Obviously, the U.S. government is a client of ours, but if the Pentagon uses it, what will they use it for? Well, generally, our clients today use it for intelligence, that is, to know what is happening in a place where they are denied access. To provide data to all the non-governmental organizations that were trying to evacuate people from Afghanistan. And I can tell you firmly that there are hundreds of families who are alive because we were able to give them that data. What was announced at the time was an investment of up to 25 billion dollars. We were talking about a data center. This data center is in the Patagonia of Mian Ridel, who was an advisor to M, he approached Matt and said, 'Well, give me a hand to understand how we can position Argentina with Silicon Valley. Humanity has no choice but to go into space.' So.
Welcome to another edition of Sello Argento. Today we are going to talk with an Argentine businessman who dedicates himself to making nanosatellites to capture images of the Earth that are used in the field or even in defense, and at the same time he is a key man in the possible landing of Open AI with a data center in Argentina. His name is Emiliano Kargieman and I already greet him.
All that I tried to summarize, how do you explain it? If I ask you, what do you do?
If you ask me what I do, I'm going to say I'm a technology entrepreneur. Since I was little, I started my first company at 15 years old. I've always dedicated myself to technology and bringing it to the world in some way or another. Companies have been the best vehicle for me to do it at scale. So yes, technological entrepreneur with much honor.
What does it mean your first technology company at 15 years old? Well, at 15, let's see, I started programming computers when I was very young.
At 15, let's see, I started programming computers when I was very young. At 9 years old, I started to learn to program, and by 15 I started. Briefly, I worked for a person, for a woman who made custom systems for small businesses, and after a month and a half, two months, I realized it would be easier if I went directly to talk to the clients. So I set up my own company to make custom systems. It was the very early days of personal computers, where people or small businesses bought a personal computer and didn't know very well what to use it for. And then I built custom systems for, I don't know, for pharmacies, for financials, things like that. I was born before the 90s, around '89.
And where does your link with computers come from? What did your parents do? Were they in that field? How did you come to have that link where you say, 'No, at Nacional no, leave me time to program.'
My parents, both psychoanalysts, professionals, the truth is they didn't have a particular link with computing, but they were obviously very curious people and above all they let me explore the things I liked and gave me the support to explore what I liked. They bought me a computer when I was 9 years old, and a little bit opened up this world. I don't know exactly how I got to that. I think that somewhere you asked for a computer.
Somewhere you asked for a computer.
Yes, it was very early, you know? In the times of the first personal computers, I started with a Sinclair 2068, which was a very small computer. I think I saw it because I went to public school, and at school there were no computers, but I think I saw a computer at a science workshop I went to, Galileo Galilei, very nice, from Hilda Weiseman at that time, and I think there I saw the first computer and said, 'This is going this way.' I did something with Logo a little bit, saw the turtle move, and said, 'My life is going this way.'
And if at 15 you already had your first company or you were clear about what attracted you to do, you started studying, what did you study? How did your career continue?
Well, I always knew since I was little that I wanted to study mathematics, I mean, I always dedicated myself to programming since I was very young, but also in a sense I had this idea, I said, 'Well, computer science is a science that has 30, 40, 50 years. Mathematics is a science that has thousands of years. Better I study something where there are thousands of years of history to learn, where maybe, you know, what happened in the last 30 years I can learn alone.' So when it was time to study and go to college, I chose to study mathematics. I did a degree in mathematical sciences at the UVA. And yes, I liked pure mathematics, number theory, that type.
But did you know that your life would be tied to technology?
Yes, I never stopped building technology, since I was 15 I set up my first company. At 19, I set up with some friends my second company, a company called Core Security, a cybersecurity company, and I was very while I was in college, I was very involved in Core. Yes, I always managed both things. At some point, the companies started to take all my time and then the university career, as a mathematician, I'm a frustrated mathematician, let's say.
Ah, you had to leave the career.
Never. Yes, I never dedicated myself to mathematics. I finished taking courses, you know, but I never dedicated myself to mathematics. And well, it's a bit of a frustration, but at the same time I recognize that I didn't have the patience and mentality necessary for academic life. And perhaps I found in building technology in the world, and in contact with real problems, a much more interesting mechanism to contribute value, let's say.
All this in your life runs where, where are you from?
I'm not far from here. We're recording in French with Díaz. I went to elementary school here at Wenceslao Pose, which is in Juncal and Colón Díaz, two blocks from cafes.
