00:00the first electric cars can be traced
00:02back to as early as The 1830s Flash
00:06Forward to 1900 and astonishingly
00:08electric cars make up about a third of
00:11the cars on the road but electric
00:13vehicles that were once leaders of
00:15innovation became a faint echo of the
00:18past overshadowed by their gas guzzling
00:20competitors but what caused this radical
00:22shift what happened between then and
00:25today that caused the electric car to
00:27lose its charge how did the electric
00:29vehicle go from a third of the market to
00:32a fraction of a percent a century later
00:35luckily electric vehicles are making a
00:37triumphant comeback due to Decades of
00:40innovation and as we embark on this
00:42Resurgence of electrification we are
00:44seeing this investment impact more than
00:46just the automotive Market we're seeing
00:48the electrification of planes boats
00:50school buses even cargo ships joining us
00:54today are Gregory Davis CEO of Aviation
00:56planes Mitch Lee co-founder and CEO of
00:59Arc oats and Duncan McIntyre founder and
01:02CEO of Highland electric fleets so we've
01:05got planes boats and buses and together
01:08we discussed the breakthroughs that have
01:10set us on this path but also what can
01:12and can't be applied to these new
01:14applications cost curves and moats and
01:17by the way if you don't think this will
01:18happen quickly enough I'd like to point
01:20you towards two pictures taken on Fifth
01:22Avenue on Easter morning
01:24these pictures were taken 13 years apart
01:26the first in 1900 and it looks like a
01:29Waldo puzzle where you're actually
01:31trying to spot the car amongst the Sea
01:33of horses but just 13 years later in
01:361913 spot the car really turns into spot
01:39the horse where you see one horse
01:41amongst a sea of cars and I think this
01:44is just a testament to just how quickly
01:46technology can change things so buckle
01:49up folks welcome to the electrification
01:53as a reminder the content here is for
01:56informational purposes only should not
01:58be taken as legal business tax or
02:00investment advice or be used to evaluate
02:02any investment or security and is not
02:04directed at any investors or potential
02:06investors in any a16z fund please note
02:09that a16z and its Affiliates may also
02:12maintain investments in the companies
02:13discussed in this podcast for more
02:16details including a link to our
02:17investments please see a16c.com
02:30I am so excited about this conversation
02:32because I think many people are familiar
02:36with the electrification of passenger
02:38vehicles right some of the biggest
02:40companies in the world now are tackling
02:42this and have been tackling it for many
02:45but I guess as a carryover from that
02:49industry we're seeing the
02:50electrification of many more things
02:52which I think people are maybe a little
02:54less familiar with and so I'd love to
02:56hear from each of your perspectives what
02:59got you into this industry what got you
03:01fixated on this idea that you needed to
03:03Electrify a new industry and so why
03:06don't we just kick things off with you
03:07Greg thanks very much for the question I
03:10mean the idea of electrification in
03:12aircraft has been around for quite a
03:13while but my my involvement in this
03:17actually went back to something I was
03:18doing in about 2017 2018 looking at ways
03:22to see how the new technology the new
03:24engine technology that was being
03:25developed could be used to reduce the
03:27carbon input impact of the aircraft the
03:29sustainable aviation industry is still
03:32quite young but it's being born out of
03:34the fact that we look we know we need to
03:36do something about it so what I mean is
03:38that right now Aviation contributes
03:41about three percent of all World CO2
03:43emissions but our own industry
03:45reproductions are that by 2050 that's
03:48going to be anywhere up to 50 percent of
03:50all CO2 emissions everywhere and it's
03:52because that technology of evolution uh
03:55hasn't happened in the Aerospace
03:57industry the way that it has and say for
03:58instance the automotive industry and
04:00some of the other great uh industries
04:02that we're going to be discussing today
04:03and I absolutely love aircraft I I think
04:08it's so important from an economic and
04:10from a social perspective that we can
04:12continue to connect communities but we
04:14can't do it while we're harming the
04:15environment and what really attracted me
04:17to Aviation and this opportunity that's
04:20that's here right now what we're
04:21specifically working on we have an
04:22aircraft that's going to be able to to
04:24really change the way that that we fly
04:26the cost efficiencies of operating on
04:29electric power the the noise reduction
04:31from having you know in the new engine
04:33technology that we've got again that
04:35elimination of carbon pollution
04:37um makes it a cost-effective convenient
04:41and and also carbon free to connect
04:44communities and I just find that very
04:45exciting I love that because I think
04:48maybe one aspect that people pay
04:50attention to for good reason is just is
04:52it electric or not but what you're
04:55pointing at is that electrifying an
04:57industry or a product also has other
04:59ramifications like you said noise
05:01pollution could also be you know the
05:03ability to move that energy back into
05:06the Grid in other ways and so Duncan
05:08you're working on school buses which is
05:10a whole nother industry and so tell me a
05:12little bit more about how you decided to
05:15venture into this space
05:17sure I think you know Greg hit on one
05:20thing that's near and dear to me which
05:22is noise pollution I think when I think
05:24of electrification I think of it as an
05:27upgrade all around maybe a third to half
05:30of the folks that we engage with
05:32commercially are interested in talking
05:34about climate change and CO2 but more
05:38than half of them if you start the
05:40conversation that way the conversation's
05:41over but if we can frame it in a
05:44different way around uh being an upgrade
05:47they're cheaper to operate cheaper to
05:50fewer moving parts are cheaper to
05:54they are very quiet they help attack
05:58poor air quality in you know in urban
06:02areas transportation is local no matter
06:05how you slice it it's a local Dynamic
06:07local politicians are you know awarded
06:11their seats or rejected from their seats
06:13based on topics like this and so you
06:16have to get into the local little side
06:18of it to win but more than anything I
06:21think you know Tesla inspired us all to
06:24look at the EV as a as technology that's
06:29here now and it's not only here but in
06:32many cases it's better it's an upgrade
06:34it took the market a little while before
06:37the product was developed to do medium
06:39and heavy duty and and we're there now
06:43companies like Daimler are producing
06:45medium and heavy duty platforms
06:47electrified platforms and so we started
06:51Highland focused on the school bus
06:52Market because we saw the demand and we
06:55also saw the duty cycle as being really
06:58appropriate for uh you know what
07:00electrification had to offer but were
07:03entering the trash hauling space and
07:06we're getting into basically any form of
07:09Municipal and government-operated
07:11vehicle that tend to operate in a fleet
07:14format and so for us it's about making
07:18sure that it's reliable and affordable
07:21and our product Suite stitches together
07:23the capital infrastructure the services
07:25needed and I think about it as 12 to 15
07:29small businesses that have to be
07:31stitched together and completely
07:33seamless to the customer and when that's
07:35done at scale it's not only affordable
07:38it's just cheaper for cities to run
07:40electrified fleets so we're we're really
07:43we're really excited about it and I saw
07:45that sort of opportunity to innovate
07:47around business models and drive
07:49commercial adoption right to make it a
07:52no-brainer right again not just the
07:54electrification but to just make it the
07:56obvious answer Mitch you're tackling
07:58boats which is again like a totally
08:00different line of of products but maybe
08:03with some parallels and so would love to
08:05hear how you got into that and as both
08:07Greg and Duncan have mentioned it feels
08:10like you can almost piggyback off of the
