CEOInterviews.AIRobinhood Co-Founder Baiju Bhatt on Building Big Ideas That Sound Crazy

M

Matt Eert0:00

I'm Matt Eert. I turned one collision repair shop into a multi-billion dollar business called Crash Champions. Now I'm sitting down with people who have also built great things so you can build something of your own.

C

Co-Panelist0:12

Hey Matt, thanks for having me on the podcast today.

M

Matt Eert0:15

Yeah, excited to be here. What do we got going on?

C

Co-Panelist0:17

Well, every industry has a gatekeeper as you know and today's guest actually broke through an entire industry to allow anyone to invest in the stock market.

Today's guest is Baiju Bhatt. He's the co-founder of the app Robinhood which basically changed how an entire generation thinks about investing.

M

Matt Eert0:36

I mean you think about my kids today. So my kids are what 18, 19 years old and they're already utilizing the Robinhood app to invest. I mean when you were that age were you investing?

C

Co-Panelist0:46

Yeah. Wouldn't knowing where to look or anything about it.

M

Matt Eert0:48

Same here. But it's good, right? It gives them experience in the stock market. Gets them to lose, you know, tens of dollars here and there. But okay, so jumping back on this. So today Baiju is the CEO of a new company called Aether Flux.

C

Co-Panelist1:04

Yes.

M

Matt Eert1:04

So if things weren't hard enough here on Earth, he's actually taking it to space. So what they're trying to do is build satellites that beam solar energy down from space back here in Earth. I guess in a more efficient matter. It's really no big deal.

C

Co-Panelist1:17

According to example of thinking big, right? So I always talk about thinking bigger is great and now he's thinking about going outside of Earth in orbit. So definitely space is a big thing.

M

Matt Eert1:31

Yeah. And speaking of like outside of Earth, right, or your environment, a person like Baiju who went from building a company in the finance realm, right, and investing and then now is moving to space, the space realm, if you had to build an additional company tomorrow, let's say, what traits do you think are the most important thing to take with you? Things that you maybe didn't learn or didn't have building Crash Champions that you would definitely take into building your next organization.

C

Co-Panelist1:59

Well, yeah, definitely. You get the experience of everything. So I had no experience, right? Starting from kind of from scratch. So can't help but think that those experience, the experience gained applied over something else is much better. So and would have a little bit of capital now where before it didn't have any. So maybe that helps it go faster.

M

Matt Eert2:20

Yeah. And if you had to choose from these three, and there's no silver bullet obviously to building a company, but if you could choose one of these three, so people over resources over cash, which one matters the most?

C

Co-Panelist2:32

Oh man, I still go with people because I think getting good people is so important, harder to do maybe even than finding cash. So I think great people doing the right stuff can attract the resources and the money.

M

Matt Eert2:46

Like it. Well, I'm looking forward to your conversation with you and Baiju. It'll be good.

C

Co-Panelist2:49

Yeah, it's going to be exciting. Okay, everyone. This is Pod Crash.

M

Matt Eert2:59

So excited to talk to you today both about, you know, maybe we spend a few minutes on your history and past, which I think is pretty well known, and then can't wait to talk about what you're up to today. You know, the thing for me is seeing something that you did not much different than me grinding it out as an entrepreneur bootstrapping something only you thought way bigger about what you were building. I got to say I was more a needs-based business and you built something that consumers could all take advantage of on their phone which is pretty cool. But did you always intend to own your own business and start your own thing? Does that go all the way back to childhood, too?

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Baiju Bhatt3:45

I don't think so. I mean, I kind of like to make a joke that I was probably not terribly employable coming out of college because I was just like I kind of look at where my life is now and I realize that I'm like a bit of a caricature of an entrepreneur. Like I was the person that was probably not going to be able to sit still at a job working for somebody else for too terribly long.

Yep. Worked in finance for a little less than a year after I graduated from college at an investment firm and that was just like it was cool. I enjoyed it. But like I knew pretty early on that if I was not going to be in academia, I was going to be an entrepreneur. And like it's kind of interesting because looking back on it, obviously, you know, Robinhood was a very big idea.

M

Matt Eert4:41

Yep.

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Baiju Bhatt4:42

And I talk to a lot of entrepreneurs these days or people that want to be entrepreneurs and people like, 'Well, what do you think? Is this the right time? Should I try it? Should I not try it?' And like my message is pretty much always the same, which is like literally if you're thinking about this, like stop talking to me, leave and go get started right now because it will never ever ever be easier than it is right now. Like just if you think you want to do it, just try. Like there's no right or wrong answer to this stuff. And if you overthink it, you know, that's not really what being an entrepreneur is about. You know, it's about gumption and just like going for it and not being right always and kind of iterating through it.

