Quick question. What's our latest timeline on getting to Mars?
Getting to Mars? Oh, I think we'll put people down within a decade.
Welcome Gwen Shotwell, the president and COO of SpaceX. She's an instrumental, a really crucial person to the success of SpaceX. She's really the glue, you know, she's the glue to the tornado.
Fail fast, learn fast, make your design robust. I would be disappointed if we didn't have a settlement on the moon.
The space and AI firm has officially made history on its $75 billion IPO, debuting with a market value of $1.7 trillion.
The most efficient place to put inferred its compute is on orbit. Manage risk, don't avoid it.
Please welcome Gwen Shotwell.
Hey. Thank you so much for coming.
Where do you right here next couch?
Welcome.
Well, um, we really appreciate you coming out. How's it going at SpaceX?
You know, we're bored. There's nothing going on. Not a lot happening. I've got all the time in the world. And by the way, Elon has more time, by the way.
Yeah. I mean, you've been at SpaceX forever. Are you the longest tenur employee after Elon?
After Elon. Yeah. In fact, my 24th anniversary was the 9th of September, last week. Sometime.
That is extraordinary. Bruno, can you take us back to the day where you initially get this call and you're like, hey, uh there's this thing like what is the the arc of the decision look like and how did you get convinced to underwrite this business? Like just walk us through that.
Okay. Well, Elon underwrote it, right? I just worked there. Yeah. But the the story is uh a little crazy, actually. So, I was going out to lunch. One of my best friends who I was working with was going to go work for Elon, and I took him out to lunch, kind of going away lunch, and he's like, "Oh." When I dropped him back off, he said, "Oh, come on in and meet Elon." Like, ah, he's busy, you know. We don't need to do that. But we did it anyhow. and I met him and um I said, "Hey, I think you really need I think you need a full-time person to run your business development shop. You know, you've got kind of a part-timer. He's a contractor. It you know, it's not a great look." And and he looked at me very thoughtfully and, you know, kind of scratched his head and then we said goodbye, chatted a little bit, said goodbye. And then I got back to my office and I got a call from Elon's assistant, Mary Beth, and she said, "Elon wants you to apply for the new vice president of business development position. Can you come interview?" I'm like, "Now? I no, I have a job. I can't go now. Tomorrow? Okay, sure. Tomorrow." And then it took me like four weeks to decide yes. I was being a total idiot.
But at the time, like what was the scale of that business? Like what did what what did you think it needed that it didn't have? because it was still very much an R&D.
It was very R&D, but you know, Elon had an investment and he wanted some return. He wanted cash, right? He wanted customers. And I was doing that work anyhow in the space industry. Um, turned out I was pretty good at it. Um, uh, but uh, yeah. So, he So, what did it look like? I was the seventh employee to sign my contract. I took I gave two weeks notice and took a week off to remodel a bathroom because I knew I would never have time to do it. Once I started working for Elon came three weeks later, employee number 11 and we just got to it and we sold a rocket about 12 months later.
and that's and that's without a rocket. There wasn't a rocket.
There wasn't a rocket. Yeah. So, what does that sales cycle look like? How do you convince somebody that they can they can actually take that risk and maybe give you the deposit you need to start the cycle to build the thing?
So, the timing was great. By the way, SpaceX should never have existed, right? If the other launch providers were great, then a new entrant can't make headway, right? Because they were so entrenched. So, we should have never made it. But turns out, you know, customer service wasn't great. Rockets were incredibly expensive. And so, there was that piece, right? And then the other piece was 9/11. Um, at that time, the military was desperately looking for someone who could come in and do rapid launch. you know, they they kind of knew where the bad guys were about four for about four hours after the events of 911, and they really wanted to be able to get some capability in theater. Um, it took us a while to do it, but we we did what we said we were going to do.
Oh, so it really was sort of like out of tragedy, this opportunity gets born to some extent.
Yeah, that's and it wasn't specific to SpaceX. It was just the state of the industry at the time.
And then obviously you know very very famous first chapter where you guys get almost to the brink and you need this last launch to work and um your role started to evolve pretty meaningfully by that point. So can you walk us through like what was the internal dynamics at that business that kind of like put you into that position?
So it was very startupy. Um I was the sales lady. Um, but then when you have sales, you need, you know, to manage your customers and you need a finance function. And even though we were little, and I think one of the defense contractors at the time said, "They're a fly on my, you know, on a giant on my big toe or something." I was like, "Well, I don't think you should have flies on your toes." But, um, uh, so, but you still need a government affairs function. You need to defend yourself. Um, we never go on the offensive in Washington. We're always in defense mode. Um, but so I just kept taking on more and more and then when we were getting our largest contract at the time, it was the cargo resupply contract. We call it CRS and this was 2008. Um, Elon was super busy with Tesla, quite busy at SpaceX as well. there was a lot going on and he needed a partner at the time and I think he was trying to pick Quinn on this side or maybe one of the other guys who had kind of taken on gobbled up more technical scope and he asked me to do it on our way to our final negotiations for this $1.6 billion contract with NASA on the runway. It's like hey do you want to be president? I was like do I? Well no not not initially for like that nancond like well I I love my job. I love the guys, my teammates. And then it's like, okay, I'm being an idiot again. Yes, I want the job.
