1b5c94d63&nd=1 🎥 Subscribe on YouTube: https://www.youtube.com/channel/UCugS0jD5IAdoqzjaNYzns7w?sub_confirmation=1 Follow on Socials 📸 Instagram - https://www.instagram.com/theloganbartlettshow 🐦 Twitter - https://twitter.com/loganbartshow 🎬 Clips on TikTok - https://www.tiktok.com/@theloganbartlettshow About the Show Logan Bartlett is a Software Investor at Redpoint Ventures - a Silicon Valley-based VC with $6B AUM and investments in Snowflake, DraftKings, Twilio, and Netflix. In each episode, Logan goes behind the scenes with world-class entrepreneurs and investors. If you're interested in the real inside baseball of tech, entrepreneurship, and start-up investing, tune in every Friday for new episodes.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  Concorde killed supersonic flight. Apollo killed space exploration. And we're thinking, what? How is it that the most amazing airliner ever made is in a museum while nothing better is in the skies? Humanity went backwards.

• 0:10Logan Bartlett?

  Because the business model never really worked.

• 0:12Speaker 00

  20% of seats at the front of the airplane, business class, are 80% of the profit dollars. This is like the business case for what we're doing and why it's working.

• 0:19Logan Bartlett?

  What do you hope the future of travel looks like?

• 0:22Speaker 00

  What if you could go to London, have a dinner meeting, and come home and tuck your kids in the same night?

• 0:25Logan Bartlett?

  What's been the most counterintuitive lesson you've learned along the way?

• 0:28Speaker 00

  The most surprising thing that I never would have predicted.

• 0:35Logan Bartlett?

  All right, Blake, thanks for doing this.

• 0:37Speaker 00

  Yeah, thank you for having me.

• 0:38Logan Bartlett?

  Welcome to New York.

• 0:39Speaker 00

  Great to be here.

• 0:40Logan Bartlett?

  So at a high level, I want to talk about the history of aviation. And maybe we can, we can start with some basic facts. So, um, commercial airlines right now, if I'm flying from San Francisco to New York, how fast does that plane go?

• 0:55Speaker 00

  It goes about 75 to 85% of the speed of sound.

• 0:58Logan Bartlett?

  Which is?

• 0:59Speaker 00

  Which is like 600-ish miles per hour. Um, you know, it's, uh, and it hasn't changed in 50 years.

• 1:06Logan Bartlett?

  Hasn't changed in 50 years. That was my next question. Uh, at one point in time, there was the Concorde, which went faster than that. Can you give people a little bit of a history on the Concorde airliner? How it came to be, uh, what the commercial application of it was, and ultimately why it failed?

• 1:22Speaker 00

  Yeah, so the first half century of aviation was really incredible progress. Uh, the, of course, the first airplane was built by bicycle entrepreneurs in 1903. And who totally did not have the resume to do what they were doing. And, uh, uh, there was a golden age of flight, really from 1903 through 1921, when all of the companies that we think of as great aviation companies were created. Boeing, Lockheed, Douglas, all created during that, that window. And, uh, and then we had decades of really, I think, founder-led progress in aviation. Airplanes kept getting bigger, faster, safer, more comfortable. Um, and it was, it was generally commercially led.

• 2:07Speaker 00

  Uh, and then in the 1960s, uh, of course, we had the Cold War and the leadership changed. Uh, in fact, the introduction of the first jetliner corresponds exactly with the retirement of the last founder.

• 2:23Speaker 00

  The first jetliner was the de Havilland Comet, introduced by de Havilland while he was still running his company. But by the end of the 60s, all the founders were gone. And of course, the Cold War was in full swing. And the world started to see technology as a symbol of national progress. And countries started leading the technology rather than industry. So we had, in the 60s, we had supersonic projects launched in Soviet Russia, in Europe and in the US. And the European one was Concorde. And that was a joint venture between the French and British governments. And I find this really remarkable that it ever worked at all.

• 3:07Speaker 00

  Because usually when the French and British governments get together, it's a war, not an airplane, right? And, you know, and they may or may not even be on the same side of the war. But, uh, but so that the goal of Concorde, much like Apollo, was to demonstrate the superiority of Western technology. Of course, there was, you know, basically, there's this massive Russia versus the West. And trying to win over the, the, the rest of the world. You know, there's sort of this communism versus capitalism competition. And very ironically, in trying to compete, the West went the communist way. And we had this like centrally planned aerospace stuff. And so Concorde and Apollo were very much brethren on this.

• 3:52Speaker 00

  And I, you know, I think, I have a pretty radical view on this. Concorde killed supersonic flight. Apollo killed space exploration. You know, we had the moon landing and we had a Concorde flight, 1969. And I think if you'd stopped anybody in the street and said, tell me about 2025, no one would have said, we can't go to the moon and we can't fly supersonic. And, uh, and yet I think both of those programs that were theoretically about demonstrating great progress are actually the death knell of progress. And, and the reason is both were done without any economics.

• 4:28Speaker 00

  I mean, Apollo was obvious, right? We spend a percentage of GDP to go land on the moon and we plant a flag there and we don't even know what to do next. And Concord, in a way, was worse because they at least pretended to be commercial. Because, oh, airlines will take this. People will buy tickets. Like, it's a product. No, it's not. Technologically, very impressive, just the same way the moon landing was. But here's a 100-seat airplane with really cramped, uncomfortable seats, where, in order to make any money, they ended up having to charge $20,000 for a round-trip ticket. And you just can't find 100 people that want to spend 20 grand to go somewhere quickly.

• 5:12Speaker 00

  So, the airplane flew half-empty. It really only worked at all on a couple of routes. And it convinced the world that supersonic flight was economically impractical.

• 5:21Logan Bartlett?

  I want to drill into all of that stuff. You made the point earlier, or it felt like an implication, that the founder-led transition or people moving out of their companies maybe had some implications for innovation. I don't know if that was the right framing of how you were sort of articulating it, or was it more the government stepping in, less the founder element?

• 5:43Speaker 00

  Well, I think both of those are very, those are two sides of the same coin, right? Like, what's driving innovation? And if it's commercially driven, Adam Smith's hand is really helpful. And founders are pushing progress. They're looking for things that get to product-market fit. They're always thinking about, is what I'm building actually useful? Or is it just a really great demo? And Concord was a really great demo. It's a, you know, if it had come from a startup, the knock would have been that it never got to product-market fit. And so, the rise of national prestige-driven technology efforts and the decline of founders in aerospace, I think, are very much intertwined.

• 6:28Logan Bartlett?

  Yeah, I guess my question was, or the distinction I was trying to draw out, like, CEOs can still push forward progress in some ways. And CEOs aren't necessarily the antithesis of government intervention or government pushing things forward. Founders maybe have some unique abilities to innovate in a lot of different fields.

• 6:48Speaker 00

  Yeah, well, if I just look at what actually happened in aviation...

• 6:53Speaker 00

  There was founder leadership through the 1960s. And then there was a kind of a new generation of leaders that were basically people who worked with the founders. And then, and then the accountants took over. And, and that is very much the trajectory of Boeing. Where in the last, it's been more than 20 years since Boeing's launched a new airplane. I just think about that, more than 20 years without an all new product. Like, Apple goes for 18 months without updating something and people say they can't innovate anymore. Two decades? And, and what happened was

• 7:31Speaker 00

  really a couple of things intertwined. One was just this, this focus on the next quarter. And trying to run an aerospace company focused on the next quarter is like trying to fly an airplane while only looking straight down. It'll work okay for a little while, but pretty soon you're in a very strange place in the sky. And that's, that's really what happened at Boeing. And at the, at the same time, the political fallout of Concorde, because it was a competition between nations, was really disastrous. So after the American competitor to Concorde was canceled,

• 8:06Speaker 00

  we tried to protect Boeing from Europe. And so what did we do? We banned supersonic flight in the continental US. Literally, we put in place a speed limit. And everyone claimed it was because sonic booms were this massive problem. If that were really true, it should have been noise limit, not a speed limit. But when, the way supersonic flight should have started, the minimum viable supersonic jet would actually have been a private jet. That was designed to fly from, say, Seattle to Miami,

• 8:40Speaker 00

  carry a handful of people whose time is most valuable. And that small sort of minimum viable supersonic jet would have been easy to make quiet, easy to make economically viable. But if you can't fly supersonic coast to coast, there's no, basically the product's illegal. So we banned the minimum viable supersonic jet.

• 8:57Logan Bartlett?

  Well, and so I want to talk about that and the business model implications for the Concorde and the different regulatory considerations. But before we let this point go, I guess, as we sort of zoom out, there was a lot of innovation that happened in society from, with physical goods from 1900 to 1960 plus or minus. And it wasn't just aviation necessarily that started to stagnate in terms of innovation. It's true of critical infrastructure as well. Our ability to build trains or highways was amazing in the 40s, 50s, 60s, and now the cost of these things, the central planning, all of that. And so I guess I'm curious how much, there's obviously the government intervention into the private sector, or at least trying

• 9:42Logan Bartlett?

  to commercialize things that were out of scope historically for it, for maybe orthogonal means, which was showing off our technological superiority more than trying to build fundamental businesses, which I think is, is an interesting point. But I guess as you think about the regulations that maybe started to permeate the industry, even beyond the point about the Concorde and Sonic Boom and all that stuff, because I want to talk about that in a second. But was there, were there other regulations introduced at that point in time in the 60s or 70s that really started this general stagnation of innovation?

• 10:20Speaker 00

  Broadly, yes. I mean, there's a, if you follow sort of history of technical progress, you find there was an inflection point around 1971 where a lot of positive trends vanished. Like, prior to then, energy consumption per capita was on an exponential growth curve. And then the curve completely changed, and it became a slow linear growth. And it got much, much harder to build things. And I think that the story is complex. I think at one level, it's cultural, where we went from utopian visions of the future. We went from like Jules Verne sci fi to dystopian sci fi.

• 11:03Speaker 00

  I think our motivation changed, but also we did things like the NEPA Act, which made it extremely difficult to build things physically and really easy for people to block stuff getting built.

• 11:15Logan Bartlett?

  Maybe explain the NEPA Act.