M

Matt Eert5:32

Yeah. I thought it would be good to ask you about that because there were some not so great successes ahead of Robinhood, right? Like it wasn't just Robinhood out of the gate.

B

Baiju Bhatt5:49

No, no, no it wasn't. There were a couple of ideas before that that frankly were like smaller ideas in the grand scheme of things and kind of didn't have the same sort of breath to them as Robinhood did because yeah like when I was starting out doing Robinhood with my co-founder, we were very young like I was in my early mid-20s.

And it's kind of interesting because like a lot of people if they want to be entrepreneurs, they end up kind of finding an idea and like wanting to do a thing, but the dividing line between where is the product and kind of where's the sort of service that you're providing, I think is kind of an interesting one because the thing about Robinhood was we kind of had a full idea. It's like if we can make this work and we can make that work and we can make that work and all these pieces come together, then this idea is going to come to life. Whereas I think a lot of people when they start out as entrepreneurs, it's a little bit of like consulting basically. It's like you have somebody that wants some version of what you're doing and you spend a lot of time kind of making that version of it where when you have a really clear idea of what the product is is when you kind of take the full agency for what the thing that you're building is.

Yeah. But yeah, the first couple of years were a bunch of failures and frankly even getting started with Robinhood, like we heard no from like countless investors and people just didn't believe that that was going to be a thing.

M

Matt Eert7:28

So that takes a special kind of belief in yourself to hear no that many times and keep going.

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Baiju Bhatt7:33

Yeah. I think the best entrepreneurs or the people that really make it. It's interesting. There's like how to say it like you have to have like almost an irrational belief in yourself and an irrational belief in your ability to do whatever the heck it is you're trying to do because generally speaking if you look at the set of circumstances when you're trying out to do something new like the odds are like not, you know, if you looked at it very dispassionately you're like yeah you're probably not going to succeed at this but the people that push through just do exactly that. They're like, 'It doesn't matter if the odds don't look good right now. I'm going to put one foot in front of the other. I'm going to iterate and I'm going to keep working until I can make the thing happen.'

M

Matt Eert8:22

Did your friends and family, did you have their support or were they doubters, too?

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Baiju Bhatt8:28

Oh, I had the support of my friends and family. I think my dad has kind of always been like, you know, Baiju you need to go and get a PhD, you need to go finish your education and there was definitely that backdrop when I was getting started as an entrepreneur it's like ah you know when are you going to go back and get your PhD when are you going to go back and finish your education and besides that I mean my parents were pretty supportive and obviously my girlfriend then wife now has also been kind of the wind at my back through a lot of it, right? Having the people around you that it's probably worth saying, right, as like I speak today as somebody that's created valuable companies before, has done this before and but there's a journey to getting there, right? And like nobody, the self-doubt is definitely there along the way and just like the simple things that your friends and family do where it's like oh you know I knew you were going to be able to figure this out like I kind of knew you were going to be able to figure this out. You're like wow you believed in me in that way like that's awesome because you don't when you're in it you're not always thinking about like you know you're kind of living in your head in the process.

M

Matt Eert9:45

Yeah, understood.

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Baiju Bhatt9:46

And having that sort of support from a place of love is very cool.

M

Matt Eert9:51

What I'm curious about is for me I wanted to own my own business and it started you know with really just the goal first of just making a living being able to pay the bills and the scale ideas came later. Were you intentional in I want to do something really big as you were trying your first couple ideas and Robinhood? Were you thinking big out of the gate as opposed to again for me it was just let me try to make a paycheck which took a long long time by the way and then came the idea of scaling it.

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Baiju Bhatt10:32

I think there's a progression that kind of comes as an entrepreneur. Like step one is as you start out as an entrepreneur, you just want to control your own destiny, right? Like there's the I think the first year or two where there's just a real excitement that comes from being like I'm doing it. I'm an entrepreneur. Like I'm making it happen. And then you kind of get to the point where you were able to pay for your own living and you have like a small team or whatever.

M

Matt Eert11:00

Exactly. Right.