08:14automotive industry or the the strides
08:16that have been made there and so tell me
08:17about how that has maybe also applied to
08:21yes I I come at this from a very
08:23personal level I grew up on boats my
08:26parents were huge water skiers and I
08:29somebody that loved uh being out behind
08:33a boat on a kneeboard and water skis and
08:36wakeboarding and eventually surfing and
08:38inner tubing and just enjoying the water
08:40with friends but gas boats are so much
08:44fun to be on in an absolute nightmare to
08:46own and awful for the environment
08:49particularly when it comes to not just
08:51air pollution but water and noise
08:54pollution electric boats are are just
08:57better boats and they make a ton of
08:59sense I like to think that or say that
09:01in the Auto industry
09:04gas cars were actually pretty good at
09:05what they did they're quiet they're
09:09reliable they have relatively good fuel
09:11efficiency electric cars are still an
09:13upgrade but when you look at the Boating
09:16the the pain point of boat ownership is
09:19so much more visceral
09:21these are boats that are stuck in the
09:231980s technology they're basically like
09:26oversized gas lawn mowers they're loud
09:29they're noxious they are unreliable they
09:33run out of gas on you and when you
09:35compare that to what you get in an
09:37electric package it's such a better
09:39experience reliability goes way up you
09:43can enjoy conversations on the boat when
09:47it's whisper quiet you know the the
09:49torque that you get pulling somebody out
09:51of the water is better even the
09:53experience of refueling gets to be so
09:58because boats are kind of a point A to
10:01point a sort of vehicle so that makes
10:03charging a lot more tractable electric
10:05boats are a very obvious idea
10:07and a huge improvement from a customer
10:09perspective the hard part is the
10:11execution of this they're so power
10:13hungry and that's where we have really
10:15benefited from hundreds of billions of
10:18dollars that have gone into research and
10:20development in the Auto industry and the
10:22supply chains and the you know Battery
10:24Technology that's powering the Auto
10:26industry that has suddenly enabled us to
10:29go tackle the Marine industry which
10:31might not by itself have been able to
10:33support that volume of research and
10:35development and that's what gets us
10:36really excited because
10:38what we're doing today was not possible
10:40five years ago but what we're doing
10:45such a better product experience
10:46compared to what exists today in the
10:49on this idea of borrowing from the Auto
10:52industry I'd love to hear from all three
10:54of you what aspects were really easy to
10:57Port over where you could say look this
10:59innovation has you know been worked on
11:01for a long time and I can kind of copy
11:04and paste it to my industry but then
11:06also what required you to create
11:09something net new because it is a
11:12different product line there are
11:13different considerations whether it's
11:15being on the water or having to be in
11:18the air or having additional redundancy
11:20because you're in the air and so I'll
11:22just kind of leave this open to the
11:24group what have you had to consider and
11:26reinvent versus what has again been able
11:29to be you know borrowed from the
11:31existing automotive industry the all the
11:34technology development around making the
11:36electrified powertrain super efficient
11:39right this is your electric motor
11:41connected to you know your batteries and
11:44all the high voltage systems that need
11:47to exist in the balance to make it work
11:50and you know Mitch talked about
11:51reliability couldn't agree more electric
11:53is awesome because it is so reliable
11:55that is an area that we probably all
11:58benefit from is just years and years and
12:00years of making it a super durable
12:02system I would say for us we we had to
12:04create a ton of interoperability systems
12:08that we didn't expect we'd have to build
12:09and what I mean by that is not all
12:12charging stations work with all vehicle
12:14types you know there's firmware there's
12:16other other you know battery management
12:19software within your vehicle and then
12:22there's the utility and if you think
12:24about creating a reliable ecosystem all
12:26of us you know Mitch said power hungry
12:28they're really power hungry right our
12:31our Depot in Bethesda Maryland you know
12:34draws five megawatts of power when we're
12:36charging it's the largest electrified
12:38Depot in the country running 200 school
12:40buses and five megawatts is like five
12:43hospitals coming online overnight and so
12:46you need really Advanced software that
12:50that is managed in a way that we've
12:52never had to do in the past here in the
12:55states anyways and that's
12:57interoperability between your chargers
13:00your utility your vehicles and if you're
13:03going to make the experience the overall
13:06experience reliable the vehicles are
13:08reliable when they're out running but if
13:10they're not reliable when they're
13:12charging you have a major problem and so
13:14that's maybe the biggest thing we've had
13:16to do far more creation around than I
13:20I could maybe piggyback off of that
13:22specific to power requirements boats are
13:25power hungry and for to give you some
13:28scale recreational boats use more
13:31gallons per mile than a fully loaded
13:33semi truck a fully loaded semi truck
13:36might get six to eight miles to the
13:39a boat gets one to two the the amount of
13:42energy you need to store on these boats
13:45is is pretty large The Arc one has two
13:48battery packs totaling 220 kilowatt
13:51hours of battery capacity which for
13:54is well over twice the size of any car
13:58that you'd find on on the market today
14:00like a model S or model X it's identical
14:02to what you put in a full-size school
14:04bus that hauls 78 children around
14:06exactly and so one of the biggest
14:09challenges is just packaging that much
14:12capacity and and building battery packs
14:14at that size and then on on the Boating
14:17side and I'm curious to hear uh Greg's
14:20take on this but on on the Boating side
14:22we have a very high continuous power
14:24draw so in the Auto industry what you
14:27see is your power demands kind of Spike
14:30as you're accelerating 0 to 60. that's
14:32where you draw a lot of power once
14:34you're up to 60 miles an hour The
14:36Continuous power draw tends to be much
14:39lower boats almost have the inverse
14:43your power drop is you know you don't
14:45necessarily have very high peak power
14:47because it's actually hard to put a lot
14:49of power into the water you're limited
14:52instead what you have is very high
14:54continuous power because going you know
14:5740 miles an hour through the water which
14:58is viscous uh is much harder to sustain
15:03that and so that generates a lot of
15:05unique challenges for the Marine
15:07industry or for you know our application
15:11electric technology to the Marine
15:13industry particularly around how do you
15:16cool that when you're generating so much
15:18uh powering how do we you know make our
15:21Motors uh tolerant to that amount of
15:24power jaw and again Greg I'm curious
15:26your your take on this from the aviation
15:27Greg needs 20 000 times more power than
15:30we do to get the point in the air
15:32we you know what it's actually the
15:34comparisons are really interesting I
15:36think I'm going to start by highlighting
15:38a few differences just to sort of lay it
15:40out there each of our Battery Systems is
15:42actually designed to different criteria
15:44so that where we've benefited from
15:46Automotive is is the you know
15:48advancement of the the cells right so
15:50there's a definite benefit for improving
15:52the energy density or the you know what
15:55we measure in Watt hours per kilogram at
15:57the cell level but the architecture of
15:59our systems is each is going to be
16:01unique for each application so I'll give
16:03you some practical examples of why that
16:06is when you're building a car or I you
16:09know done can I get your opinion on this
16:11then Mitch actually I think it'd be fun
16:13to sort of fact check here on on air but
16:17um when you're building a car or
16:18ground-based vehicle the typical
16:19consumer is involved in buying that car
16:21and when they buy an electric car they
16:24don't want to think about things like