• 11:16Speaker 00

  Yeah, so NEPA was the National Environmental Policy Act. And basically said, if you want to go build something, you're just going to be subjected to a whole bunch of environmental review. And anybody who doesn't like the project can sue. And so now we have projects that get mired in years, if not decades of approvals. And just to give you one example, so we built a factory in North Carolina, where we're going to build supersonic airliners. And it took as long to get the permit as it did to take the, to build the actual factory. And it took, it took a year to get the permit. And by the way, people tell me that's a great timeframe that we did really well, that it only took a year.

• 12:01Speaker 00

  Why did it take a year? Well, we had to go through a noise review for how much noise the airplane would make after we were building them in the factory, in order to start building the factory. And this is, this is a noise review on an airplane that we're not even done designing yet, let alone actually building, where we have publicly committed, it's not going to be louder than other jets. And yet I can't roll a cement mixer until we've finished an environmental review. And it just is not, we're in our own way.

• 12:34Logan Bartlett?

  And do you think these are maybe well meaning, well intentioned people or policies that have just been taken to the, to the outermost extreme? Or are there, are there dark forces from other airline industries at lobbying play that are trying to make this a more difficult process?

• 12:53Speaker 00

  I think both is the reality of it. I mean, everybody wants clean air and clean water.

• 12:57Logan Bartlett?

  Yeah, it's motherhood and apple pie. No one disagrees.

• 12:59Speaker 00

  Nobody wants to be woken up in the middle of the night with the sound of, you know, something loud, right? Like, like obviously, but I think most regulatory stuff.

• 13:08Speaker 00

  Is there's always a moral cover story, which is very believable. And then there's what's actually driving it. And very often, the actual driving is some kind of protectionist interest, or it's some kind of regulatory capture. And, you know, but, you know, if you're, if you're Boeing, and your Concord competitor just got canceled, and all you've got is the 747. Well, now you make, you gotta make supersonic jets the enemy. Or at least that's what they thought they needed to do. And, and so now they, now there was, I think, a lot of like funding of that opposition that was like secretly funded by industry.

• 13:52Speaker 00

  And, you know, I think the, I think we have business ethics all wrong.

• 13:57Speaker 00

  Business ethics should be things like, don't fucking do that. Like regulatory capture is unethical. And, and we should not allow businesses to do it. And business leaders should be taught to play fair, not to use red tape to hamstring potentially better things.

• 14:16Logan Bartlett?

  The shift between the utopian sci fi to the dystopian sci fi, the 1971 culture shift, is there? It sounds like you've, you've thought about this and looked at some of the different considerations around it in 1971. Is there any societal event at a cultural level that we look back on? I mean, obviously, the 60s were a pretty transformative decade between, you know, different political leader assassinations, different civil leader assassinations, obviously, the Vietnam War, all that stuff. Is there, is there something societally that feels like it actually shifted as a moment in time?

• 14:52Speaker 00

  I mean, I think so. I don't know if it's any one thing. These things are often lots of threads woven together that have a combined result much bigger than any one. I don't, I don't, I'm not aware of any like catalyzing.

• 15:05Logan Bartlett?

  Yeah, there wasn't.

• 15:05Speaker 00

  It's not like, oh, it was Woodstock.

• 15:06Logan Bartlett?

  Yeah, or Watergate or, you know.

• 15:08Speaker 00

  Yeah, no, I think it was, I think it's probably a lot of things in combination. But just generally culturally and then politically, a loss of focus on building a better future. And I think, you know, it was on the heels of, call it a century, of the, the future actually getting better. And A loss of appreciation of what actually makes that happen. The future can be far, far better, but it isn't automatically far better. We have to actually make it better and we have to not have things that get in the way.

• 15:47Logan Bartlett?

  So the Concorde was, so French and British government get together. It's, is it mostly, it sounds like they're not thinking through the business model necessarily in a meaningful way, like how this is actually going to work.

• 15:59Speaker 00

  No.

• 15:59Logan Bartlett?

  They say this will be cool and then we'll figure it out later.

• 16:02Speaker 00

  Basically, I mean, there is hand wavy economics, right? But it was not at all what, you know, any business minded person would have built first.

• 16:11Logan Bartlett?

  So first test flight was 69?

• 16:14Speaker 00

  Yes.

• 16:14Logan Bartlett?

  And first commercial flight was when?

• 16:16Speaker 00

  Seventy six.

• 16:17Logan Bartlett?

  Seventy six. And how many were made?

• 16:19Speaker 00

  Fourteen carried passengers.

• 16:21Logan Bartlett?

  Fourteen carried passengers.

• 16:23Speaker 00

  Right. And this, this is actually an important part of the story. So the internet, so prior to me starting boom, the internet was full of basically false conventional wisdom about supersonic flight. And one of those myths is, oh, it was nine 11 and, you know, one crash that killed Concorde. No, there were only 14. It was still boring.

• 16:45Logan Bartlett?

  Yeah. So they didn't actually take it to the full extent. Well, I guess maybe let's talk about the different business models. So 14, how many people fit in?

• 16:53Speaker 00

  A hundred.

• 16:54Logan Bartlett?

  A hundred people.

• 16:55Speaker 00

  A hundred packed in like sardines.

• 16:56Logan Bartlett?

  Packed in like sardines. And it flew how, how much faster than today's commercial airlines?

• 17:01Speaker 00

  Almost two and a half times.

• 17:02Logan Bartlett?

  Two and a half times.

• 17:03Speaker 00

  It was Mach two, which is twice the speed of sound versus point seven five to point eight five for today's airplanes.

• 17:09Logan Bartlett?

  So, so US to San Francisco, it could be, I mean theoretically, that wasn't the route you were actually able to travel, right?

• 17:16Speaker 00

  Yeah.

• 17:16Logan Bartlett?

  But that was two and a half, two 45, maybe three hours, something like that.

• 17:20Speaker 00

  Uh, yeah, probably like three, two and a half hours coast to coast.

• 17:24Logan Bartlett?

  Yeah.

• 17:24Speaker 00

  And like if, if you'd actually flown it coast to coast.

• 17:26Logan Bartlett?

  If you had actually flown it coast to coast, uh, which is an interesting story that we'll talk about in a second. But, um, okay. And how many people would fit on it?

• 17:33Speaker 00

  A hundred.

• 17:33Logan Bartlett?

  A hundred. So, so a hundred people and they would charge?

• 17:36Speaker 00

  Twenty thousand dollars.

• 17:37Logan Bartlett?

  In today's dollars?

• 17:37Speaker 00

  In today's dollars.

• 17:38Logan Bartlett?

  Today.

• 17:39Speaker 00

  Actually, well, maybe it's more than that in today. But, um, But yeah, it's the again, this is econ 101. The higher the price, the smaller the market. Right. And so if you're going to make an airplane where the tickets are going to cost $20,000 and you're designing for 1970s or 80s market size, the airplane needs to be a lot smaller.

• 18:02Speaker 00

  What Concorde actually did is fly around a lot of empty seats. Even on the best route, which is New York to London, this is the like rock stars and royalty route. Right. This is the if you want to make a premium supersonic product, there is no better route than New York and London. And even on that route, it flew on average half empty.

• 18:19Logan Bartlett?

  And it flew half empty presumably because of the price point.

• 18:22Speaker 00

  Right.

• 18:23Logan Bartlett?

  And it sounds like some of the accommodations weren't great either.

• 18:25Speaker 00

  Yeah. So there's a there was a vicious cycle that kind of spins here. Right. So you start off with like a high price point and uncomfortable product. So that lowers demand. Now you can't keep the airplane flying all the time because there's not enough demand. So you got to schedule it so that like the first eastbound flight from New York to London would leave at 10am out of JFK. Well, why 10am? Well, it's actually a terrible flight time. Right. And terrible is an exaggeration. It gets you to London after dinner.

• 19:02Speaker 00

  Versus if you leave a little bit earlier, you can make a late afternoon meeting, a dinner meeting, if you want, come home the same day. There's actually a much more compelling use case with an earlier departure. Well, why was it 10am? Well, they didn't have enough demand because of the the cost and the comfort. And so they had to have a later departure so that connecting passengers would have time to connect onto a 10am departure. So you'd fly, say, even from Chicago or Denver or whatever, early morning departure and still make your 10am Concorde flight. But it's all of that kicks off a vicious cycle. So now there's not enough demand. So then the one of the economic advantages of supersonic is you can do more flights of the same airplane and crew. But you only realize that benefit if you've constructed the whole thing such that there's enough demand to keep the airplanes full and flying. So it's a whole,

• 19:47Speaker 00

  you know, the it's a flywheel that's spinning in the wrong direction.

• 19:51Logan Bartlett?

  And so ultimately, the Concorde was disbanded when?

• 19:56Speaker 00

  2003.

• 19:57Logan Bartlett?

  2003. And they never made more than 14. It was sort of the same.

• 20:00Speaker 00

  Yeah, 14. I mean, there are some prototypes and whatnot, but 14 carried passengers. Seven for BA, British Airways, seven for Air France.

• 20:08Logan Bartlett?

  Did it feel like it was on that inevitable path because the business model never really worked? Was there a public outcry at all? Were people upset about losing this or at that point?

• 20:16Speaker 00

  Oh, in a certain world, like it's regarded as just this unbelievable tragedy. And there are still people campaigning today to get Concorde's out of museums and put the literally actual Concorde's back in the sky. It's, I think it's something that has captured, it's captured a lot of people's emotional reaction because it is a symbol of going backwards, right? How is it, and this is like a little, in a certain sense, part of my own journey to doing this. I, you know, when I was in my twenties in Seattle, I went to the Museum of Flight and I saw, you know, the Concorde that was in the museum there. And I remember thinking, what?

• 21:01Speaker 00

  How is it that the most amazing airliner ever made is in a museum while nothing better is in the skies? Like, that seems wrong. Humanity went backwards. That's not how it's supposed to be. And I think that paradox, in a way, of regression is so contrary to much of the rest of technology that it is, it's almost like a murder mystery.

• 21:27Logan Bartlett?

  Structurally, as existing planes are today, like, what is the, the limiting force that hasn't allowed us to, it feels like so much of the digital world, we just get incrementally better in some way, shape or form, right? Our iPhones, even the, you know, iPhones get better. Every new model that comes out is just, works a little bit better. It's a little faster, photos are better, all that stuff. Like, what is the structural limitation on just why we're not going from 650 to 675 to 700 on incremental planes?