And all this path you take, son of psychoanalysts in the Palermo area, with that curiosity that falls for computing, mathematics later, at what moment does it end? I don't know if I'm going to say it right, in let's be satellites, because it sounds like, not to say fanciful, but like a lot of audacity.
Yes, for me, well, several things, after doing Core this cybersecurity company, we did great, let's see, we set up the headquarters in Boston, we had a large group, people here, we managed to have 80% of the Fortune 500 as clients, we invented in a sense the category of what is called automated penetration testing or automated penetration tests, so Core did very well. What is that category? Well, it's basically we designed the first software product that allowed companies to break their own security to see where the problems were, instead of having to hire experts who came and charged by the hour and did a bit of magic and told you, 'Here are the problems.' With this software product, they could break, try to break their own security, see where the problems were and fix them. That category of software products, if you want cybersecurity products, we created with Core, not far from here, in the office we had here in Palermo too, and we did very well with that. When I left Core, the first thing I did was, together with Johnny, one of my partners, we set up a venture capital fund, Concau Ventures, with the idea of being able to invest in technology companies in the region, in very early stages to help them develop as global businesses. And we did that for a few years. For me, it was a nice experience, but also extremely frustrating because I always wanted to cross to the other side of the table, let's say. It's very different the mindset one has as an entrepreneur, if you believe, than the mindset one has to have as an investor. It's nice to learn that discipline, it's good, but at the same time, yes, it wasn't for me, especially at that moment, I was less than 30 or 30 years old and it wasn't for me. So after a while, I was quite frustrated, I said, 'No, I want to start a company again.' I wasn't thinking about satellites specifically, but I was thinking about what for me were some of the great problems of humanity. I said, well, I always had this idea that one has to try to maximize the value one creates in the world, let's say. And from my point of view, that has to do with trying to solve big problems for which one has a special perspective, let's say.
And here, what would be the problem that you saw?
And at that time I was thinking a lot about the interaction between the universe of problems, let's say, of food generation, energy generation, and the use of natural resources, water in particular. And in the intersection of that problem, how we made decisions, how humanity makes decisions to optimize each of these things. And I started to realize that we could build better decision models, but what we lacked were fresh data to feed those models. And I started to look around what was there, and I realized there was a big gap in data collection and that the difficult problem to solve was not how to process that data, how to transform data into a competitive advantage, a decision, but that the more difficult problem was how you did to consistently go and get data on everything happening on the planet. Now, I don't know, only it occurs to you as a response to that, let's put a satellite because what's missing is to see the planet from afar.
Is that something that occurred only to you here in Palermo or is something that many people have thought throughout the world and each is making their satellites cheaper?
Yes, you know, I started completely agnostic to the technological theme. I mean, I started, obviously I started thinking, first I put sensors on the earth, I distribute very cheap sensors, then I started thinking, well, if I go a little higher, I put them on vehicles that move, maybe it helps me. A little higher I said, 'Well, if I make drones for this.' I was thinking, 'We're talking about 2009, there were no drones yet, but I saw it coming.' I said, 'Well, what if we make drones?' And you see, each time I went a little higher, and as you went higher you said, 'Well, I have a better perspective, it costs me less to acquire data at scale the higher I go.' And so, naturally, I started thinking about satellites. I started saying, 'Well, if I go a little higher, I can do it with satellites.' When I started to look at what it cost to make a satellite, it was like I had a click because it was a moment when I said, 'You know, at that moment a satellite cost, I don't know, 500 million dollars.' Besides, one associates that satellites are made by countries or state-owned companies or companies for countries. That was happening, right? I looked and said, 'Well, a satellite costs 500 million dollars.' But at the same time, you know, it has the size of a van, let's say, and ultimately it's made of electronics, carbon fiber, a bit of aluminum, a couple of mirrors, you know, and I said, 'Well, if you give me a van and ask me to fill it with all these things, how is it going to give you 500 million? How do you make it give you 500 million? I mean, you can't, right? I mean, how do you have to make it from platinum? I don't know.' So, you know, that was the click. There I started to say, well, actually here the problem is not an inherent problem of building a satellite, it's a problem of the engineering methodology we are using, of the supply chains we are using, of how we plan the architecture, let's say, and how we plan the engineering of a satellite. And I started to realize that I could apply many things I had learned in the computer industry to find a way to make satellites hundreds or thousands of times cheaper than they were made at that moment.
Now, is that something that occurred only to you here in Palermo or is something that many people have thought throughout the world and each is making their satellites cheaper?