16:25having to replace the batteries while
16:27they own the car right you want the car
16:28to last through the entire time that you
16:30buy it I would say my guess is that the
16:32Marine industry is a little bit more
16:34forgiving than that they are okay yeah
16:37and the Aerospace industry actually
16:39expects to have to maintain the area
16:41aircraft so when we're designing our
16:43batteries we're actually designing them
16:44to a specific uh life cycle and so the
16:48the battery replacement you know the the
16:50quality of the batteries in in an
16:52aerospace application uh is it it's
16:55obviously very very high but it's also
16:57governed by the certification standards
16:59that we're going to have for the
17:01um part of our advantage of Aviation is
17:03that we're our whole product the premise
17:05is based on the fact that we're able to
17:07design and certify an airplane using the
17:09existing standards so we actually have a
17:10clear path to certified education but
17:13you know we design our batteries to be
17:14replaced every 3000 Cycles which given
17:17our utilization is about every 3000
17:19hours so that could be two years three
17:22years four years depending on how you're
17:23going to use the airplane
17:25but the great thing is is that the
17:27Battery Technology continues to evolve
17:29and so our architecture is designed so
17:31that it can actually be
17:33um I'll say somewhat agnostic to the
17:36actual cells that are being used to
17:37provide the energy so we can upgrade our
17:40battery uh every two three four years so
17:43when you go in and you do a mandatory
17:45maintenance activity which is absolutely
17:46normal for an airplane you actually end
17:48up getting a better plane I want to
17:50chime in there because I think it speaks
17:52to how different the the problems are
17:54for each of these industries we have an
17:57entirely different scenario which is
18:00a big boating season is maybe 50 maybe
18:03100 hours we are the opposite of cycle
18:07constraint you will never reach a point
18:10where you have out cycled the useful
18:13life of your battery because even with a
18:16ton of usage on that boat it is nowhere
18:19near what you would see in an auto
18:21industry or in the aviation industry and
18:24and you know I mean one final thought is
18:26what we really should get to as an
18:28industry is you know Gregory uses the
18:31these batteries for two and a half years
18:33and they're no longer you know suited to
18:37the standards that you need but they're
18:39perfectly fine for me they roll off and
18:42they're in applications that are less
18:44Mission critical where they're still
18:46perfectly safe and they've got a
18:47perfectly good life that's ultimately a
18:50better design than you know not to the
18:53extent that Mitch explained but in our
18:56school bus fleets are on the road and
18:58nine percent of the hours in a year and
19:0191 of the time they're sitting idle so
19:04they're actually relative relatively
19:06underutilized on that note I'd love to
19:09hear from from especially actually you
19:11Duncan and Mitch because these assets
19:13actually I guess the plane is this is
19:15true for as well but for some period of
19:18time they're not being used right and so
19:21that influences when you can charge how
19:23much you can charge but also something
19:25that we're seeing a lot more with even
19:27the passenger vehicles is the idea that
19:29some of this charge can go in the
19:30reverse Direction getting more use out
19:33of the asset itself and so would love to
19:36hear your thoughts on again this idea
19:38that the electrification of these
19:41products is not just a gas to electric
19:44but it opens up this whole range of
19:47other potential opportunities yeah look
19:49it's a good question it's Corda our
19:51business model at Highland and about
19:54half of our projects today are
19:56backflowing power from our Fleet of
19:59batteries to the grid when the grid
20:01needs the power the most and we earn
20:04very we are in various amounts of money
20:06but you know in New England as an
20:08example we earn about a third of our
20:11wow just from providing grid services
20:14this is a it's a it's a battery just
20:17like any other stationary battery and it
20:19can be used to absorb high levels of
20:23Renewables production and help meet the
20:27grids demand during the Grid's Peaks and
20:31so it's a it's a very interesting
20:33opportunity for frankly all of us all of
20:37our Industries are power hungry and if
20:39we charge at the wrong times it's going
20:42to make operating the grid much much
20:44more expensive and so I think it's we
20:46see it as an issue that is getting
20:48solved but too slowly you know
20:51ultimately the utilities and the
20:53wholesale energy markets we think should
20:55develop better products and then better
20:57better policies too to sort of really
21:00require that this activity is done
21:02smartly because if it's done in the
21:05you know you're going to flatten the
21:07load curve and drive better efficiency
21:09in our distribution system and our
21:11generation systems as opposed to the
21:13opposite so we we come at this from the
21:16more localized customer perspective you
21:19know Duncan's coming at it from the grid
21:21level which is very exciting because
21:23when you stack multiple of these
21:24vehicles together you quickly get into
21:26the megawatt hours of capacity we think
21:29about it from from two perspectives the
21:31first is the fact that you know a normal
21:35boat outing might be
21:38four hours out on the water what that
21:4220 hours of downtime that you can then
21:45go recharge before you would feasibly be
21:47using that boat again and so it makes
21:49charging a much more tractable problem
21:53if a boat's at a dock you have plenty of
21:55time for an overnight charge before you
21:57use it again you don't necessarily need
21:59fast charging to exist in order to have
22:03a compelling electric boating experience
22:06and then the second part is
22:08yeah that boat is sitting in the off
22:11season when it's winter and it's too
22:13cold to go boating or you know even
22:16mid-week when you're working and not
22:19able to get it out that's an opportunity
22:21to provide power back to your house so
22:24again not necessarily at the grid level
22:25but that is a tremendous amount of
22:29battery capacity that could power your
22:31house for a week without you doing any
22:35finagling of of electric loads
22:39and that's exciting because
22:41it it presents a whole bunch of
22:45optimize your energy because consumption
22:49a a given week it's funny I was just
22:52talking to one of my board members a guy
22:54named John mascal of it this exact same
22:55thing and what we've just highlighted
22:57collectively is how well this technology
23:00The Battery Technology electric
23:01technology integrates into the way that
23:03we actually use things the primary and
23:06secondary uses of the aircraft um each
23:08of us is looking at the charging network
23:10uh right so the infrastructure but not
23:12just at the infrastructure level also at
23:14the actual vehicle interface level and
23:17uh you know certainly our discussions
23:19about the charging Network absolutely
23:21include the idea of secondary storage of
23:23energy typically speaking the aircraft's
23:26going to fly you know morning to evening
23:28cargo applications will be able to use
23:31it uh later in the evening which which
23:33isn't directly related to batteries it's
23:35actually related to the fact that the
23:37aircraft's so much quieter that it's not
23:39going to be subject to noise
23:40restrictions but when you look at the
23:42the typical turnaround time for an
23:46um the uh the aircraft you know you load
23:48passengers onto it it takes off it
23:50travels for an hour it lands and then
23:52you offload the passengers and baggage
23:54and then repeat the cycle that
23:57turnaround time typically takes about
23:58half an hour you can charge your
24:00batteries for one hour of flying time in
24:03and and that's that's a actually a
24:05fairly gentle charging cycle for a
24:07battery so you could I mean you have the
24:09opportunity for using fast charge and
24:11megawatt chargers and all this and and
24:12those will be part of our solution for
24:14certain some applications but compared
24:17to some of the more strenuous
24:18applications on batteries we're actually