• 22:00Speaker 00

  Yeah, so the question is, what's the product for which there is product market fit at scale with somebody with a business incentive to deliver it? And so let's break that down. If supersonic flight... Over land were allowed, the Gulfstreams of the world would long since have delivered a supersonic business jet and that would have kicked off exactly what you're describing, a whole cycle of innovation. We'd all be going Mach 5 by now, but we banned, basically banned that product. So, okay, what would ordinarily be 2.0? What would be the first step beyond a supersonic private jet? Well, it would be a small premium supersonic airliner. So if

• 22:43Speaker 00

  we look at the economic anatomy of international air travel today, now this is really fundamental. This is like the business case for what we're doing and why it's working. 20% of seats at the front of the airplane, business class, are 80% of the profit dollars. This is why you have fancy wine lists, nice lounges. Essentially, all of the money on a per-trip basis is premium international travel. And by the way, if you look at it on a passenger cohort basis, it's even, it's like 99%. The frequent flyers who fly at the front of the airplane are substantially all of the international airline profits. So Boeing and Airbus today,

• 23:28Speaker 00

  they make three-class airplanes: business, premium economy, coach. Economically, that airplane balances because of the monetization in the front relative to the monetization in the back. So if you're Boeing today, you don't want to build an all-business-class supersonic airplane because it disrupts the bundling of the three-class airplanes. So if Boeing shipped a all-business-class supersonic jet, it would undermine the market for 787s, undermine the market for 777s. Same story at Airbus. And because it's a duopoly...

• 24:11Speaker 00

  Uh, nobody blinks. Like, well, I, I'm, I won't do it if you won't do it. Okay. We can all kind of rest on our lows.

• 24:17Logan Bartlett?

  At an economic level, I just want to understand that point. So, so, so if, if they, let's say, I think I'm probably in the 99% given I'm bouncing all over the, uh, the country at different times. And so I would love, uh, obviously to shift to, uh, a plane like you're describing. If that happens, then the Boeing has that in this sort of duopoly world. They sell it to United, for example. And then I now start flying that plane exclusively. How does that, wouldn't I shift over to what airline it is? Like if, if United's doing it and I'm a Delta member, wouldn't I shift to United? So it's like a, a net benefit to United to have this and therefore Boeing to have this?

• 24:55Speaker 00

  Well, this is why United's doing exactly that.

• 24:57Logan Bartlett?

  Yeah, sure, sure. Let's take someone else that, uh, not someone your JetBlue, uh, for example, or something like why? I guess from a business implication standpoint, I, I, I guess I'm not fully following why Boeing wouldn't be pushed to innovate or want to innovate on this.

• 25:11Speaker 00

  It, it's duopoly market dynamics, um, and in, in unwillingness to cannibalize an existing product line. This is classic big company behavior in a duopoly market. Uh, very few, and this goes back to the, I think the importance of founders, like Steve Jobs was willing to destroy the iPod business to create the iPhone business. Right? Boeing today, many, many, many CEOs removed from the founder, uh, working for the board, being very focused on the next few quarters, is not willing to eat the 787 business to create a much larger supersonic business. If there was perfect competition, if there are lots of airplane manufacturers, they would have to because they would know that if they didn't do it, somebody else would.

• 25:56Speaker 00

  But there's only two. There's only Boeing and Airbus, right? And if you look at every Boeing product, there is an exact same Airbus product. The 787 and the A350, same airplane. 737, A320, same airplane. Um, and you know, if you're a real av geek, you'll be like, oh, but like the, the shape of the boarding doors, no, no. It, it, this, this, this, by the way, this is why the margins are terrible as well. When, when you're, you have a competitor that has the exact same product line, the customers, uh, get to compete you down to like almost no margin, uh, which is the story of Boeing's commercial business and Airbus's commercial business. Like they're terrible businesses because there's no product differentiation.

• 26:34Logan Bartlett?

  So we touched on this element of flying over water versus flying over land and the considerations from a regulatory standpoint about what we're, what's allowed and what's not. Can you talk about like how that came to be and what the implications of that are for different airliners?

• 26:48Speaker 00

  So I think, I think maybe the thing I should explain is what's the breakthrough that actually makes boom possible here is that it is, you know, we've known how to build supersonic airplanes since 1947 when Chuck Yeager broke the sound barrier. We had Concorde. You can build a supersonic passenger jet, like that's been done. The question really is, what is the right supersonic product to build that will make sense for a new entrant to build? And the, our going and approach at boom was for have any chance of succeeding at this as a startup, we would need to eliminate every conceivable risk systematically. So we're only using 20-year-old proven 787-level technology, things for which

• 27:31Speaker 00

  there's already a regulatory precedent. Basically, everything's pre-approved. And we are not assuming any changes in regulation. So what can, if with those constraints, is the surprising thing is there's actually a great product to build. And that product is an all-business class supersonic airliner designed to focus on the routes that are the transoceanic routes, where you fly subsonic over land, supersonic over water. And it turns out with that constraint, there are about 600 routes on the planet where there's enough traffic to fill the seats at fairest people are already paying, that airlines can operate very profitably. And that turns into a multi-hundred-billion-dollar market

• 28:14Speaker 00

  for the, for this product. And so think, you know, New York, London, but also Miami to Madrid, and Seattle to Tokyo, and DC to Paris. Literally, there are hundreds of these routes that have enough people flying business class today, who would happily walk away from their business class to get a faster flight instead. And when we, we make the airplane only 64 seats, 64, by the way, really nice seats, that's important, economically, it fits for airlines. If you can operate A Boeing or Airbus widebody and have profitability in your business class, you can operate a boom over to your jet on that same route and have even better profitability because you'll be able to fill the seats with those passengers. They'll probably pay a bit more for speed and you can do twice the flights with the same airplane

• 28:59Speaker 00

  and crew because it's faster and there's enough demand to keep the, so you can sweat the asset.

• 29:03Logan Bartlett?

  And so subsonic over land, what's the fastest in the US that you're allowed to fly?

• 29:08Speaker 00

  So right, right now, 14 CFR 91817 says thou shalt not exceed Mach 1, the speed of sound.

• 29:17Logan Bartlett?

  Mach 1, which is how fast?

• 29:19Speaker 00

  It, it, it varies, but like, you know, think 700 ish.

• 29:22Logan Bartlett?

  700 ish. And so how did that regulation come to be?

• 29:26Speaker 00

  Well, this was, uh, this was protecting Boeing from Concorde. So this was 1973, Congress had said, hey FAA, figure out a way to, um,

• 29:36Speaker 00

  protect the public from sonic booms that can be bad. And, uh, and then what actually happened is we got a speed limit.

• 29:46Logan Bartlett?

  And sonic booms for people that don't, I mean, I assume most people know what a sonic boom is, but can you just explain what a sonic boom is?

• 29:51Speaker 00

  Yeah, I think, I think there's not much understanding of what a sonic boom is. It's, um, think of it as like the wake of a boat. And so, uh, when a, when a boat goes by, if you're like right next to a big boat, you'll feel a big wake. Um, if there's a, a smaller boat or a boat further off on the other side of the lake, you know, the wake is smaller. But it is basically the pressure wave a supersonic airplane creates anytime it's supersonic. And, uh, you know, and today, because there are no commercial supersonic airplanes, they're only fighter jets. Um, you know, if you scramble a fighter jet and you fly supersonic at a low altitude, it makes a very loud sound. Uh, however, if you fly an airliner at 60,000 feet, it's a completely different story.

• 30:33Speaker 00

  And one of the breakthroughs that was not part of our original plan, but something we figured out along the way is it could actually do it with no audible sonic boom.

• 30:44Logan Bartlett?

  So, and we'll show a picture on screen of, there was actually captured of what it looks like and you can almost see the wake behind. And so I guess that that's an important point, though. I think when people think of the sonic boom, there's the auditory element associated with it. And so what, what is that? What is the, when people and when Boeing is lobbying against this, obviously, people don't want huge loud noises flowing down and disrupting cityscapes or whatever, countrysides.

• 31:18Speaker 00

  So I think what we're going to see actually happen is that this could happen very quickly because nobody's opposing it now. And it just makes common sense. If there's a supersonic flight with no audible boom, it should be allowed. Full stop. If there's an audible boom, then reasonable people might differ about is it too loud or not. And, and that's a, that's a complex conversation.

• 31:39Logan Bartlett?

  Which, which goes to your point on the auditory regulation should have been where we would have, would have landed if there was, if we were trying to do a societal good around this back in 1973, if Boeing was, it's like, okay, let's focus on the noise element of it. And instead, we focused on the speed element of it, which is theoretically an input into the noise element, but not necessarily.

• 32:02Speaker 00

  Not directly, right? The, yeah, the thing that should obviously be allowed is boomless supersonic flight. And, and by the way, it's, this is a concept that's been around kind of theoretically in academia for a long time, but now we've done it. And so that's something that I'll show you the picture and we'll put it up on screen. So we broke the sound barrier on our prototype airplane earlier this year. It's called the XB1. It is the first supersonic jet made not by a nation state. It's the first one made out of airliner ready technology. It's the first civil supersonic jet since 1969. And it's the first one ever made in America.

• 32:43Logan Bartlett?

  For people, basically, for people listening, we'll show it on, or watching, we'll show it on screen. For people listening, it basically looks like a boat with a wake behind it almost, which is, are those the sound waves?

• 32:57Speaker 00

  They're called shock waves. So basically, the, I'll be nerdy for a second here. The, the best question that nobody asks is, what does the speed of sound have to do with an airplane? And the the answer is the speed of sound is the speed at which pressure waves move in air and airplanes are all about pressure waves. If you're flying less than the speed of sound, there is a pressure wave in front of the airplane. It's basically nudging air out of the way before the airplane gets there. If you're flying supersonic, that means the airplane is outrunning the pressure wave, which means when it smacks into the air, it compresses it. And so you get these little bands of compressed air that come off the

• 33:41Speaker 00

  airplane. And the way they stack up on top of each other as they go from the airplane down to the ground, can create this sort of constructive interference. It creates this sort of like N shaped wave that is heard on the ground as a sonic boom.

• 33:55Logan Bartlett?

  So you've been at this for 11 years?

• 33:58Speaker 00

  Very nearly, yeah.

• 33:59Logan Bartlett?

  Nearly 11 years and you recently had your first flight that broke the sound barrier?

• 34:04Speaker 00

  That's right, yeah.

• 34:05Logan Bartlett?

  And and so what is the business forward from from here? So we're looking at we got in front of us this United plane like I guess where do things sit from a timeline, commercial applicability?