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Baiju Bhatt11:08

But I think for me at that point the next step kind of unlocked which was it's not just enough to be an entrepreneur. I want to do something that's really successful, right? I want to do something that creates something really valuable that is more than just like a lifestyle business. This is kind of for me the way I thought about it. And then I feel like the next step after that is like not only do I want to be an entrepreneur and kind of pave my own path, not only do I want to be successful, but I want to do something that has this very bold vision for how the thing I'm doing is going to leave a mark on the world and ideally like a positive mark on the world. And I think for me that version was like I want to build something that millions of people use and that millions of people find useful. That's kind of the way it progressed for me.

M

Matt Eert12:07

Did you have people that you looked up to that kind of help? I think maybe the difference in the time frame for me too. So I grew up in a real small town in Illinois and kind of graduated from a high school without computers. So, a little bit of how big things can get because of technology wasn't on my radar in my teens because that just didn't exist. You had the chance maybe to see others doing things through technology that had global reach actually. Did that help you? Did you see others like Steve Jobs and those type of people that maybe motivated you?

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Baiju Bhatt12:48

Very much. I mean, I really really looked up to Steve Jobs. If there is an entrepreneur that was very much my idol, it was Steve. And it's because he made these things that millions of people found useful and frankly created products that inspired this level of curiosity and sort of creativity in people because I remember the first time I used a Mac. I remember very distinctly what that experience was like because I remember I turned the thing on and I was like this thing is really quiet. Wow. Like how do they beat the like I remember feeling it's like this thing is super sturdy. It's really quiet. And I turned it on and I remember going through the screens and being like man all the icons are really nicely designed. And I remember finding myself going and scrolling through all the little menus and being like wow this is really well considered. And just kind of realizing that this thing that felt like it was in a final state of design almost was the byproduct of people having thought it through and being like and then obviously this was like mid-2000s I think was when I got my first Mac and then obviously like the creation of the iPhone, the iPad and just being like oh my god people made this like a person conceived this idea and brought it into reality.

And I think actually kind of makes me come back to a question that I feel kind of answered a couple of minutes ago, which is like what is the difference between a big idea and a small idea? And like what you know, because people often times were like, well, that was a really big idea that you created. And I wouldn't necessarily say that's how I thought about it. The way I kind of thought about it was in order for this idea that I had to happen, it had all of these constituent pieces, each of which was really hard. And I think it sort of necessarily makes you think it's like well you know if I want to build a consumer product in financial services that millions of people use and that eventually has this broad mission of democratizing finance for all like connecting a new generation of people to view the stock market as something that's useful and for them and that they can make a part of their lives. Then you kind of think about it and you're like, that's not something you're doing in a year. You know what I mean? Like that ain't happening quickly.

And no matter how hard you want to try to do it quickly, it's because there's all these constituent pieces that have to happen. And when you kind of put all these things together, you realize that the idea was like so multi-faceted that it kind of was going to take nearly a decade to kind of breathe into reality. And from a certain point of view, it's like, well, that's a really big idea. And I would say from a more humble point of view, it's like, man, that's a really complicated idea that like, you know, 10 things have to break correctly over the course of a decade for the thing to happen, right?

When it works out, you look back and you're like, 'Wow, that was, you know, such a big idea.' But when you look at it and you're in the middle of it, you're like, you know, this is like almost unrealistically ambitious, right? And you kind of hear very rational, smart people be like, 'Well, how the heck are you ever going to pull that off?' And you kind of realize that like the really bold, ambitious ideas when you look at them at the early stages look borderline irrational. It's like what makes you think you could, you know, have all these things break right over the course of a decade? And you're like, well, that's the only way my idea makes sense. So like I have to think about it over the course of a decade.

M

Matt Eert16:46

Love it. Do you think there's a lot of misconceptions? I feel like your success story and others like it which are awesome. I feel like sometimes people misconceive how hard it was especially as like what because once it takes off it does go pretty quick. So would you or maybe it wasn't hard. I don't know. I didn't live it with you, but I feel like people will see it and say, 'I could do that.' And I kind of feel like lightning strikes every now and then, and there's probably way harder work that went into it than we can see.

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Baiju Bhatt17:23

Yeah. I mean, first things first, it was really hard. It was not easy.

M

Matt Eert17:28

Yeah.

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Baiju Bhatt17:30

I not to discourage people, but I just feel like there's always work behind it. Like I don't know that anything that becomes great was easy.

M

Matt Eert17:42

Yeah, I think there's a pretty interesting thought here that I kind of ruminate over. And again, like we haven't gotten to this yet, but I'm back at it, you know, like I'm an entrepreneur again, like pushing a really big idea up the hill where, you know, it's like how the heck are you ever going to make this work? And, you know, realizing again in order for this idea to work, which is new company I'm building, which called Aether Flux. We'll talk about that in a minute. You know, again, everything has to break right for the course of a decade. But I kind of have this view on entrepreneurship which is that like the difference between working on something really hard versus working on something that feels easy. Or I guess to be more precise where like you can wrap your head around it early on in the conception of the idea.