24:20being relatively gentle uh to what we're
24:22what we're doing with our batteries even
24:24at the aircraft level and uh and that's
24:27actually again very very exciting so you
24:29know with today's available energy
24:31levels energy densities that we can get
24:32from batteries with the the projected
24:34efficiency gains that we're going to
24:36have as the systems develop
24:38um you can actually take that technology
24:39that that's very clearly in front of us
24:41in the next two three four years and
24:44design it right into your product uh
24:46it's it's a great fit
24:48yeah Greg will you provide charging
24:50Solutions with the planes I would
24:52imagine your business model is to sell
24:54equipment to operators is that right
24:56yeah you know what thanks for that
24:57there's three parts of our business
24:59model the first is selling aircraft it
25:01was again very traditional for an
25:02aircraft manufacturer
25:04um the second is the aftermarket support
25:06so yeah supporting those airplanes Parts
25:10um again very very typical and the third
25:12is actually the charging solution and
25:15and there's there's different approaches
25:16to charging there's different ways that
25:18you can do it you can work with uh
25:20directly with the airports um certainly
25:22the the people who are buying planes
25:23from us right now or potentially leasing
25:25charging applications from us
25:28um and we've we're looking at charging
25:29in I'll call it two different ways the
25:32first is you know a fixed charging
25:34location where you you tap it directly
25:36into the uh the Grid at the airport that
25:39you're going to be servicing your
25:41aircraft from that works very well for
25:44um maybe an operator that has their own
25:46terminal where you can reliably perk
25:49um but we're also looking at mobile
25:50charging the idea of having a truck
25:53that's specifically designed for
25:54charging Alice our aircraft that has a
25:56battery Bank on it uh so you can you
25:58know again quickly charge like like we
26:01call it an e-browser a fuel Bowser but
26:03maybe a school bus you know what I so I
26:07will say the thought crossword moment
26:08yeah I I I'll tell you we're in the
26:10middle of the same Tech r d and that
26:12stuff is hard it's gonna happen and
26:15we're all gonna get there but uh we're
26:17gonna power a concert I won't say who
26:20but a big concert you would have grown
26:21up with them part of the concession the
26:24concession which is this big part of it
26:26we're going to be powering it with
26:27school buses in the fall and so I'll
26:29send you guys tickets you'll have to
26:30come nice thank you yeah great I mean on
26:33that note I'd love to hear from all
26:34three of you and and Greg you've already
26:36touched on it for Eva
26:40Vehicles let's just use Tesla as an
26:43example they think okay most of the
26:44revenue comes from the sale of the
26:46vehicle to the consumer but also Tesla
26:49makes a bunch of money through the
26:50software right that it sells to those
26:52consumers as well and what the three of
26:54you have pointed towards is that there
26:56are other business models here right so
26:58it could be the energy moving back into
27:00the grid but I'd love to hear how each
27:02of you are thinking about the different
27:05business models that kind of ladder up
27:07to again a multimodal system for your
27:11company and also where maybe if you're
27:13willing to share you see the biggest
27:15opportunity like where do you do you see
27:17the largest revenue opportunity for your
27:20given space the way we think about it is
27:24we are delivering better boats that's
27:26our goal and everything that we are
27:29doing at the design and Manufacturing
27:31side is optimized around how do we
27:33deliver a better product to customers
27:36one of the biggest pain points of boat
27:38ownership is the reliability in the
27:40maintenance burden so we are at the
27:43design stage and again through the
27:44manufacturing process
27:47designing out a lot of these maintenance
27:49burdens an example is we have a closed
27:51loop cooling system on the arc one it
27:53basically uses the the hole itself as a
27:56heat sink to dissipate heat from the
27:59powertrain and that means we're not
28:01ingesting raw water and clogging up
28:04filters or having pumps break software
28:07is also a way to make that experience
28:09better you know Garmin cells
28:13off the shelf sort of navigation maps
28:15and that's a billion plus Dollar
28:17business for them we want to offer that
28:20for free to customers as
28:26um incentivize adoption of the boats
28:28that we're selling which is still our
28:30Core Business when we talk about
28:32providing backup power to your house
28:36there is a multi-billion Dollar business
28:38for backup generators for people's house
28:40that we want to go tackle by
28:43giving you a boat that you can use to
28:48all of these are still in support of our
28:51core product which is
28:53selling better votes to people at uh you
28:58put on earmuffs at very good margins
29:02that's kind of the core business that we
29:05we think about a lot of the Investments
29:07we're making go back into driving sales
29:10around that Core Business I mean I think
29:13I would generally Echo some of those
29:15themes I think the the market has
29:19historically operated in a way such that
29:21oems are really good at making a product
29:24of making a vehicle whether it's a plane
29:27or a boat or a truck whatever it is but
29:29they tend not to be in the fleet
29:31operations business they tend to sell it
29:33to an operator and that could be
29:36someone who buys a car who's just
29:39driving around town it could be uh some
29:42could be a waste hauling business it
29:43could be uh Delta right so there are end
29:47users that tend to be Fleet operators
29:49the business model opportunity that we
29:51see is to create more performance-based
29:54guarantees around these these new
29:56vehicle classes there's a ton of sort of
30:00perception out there that it's new tech
30:02and so it's not going to be reliable and
30:04there's also a perception that what is
30:07this fuel cost it's electricity I don't
30:09really understand it my utility bill is
30:12very complicated it's got all these line
30:14items that we don't really understand
30:15but so you know Corda our business model
30:18which we're confident has accelerated
30:20adoption in our category and driven the
30:23Highland Business is this concept of
30:26making it very simple and Performance
30:28Based so we will often get paid by the
30:30mile we might get chart we might charge
30:32a customer three dollars and fifty cents
30:34per mile and they get all the equipment
30:36they get all the services if the
30:39charging station breaks and the chart
30:41the bus isn't charged we just don't get
30:43paid so there's very much an alignment
30:45of incentives and then I think by by
30:48making it Performance Based
30:51we tend to own the assets and we can
30:54then bring on Downstream services to
30:58increase utilization you know Elon Musk
31:01wrote a great article recently about how
31:04he views autonomous electric vehicles as
31:08capable of taking utilization from
31:11single digits up to 50 60 70 percent
31:14because all of a sudden you have
31:15autonomous vehicles performing tasks and
31:19you know that utilization changes
31:21dramatically so we need fewer Vehicles
31:23where we get more done with the vehicles
31:25that we have I I believe that's a big
31:28opportunity you know if you look at
31:30garbage trucks school buses parks and
31:33rec Vehicles any vehicle out there that
31:37that is not long-haul Trucking
31:40and you have this Dynamic where you can
31:43start to piece together other ways to
31:45make money or make that asset useful
31:48and if you can deliver it as a service
31:50and make it easy for the customer I
31:52think that's I think that's where the
31:53Market's going that's really exciting
31:57maybe tack under the exact opposite end
32:00I think there is an opportunity for
32:02people in the infrastructure development
32:04business to actually go and start
32:05selling solutions to bringing the right
32:08electrical services and layouts and it's
32:10it's well almost like an urban planning
32:12exercise but to actually you know get
32:15the power lines get get the get the
32:17infrastructure set up for whether it's
32:19the airport the marina or or the