• 34:19Speaker 00

  Yeah, I mean, so I think where we are now is we've really had supersonic aviation's Falcon 1 moment. And the Falcon 1 was the that was the first SpaceX rocket that made it to orbit. And as I said, what we did on XB1, I think in some ways was even more meaningful, because there was a human on board. The first three Falcon 1s blew up. And it was okay because they were unmanned. But we have a pilot on board, our airplane, of course, we're going to have passengers on board, the product airplane. So failure is not an option. So we demonstrated it can be done by a small team with a relatively small amount of capital, and that the technology actually exists. And moreover, we can do

• 35:02Speaker 00

  it without an audible sonic boom. And so what's what's next? It's time to go big. This is a this is a business that was, you know, to this point. Funded by VCs investing their own money to kind of get to the right point of demonstration that the technology is there and the team can really do it. And now it's time to scale up and go big and build the airplane that you and I get to fly on. And we will start building the first full-scale airplane next year. And our goal is to have it in the air by the end of 28 and ready for passengers by the end of 29.

• 35:42Speaker 00

  So if we look at technically where the development is, we are a few months ago where the Boeing 777 was, five years before it carried passengers. So if we execute as well as 1990s Boeing, it's less than five years for you and I can buy a ticket and break the sound barrier.

• 36:02Logan Bartlett?

  And what is the relationship with United?

• 36:06Speaker 00

  United was first to place an order with a deposit. And I think, I have an enormous amount of gratitude for the leadership team at United that had the vision to place an order for supersonic jets during COVID. And it was really Scott Kirby and Mike Laskin who looked at COVID and said, everyone else is retrenching. This is actually the time to build for the future. And so they made a couple of bold bets. They made a bet on supersonic flight and they made a bet on eVTOL. And they were willing to put their money behind the bet and put their brand behind the bet.

• 36:49Speaker 00

  And so United ordered 15 overtures. They pre-ordered another 35. And most important, they're actually working with us on the airplane development. So the United team is deeply involved in our development. When we do technical reviews, United comes to them, their pilots fly the simulator, they give us feedback, their flight attendants look at how the galleys work, help us make sure that those are going to be great. So is an airplane, an airplane has a million decisions that go into it in creating the product. And If I contrast Boom with, say, a SaaS company, the thing about a SaaS, there's this sort of falsehood

• 37:31Speaker 00

  that SaaS companies are less capital intensive than deep tech. But if you look at like the money consumed by an Uber or a Lyft or an Airbnb versus the capital consumed by like a SpaceX or an Andro, it turns out the SaaS companies actually consume more VC. But there is an important difference, which is how much capital do you need to demonstrate product market fit with a shipping product?

• 37:55Logan Bartlett?

  To get to the, get to the, you know, zero to one that something.

• 37:58Speaker 00

  Yeah, so the, you can build an Uber and see if anybody wants to use it for a small amount of money. And if it doesn't work, well, people lose their seed money, but that happens all the time and it's okay. You can't test product market fit on a supersonic airplane by shipping it. You have to test it differently. And, and so one of our very early insights was, you know, we basically needed Kickstarter for supersonic aviation. And so getting, getting orders with real non-refundable deposits and getting the airlines to lock hands with us and be part of the development program such that we're not going to ship another Concorde that they don't want, that their passengers can't afford. You know, we call it, we call it the three-legged stool.

• 38:41Speaker 00

  There's the technical execution of the airplane, which in many ways is the easiest part. Like, people have been building supersonic jets for a long time. We just have to build it capital efficiently. But then there's the, what are airlines really going to be able to operate profitably? And what are passengers going to pay for? And, and getting those three things in sync is really important. You know, should it be a little bit more seats, a little bit less seats? Do you want a little bit more range, a little bit less range?

• 39:08Speaker 00

  All of those decisions really matter and we needed to prove to ourselves that we are, what we are building has product market fit before we're done physically building it.

• 39:18Logan Bartlett?

  It's impressive. I mean, you've sold, you've pre-sold more planes than Concorde ever sold.

• 39:25Speaker 00

  We have the first five years of production in the books.

• 39:28Logan Bartlett?

  And so how much, how much capital have you consumed to date, raised, consumed?

• 39:32Speaker 00

  Yeah, we've consumed about 450.

• 39:34Logan Bartlett?

  450.

• 39:35Speaker 00

  Which makes it. By a large margin, the most efficient supersonic development program in history. We did XB1 with 50 people, including the engineers that designed it, the technicians that put it together, the test pilots, all of that. And we've also designed a full-scale jet engine. We've designed the full-scale airplane. We have a factory, almost 200,000 square foot factory in North Carolina. Like, we've done a lot for about 450.

• 40:03Logan Bartlett?

  And so what stands in between now and me being able to go on a plane?

• 40:11Speaker 00

  It's scaling up the engineering. So just a few weeks ago, we hit what's called config freeze, meaning we broke the engineers' pencils and said, "You're done optimizing. It's time to go build." So there is a slightly refined version of this airplane. I think to the layman, you wouldn't notice the difference, but it actually takes a bunch of lessons we learned from the XB1 test plane, folds it into Overture. And so we're now doing the more detailed engineering. Next year, we'll start building parts. Around the end of this year, we'll have the first full-scale engine running on a test stand. And then we will take it through an enormous amount of testing. We'll do as much as we can on the ground. What we have to do in the air, we'll do in the air.

• 40:56Speaker 00

  And then we will, all along the way, we're working with the FAA and generating their buy-in so that when we're all done, everyone agrees it's ready for passengers.

• 41:07Logan Bartlett?

  And plus or minus, like, what is the shelf life of an airplane? Like, what do they typically sell for? Can you just give a sense of economics?

• 41:18Speaker 00

  Yeah, so a typical Boeing 200-seat wide-body airplane, like a 787, after all the discounts, it's on the order of $150 million. And the time to pay back on that for an airline is about a decade. And we sell over-

• 41:36Logan Bartlett?

  And they last for how long?

• 41:38Speaker 00

  Decades.

• 41:38Logan Bartlett?

  Decades.

• 41:39Speaker 00

  I mean, by the way, which is a demonstration of the lack of innovation. Like, they should be obsolete long before they wear out, but they're not. Um, uh, the product cycles have gotten, the innovation is so poor that the products have a very long shelf life, longer than they really should have.

• 41:57Logan Bartlett?

  It's pretty remarkable, like to think about decades plus, uh, products that we use in other, I mean, televisions 10 years ago, just, uh, 20 years ago, just look ridiculous compared to today. You would never use it, even though they're functional enough to work.

• 42:12Speaker 00

  In, in the 1960s, the average time an airliner would stay in service was about six years, not because they fell apart, but because there was a new one that was better that you wanted to upgrade to. Right? Um, so I think, um, one of our biggest goals at boom is to speed up the innovation cycles and to shorten the development costs and timeline for new airplanes. So we can iterate much faster, ship newer products much faster. Like over, overture is like the first of what's going to be a whole family of products. We're going to build a smaller one. That's a private jet. We'll build a larger one, uh, that can have a coach cabin in it. There will be a whole family of airplanes. Just the same way Boeing and Airbus have a whole family of airplanes. You know, an overture is just the starting point.

• 42:53Logan Bartlett?

  So, uh, if we look forward in our lifetime, let's say 25, 30 years, what do, what do you hope the, uh, future of travel looks like?

• 43:02Speaker 00

  There's going to be a lot more travel. So, um, trivia question. When Uber launched in San Francisco and started out with black cars, uh, what percentage of the black car market did they take?

• 43:16Logan Bartlett?

  Within what period of time?

• 43:17Speaker 00

  A year or so.

• 43:18Logan Bartlett?

  I don't know the answer to it. I would guess that, I mean, over time, it's much greater than a hundred percent.

• 43:25Speaker 00

  You were the first person I've asked that question, if you got that right.

• 43:28Logan Bartlett?

  Thank you. I appreciate that.

• 43:30Speaker 00

  But yeah, I usually hear things somewhere between 10% and 70% and the actual answer is 300%. Yeah. And so, you know, people talk in AI about Jevon's law now, um, about when you reduce the cost of something, demand goes way up. Uh, but really there's a broader principle, which is when you reduce the friction of something, demand goes way up and cost is an element, accessibility is an element. Um, and I think what we're going to see with air travel is the market for supersonic jets is much, much larger than the market for subsonic jets. Because when flights are faster, people travel more and.

• 44:06Speaker 00

  You know, we can look back in history because this is, by the way, this happened before. It happened in the 1960s. When we went from propeller airplanes to jets, flights got twice as quick and travel went up sixfold. Nobody went to Hawaii before there were jets. Took too long to get there. You know, and now it's like, okay, what about Sydney? Oh, who wants to go to Sydney? Takes so darn long. What if you could go to Sydney as quickly as you could go to Honolulu? What if you could go to London, have a dinner meeting and come home and tuck your kids in the same night? What if our kids could grow up in a world where they actually have friends on other continents that they've spent time with? What would happen if there's a factory in Asia that produces a product?

• 44:50Speaker 00

  And in less than 24 hours, it could be back on the desk of the engineer that designed it? Like, right now, that takes 48 hours. We'd actually double the rate of iteration. The second order effects of supersonic flight will absolutely destroy the first order effects. And so I think, you know, to go back to your question, that the future is, supersonic flight's not special. It's just normal. It's how we all fly and we do a lot more flying. And the speed up that kicked off in the air ricocheted on the ground. We figured out how to build much more efficient airports.

• 45:29Speaker 00

  You can imagine you could arrive at the terminal 20 minutes before your flight without worrying you're going to miss it. That, that, all of that will put more liquidity in the travel ecosystem. More, more demand, more flights, more passengers. That means more frequency of flights, which means more choice of when you leave and when you arrive. And that flywheel starts spinning. And it's the flywheel that started spinning in the 1960s with jets. And then it just kind of slowly coasted down because we haven't gotten any better. And it's the flywheel that Concorde never started because it wildly missed on product.

• 46:07Logan Bartlett?

  In some ways, regulation at this point is a moat or an advantage for you all in that you had to go through all these different hoops to kind of get to where you are. Do you agree with that?