At that moment, I would say in 2009, 2010 when I started having these ideas, there were some indications that the world could go that way, but there was no company in what is called today newspace, no one had made a space company in a long time. In fact, the only one that was starting and had not yet been successful was SpaceX, which had not yet managed to successfully launch its first rocket, right? I mean, they were still doing the Falcon 1 and starting, and it was the only thing there. No one else had made a company in the space sector in, I don't know, decades.
Yes. How do you define satellite? What is a satellite?
A satellite is a piece of technology that we put at such a speed and at such a height that it takes many years to fall, let's say. It stays there orbiting for a long time.
If your company was able to design a satellite that is no longer the size of a van, it's the size of what?
And ours today are more or less the size of a chair, I don't know, a small refrigerator.
Do you have to at the same time in your company have the mechanisms to put it into orbit or is that contracted out to a third party who puts it into orbit?
We contracted them. I mean, the interesting thing is that we started in 2010, shortly after SpaceX started to launch. SpaceX has had a very interesting trajectory, but if you look at the launch price per kilo, historically, in the 50s, 60s it was around 50,000 per kilo. In the 90s up to 2010 more or less it should be around $10,000 per kilo in a more or less constant way. And with SpaceX today you're talking about around $7,000 per kilo. I mean, the price per kilo to put something into orbit, although it is dropping, is not dropping in such a disruptive way. Starship, which is SpaceX's new project, promises to eventually bring that price down to $600 per kilo commercially and eventually below $100 per kilo. It will still take a few years to see if it works. But so in the order of 10,000, 12,000 to 7,000 per kilo, which is where I started building Satellogic, more or less to close the business model, from my point of view it was saying, well, instead of making satellites for 500 million dollars each, I'm going to try to make satellites for $100,000 each, of a weight such that putting them in orbit costs me, I don't know, 100, 150, 200 thousand. And so in total for less than a million I can put a satellite in orbit that captures the type of data I want. If I can do that, then for 300 million, yes, which is less than the cost of a traditional satellite, I can put enough satellites to remap the entire surface of the Earth every day. And that was a bit of the vision. That's how we started in 2010.
Now, in that beginning, that model, beyond your goal of mapping the Earth every day, you think with that original goal you said. You sell a service to an investor in natural resources, in agriculture or energy, because they can see their field or fields and over that you charge a fee and they make better decisions. That's the beginning.
Yes, the business model is that today we have two products that we sell. On the one hand, we have already launched 55 satellites, we are operating today a constellation of 20. From those satellites we sell information, we sell images, but we also sell the analysis of what happens above those images, right? So, a client and for the most part today the clients we have there are defense and intelligence clients, let's say, governments for defense and intelligence purposes. In that market, what we sell is fundamentally monitoring of sites of interest. Yes. Now there is, I don't know, a conflict in the Middle East. There are a lot of people interested in seeing what happens in Iran. So, well, we have about 100 sites, 100 places in Iran that we are watching every day. We are taking images, processing those images, generating analytics and our clients buy us those analyses of what is happening in these places in the world. The same happens to us in, I don't know, in conflict zones, like between Ukraine and Russia. Obviously there is a lot of demand, but the same happens to us in places that are not in conflict, where maybe a client wants to see, I don't know, ports or they want to see airports or they want to see energy plants, or oil wells. So, we have clients that what they do is look at a portfolio of sites around the world and see what is happening.
And that is the core of your business today.
That is the core of my business today. Defense and intelligence for all that type of universe.
And that is in real time?
Well, yes, today we can see up to, I don't know, we can take images up to 15, up to 12 times per day of sites of interest, let's say. Now, after that, we just announced that for the first time this year, we announced this week, actually, that we are launching the first Merlin constellation that will allow us to remap the entire earth at one meter resolution every day and we are going to launch this product, we launched the first satellite in October, for the middle of next year we are going to have the complete constellation and that already allows us not only to point satellites at the points of interest of our client and will give them 100 sites per day, but that starts to allow us to look at the entire surface of the Earth every day. So, for anyone who wants information on what is happening, we can give them that data because we already have it in the archive. That opens up a much bigger world than defense and intelligence. And there we are in a position to start providing services to agriculture, the forestry industry, the oil industry, utilities, commodity traders, a lot of things that until today when you have to point satellites at targets it gets complicated because in a sense your clients are competing for your resources, right?
Now, the service you are giving of, I mean, you are already mapping the earth every day a number of times.