32:22schoolyard or wherever you're going to
32:23do your charging that's something that I
32:25think we all share and right now I I
32:27know that people come to me to ask you
32:30know where should I put my charging
32:31station at my airport how much capacity
32:34should it have and and so the fact that
32:36people are coming to me is the aircraft
32:38manufacturer means that there's probably
32:40no place else for them to go to get that
32:41information right now I think there's an
32:43opportunity for somebody listening to
32:45this who's looking to to start a
32:46business to actually become an expert in
32:48doing that you know Focus their
32:50attention on it and start delivering
32:53on the note of opportunity it feels like
32:55there are still some challenges in the
32:58industry that could be related to
32:59regulation it could be related to the
33:01grid infrastructure that exists and
33:03needs to be upgraded it could be the
33:05Battery Technology Mitch something you
33:08mentioned is potential fear around range
33:10anxiety depending on you know the
33:12product and it's needed range or at
33:16what consumers think they need in terms
33:18of range and so I'll just open it up to
33:20the group what gaps are there for people
33:23to tackle and what would you love to see
33:25people tackle Greg I love that you've
33:27already mentioned one very clear
33:28opportunity but it feels like it's still
33:30kind of open range in a way where
33:32there's there's a lot of work to do in
33:35the next few years and I'd love to hear
33:36where the three of you are seeing the
33:39biggest opportunities perhaps so in
33:41terms of aircraft in the United States
33:43there are 5 000 airports about 3 600 of
33:47them you can have paved runways nav AIDS
33:49you can you can fly a small commuter
33:51aircraft like Alice from those runways
33:54as a commercial operation but we don't
33:57use 3 000 something airports that we we
34:00use a couple hundred airports with
34:01regular scheduled service and and that's
34:04actually something that's changed over
34:05the past 40 years we used to be able to
34:08fly point to point much more often than
34:09we can but the market after deregulation
34:12the market it went away but even so if
34:16you look at the breakdown of of the
34:18world's air travel and it's very similar
34:20whether you're in North America or
34:21Europe half of all flights in the world
34:27and a full 30 or 250 miles or less watch
34:32planes fly by there's a 30 chance that
34:35the plane that you're looking at is
34:36flying a flight of less than 250 unlock
34:38miles and the proposition I think Mitch
34:40was mentioning or this so I think we're
34:42on the same page on this one it's a very
34:44different thing yeah we're A to B not
34:48um but if you go back to the whole
34:50culture around the automobile when you
34:52get in your car you want to be able to
34:54get in your car and go wherever you want
34:56to go you know without without any
34:58concerns is you go it's your open road
35:00it's Freedom you know it's it's a it's a
35:01great sensation with an airplane you
35:04want to take off from the airport you
35:06wanted to take off from fly for exactly
35:08how long you wanted to fly and then land
35:10at the airport that you wanted to land
35:12at exactly when you wanted to get there
35:13right so it's a very different Prospect
35:16and so there's a is a wonderful marriage
35:18here between what the technology is
35:20available today in terms of what we can
35:22achieve with range and payload
35:25um for an aircraft uh in the way that
35:27people actually want to fly so you know
35:30our plane today represents you know
35:33potentially 30 of the total market for
35:35aircraft if you if you if you look at it
35:37and and that's pretty outstanding it's
35:40such a great point that there's this
35:43you know marriage between the technology
35:45and how people are using this and I
35:47hadn't really thought about
35:49the culture around how you approach
35:52plane flights but that's so true I mean
35:54you you before the trip ever starts know
35:58exactly where you're going exactly the
35:59distance that you're going and so you
36:00could plan accordingly if you get out on
36:04it's stuck in the 1980s
36:07your fuel gauge goes like this
36:10they're super unreliable your
36:11speedometers don't work
36:13uh there's no odometer on on boats the
36:17state of the art in most cases is
36:19unscrewing the fuel tank and looking in
36:22and guesstimating how many gallons of
36:24gas you have left and then using
36:27intuition to think how far can I go on
36:32and so it is common to run out of gas on
36:36a gas boat that I I have done it
36:37personally at least a dozen times in my
36:39life and when you think about
36:41what you get with an electric boat
36:44suddenly you have down to the you know
36:47percent level Precision on how much
36:50capacity you have left on that and you
36:52have intelligent software that can tell
36:54you this is how far you can go with that
36:56amount of battery capacity and oh by the
36:59way something that's unique to boats is
37:01if you're out in the middle of Lake
37:03Tahoe and you have five percent battery
37:05you can reach any other point on that
37:07Lake as long as you're going five miles
37:09an hour it's not a question of if you
37:11get back it's a question of how long it
37:14takes and that is something that's
37:17so novel and such a huge improvement
37:21from a customer perspective over where
37:23things are at with the gas industry
37:26so I guess going back to the
37:30I think about it in three tiers there's
37:33plenty of these product opportunities
37:36we happen to be tackling the Marine
37:39and and delivering much better boats to
37:42people that happen to be Electric
37:44you could look across all these
37:46industries and and find those
37:47opportunities where the technology that
37:50exists today the the electric
37:53you know powertrain delivers a better
37:55and more compelling experience to people
37:57and I think you know the three of us are
37:59all doing that there's also supply chain
38:02opportunities it's we want our battery
38:05prices to be lower we want our high
38:08voltage electrical you know powertrain
38:11components to cost us less that helps us
38:14a lot I think there's a tremendous
38:16number of opportunities at that
38:18kind of Base supply chain level and then
38:21there's this third category of
38:24what I call second order opportunities
38:26you're going to have an electric future
38:28what does that imagine what that looks
38:30like well you're going to be Towing
38:31around a bunch of electric boats in
38:33electric trucks or you're going to be
38:36Towing around an RV in an electric truck
38:37and what does that mean in terms of
38:40the new charging infrastructure you need
38:42to go support that or the new technology
38:45you need to go make that happen maybe
38:46it's powered trailers that can actually
38:49help you know help the vehicle or
38:52there's there's just a ton of
38:53opportunities and if you start
38:55if you cast your mind forward a few
38:58years and think about what are the new
39:00problems that are going to exist when
39:02all these kind of like
39:04the Marine industry is going electric
39:06and the aviation industry is going
39:07electric and the bus industry is going
39:10yeah and I think interoperability and
39:14standards industry standards is a
39:16challenge today and we've left it
39:18largely to sort of Standards making
39:22you know traditional industry
39:24associations to drive standards and in
39:27my opinion it's been too slow we've done
39:30Integrations with uh
39:3315 to 20 utility companies in the last
39:3612 months and every single one of them
39:38has been discrete and different
39:40it's and it you just have to put the
39:43right team on it to know how to navigate
39:45the system and get through to the other
39:47end but putting better standards in
39:49place would allow for what Mitch is
39:52describing your boat is charging your
39:55house when the power grid is down or for
39:58four hours every afternoon when the grid
40:01is strained and demand charges are
40:04or your your trailer is charging your
40:09vehicle because it's got extra power
40:10that's all interoperability that needs
40:12standards I would flag one other
40:14challenge Mitch mentioned it but it is
40:17our one of our greatest pain points
40:19which is Supply chains it's not just