• 46:18Speaker 00

  Uh, not really. I mean, so we designed everything we're doing to make it easy for our regulators. And, you know, a thing I always tell the team is regulators are humans too. They want to work on things that are exciting. They want to be involved. They want to put their fingerprints on the things they work on, and they want to feel trusted and able to trust. So with XB1, what we did was we involved FAA from when it was on paper to when it was a bucket of parts, to when it rolled out, to when it was ready to fly. And we said FAA, we're ready to, you know, we always said, come anytime you want, look at anything you want to see, talk to anybody. There are no secrets here. And when we said

• 47:00Speaker 00

  we're ready, they gave us the paperwork the day that we asked for it.

• 47:06Speaker 00

  Why? It wasn't some miracle. It was common sense. Build trust, build buy-in as we go, and then it's not a big deal. And by the way, this is a high-profile program. If we screwed it up, it would make the regulators look really bad. So it's all the more important that we build trust as we go. But it's, this isn't rocket science. This is just human relationships and doing good work and being transparent about the work. And when there's a problem, be open about it. When there's a tough decision, involve the regulators in the decision.

• 47:39Logan Bartlett?

  If you could wave a magic wand for regulations that exist, or maybe elements of FAA and different considerations to make it easier to do what you've been able to do, is there one thing that stands out?

• 47:54Speaker 00

  There, yes. Repeal the ban on supersonic flight.

• 47:58Logan Bartlett?

  And where does that currently stand? I know Elon Musk said it's something that should happen under this administration.

• 48:04Speaker 00

  Yeah, I mean, I've been at the White House four times this year. I've been all over Capitol Hill. I've met with multiple cabinet secretaries. It's gonna happen.

• 48:15Logan Bartlett?

  That's great. What's been the hardest part of getting to where you are today?

• 48:18Speaker 00

  It's not the engineering. It's not even the financing. It is building a startup team in an industry that has not had a startup in a century.

• 48:30Speaker 00

  And so we have to find people who are incredibly good technically, but also have the right, I'll just call it startup gearing ratio to move fast, to be efficient. And this is part of why I said earlier that I thought Concord destroyed supersonic and Apollo destroyed space exploration. And part of the insidious way they did that was by creating an entire industry that had no cost pressure. There are all these like cost plus government contracts. And so if you're operating on a time and materials contract, you're incentivized to use more time and to use more materials. And you don't want to embarrass the customer. So you don't want to take a risk and fail.

• 49:13Speaker 00

  And so all of that has led to a bunch of just calcification. I'm sure we all see the same headlines about just Boeing and their struggles, but the whole industry has elements of that. So we had to learn how to build a team where the incumbents were culturally the antithesis of what we needed to be.

• 49:37Logan Bartlett?

  Where have you found these people from that comprise like the core? I don't know. Like, are these people that are similar to you in background that maybe came up in traditional tech world and then pursued this as an interest area? Or are they more Boeing entrepreneurial people?

• 49:54Speaker 00

  I'm not aware of any Boeing entrepreneurial people.

• 49:55Logan Bartlett?

  There you go.

• 49:56Speaker 00

  So it's not that. So take that one off the table. Yeah, no, the, so we have some people from SpaceX. We have some, we care about what you can do, not what's on your resume. We care if you've solved a hard problem and you're passionate and smart and curious and learn quickly and driven by the mission. So for example, the guy that cracked the code on some really difficult landing gear engineering issues. Previously worked on janitorial equipment at a different company. I remember when I interviewed him, I looked at his resume and I'm like, why is the team having me talk to this guy? And then I had the conversation, I was like, oh, I get it. This guy is way bigger than a power mop.

• 50:40Speaker 00

  Is a brilliant mechanical designer. And so what we, so we've tried to find really talented people from just anywhere. And we also, we find people who went to Boeing by accident earlier in their careers before they got corrupted. Like, we hired another guy who ended up being a very talented mechanical designer who reached out to me and said, well, I went to Boeing because I wanted to work on a supersonic airplane and somehow I didn't realize that would never happen. Can I please come to Boom? This is what I really want to do. And, and there are, there are a handful of stories like that as well. But we also just, we take young people and we put them in absurdly big roles and, and they can do it.

• 51:18Logan Bartlett?

  Resumes are something of a, or companies in general are something of a filtering mechanism. When we can talk about how good it actually is, colleges, same thing, right? We can, we can certainly rail on that probably for a while. But I'm curious, like, how, as a sorting mechanism of talent, I assume you guys get a fair number of people coming through the doors, applying, I guess. Everyone I know probably aspires to find the undiscovered talent, the undiscovered gems within, that could be at their company and really scale. It's hard to go pursue just people from SpaceX or Stripe or whatever it is, one of those businesses exclusively. And so I guess as a filtering mechanism, do you guys take a disproportionate number of first calls when people come through the door?

• 52:03Logan Bartlett?

  Like, how do you actually make this a practice that you can go through and try to find the undiscovered gems?

• 52:10Speaker 00

  There's sort of multiple, there's no single answer to this. One part is, we keep our eyes open for high agency candidates. So, like, people email me directly and some of the best people we've ever hired have been cold emails to me. And so I, I, I place a lot of value on a well-written cold outreach. So that's, that's kind of one avenue on it. Another is, and Brian Chesky talks about this a lot, starting with the work and reverse engineering the human. Like there's if there's a thing that we admire that is out there in the world, let's figure out who really did it and talk to them. You know, another another twist on this is that the way the way I got the initial team.

• 52:55Speaker 00

  So I wasn't from the industry like my last job. It's become a joke now. My last job, I was a product manager at Groupon.

• 53:03Speaker 00

  And I remember going to LinkedIn and filtering for industry equals aerospace, connection equals first degree.

• 53:12Speaker 00

  No results. I didn't know a soul in the industry, not a soul. So, okay, second degree. Well, there was somebody who now worked at SpaceX, who had played hockey in college with one of my directs at Groupon. Okay, great, maybe I can get that meeting. Is that a strong enough connection to get a good intro? I'll try. And I I flew down to Hawthorne in LA where SpaceX headquarters is. My only cred was I showed up in an airplane that I had flown myself, a little single engine. This was this was my only cred on day one. I like I had my pilot's license. And I I I sat with him and I explained what I was doing and why I thought it made sense. And he got pretty excited. And I said, Jamie,

• 53:57Speaker 00

  if you could wave a magic wand and get anybody in the world to come be in the trenches with me on this. And you're not thinking about whether they'd want to. You're not thinking about whether I can afford them. You're not thinking about whether they have a job that they're happy about now. All you're thinking about is who would you absolutely want in the trench with you, fighting this battle, making this thing? Who would be your top five? And he said, you think about it. And on the flight back to Palo Alto, my phone buzzed and I had five names. And so I met those five people. And I asked them the same question. And I was sort of recursively searching my network for the best people. And there's that old joke about, you know, everybody's six degrees to Kevin Bacon.

• 54:40Speaker 00

  Turns out, everybody's also six degrees to the very best people in aviation. And so when I would tell people I was building a supersonic passenger jet, the first question was always, are you crazy? And it people would rarely ask it out loud, but I could always tell it was the first question. And there was this other system to the meme amongst like aviation people, that they're always these internet guys with like crackpot airplane ideas. And I remember when I I met the guy who became our first chief engineer. I showed him the work I'd done on market sizing and on technical feasibility. And he looked at it, he says, wow, I didn't think you'd be this far.

• 55:23Speaker 00

  And I'm used to hearing a lot of airplane ideas that make no sense. This one actually makes sense. And then he wanted me to hire him as a consultant. And I was like, nope, you're either in or you're out, dude. And he couldn't stop himself. He just like started building his own spreadsheets and his own models. He just could not help himself from working on this. And he became, he became our first chief engineer.

• 55:47Logan Bartlett?

  Along the way, I'm sure you've made a bunch of different trade offs. Is there one that you feel was really a fork in the road that you're particularly happy you made?

• 55:55Speaker 00

  Yeah.

• 55:58Speaker 00

  We were insanely ambitious in our choices for what to target with our first prototype airplane. That made the job far harder.

• 56:09Logan Bartlett?

  What to target, how so?

• 56:10Speaker 00

  So we said, we're going to go fly it. The original design was 10% faster than Concorde, incorporated one passenger seat.

• 56:18Speaker 00

  It had all these like requirements on it that on paper were very achievable. But we did not, we did not appreciate where the real breakpoints were in challenge, including we decided to put a person on it. Like if we'd made a supersonic drone and the only goal was to like, build a thing that's looks like an airplane that breaks the sound barrier. Oh, boy, it would have been so much easier. Also, we would have learned way less and proven way less. We, the most important thing we learned from XB1, two things. One was how to build a safety culture. Hugely important.

• 56:53Speaker 00

  Easier to say than it is to actually do. And number two, we learned where the real breakpoints in practicality were. And so when we said, okay, great, now we're ready to scale up to the airliner. We were able to make far more pragmatic choices. We backed off a little bit on speed. We went from Mach 2.2 to Mach 1.7. Why? Well, at 1.7, we can use completely off the shelf materials that were already certified for the 787. We don't need to qualify even the same materials for different operating environments.

• 57:27Speaker 00

  It's far easier to meet the same noise regulations that apply to subsonic jets for takeoff and landing at 1.7 than it is at 2.2. At 1.7, the aspect ratio on the wing can be wider, meaning a higher wingspan. That makes stability and control for takeoff and landing dramatically easier. One of the technical challenges on XB1 was at Mach 2.2, you have this very slender airplane, slender wing, long skinny fuselage. It's hard to make stuff fit. And at 1.7, which by the way, means another 15 minutes across the Atlantic. It's not that big of a deal. All of those things get easier.

• 58:07Speaker 00

  And along the way, taking all that thinking, remembering this is not a one trick pony. We're going to ship an airplane and a .1 revision and a .2 revision and then a 2.0 and a 3.0. We don't have to put every good idea on 1.0 that we can really embrace the M and MVP, Minimum Viable Product. And that allowed us, that plus the experience on XB1 allowed us to be far more pragmatic about what we're doing.

• 58:35Logan Bartlett?

  What's been the most counterintuitive lesson you've learned along the way?

• 58:42Speaker 00

  The most surprising thing that I never would have predicted was that an airline would place an order and give us money before we ever flew an airplane. I would have guaranteed on day one that that would never happen, but yet it did. Thanks, Scott. Thanks, Mike.

• 58:58Logan Bartlett?

  Do you think this happens ex-COVID that they're like thinking about and taking into all the consideration or you think that was a unique confluence of events?