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Baiju Bhatt18:36

Okay, these aren't that different actually because whether you're trying to, you know, build gigantic orbital data centers that you'll need to sort of put pieces together over the course of a decade to do or you're building, you know, a mom and pop shop or you're building an enterprise technology platform or whatever, right? These things are all hard and oftentimes if you're working on something that you can kind of wrap your head around where it's like we're building this idea which works over here but for this other market over here. The reality is like somebody might have thought about that already, right? And so where the idea seems like more tractable or easier to do, you kind of quickly realize that like other people saw it and as a result the idea is easier to understand but the competition is going to be way harder.

Whereas if you think of something that not a lot of people are working on that's kind of far field, the idea might be pretty hard to wrap your head around. But if you actually pull it off, like other parts of it might be a little bit easier or they might also just be really hard. And so the upshot of this that I kind of think about is like easy ideas versus hard ideas. There's like a baseline level of hard that everything has.

M

Matt Eert20:01

Okay.

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Baiju Bhatt20:02

And I feel like a consequence of that line of thinking is you might as well dream big. And this is like one of my mantras in life is like if you dream small, guess what? Get ready to live small, right? If you dream big, you have a chance of like making something big happen. So you might as well dream big because whether it's an easy idea, quote unquote, or a hard idea, quote unquote, they're all got a certain level of hard to them. And you know the related thoughts here are right like there's nobody on this planet that is going to believe in you more than you believe in yourself. And if you think other people should believe in you more than you believe in yourself, it's just wrong. Like that's not how the world works, right? So you got to bet on your own ideas, your own ability to do stuff, your conviction and stuff and you might as well dream big because at least then you have a chance of hitting it big. Like I've never in my life encountered somebody who dreams small and they're like, 'Holy, this turned out to be, you know, look at how successful I am right now.' You know what I mean?

M

Matt Eert21:19

Like you got it. Just smiling because I feel like I'm talking to myself because I spend all day every day getting people to think bigger and if you shoot for the stars you might hit the moon but you sure can't hit the stars by only aiming at the moon. It just doesn't work that way.

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Baiju Bhatt21:34

Bingo bingo. Pardon my language. Naysayers are a dime a dozen. You know what I mean?

M

Matt Eert21:40

Oh yeah. For every one person that's in the arena and like getting it done, there's going to be a chorus of people that will opine on it, but won't lift a finger to make something big happen themselves. I guess like a byproduct of that is like if you're dreaming big or you're trying to make something big happen, it's way easier to be a critic than the person doing the thing.

B

Baiju Bhatt22:06

For sure. The way to not get criticized is don't do anything. Like if you're trying to do something, somebody's going to criticize you. You're dead right.

M

Matt Eert22:14

So, a little bit on the whole you pitched Robinhood dozens and dozens of times before you got to a yes. Maybe what changed in the pitch do you think from the beginning to the end to where you finally got a yes? Because I look at things where I'm trying to get people's buy in or get, you know, go to my board and try to get them to say yes or get investors to invest. And if I get a no, I basically have and I didn't used to be this way, but now I look in the mirror and I say, 'Well, I didn't sell it good enough because it's a great idea. They said no. So, I got to look at what I did from my sales pitch point.' Like I just look at it like they're not getting it like I get it. So, I didn't sell it well enough. I got to go to work on that. Did your pitch evolve? Is that why it finally got a yes?

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Baiju Bhatt23:05

Uh yeah, it did. And I think there's a broader thought here which is actually at the early stages of an idea or a company like if you're putting something together, pitching and talking to investors is actually good insight, right? It's putting your idea in a place that's not very comfortable where people are going to be like, 'No, it's dumb. I don't believe in it. I don't believe in this. I don't believe in that. I don't believe in the way that you're pitching it. I don't believe in you. You know, like maybe I think the idea is great, but I think you're an incompetent fool that's not going to accomplish it.' I think I've received all versions of this, by the way.

M

Matt Eert23:49

Sounds like they made it personal sometimes.