40:21about getting the sell cost down so we
40:25can deliver cheaper product it's being
40:27able to deliver product full stop you
40:30know the last couple years have been
40:32really tough on Supply Chains It's led
40:34to Soaring costs but also just uh you
40:39know poor reliability you know we're
40:41buying we're one of the largest buyers
40:43of medium and heavy duty you know truck
40:46Platforms in an electric format right
40:48now so we're talking hundreds of
40:50millions of dollars per year of
40:52equipment purchases we're not billions
40:55yet but we will be quite soon and even
40:59as a large buyer it's tough to get
41:02product and so you've got you've got
41:05manufacturing sites that have thousands
41:08of completed vehicles and they are all
41:10short an air compressor or they're all
41:13missing so they can't complete these
41:15vehicles and deliver them to customers
41:17and so yeah we if we can solve you know
41:21we are buying switch gear 18 months in
41:24advance for projects we don't even have
41:25in our contract yet because if we don't
41:28have switch gear we're not we're not
41:30getting the infrastructure completed and
41:31we can't get up and running we don't get
41:33paid and so we're we're doing all these
41:36things that we that we're solving
41:38problems that we shouldn't have to solve
41:39is my in my opinion and so I think for
41:43some entrepreneurs there could be big
41:45opportunities in streamlining Supply
41:48chains and creating better standards
41:51I I heard a very creative description of
41:53the supply base over the past couple of
41:55years and it was called the surprise
41:59that's all you need to say perfectly
42:01okay here's the here's a you know timing
42:04timing for what we're doing you look at
42:06the outlook on the Aerospace industry
42:08right now in particular aircraft
42:11the a lot of the major aircraft
42:14manufacturers have already launched
42:16their their next program so they're
42:17they're into entry into service they're
42:19delivering them and if you take a look
42:22around at the in large incumbent
42:24aircraft manufacturers there's no new
42:28programs on the uh on the docket right
42:31now and the the for tier one Supply base
42:34and even the tier two tier three Supply
42:36base they're all they're all hyper aware
42:38of of what they're going to be working
42:39on and it gives us an opportunity to
42:42show hey we've got an aircraft we've got
42:44a market you know we've got good orders
42:45the utility of the product is there and
42:48you know I think what's going to happen
42:50is that the new technologies that we're
42:51bringing and our new products are
42:54actually going to Garner the attention
42:55of the forward-looking supply chain so I
42:57think we're gonna we're gonna
42:58disproportionately benefit us in the
43:01aviation industry but I think the same
43:02is probably broadly applicable uh the
43:05new technologies the new companies are
43:07actually going to benefit from obtaining
43:08the focus of the established uh tier one
43:10tier two Supply base so I don't want to
43:13say the problems are behind us yet but I
43:15I think the Outlook is is actually quite
43:16quite Sunny sunshiny I'm I'm curious how
43:19you two think about this I know for us
43:23there are incredible advantages for
43:25bringing the battery pack in-house and
43:27that's why we vertically integrated our
43:29battery pack like we it is structurally
43:30integrated with the boat hole in the
43:34same way that you know electric cars
43:37become that compelling until you built
43:40car around the powertrain Up Under One
43:44I think the opportunity that I see at
43:47least is on some of the other Atomic
43:49components that go into a high voltage
43:52electrical system an example might be a
43:55DC DC converter that when we started Arc
43:58there was one on the market and we did
44:00not have much Choice there are now 30 of
44:03those and that's exciting because
44:05you can use those across applications
44:08more so than you can just drag and drop
44:11an entire battery pack
44:12and so when I when I think about Supply
44:15Chains It's actually at some of those
44:16more tonic components or you know
44:19connectors are a big one for us that are
44:22just historically been a nightmare
44:26those are examples of things that work
44:27across application and are not
44:30necessarily so tailored to your
44:32application so I wouldn't necessarily
44:34encourage people to go after
44:37say building an entire battery pack and
44:39trying to make that battery pack work
44:40for both boats and airplanes because
44:44that's going to be really hard we have
44:46objectives out of out of what we want
44:48from those battery packs but you might
44:50be able to find components that factor
44:53I agree you want you want ballast right
44:56you want the Keel and the ballast to be
44:58replaced by battery packs I'm guessing
45:00yes yeah there's uh we actually don't
45:02mind weight on a boat um it allows you
45:04to throw a bigger wake and makes the
45:06boat more stable so we're not as weight
45:08constrained as some other people
45:10certainly for us you know that's a prime
45:12example of the difference in in some of
45:14the design criteria that we've got in
45:16the aircraft side versus the the marine
45:19and land-based applications but what
45:21we've seen uh in terms of Technology
45:23evolution is you know talking to people
45:25dc-dc converters is by the way the
45:27perfect example for a shareable
45:30component that has an important role to
45:32play but I'd like to take it one step
45:34further which is why do we need the DC
45:36to DC converter why don't we just get
45:38the subsystems made to operate at same
45:41800 volts system level is the rest of
45:43the the equipment right and so we're
45:45seeing high voltage applications of you
45:48know traditionally lower voltage
45:49electric components coming up we've got
45:51environmental control systems that
45:52operate at 800 volts now looking at
45:55other other actuation and so on that
45:57operate at high voltage reduce your wire
45:59sizes I mean that's what we're pushing
46:01yeah great point I would love to see
46:05some of these low voltage components
46:07actually come up and support
46:09high voltage ranges that would be
46:12maybe as a follow-up question there
46:15Mitchy mentioned whether or not you
46:18design your own battery packs how do you
46:20think about given that every single one
46:22of these planes both school buses have
46:24many components how do you think about
46:26what is inherent to your business and
46:29that you build on your own versus buying
46:31or borrowing and then I guess tacking on
46:34to that what I really am trying to get
46:35to is this idea of what moats might
46:39arise in these industries right like I
46:42imagine let me know if you guys disagree
46:44but like let's say 10 20 years from now
46:46we're going to be seeing a lot of
46:47electric boats a lot of electric school
46:49buses a lot of electric planes and so
46:52where does the differentiation come from
46:53you know we're just over two years old
46:56and we're delivering the most advanced
46:58electric boat in the world to paying
47:02the way that we've been able to do that
47:05a lot of the research and development
47:07that has gone into the automotive
47:09industry over the past decade
47:11intelligently and and apply it and adapt
47:16it to the unique challenges in the
47:18Marine industry we're very careful to
47:21integrate the things that become the
47:24platform for all future boats we develop
47:26and try to not integrate the things that
47:31do not give us a unique advantage over
47:33time or that are more marginal
47:37so the battery packs are core to that
47:39mode and that's hard it is hard to build
47:42your own battery packs when we talk
47:44about mode we have an incredibly
47:46talented team we have top talent from
47:49SpaceX and Tesla and rivian and other EV
47:51companies and Marine companies
47:54and it still took us two years of
47:56working you know around the clock to
48:00integrate those battery packs and get
48:01them production ready for customers
48:04I just was wondering do you aspire to be
48:09you know voting applications or is the
48:12business does all that IP you're
48:14describing which sounds very cool
48:16doesn't it all apply when you get into
48:21ferries that may have predictable routes
48:23maybe not long-haul shipping but I don't