• 59:05Speaker 00

  I think we've, we've always found, so we, when we were going through YC, we did a preorder deal with Virgin that we unveiled on Demo Day, like $2 billion LOI from Virgin. We got a preorder from Japan Airlines actually before United. United was the first to put money in with an order. So why Virgin? Why Japan Airlines? Why United? Why American after that? There is a specific answer why that team with that set of humans at that point in time wanted to do the thing that did with us. And the answer, the answer is different for Richard Branson than it was for United, different from what it was for Japan Airlines.

• 59:46Speaker 00

  But at each, each point, we caught them in the right moment where this created real value for them, short term and long term. Like when I met Richard Branson, there's a whole story of... Um, how I managed to basically crash a Virgin event to get time with him. Um, but I, I, uh, I, I explained to Richard what we were doing. We had a little model of the airplane with a Virgin logo on it. And, you know, he, he sat back in his chair and he says, wow, guys, this is, this is brilliant. Like, I love it, but like, I'm doing this Virgin Galactic thing. Like, I don't think I've got it in me to do two of these. And I, I said, Richard, no, no, no, I'm not asking you for your money. I'm not even asking for your belief that we're going to pull this off.

• 1:00:30Speaker 00

  All I'm asking is, when it works, would you like the first one to be for Virgin? And if you're willing to say, yes, I want this, I'll go get all the money somewhere else. I don't need your money. I just, I just need your belief in the product, that it makes sense, given everything you know about airlines. And he said yes to that.

• 1:00:51Speaker 00

  And, um, there was a similar story with Japan Airlines in a different way. And that, that deal took a year and a half.

• 1:01:00Speaker 00

  Uh, versus the Virgin deal took eight weeks.

• 1:01:03Speaker 00

  But there's, there's always a reason to, to why, and it's, uh, it's, you got to find the company and the team in the right place. Like, United wanted to build their story.

• 1:01:15Speaker 00

  And their plan for how to make United the greatest airline ever. And I think that's actually one of the many things that's brilliant about Scott's leadership is he, he doesn't tell the team at United, be the best airline. That's actually not that inspiring today. He says, be the best airline in history. And that framing causes the team to rise to the occasion. And it causes them to think much more ambitiously about everything they do. Well, the best airline in history would have a faster airplane.

• 1:01:41Logan Bartlett?

  The Symphony system that you guys have built out, can you, can you describe to people what that was? And then I'm curious, was that an entirely new design or was it based on something existing?

• 1:01:52Speaker 00

  So Symphony is our, um, full-scale custom jet engine. And this is, there is still, you know, if you said, what's the stink on Boom? Like, I think we still have the biggest stink-around engine, uh, because there is this mythology. Uh, I think perpetuated by the big three engine companies, that only the big three engine companies can build jet engines. And, um, we, I think we made the mistake along the way of, um, flirting with them. We, we publicly sort of dated with Rolls-Royce. Uh, and so the world kind of thought that, um, It was going to be a Rolls engine. And I think when I made the mistake of feeding into that narrative. What we found along the way was a startup working with a hundred year old

• 1:02:34Speaker 00

  company was a really bad idea. They didn't want to build us a custom engine. They were only kind of shoehorned what they already had. And so we got to a point where we said, you know what? We're going to do this the SpaceX way. We're going to take control of our own destiny. And, you know, we will, we will happily create for you a face saving way off the program. Maybe we'll license something from you, you know, but we'll, you know, then we'll lock arms and kind of, you know, wave goodbye and give each other a hug. And then what, what actually happened was, so we, so United placed an order. About a year later, American placed a bigger order. And, you know, we were still incubating our own engine effort. We weren't ready to show it to the world yet. And, uh, and Rolls freaked out. And they ran to the press and said, there is no supersonic market. We're not interested.

• 1:03:19Speaker 00

  Uh, I think, I think because they didn't want to, you know, the, the market was clearly coming together and they weren't going to be part of it. Um, and so that, uh, and that was just, it was one of the darkest moments in boom history because the, the world was like, ha, ha, boom has no engine. They're building a supersonic glider. Um, and, uh, and so we very, you know, my team wanted to just, uh, save everything we actually thought. Instead, we said, we were grateful to Rolls for our work. And, uh, we'll show you our engine when we're good and ready. And, uh, and then we eventually we did announce, you know, our own engine program. And it is, it's just like the rest of the airplane. This is all proven technology. There's nothing new on it materials wise or science wise. It's just custom.

• 1:04:02Speaker 00

  And, uh, because it's fully custom, it is much, much better. So the whole boomless cruise thing would not be possible if we weren't doing our own engine. Because the key thing is it's got to be able to break the sound barrier at a sufficiently high altitude. That comes down to something called transonic performance. Um, with a modified Rolls engine, we could only break the sound barrier at 26,000 feet. Boomless doesn't work. With our own engine, we can do it well above 30. And it's a complete game changer because it can do supersonic over land with no boom. And that would not have happened if we hadn't said, all right, yes, we're going to follow in SpaceX footsteps. We're going to build not just our own vehicle, but our own engine too.

• 1:04:48Speaker 00

  People still think we're crazy for this, but like the actual craziness was entertaining any other plan.

• 1:04:53Logan Bartlett?

  What is the, I guess, what was the timeline of how that, when that played out? Like the initial conversation with Rolls through the breakup?

• 1:05:00Speaker 00

  Yeah, I mean, it was, um, you know, on day zero, our plan was to build our own engine. And then I, you know, I'm accountable for this. I made the mistake of thinking, ooh, if there's a modifiable engine, wouldn't that be easier? And, you know, wouldn't it be nice to have the brand association?

• 1:05:18Speaker 00

  Because we're, you know, we're trying to convince the world that like we have any shot of pulling this off, right? And so we're executing like crazy, but anything that adds credibility, we're like, you know, I made the mistake of getting too thirsty for it.

• 1:05:30Speaker 00

  And, uh, and so we kind of, you know, continue to go for it down past with Rolls, but like, you know, kind of, it was, it looked great on the outside, uh, but a startup and a big British company is just not, the gears don't mesh well. And a supersonic airplane really wants a fully custom engine.

• 1:05:50Speaker 00

  And I think it was 2022 that kind of it all, it all became public.

• 1:05:55Speaker 00

  And then, you know, where we are now, uh, we're building our first custom engine right now, and it'll be running a test stand around the end of the year. And so we will, you know, I'm sure it will be challenging, but you know, the world will find out soon whether a startup can build a supersonic jet engine.

• 1:06:12Logan Bartlett?

  What's the, what's the biggest difference between what you will have versus what currently exists in a commercial airline?

• 1:06:19Speaker 00

  It is a, um, a thing that is, I think, easy to miss coming from the software world is, um, how important sizing is to physical engineering. What I mean by sizing? Well, so Overture has a turbofan engine, meaning there's a jet engine core that powers a fan that blows air around the core of the engine. Okay. Well, which turbofan? What are the design parameters? How, what's the fan diameter? What's the actual size of the fan? How much air goes around the core versus through the core? What's the pressure ratio? What's the design operating temperature? And these are all choices. You can, you can turn these knobs. You can make a bigger fan, a smaller fan, a bigger core, a smaller core.

• 1:07:04Speaker 00

  And a subsonic airplane tends to want a big fan and a small core. And a supersonic airplane tends to want a medium sized fan and a big core.

• 1:07:15Speaker 00

  It's the same stuff, it's just different, different sizing. You know, our fan blades are smaller than other people's fan blades. Our core is approximately the same size as the largest core that had been done. We're very careful not to go outside the bounds of what's been done before. We don't want to stumble off and like, oops, we're building the world's largest single crystal castings. Nope, not on version one.

• 1:07:39Logan Bartlett?

  What's something that's maybe looks simple from the outside with the overture, I guess in general, that is actually insanely complex?

• 1:07:51Speaker 00

  Hmm, uh, low speed.

• 1:07:56Speaker 00

  The, the high speed's the easy part, the low speed's the hard part.

• 1:08:01Speaker 00

  Everything for high speed, it drives you towards long slender airplanes. It drives you towards skinny engines. And all of those things are the exact opposite of what you want for quiet, low speed takeoff and landing. So that the art is two airplanes in one. It can go fast and it can go slow. The fast part's easier than the slow part. And we spent a lot of energy on XB1, working out low speed stability and control. And, uh, but all of those lessons, you just scale up very directly. And with our sort of backing off a little bit on top speed, it should get a lot easier.

• 1:08:37Logan Bartlett?

  On the business side of things, we, we talked a lot about the Concorde and some of the mistakes that they made. And it seems like you guys are taking a vastly different approach to it. So as you, I guess, as you've been talking to United and other folks that are interested in, in placing orders around this, like, how much of, of the business model or the, the price points and the considerations on all this? How much have you come to them with like, hey, here's how we think it should work. Here's a price point that we've sort of thought through. Here's the implications versus they came to you. And I guess where have those things met in the middle? Like, what are we sort of talking about? Number of flights, price point?

• 1:09:14Speaker 00

  Yeah, um, so our, our approach was, uh, we actually built a team out of ex-airline analysts. And we said, let's do all the work that we would expect an airline to do in evaluating the product before we ever call them. So

• 1:09:30Logan Bartlett?

  And when was this in the journey? Like, how long ago?

• 1:09:32Speaker 00

  Uh, so I personally did this in 2014.

• 1:09:35Logan Bartlett?

  Got it.

• 1:09:35Speaker 00

  And like a baby version.

• 1:09:36Logan Bartlett?

  This is maybe what you showed up at SpaceX with, some of the early?

• 1:09:39Speaker 00

  Yeah, yeah. I had a spreadsheet model of the airplane technically, and a spreadsheet model of the airline economics and the, and the overall market sizing. And that was something I built myself in Google Sheets with a bit of JavaScript code and some screen scraping of like market data out of FlightAware. And, and today we have pros doing the same thing. And it's far more sophisticated, but it gives basically the same answer. And so we would, we would show up to an airline and we'd say, let's just show you the math here. Here's the vision. Let me show you the math. This is what the airplane can do. If you make this fair assumption, this is how that sits relative to market fares. This is how many people we think will fly on it. These are the routes where I think it makes sense. This

• 1:10:22Speaker 00

  is how you would schedule the airplane. This is how many round trips you can do. This is why you can fill those. Here are the departure times, the arrival times, how it fits into your banking structure. Like, we just, we kind of did all the work. And, and because of that, they're like, oh, it kind of makes sense. And of course, they'd have like bits of feedback around the edges. But I think, you know, I think if we, if we'd said, hey, you know, what airplane do you want? We never would have gotten anywhere.