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Baiju Bhatt23:52

I mean, look, when I was starting Robinhood, people would look at me and my co-founder and be like, you don't know how to build consumer products you've never done before. Never. I don't see any track record at like major tech company on your resumes. Also you're a couple of math and physics kids. Also the idea doesn't make any sense and you're like so you go through that and you realize that like one you can iterate on the way that you're pitching as you do it. But also at the early stages of a company. And this is kind of how I think about entrepreneurs when I meet them, when I back them, is fundamentally until you've got traction with your business when you're getting started. It's way more about the entrepreneur, right? And whether when you're talking to investors, like a lot of the times investors are looking to see if you've got that dog at you, you know, because whether the idea is right or not, like it's great if your idea is right on the first pass, but it generally if it doesn't evolve, you're not doing anything, right? So like whatever you think you're doing at like the seed stage or the series A stage is probably going to change and that's a good thing because that means you're being attentive to what the market's telling you. So it's not as much about the specific exact plan necessarily, but it's also about like who are you as an entrepreneur and why are you going to be the successful one at doing it, right? Like why do you have that dog in you?

And this kind of connects with the point I made earlier, right? It's like when you're trying to start something new as an entrepreneur, it's not about the idea being perfect. It's about trying and it's about iterating through the parts of it you don't understand and trying to get to failure pretty quickly and then when you get to failure being like okay well at least I took the core idea that I had in the beginning and I saw it through from start to finish and when I got to finish I was like okay well that clearly wasn't the right thing but now I definitely have that insight like I got it. The reason it didn't work wasn't any of the things that I thought might not be the reason in the beginning, but it was that little insight that I figured out at the very end and like I'm going to do it again. I'm going to get it right this time. Does that make sense?

M

Matt Eert26:31

It does. It resonates very very very well with me. I know just from my experience that they're investing in the jockey just as much as the idea. Like I couldn't imagine bringing some idea that's like ridiculous and having them want to invest just because the jockey is great, but they very much the entrepreneur the jockey matters and whether or not they believe in him for sure. So same experience.

B

Baiju Bhatt26:59

I like this.

M

Matt Eert27:00

Yeah.

B

Baiju Bhatt27:00

I've never referred to myself as the jockey. I like that.

M

Matt Eert27:06

That's good, man. That's good. And you know, moving on to Aether Flux a little bit. Which I want to do. But I imagine now that you've kind of got the street cred of hey, I've done it before, it's probably a little easier than unproven the first time.

B

Baiju Bhatt27:24

Still pretty hard.

M

Matt Eert27:26

Now, did you take some time off or

Did you have this idea pre kind of stepping out of the day-to-day at Robinhood, or did you take some time and then the idea came to you?

B

Baiju Bhatt27:42

I think I might have taken like a day.

M

Matt Eert27:44

Okay. So, you had it already?

B

Baiju Bhatt27:47

Well, I had the motivation to do this like over a decade ago. The motivation to want to do a space company actually, believe it or not, predates starting Robinhood.

M

Matt Eert28:02

Really? Okay. So, tell me about that.

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Baiju Bhatt28:04

Well, first things first, I grew up around the space industry. My family, my dad moved to the US with my mom. My mom was pregnant when she got on the plane because he wanted to pursue a PhD in physics in America.

M

Matt Eert28:18

Okay.

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Baiju Bhatt28:19

And my mom didn't speak a lick of English, didn't really want to come. She gets on the plane and she's pregnant with me. And you know, spent my childhood being the most loving dedicated mom in the whole world. And you know, growing up, my dad had some health problems along the way, which we could probably have a whole podcast talking about like how those childhood experiences turn you into who you are. And like the sort of moment in your life where you get agency or you realize that you have agency, like it's, you know, you sort of have like the coming of age. You go from being a child to being an adult. I digress. During that childhood phase, after my dad stopped out of his PhD program, he was a research scientist working at NASA Langley.

M

Matt Eert29:17

Okay.

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Baiju Bhatt29:18

So, he was like doing space stuff my whole childhood. And then I go on to study physics and math at Stanford. At some point along the way, I remember getting this book, The Case for Mars. You heard of this before?

M

Matt Eert29:31

I have not. Um, so physics, physics to me is like the study of how the universe works. That's as much as I know about physics. And I don't even know if that's a good definition or not, but that's how I think when I hear physics, I think that's the study of how everything in the universe works and comes together. Like that's about all I know.

B

Baiju Bhatt29:53

I think that's pretty spot on. Okay. I mean, now, yeah, it is. Now, asking me how the universe works, that'd be a whole another question that I couldn't answer, but um so the book though that you mentioned, I haven't heard of that book, but is it really well-known and I should know it?

M

Matt Eert30:09

Yeah.