48:25know our aspirations are that everything
48:27on the water eventually becomes electric
48:29and the Playbook that we're taking is to
48:33start on the recreational side what
48:35we're doing is building a strong brand
48:36we're building a technological note we
48:40are building an extremely talented
48:45and along the way we're driving down our
48:47cost of capital because boats are a very
48:49good business and the more boats we
48:52produce the more working capital that we
48:53have and that is those are the
48:55ingredients that ultimately set you up
48:57to more efficiently go after larger
49:00which I'm not necessarily ready to talk
49:02about that part we have our hands full
49:05on the recreational side but certainly
49:06there are aspirations to go there I
49:12you know we found the sweet spot for
49:15making an electric plane
49:17um what you know the size of the
49:18aircraft it's a it's a not a nine
49:20passenger aircraft it's nine passengers
49:23on purpose because in in the United
49:24States you can actually fly nine paying
49:26passengers with a single pilot uh we
49:29have two pilot seats so you can also use
49:31that other pilot seat to train a new
49:32pilot which will help address the
49:34overall pilot shortage that we've got um
49:37and and we didn't do that in isolation
49:39we we've come up with this approach
49:42based on on interacting with real
49:44customers and figuring out what they
49:45need and what the market needs the other
49:47thing is we're building you know it's an
49:48electric airplane but it's just an
49:50airplane so it's a part 23 commuter
49:52category aircraft that means that we're
49:54building it to be certified under the
49:55existing standards um the pilots who fly
49:58it will be able to fly it with their
49:59existing Pilots licenses they get
50:00trained the same way as they would for
50:02any other aircraft that size likewise
50:04that the mechanics and people who
50:06operate the aircraft on the ground and
50:07maintain it it's the same system that
50:09we've got today flies from existing
50:11airports using the existing airspace
50:13right so we've got this this this this
50:15product that's being fit so that we
50:17don't have to go and change
50:19the way that aircraft are certified it's
50:21the other way around what we're able to
50:22do is say look we've developed an
50:25electric airplane that meets all of
50:26these standards right so our plane meets
50:29the same standards as any other airplane
50:30in its category and to the point of mass
50:33adoption 100 I firmly believe in the
50:37next 10 to 15 years we will all be
50:40flying regularly on electric airplanes I
50:42have I have aspirations to get my
50:44pilot's license and one of the things
50:46that clicked for me is the biggest risk
50:49to being a pilot and flying you know a
50:51Cessna is reliability of those vehicles
50:53and the number of checkdowns that you
50:56have to do on an aircraft before it gets
51:00in my mind it makes a ton of sense like
51:03electric aircraft make a ton of sense
51:05because you get that extra reliability
51:07you know almost for free that you you're
51:10no longer worried about
51:12the whole class of problems you worry
51:14about with uh mechanical engine failure
51:16on an aircraft so I am personally
51:18excited for that future I want to I want
51:20to fly an electric plane I aspire to
51:23visit Greg and have him take me for a
51:25flight in his plane me too yeah you guys
51:28can all rotate you can get impact yes
51:34I can ski a little bit awesome great
51:38yeah you know Steph your question on
51:40differentiation you know these guys
51:42obviously have you know products that
51:45have had a ton of Ip investment that
51:47that's truly you know technical IP
51:50behind the product we we're a really
51:52different business you know we buy a
51:54finished product for the most part from
51:57leading oems and the business model that
52:01you know that we're that we're running
52:02is really bundling and packaging of
52:05services and financing and if you look
52:08at the big solar operators companies
52:12like makes Sun Run and uh you know other
52:15utility scale businesses they drove they
52:19drove commercial adoption and that's
52:21because they very elegantly bundled and
52:23packaged a whole bunch of services with
52:25capital and they made it uh very easy
52:28for customers to adopt and so we we're
52:31we're very much in that business
52:33it's lots of little things from training
52:37mechanics to training drivers to
52:40building a technology backbone that's
52:43scalable so that we can actually operate
52:45these fleets relatively efficiently but
52:48I think what one of the things that
52:51we've identified as a core
52:53differentiator for us right now is
52:57we're the largest provider in this space
52:59we have more contracts and bigger
53:02contracts than anyone else and uh when
53:05when you when you look at scale
53:07especially in the early days of the
53:08market evolving we have better access to
53:11Capital cheaper Capital we have more
53:14miles under our belt to prove to that
53:16Capital that you know we're a reliable
53:19operator you know we can buy product at
53:22scale and get better terms in buying
53:24everything from charging stations to
53:26switch gear to Construction Services and
53:29then because it's local we have
53:32operators on the ground that are you
53:35know responsible for actually delivering
53:36some of those Services some of them are
53:38really technology driven but some of
53:40them are people on the ground who
53:42actually have to turn some wrenches and
53:44we have scale in places like Maryland
53:47Michigan New England where it's much
53:51cheaper for us to operate and add that
53:53next customer than it is for our
53:55competitors and so I think those are
53:57some of the moats we're building but
53:59very much believe that it's it's a more
54:04challenging bundle of services than
54:07operating a solar farm and uh and that
54:11there that's going to be that's going to
54:13continue to be difficult for others to
54:15uh you know to replicate
54:17absolutely my my synopsis or summary of
54:20Duncan's point there is
54:22ideas are cheap the hard part is
54:26I'm sure there are a million people in
54:28the U.S that have thought somebody
54:30should make a Tesla for boats the hard
54:32part is how do you go
54:34build a product that can actually
54:36deliver that Vision how do you go
54:38package enough battery on a boat to make
54:40it compelling in such a power hungry
54:42Market totally how do you do that
54:46spending incredible amounts of money on
54:48capex or r d that's the hard part and
54:52and I think that speaks to the moat here
54:55it is hard to go do this
54:57that's amazing I couldn't have said it
55:00better I completely agree with that but
55:02I also just want to pick up on one point
55:03that Duncan just made which is very very
55:06important it's the order book
55:09right either having a real order book
55:11where you've gone and sat down with the
55:13customer and they've they've said yes we
55:15want your product you know we we
55:18Aviation recently passed by the 3.5
55:20billion dollar pre-order Mark right for
55:22the aircraft more than 400 airplanes on
55:25on Loi that we have with our customers
55:27now and they're real customers these
55:30customers that are signed on early are
55:32committed to working with us on the
55:34program they're giving us feedback
55:35they're giving us information about how
55:37they're going to actually operate the
55:38planes and then they're there to to work
55:40with us to be our our launch Partners
55:43when we actually put those planes into
55:44service with them in the next few years
55:46so it's I just want to emphasize that
55:48that order book says so much about it's
55:51you know what your what Your Market is
55:52saying and then you know recently we
55:54just announced a deal with the leasing
55:57and it right and because the leasing
55:59company doesn't just spend on on
56:01aircraft on on our aircraft the leasing
56:04companies betting on the market
56:06and so it's giving it's telling you that
56:07there is a market for your entire
56:09product line when somebody bought a
56:10leasing company buys it it's it's very
56:12very important to look at that mix I
56:14should share that we chose the three of
56:16you tribute to this conversation is
56:18because we did do our research and check
56:20that all three of you have orders booked