• 1:10:50Logan Bartlett?

  And so the price point for, for the consumers will net out about where?

• 1:10:53Speaker 00

  About like business class today.

• 1:10:54Logan Bartlett?

  About like business?

• 1:10:55Speaker 00

  So you'll Concorde, $20,000 ticket, uncomfortable seat. Overture, $5,000 ticket, really nice seat. The, the one thing it doesn't do for a transatlantic flight is lie fully flat. When the flight's three and a half, four hours, you don't need a flatbed. Just the same way you don't have a flatbed on a domestic flight that's three hours.

• 1:11:15Logan Bartlett?

  So have you, have you spoken publicly about the interior design and what that's going to look like?

• 1:11:20Speaker 00

  We have a little bit, but we have a couple of things that are still under the, the wraps. I'll, I'll share a bit. So Concorde, if you've ever gone on one at a museum, the first impression is terrible. It's got a really short boarding door. Most people have to duck to get on. There's the equivalent of several rows of floor to ceiling, equipment racks and a narrow aisle. So you just have to squeeze your human into this airplane. And by the time you get to your seat, you're already just emotionally convinced it's tiny and cramped. And the seat's not great. So we said, look, we want to build something that passengers are going to want to fly over and over and over again. And the first impression has to be great and the in-seat experience has to be great.

• 1:12:02Speaker 00

  And, and so we do have a long, skinny airplane with a very unusual shape. It's actually bigger in the front and skinnier in the back. The back of the airplane, the very last row of seats is the same diameter as like the best Gulfstream. And in the front, the boarding door is actually 10 inches taller than Concorde's, an inch taller than a 737. And you step onboard the widest part of the airplane where there are these like eight-foot cathedral ceilings. So it's a, it's a great first impression. And then there is, the front cabin has something I can't share yet. That if, it was a collaboration between design and engineering that changed, it changed the, the aerodynamics of the airplane slightly,

• 1:12:46Speaker 00

  but created something that I think when people see for the first time, they'll be like, no way.

• 1:12:51Logan Bartlett?

  From a consumer experience.

• 1:12:53Speaker 00

  Yes, from a consumer experience.

• 1:12:54Logan Bartlett?

  So, so as we look here, so is, is it two and two through here? How is it laid out?

• 1:13:00Speaker 00

  That'd be one way to do it.

• 1:13:01Logan Bartlett?

  Got it. As you get near the back, as it narrows, I guess, let me ask this a different way. Are there, are there different seating as you?

• 1:13:10Speaker 00

  Yeah, so the, the, the, the back is one plus one. And actually, the best seats are in the back of the airplane. Every seat's a window seat and an aisle seat. We, we actually, again, there's magic that happens when designing, when designers think like engineers and engineers think like designers. So one of the things we did is we changed the, the structural frame spacing on the fuselage to line up with the interior. So the windows always line up with the seats. And this is, you know, this is not done today and you, we have that sometimes you get lucky and there's a window where you want the window to be. Sometimes it's like, well, the window is kind of like kind of halfway between rows and you can't get a good view.

• 1:13:50Logan Bartlett?

  And what's the reason for that for in a Boeing plane?

• 1:13:53Speaker 00

  Uh, the interior and the airplane itself are developed independently by like different companies. And there's a lot of like principal agent kind of problems.

• 1:14:02Logan Bartlett?

  Yeah, I got it. So, so I end up with two windows angled slightly weirdly and someone else ends up with no, no windows or whatever. That's interesting.

• 1:14:10Speaker 00

  Right. Yeah. And versus we designed the interior and the airplane together.

• 1:14:13Logan Bartlett?

  In terms of the actual like design, we, we spent a lot of time sort of talking about the different technical considerations, regulatory considerations and all that stuff. As you moved into the consumer experience, how, how opinionated were you about these things? Did you bring in different consultants or different hiring that once you sort of realized the commercial viability and you started to make plans for the actual, you know, commercial availability?

• 1:14:38Speaker 00

  So we, we built a design team that had never done an airplane before. And we brought in a few consultants that had, uh, so they would, you know, teach us what we didn't know about, you know, say certification for crash worthiness. But mostly, um, it was me and a handful of, uh, really great designers, uh, thinking very aspirationally about what we could create. And just really sweating the details. Um, you know, one of my favorite just, you know, favorite days at Boom is when I go from a, a deep technical meeting where I'm just working with the team on, say how we, how we designed the approach to landing, uh, for quiet operation and without compromising high speed performance.

• 1:15:20Speaker 00

  It's like fascinating little technical problem right in there. And it's like right at the intersection of regulation and engineering and pilot experience. And then I go to the next meeting and we're looking at a mock-up of the windows. And, uh, we're talking about the design of the interior and how the airplane sidewall interfaces with the window and how we can reduce seams and gaps to create a visual experience that is far more tranquil. And so there is, um, it, one of the things I just very much love about this company is, uh, there is a lot of art.

• 1:15:58Speaker 00

  And design and ineffability, how do we make it a sensory experience that's pleasant? How do we make this an oasis in the cacophony that is an airport? And also, there's just like the most awesome physics and engineering and manufacturing. And that all can be in, you know, all can be in one day. And the magic happens, the more these are threads that are woven together and cross pollinate. And the more we, you know, like, like one of our big things is no silos. And I, I expect every person at Boom to be, not just be an expert in their own discipline, but to be curious about every other one.

• 1:16:41Speaker 00

  See, this is again, a difference between physical products and software. Everything's a trade off. If we make the fuselage wider, it will create more aerodynamic drag and fuel economy will get worse, range of the airplane gets worse, and the required fares go up. So there's a tension between making the airplane bigger and more spacious and making it more cost effective. And the, you know, you could look at this as a tug of war, or you could look at it as what we call invent together. And invent, invent together is like one of, it's one of our five values. And it means everybody on the team has the obligation to teach what they know and to learn from what their peers know.

• 1:17:26Speaker 00

  And a belief that when there is a shared understanding of every side of every trade off, that's where the magic gets found. And like this, this thing I'm not quite telling you about the front cabin of the airplane came out of one of these. Where it's just like, you know, when I saw it, there's like, it was like a no way. Wait, but that could really work?

• 1:17:43Logan Bartlett?

  We've talked about the, the initial going and meeting the gentleman from SpaceX and the cascading effects of trying to find five and then five along the way. 11 years in, you've had to retain these people or different, different people with. Um, different points of um, validation uh, from the outside uh, and probably different people feeling like um, they were making a ton of progress, or maybe like, where is this going at different points in the journey? I'm curious on the talent retention side, like, what have you learned about keeping people going through what probably has felt like manic episodes at different points along the way?

• 1:18:27Speaker 00

  Yeah, boy, we could do like, probably three podcasts just on this question, because I've made, I've made plenty of mistakes along the way, and I've also learned some important lessons. I'll share a couple. So, one is, um,

• 1:18:41Speaker 00

  what we're doing requires a lot of perseverance and a lot of grit, and

• 1:18:46Speaker 00

  rational people will give up if they don't care about the mission, because it's just too, it's just too tough. And so, one of the most important things we, we've done all along the way is to select for people who really, really care about delivering mainstream supersonic flight. Because if they, if they don't, and they're sane, they're going to leave and go do something far easier. So, that's, that's one. The other is, um, was less, less obvious. It's about burnout.

• 1:19:15Speaker 00

  So, I'll tell you the story of how I learned the lesson. This was uh, 2020, we were about to roll out the XB1 airplane. And um, you know, to, to plan a proper, proper event, you know, we had to call the shot on when rollout was going to be months in advance, so you could do all the media planning, all the, all the event prep for it.

• 1:19:36Speaker 00

  So, we called the shot, I think it was October 20th. And uh, the airplane wasn't ready when we called the shot. So, we had to, you know, work like crazy to get this to be ready, and that the engineers were working like crazy. The, the people on the shop floor were working seven-day weeks, 12-hour days. At literally polishing the airplane. Like, if you go back and look at the reveal video in XB1, we, we revealed it in a light box with these long, skinny light bars, and those are the least forgiving lighting environment for a physical product. If there's any surface imperfection, or imperfection, uh, it will be really obvious. So, like, people are literally polishing the airplane. And an insane amount of effort, and so, we, we had an awesome event.

• 1:20:22Speaker 00

  And uh, and I said, "All right, everybody take a week off." Because then we're going to come back, and the next job is to fly the airplane. And they came back and morale, which had been really high, was suddenly in the tank. And at first I was like WTF people, like you just got a bunch of external validation. The world is so excited about what we're doing.

• 1:20:45Speaker 00

  And I gave you all a week off. So what are you telling me you're burned out for? And at first I was like very upset and what I, what I realized was that what everyone tells you about burnout is actually not what burnout really is. Burnout is not, I'm working too hard. And in fact, people, teams can work extreme high intensities for long periods of time without being burned out. So long as there is a believable, tangible goal that is within what I call their gratification window. And I think as humans, we all have a gratification window. Some people have long gratification windows. Some people have short gratification windows, but is how far away can a

• 1:21:29Speaker 00

  motivating goal be for me to believe in it and for it to actually motivate me? And what we went from was like, oh, it is like a couple of months to weeks away from a very important deadline that I know if I work really hard, I can hit to, oh, this airplane that we just rolled out needs a lot of work before it's really ready to fly.

• 1:21:52Speaker 00

  I don't even know how to get my head around that plan. And so the solution was we engineered something called mission success events. Which is basically every roughly month, there were one or two major milestones that the team could rally around and celebrate and enjoy. And we, we still do this today. And one of the, one of the things is a, a mission success event is not just celebrated by the team that did it, but it's celebrated by the whole company. And we, you know, we try to have, we try to have like, maybe like three a month across the whole company and you know, everyone gets together and celebrates. And it's a, it's a whole company victory.

• 1:22:36Speaker 00

  And so there is a very long marathon divided into sprints. And you can think of it as, you know, you get to take a shot at the end of every sprint.

• 1:22:48Speaker 00

  Sometimes literally.

• 1:22:49Logan Bartlett?

  We've spent a lot of time talking about all the different component parts and developing airlines and all of that. I recently, obviously, there's been the implications of tariffs kind of roiling through the, the economy. I get the feeling you have opinions about different elements of this. So one, can you share, we were talking a little bit before about the bitter pill element of, of what tariffs may, maybe will accomplish?