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Baiju Bhatt30:10

Yeah. I mean, well, I don't know if you should know it. That book was super interesting. I'll go off on a little bit of a tangent about this. It's basically written by one of, if I remember correctly, it's written by one of the scientists that worked with Papa Bush.

M

Matt Eert30:28

Okay.

B

Baiju Bhatt30:28

On his 100-day plan, like a plan to go to Mars. And the book was written after he kind of did that and kind of realized that like the traditional approach to doing space explorations, this is, you know, probably from like the '90s era, was pretty flawed. It was not an engineering approach. It was kind of like a government approach where like you just make these arbitrarily big budget projects and you're like, well, you know, the path to go to Mars is like step one build Battlestar Galactica, you know, step two build moon base, step three like fly Battlestar Galactica from the moon base to Mars and you're like how much is all this greatness going to cost? Like, you know, exactly one gazillion dollars, right? And you're like that's, you know, it's that kind of thinking that resulted in the space race of the 1960s and then frankly from my perspective a few decades of like malaise that followed it where, you know, it kind of felt like the space race was won and our generation lost. But if you wanted to rekindle the sort of like engineering first approach to space, you would try to do things cheap and you would try to do things with like reusable pieces.

M

Matt Eert31:58

Which is what Musk is doing quite frankly, right? That's what SpaceX is doing.

B

Baiju Bhatt32:03

Yeah. I think that book had an influence on like the early days of SpaceX if I remember correctly. I don't want to speak too much for them, but yeah, I read that book and I was like, man, if I ever get a chance to work on space, like, you know, I really want to if I don't do that at some point in my life, I'm going to really regret it.

M

Matt Eert32:22

Kind of like childhood influence of what you saw because your dad worked in it and then um books you read. So, it was kind of a dream out there to be involved in it somehow at some point. That's really cool. And actually then able to come back to it.

B

Baiju Bhatt32:39

Yeah. And I wanted to do it while I still had like being an entrepreneur is physically and mentally pretty grueling. And I knew that if I was going to do it again, I wanted to do it while I was still relatively young. And I still had like frankly the mental and physical fitness to like go through that journey again.

M

Matt Eert33:03

You definitely need that energy because to me this is like another whole another level of big beyond Robinhood. So like every time I think I'm starting to think big then I get to read about or talk to somebody like you and now you're talking about putting infrastructure in the sky. Um not just going and visiting for a moment in time and coming back but actually taking infrastructure from the earth putting it in the sky. So maybe for those that don't know listening and for those who haven't studied physics, what is Aether Flux up to? What are you trying to do?

B

Baiju Bhatt33:42

Yeah. Yeah. I realize that's totally been glossed over all this. Uh yeah. So company I started working on about full-time about two years ago is called Aether Flux and the mission of the company is to build a power grid in space, is to build an energy company, a native energy company in space. And so two questions like why and what does that mean? And kind of like what are we working on, what's kind of happening next. Why is a couple of different reasons. The first one is kind of the observation. I think even before this sort of like AI energy crunch had really come into focus was my sense was that we were entering a period of time where energy and energy infrastructure and energy access was going to become like one of like the nexus points of commerce in society.

M

Matt Eert34:39

Okay.

B

Baiju Bhatt34:40

And similar to the 1970s where the idea of building space solar power, which is kind of the first idea that we started out with, is actually an old NASA and Department of Energy idea from the 1970s, which is to build a big power plant in space, collect power there, and then beam the power down to the ground so that you can use it for civilization. That's actually the genesis of what Aether Flux is. It's to build space solar power. So we started out, I started the company out with a goal of doing this and to take a very different approach to it. And the different approach is one where instead of building one monolithic power plant in space, to build a constellation of smaller satellites that collect power in space and use this method of power transmission of infrared lasers which is a whole another topic we could go into at some point. But basically to be able to project down power to small portable receivers on the ground. So rather than having one gigantic power plant with one gigantic receiver on the ground, have a bunch of satellites working together collecting power and then projecting down these small spots of power that are at first, you know, give or take about 10 meters in diameter. Okay? And then eventually the goal is to make them smaller.

M

Matt Eert36:01

So, I'm asking this out of super curiosity, and it might sound insulting because and it's just out of ignorance on my part. Why do you need to beam solar power? Like, why can't you just grab the solar power from the Earth? So, what do you There's got to be something different about it.

B

Baiju Bhatt36:21

Yeah. The benefit of collecting solar power in space versus collecting it on Earth is actually a good bridge to where we're, you know, the idea is kind of taking shape going forward.