Um, so now fast forward maybe just to come to where we are today. Um, the scope and the ambition of this business has expanded dramatically. I mean, it almost seems in like the last year.
Um, it's as much an AI business as it is a space business. Um, I think Elon may have said that. I don't know if it leaked or they said it out loud about the scale.
um how do you manage now the culture of these two different businesses now that have to sort of sit under this roof and ideally work together and complement each other?
So the the team you know there's been a lot of churn at at at XAI for sure um and Space Xers have kind of marched in and and helped out where there were significant gaps in that arena. Um and we were all really excited to learn about AI. I mean, I'm an AI noob. Um, and uh, uh, we have a bunch of folks that were just really excited about it. And I think we all recognized, Elon set the stage beautifully, as he does, um, that, you know, if you're not using AI, if you're not leading AI, you're you could, you know, you run the risk, significant risk of being irrelevant. And there was no way that SpaceX was going to be irrelevant, right? it's too important to the company and the work we're doing is too important. So it was, you know,
do you expect that the the future generations of rockets will be increasingly more and more informed, built, designed by these systems? Yeah.
And how do you manage the team, you know, because you have like these incredible I mean literally rocket scientists. they've trained their whole lives in a way and now you have to help them on board to a tool chain and be comfortable with sort of what that means. Like I don't know if you saw for example that all these mathematicians got really upset when uh I think it was open AI uh solved this very famous equation.
Oh the Navier Stokes. Yeah, I read about that. And well there's some debate on whether they brute forced the solution but then these 20 field medalists essentially said hey you're ruining the craft.
Uh now I don't think that that's taking away the medals. Yeah.
They're going to take Exactly. Yeah. Like that's that's the career is not about making stuff. It's about getting awards.
And now all of the awards are gone.
Yeah. And I'd rather just have the world be a better place, a smarter place, us being better informed and solving problems than worrying about make more stuff.
That Yeah. Make more stuff.
What What's the cultural merger been like? You've got X AI, you've got uh X I don't know how many people are involved in X itself, SpaceX. I mean are these differently managed businesses? How do you run management there? Do people kind of are they pretty fluid amongst the the units? Do you think about them as units or how do you how do you actually manage this?
So I would say we are not fully fully integrated yet and then we just did the cursor you know situation.
Congratulations on that. Congrats. What a purchase that was.
Yeah. Yeah. Yeah. They're great. They're great. We just closed that I think a month ago today actually. Um yeah. So, we're not fully integrated yet, but we um I think the teams are jelling really well. Uh very kind of different verticals, but again, because of the turn that we had at XAI, um so much SpaceX leadership and and engineering went into that basically went in there. So, I we're we're getting integrated faster than I thought. It's probably not as fast as Elon wants it.
Yeah. And and I so one of the things that strikes me is the scale and the number of capital projects you have that you have to manage probably more capital projects that are more different from one another than any other organization.
It's a scale of a country.
No, I mean it has to be and and so I think about this Louisiana Spaceport. You've got Starship which is the most ambitious um aeronautical project of all time. You've got Terraab which I think is one of the most inspiring and ambitious like uh projects of all time in humanity. Like I mean Terra Fab is so incredible in its vision and the scale and the the the the what what you're envisioning to do there.
And then I start doing back of the envelope math. I think I had a had a couple beers and I was talking with someone about Terraab and I'm like holy that those numbers get very big very big. Although the AI numbers are also like I used to be horrified at our expenditures before the XAI acquisition, you know, it's like, oh my god, we're going to spend the comput million seems cheap on an air separation unit and I was like, oh 100 million billion.
Do do those capital when you look at the the the kind of schedule of all of this over the next few years? Does the capital for that sit on the balance sheet? Is it going to come from cash flows from Starlink or do you have to go back to the markets to get more capital? I mean, how do you think about where the capital comes from? I have I don't I don't think anyone doubts the capacity to execute and deliver or some people might but I think generally the markets will say yes. But where does that capital come from?
So, uh, it will come from I would say the answer to the above is is yes. I don't think we're going to, you know, we're I don't think we're going to release any more stock. And by the way, I don't plan on making any news on this.
Um, that's the like the one downside of a public company.
They told me all the things that I couldn't say and I'm like, I'm going to forget one for sure.
Maybe we're going to make some news.
Um, but it will be all of the above.
and Starlink I mean is Starlink in your view kind of the core cash generation engine for the next couple of years for the business or is it compute or is it a mix again of all the above like how do you think about
so Starlink is definitely carrying its own weight but we have a lot to go right we're our market penetration on Starlink is 1 and a half to 2% depending on which country you're in um so there's a lot of headroom there um our revenue compared to what we do for the US military our revenue is very small so we expect lots of headroom there. Um, but honestly right now and it is a little embarrassing but computer rental is a heck of a business.
And does that persist you or is it
We don't see any drop. We see no drop in demand at all.
This is tens of billions of dollars per quarter in buildout and these are a new customer base for you.
Um, is this the business now? Is this like it's what percentage of the revenue is Elon Web Services at this point?