• 1:23:13Speaker 00

  Yeah, I've changed my mind a lot on this. Um, I think I, I, I booted up very much a unabashedly free trade, pro globalization. Let's have one big happy world. We embrace comparative advantage. Not everything needs to be built in any one place. The world's a better place like that. And I think I'm on this multi-year journey of realizing that the world is, that is definitely the world I want to live in, but it's not the world we actually live in. You know, Russia invaded Ukraine.

• 1:23:50Speaker 00

  China has an explicit goal of taking over Taiwan.

• 1:23:55Speaker 00

  We lived for, you know, post-World War II, post-Cold War, a few decades of relative peace, but the world is not a safe place.

• 1:24:06Speaker 00

  Not every country is free and there are, there are real life bad guys.

• 1:24:13Speaker 00

  And what is, what has happened? So let's go back to World War II. The way we won World War II was not by having a bunch of defense companies ready to go or having a big stockpile of weapons. We had no defense companies and we had no stockpiles. But what we had was the best commercial industrial base in the world. And companies like Boeing and Douglas pivoted into defense products. Ford retooled and they built, they built fighters and bombers and tanks. And we, we outproduced the Axis and we won. And then we lost our way. We went into this defense.

• 1:24:58Speaker 00

  I think Eisenhower very appropriately warned about the military industrial complex. We, you know, we put the defense industrial base and corporate welfare.

• 1:25:08Speaker 00

  Defense programs became as much as anything jobs programs. We got, you know, really fat and dumb. In a shooting war with China, we'd run out of stockpiled cruise missiles in eight days. It would take another two years to get one. And meanwhile, the, the, the efficient agile industrial base has left America and it's gone to China. And this is, I find this incredibly scary and, and like it's, it's happened in a lot of industries. Aviation, you know, we, we all know what happened with CHIPS. Like CHIPS went to Asia. It's a huge problem, very hard to get them back. And we are watching right now the same thing happen in slow motion with aviation.

• 1:25:52Speaker 00

  But China today is shipping a 737 clone. They are working on a 787 clone and they just announced last weekend. The next thing after that, yep, it's a supersonic passenger plane. And Boeing, on the other hand, America, has not shipped a new airliner in decades. The, the 787 launched, I think, 2004.

• 1:26:20Speaker 00

  Nothing new. And pretty soon the world will be

• 1:26:26Speaker 00

  first Chinese knockoff airplanes. And that, that every other country will buy because they're cheap.

• 1:26:34Speaker 00

  And we can tariff them in the US, but you can't stop that internationally.

• 1:26:39Speaker 00

  And then, and then we'll be all surprised that they've caught up with us technologically and they're ahead. And the, I cannot over emphasize the importance of this. Boeing is the number one US exporter. A quarter of all Air Force airplanes are modified commercial airplanes. So if we don't have next generation airplanes, not only do we not have the exports and the economics, we don't have the next generation defense platforms. This is how we get our tankers. This is how we get our military transports. Even some of our spy planes are modified commercial airplanes. So.

• 1:27:13Speaker 00

  Okay, you asked about tariffs. I think the most important thing here is reindustrialization. And in a world, you know, if we, it sounds like Mother Temple Pay, but if we had world peace, this actually wouldn't be important. The planet could operate as one, but that is not the world we live in. And we need to, America needs the greatest industrial base on the planet. And I think the, I think it's urgent and important, and that what we need to do is pull every lever completely simultaneously. So first off, we need to get out of our own way. Like, all this stuff that makes it hard to build, all this stuff that takes a year to do permitting, or more, gotta get rid of that. Supersonic flight, we gotta legalize

• 1:27:58Speaker 00

  it. You know, everything we can do that basically makes it more expensive to build here, we need to fix, we need to fix rapidly. We need to massively cut federal spending, which will cause more capital to flow into private markets, where it can be deployed many more times more effectively than, than any government ever could. And then we need to create economic, this is the part, I know it's controversial, and I used to be on the exact opposite side of this issue.

• 1:28:24Logan Bartlett?

  By the way, I'm still with you. I haven't disagreed with anything you've said yet. I have a feeling I'm about to.

• 1:28:29Speaker 00

  Okay. You know, I started off thinking, you know, I was in the tariffs are really dumb camp. And I am, I am now in the, this problem is so urgent and important, that we need, we need to be able to do painful things, that, that accelerate the transition. And, and so, I don't think the tariffs that we have as of like, I don't know, this morning, are the right ones long term. I don't think they're going to stay that way either. But I think, I think what we need to do is accelerate that shift towards reindustrialization. And this, this is one of several levers that will contribute. And by the way, many of

• 1:29:10Speaker 00

  these are painful levers. I think it's a bitter tasting medicine. And I also think it's temporary. It's a little bit of like, economic chemo, and it sucks.

• 1:29:21Speaker 00

  Uh, but then it will work its way through markets. Um, the economy will get realigned and I, you know, I think, I don't know, I'm not a, I shouldn't put a timeline on this, but I'm very optimistic that things look very, very different, you know, 12 to 24 months from now than they do today.

• 1:29:38Logan Bartlett?

  And the tariffs specifically as a, as a mechanism, the broad based thing that we've seen over the course of the last whatever period of time, I guess as an accelerant to this, how do you think about, how do you think about that and the inputs and the puts and takes that kind of come with it?

• 1:29:57Speaker 00

  I think one of the things that is important to realize is we're also seeing, uh, there are different ways you can plot your way through this, right? Like one is a very surgical approach where, you know, you're like, ah, so maybe, maybe, you know, we should figure out exactly which products should be tariffed. Let's make sure we don't tariff like industrial equipment coming into the U.S. from Europe. Uh, let's, you know, let's, but maybe, maybe finished goods out of China in some circumstances, but only, you know, but not, not the critical minerals. Like there's a surgical approach to this and like, a lot of people say like, ah, you know, like the surgical approach makes so much more sense. Uh, by the way, it would also take forever to figure out. And I think the, you know, I think what is

• 1:30:37Speaker 00

  very Trumpian, I think very Muskian leadership is, um, uh, someone once described Elon's management cell to me as management by thermonuclear explosion. Blow everything up and then fix it. And, um, I think that's, you know, I think that's a bit of what we have going on now. It was not that let's, there, there is a view that this is so urgent and important that, that we will make big blunt moves and then we'll figure it out and it will get refined. And that drives a lot of chaos and you have to be willing to tolerate wild volatility in the stock markets. Um, I think that the theory is that this will result in actually getting to the best configuration faster. Um, I certainly understand the argument for the surgical mode and I think we will end up in the surgical state, uh, but we are

• 1:31:22Speaker 00

  following a very, um, chaotic path to get to that state.

• 1:31:26Logan Bartlett?

  And is the implication of all of that therefore, as you sort of talk all that through is that?

• 1:31:33Logan Bartlett?

  It might be net detrimental to the overall US economy in terms of just pure GDP, cost of goods sold being as low as they are, but in terms of the the ability to withstand shocks and the long-term potential resiliency of the United States, it's just mission critical. So if that's a trade-off, we should make it.

• 1:31:57Speaker 00

  Let's talk about the end state. I think it starts by, let's get really clear on the end state. I think people should be able to agree on the end state. And then and then we can have reasonable debates about what is the best path to the end state. In my view, the end state is, again, we have to remember, the world is not peaceful. If the world is peaceful, a different end state is better. But, okay, great. So so basically, what there needs to be is, you know, America needs to be a free country that is the best in the world at making things. Physical products, digital products, inventing the future. And and by best, I mean, we're going to be really efficient. We need we need all the economic incentive to be efficient and be good and be innovative and to move fast.

• 1:32:41Logan Bartlett?

  And I would just add to the distinction, important things. I think we should be the best at making important things.

• 1:32:45Speaker 00

  Which which things are unimportant?

• 1:32:46Logan Bartlett?

  I don't know. I don't think t-shirts are particularly important. I don't think, you know, I mean, there's a lot of different widgets that don't necessarily feel particularly important to me. Toys don't feel particularly important to me.

• 1:32:57Speaker 00

  Oh, you have a little boy on the way?

• 1:32:59Logan Bartlett?

  I do. I do. But in the great scheme of things, I don't think we need to be the best toy manufacturer in the world.

• 1:33:04Speaker 00

  Um, I actually profoundly disagree. Um, one of the great things about toys is they need to be mass-produced at low price points for families. And the manufacturing technology that enables scale production of toys might also be really important in wartime.

• 1:33:26Logan Bartlett?

  It could be, potentially. But it's going to be more expensive, like.

• 1:33:30Speaker 00

  Why?

• 1:33:30Logan Bartlett?

  To do it domestically will just be more expensive.

• 1:33:32Speaker 00

  Well, why?

• 1:33:33Logan Bartlett?

  Because we will pay workers more here than we would than we pay to get goods imported.

• 1:33:38Speaker 00

  Great. So let's keep asking why recursively until we eliminate the root causes of of cost.

• 1:33:44Logan Bartlett?

  People in Vietnam are willing to accept lower wages for their jobs because of cost of living versus people in the US.

• 1:33:50Speaker 00

  So let's invest heavily in robotics. Let's make Americans the best leveraged workers. Let's effectively promote every American into management and they can manage a whole bunch of robots and be far more productive than somebody sewing by hand in Vietnam.

• 1:34:01Logan Bartlett?

  It's it sounds great. I agree with you. Over what period of time, I guess, is the possibility of it?

• 1:34:06Speaker 00

  I don't know if anybody's smart enough to put a number on that. I'm certainly not.

• 1:34:10Logan Bartlett?

  Yeah.

• 1:34:11Speaker 00

  But I think that's the the sooner we get there, the better. And this is, you know, it won't be easy, but there is a much, much better future that we can we can create here, you know, but we have to. We have to be willing to tolerate some disruption on the way there, or it might take too long. And again, if it weren't for China, I would have a very different view on this. And with and a lot less urgency would exist, and therefore the surgical approach would make a lot more sense.

• 1:34:42Logan Bartlett?

  Well, I have a feeling we probably could have could do another hour or two just on this topic. But Blake, I really appreciate you doing this. This was a lot of fun. It's a super impressive business you're building, and I glad we were able to dive deep into it.

• 1:34:52Speaker 00

  I really enjoyed the conversation, Logan. Thank you so much.

• 1:34:54Logan Bartlett?

  Thank you.