M

Matt Eert36:32

Okay.

B

Baiju Bhatt36:33

So started out the company with the idea of doing this and the reason for this is because if you collect more power in space and you use the lasers to concentrate the energy that you can have higher power density on the ground. So you basically need a smaller spot on the ground to get power rather than acres and acres of solar panels.

M

Matt Eert36:55

Yeah. Got it.

B

Baiju Bhatt36:56

So imagine being, you know, in the military context, right, like for a deployed base or like a contested environment. The alternative would be a small portable receiver for power ideally either in addition to or in place of things like running diesel generators. That's one application. Another one is going to be like space to atmosphere power. So things that want to stay in the sky sort of in perpetuity, you can just charge them up from satellites in space. And that's on the power transmission side. On the power collection side, the thesis behind this is that low earth orbit is actually a very unique environment for creating electrical power.

M

Matt Eert37:41

Okay.

B

Baiju Bhatt37:42

And the reason for that is in low earth orbit you can use largely cheapo consumer-grade electronics meaning you don't have to make every single resistor a special space resistor, every transistor a special space transistor and you can fly relatively low-cost power solar panels in space to generate power except when those solar panels are in orbit and in particular this thing called dawn-dusk sun-synchronous orbit. The solar panels are oriented in such a way where they're illuminated by the sun nearly continuously. So if the camera here is the sun, my fist is the earth, you can kind of imagine them in this orbit where they're going sort of above the north pole, below the south pole but kind of always or nearly always facing the sun and the earth is kind of like rotating like this underneath it. So you're kind of always going over the parts of the earth where either the sun is rising or the sun is setting. And when you do that, you can take solar panels that if you were to bolt them to the ground, they're going to have peak power production at like lunchtime and then kind of fall off and like not generate power at nighttime. You can have these panels generating power nearly continuously around the clock. And when you realize that you can generate effectively base load power from solar if you just put the panels in orbit, it kind of unlocks the power of solar power production. Because at least my view coming into this is that I kind of view solar power as like somewhat flawed as it exists today, right? Like it's very intermittent.

M

Matt Eert39:34

Yes. And it has a lot of limitations because if it was, you know, truly like a great alternative to hydrocarbons, we would see it much more ubiquitous.

B

Baiju Bhatt39:49

Um, but you actually can address one of the major shortcomings by solving for, you know, power production where you're not eclipsing beyond the earth. And this is the interesting bit. Is you can actually connect the dots from there to saying, 'Hey, does that mean we can use solar power to power other stuff?' And where's all the power going to right now?

M

Matt Eert40:18

Data.

B

Baiju Bhatt40:21

And this is the light bulb that went off for me like about a year ago was that actually rather than solely focusing on beaming power to places where there's no power grid, we could actually instead put the chips, the AI, you know, GPUs directly on the satellites in space and use the power that you're generating from the sun there and actually use things like lasers or RF antennas to transmit data back and forth. That's kind of where Aether Flux as a company is going is we're focusing much more now on building a power grid in space to power artificial intelligence.

M

Matt Eert41:06

Super cool. So like this is an idea that's like really easy to sell from a is the hard sell about it. Can you pull it off? So you mentioned it's still hard to raise money from investors. Is the hard thing is can he really pull this off? Is that what's hard about this one?

B

Baiju Bhatt41:28

Yeah, I think that's a big part of it. It's going to take a lot of capital to do. It's frankly the approach that we're taking, pardon me, is one where we want to focus primarily on solving engineering and economics challenges. We're not trying to like make scientific breakthroughs, you know, like publishing scientific papers if it happens would be nice. But like we're not trying to make a version of this where we have to like have a breakthrough in the way that something works. Like we kind of have to take things that have either been sort of demonstrated in other capacities or similar things have been done and basically package it together and do it on big scale.

M

Matt Eert42:14

Now, it's interesting because you commented about the kind of 10 years to get there, but you're not looking to do this in 10 years from what I've researched. Your goals are way faster than 10 years.

B

Baiju Bhatt42:27

Yeah. Yeah, they are. Yeah. So, we're actually planning on putting our first two satellites in space. The first one is going to do the space to Earth power beaming, which I'm very excited about. I think this is like an incredibly novel application for space and kind of unlocks, I think, some really interesting possibilities of how we think about space as a utility for humanity going forward. And then we're also aiming to have our first sort of GPUs and sort of mini data center in space. Both of those we're targeting later on this year and next year. Again, these are space timelines. So, you know, they sometimes move around a little bit, but yeah, I mean, we're trying to do this as quickly as we can because my experience as an entrepreneur is you have to try to get to things. You have to try to get to your failures as quickly as possible and iterate through them as opposed to waiting for perfect and like pontificating about what the idea is for years and years and years where you could just do it and like see what didn't work and do it again and fix it and do it again and fix it and get to the place where it's a real thing.