56:23that was really important in terms of
56:26like you're actually on the ground you
56:27have relationships and to all of your
56:30points it shows that this is not just an
56:32ideal where we want to Electrify and
56:35eventually people will buy into this the
56:37market is actually participating in this
56:41they're saying okay you know the cost
56:42combined with the other benefits that
56:45we're seeing in this industry now are
56:47actually better to the point that we're
56:50you know we're ready to put our wallet
56:52down and so that was really important in
56:54terms of us determining you know again
56:56there are many participants in all three
56:58of these spaces and so that was
57:01essential for us but I also want to just
57:03quickly note that all three of you spoke
57:06to so many different opportunities
57:08remotes like there was technical modes
57:10there was operational modes there's even
57:12potentially like regulatory modes and so
57:14I think it's it's fascinating to imagine
57:17how this develops right because there's
57:18not just one single moat each one of you
57:20are figuring out where your business
57:22tied with your customer base whether
57:25it's B2B or b2c like what they're really
57:29that's amazing I think one great place
57:31where we can end this conversation is
57:33we've already kind of spoken to this
57:35idea that this is where these industries
57:38are moving in five years 10 years 20
57:41years we we do expect these set of
57:44Industries to change and to be
57:45electrified and so I'd love to hear the
57:48three of you just comment on what that
57:50really means like contextualize the
57:51impact of let's just say like maybe not
57:54all aircraft but like most aircraft
57:56being electric most boats being electric
57:58I know this will take time but I'd love
58:00to for the audience to just understand
58:01maybe the second third order effects or
58:04the implications of that shift once it's
58:07fully manifested I think something that
58:10some people don't necessarily think
58:12about is the next generation of boaters
58:15will not be allowed to use gas boats on
58:19our lakes and rivers they are very
58:21unpopular because they're huge polluters
58:25you know semi trucks out on the water
58:27except a lot of them don't even have
58:28catalytic converters on them and so you
58:33fuel slicks behind boats as they take
58:35off and all the noxious fumes around
58:37there CO2 poisoning warnings on the back
58:40of these boats fast forward several
58:44you're looking at marinas that are quiet
58:46uh that have clean water around them
58:50because these boats are not
58:52polluting into them we'll take an arc
58:55one out into a Marina and we'll pass a
58:56sailboat and the sailboat will be louder
58:58than our boat so just this ability to
59:01suddenly appreciate and enjoy water so
59:04much more than you're able to today with
59:07kind of this drum of engine noise kind
59:10of drowning everything out is
59:12it's an exciting Vision that we're
59:16when you look at urban areas around the
59:20has uh you go to their website and look
59:23up who's in attainment of air quality
59:26that's fit for being healthy for human
59:28life is effectively the way they
59:29describe it and most of our major cities
59:31do not meet the threshold and it's
59:37tailpipes from vehicle traffic you know
59:41we've essentially moved all of our power
59:42plants further outside of urban areas we
59:45don't run coal plants in cities anymore
59:47and so bad air quality is a function of
59:52and cancer rates rates of pediatric
59:55asthma are high in cities where
59:59tailpipes uh and vehicle traffic is high
01:00:02and areas where the airflow does not
01:00:06wash those fumes out quickly and easily
01:00:09enough and so there are places in
01:00:12California where we're you know engaged
01:00:14with Municipal leaders where pediatric
01:00:16asthma is over 30 percent and so our
01:00:22tackling air quality at the local level
01:00:25tackling climate change at the same time
01:00:29creating a very clean quiet Urban future
01:00:33and you know Mitch said quiet we would
01:00:36we would say the same thing our bus
01:00:38Depots are silent and the buses operate
01:00:41almost entirely silently trash pickup
01:00:46Could Happen earlier in the morning
01:00:47because you don't have the loud rumbling
01:00:50noises of a diesel engine and the grid
01:00:53is not utilized to the tune of 36 or 38
01:00:57percent it's utilized to 55 60 65 70
01:01:01percent and so it we can we can
01:01:05integrate more renewable energy not less
01:01:09we can reduce demand charges and just
01:01:13charges to rate payers
01:01:15and create an ecosystem where
01:01:20uh transportation of all forms whether
01:01:23it's flight marine or road is really
01:01:28integrated into an energy ecosystem
01:01:30that's more efficient cheaper and better
01:01:32in the near future you're going to be
01:01:34able to take a 10-minute trip to your
01:01:36nearest airport get on an airplane and
01:01:39fly for an hour to do a day trip that
01:01:41previously would have been an overnight
01:01:43trip or a trip to an airport half an
01:01:45hour 45 minutes away and through going
01:01:47through security you're going to be able
01:01:49to conveniently move from point to point
01:01:51to go do the the trips that you want to
01:01:53do there'll be more time effective it'll
01:01:56be good for the economy in terms of
01:01:58enabling more trade but also in a social
01:02:00perspective you know just being able to
01:02:02go and see people that you want to be
01:02:03able to see we thrive in connectivity
01:02:06this type of connectivity will
01:02:08disproportionately benefit small rural
01:02:10communities communities that previously
01:02:12have not had the benefit of of having
01:02:14air travel which is a real economic
01:02:16motivator these flights will be much
01:02:19more cost effective than the flights we
01:02:21have today because they eliminate
01:02:24aviation fuel and replace it with a much
01:02:26cheaper electrically derived energy from
01:02:29the from the grid as with those other
01:02:31forms of transportation electric
01:02:32Aviation is very quiet which means that
01:02:35not only will you be able to increase
01:02:37the frequency of of flights or even add
01:02:40previous flights that just haven't
01:02:41existed in decades you'll be able to do
01:02:44it not worrying about polluting the
01:02:45environment but also not worrying about
01:02:47irritating your neighbors because the
01:02:48flights will be so quiet that nobody
01:02:51will complain in fact you will want to
01:02:53have that airplane next to you so that
01:02:55you can take advantage of it it's going
01:02:57to change the way that we fly and you
01:03:00know it's really this is this is the
01:03:02future I'm just picturing this like
01:03:04summer day in my head where you wake up
01:03:06you go to your nearby airport you fly to
01:03:09your friend who lives near a lake you go
01:03:11out on an electric boat after that you
01:03:14go to a concert powered by a an electric
01:03:16school bus and I'm just you know this is
01:03:19obviously an extreme
01:03:20the perfect scenario but um you know
01:03:22what it's the perfect day that is
01:03:24hopefully enabled by technology in the
01:03:27coming years so yeah yeah we're counting
01:03:30on you guys let's make it happen
01:03:32um I think that's a great place to end
01:03:34off thank you so much for sharing
01:03:36um the amazing things that all three of
01:03:37you are building in your respective
01:03:39spaces and I think it was fascinating to
01:03:41just see the overlap and also some of
01:03:43the differences that are unique to your
01:03:45industries thank you for the excellent
01:03:48questions it was a really inspiring and
01:03:51thought-provoking and Duncan and Mitch
01:03:53that was that was really enjoyable thank
01:03:54you both yeah yeah I would Echo Steph
01:03:57thanks for getting us together and Mitch
01:03:59you know Greg love to love to stay in
01:04:01touch with you guys love what you're
01:04:02doing it'd be a pleasure thank you for
01:04:04having us and it's an awesome and
01:04:07inspiring conversation I look forward to
01:04:08experiencing both of your products
01:04:13thanks for listening to the a16z podcast
01:04:18ER on YouTube to get to get our school
01:04:19suit video content I'll see you next
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