M

Matt Eert43:47

So, how many satellites can hang around up there and how do you get like your turf of where your satellite gets to like maybe these are things that we don't have time to talk about, but that's where my head goes like who decides who gets to put a satellite where and how and how do you claim that territory and then I guess it's a few questions. How many can hang out there anyway without it being a problem? There's like I Googled it real quick. There's like 10 to 15,000 up there right now, right? So, you're going to put another thousand up there maybe or like I don't know how many can hang out up there, but you get the sense of my questions.

B

Baiju Bhatt44:25

Totally. Yeah. I think there's a couple of things here. The first one is space in my opinion is going to become industrialized within our lifetime. Okay. Like in my opinion, this is like we're at the doorsteps of like a bigger revolution that's happening where there's more and more human infrastructure built in space because there's way more ways to get to space. There's way more rocket companies. There's way more sort of like launch programs. So that's kind of the first thing is that humanity is going to occupy space and we're going to build really awesome infrastructure up there. That being said, space is huge, right? And I think that you already with 10,000, 15,000, however many satellites are up right now like there are sophisticated ways of disambiguating where different satellites are and tracking sort of all the different things that are in space from satellites to space junk. And so I think maintaining and managing that is going to be a part of humans industrializing and really building space. Okay. And on the question of like how much stuff can you really put up there? I think you're going to, I think in our lifetime we're going to see a jaw-dropping amount of stuff in space. And I think that when we look back at like 10,000 satellites in space, I think we'll see multiples of that in the years to come. Like way way way more than this.

M

Matt Eert45:50

And they can happen without them running into each other. And if they do, does it cause any kind of bad chain reaction?

B

Baiju Bhatt45:58

I mean that possibility is certainly there but all I mean being aware of the sort of like things that are in space and like maintaining sort of, you know, there's rules around how you handle sort of re-entering of satellites after they sort of pass their end of lifetime and the sort of regulatory frameworks like these are there already that obviously will need to mature and evolve as more and more stuff gets built in space but I fundamentally think that there's enough utility and sort of like importance of space that those are problems that can be worked through. That make sense?

M

Matt Eert46:36

Yeah. I wasn't meaning them to sound it's more curiosity and I wonder how this works and I wonder who the government of space is going to be. And it's I don't view them as insurmountable problems. I view them as details that my mind just starts wondering. I wonder how this all comes together. Um, but what an ambitious goal and how awesome.

B

Baiju Bhatt46:57

It's also cool because like space is kind of the next frontier, right? It's like there's definitely some analogies here to like, you know, sort of like the exploration of North America and like the sort of like, you know, dare I say even cowboy mentality of like exploring the great unknown and like settling this next frontier for humanity. There's a whole tangent I could go on there about the importance of the unexplored territory and its importance to the human psyche both individually and collectively. I think if we live in a world where our civilization feels like the entirety of like where we can exist has been explored, I don't want to live in that reality. You know, I want to live in a reality where there's, you know, the human psyche is like full of ideas of how we can expand. And I'm not sure that I'll live to see it, but maybe one of my boys will. But like there will come a day when humanity exists on other planets in this solar system. And, you know, hopefully even beyond that someday.

M

Matt Eert48:08

When you're thinking about your company right now, what is the keep you up at night? Or maybe there isn't any, but is it getting the engineering answers to what you're trying to do? Is that the phase you're in, or are you getting these Eureka moments where you're getting super excited and super close?

B

Baiju Bhatt48:29

It's much more pedestrian, unfortunately. I think a lot of, as is the case with any company, right? I sometimes joke around with our team where I'm like, 'All right, so I, you know, started this company and somehow I ended up with like the spreadsheets and emails job at this company. Like what the fuck?' Um so there's a lot of that involved. I mean, I frankly I spend a lot of my time recruiting people and like building the engineering team and like making sure that we're focused on bringing in the best and brightest talent. Obviously very proud of our team. They're actually right on the other side of this wall right here.

M

Matt Eert49:14

So that must be like a short list of the geniuses that you need. Like it can't be like a throw it on LinkedIn and get a thousand applicants. It's got to be a pretty short list of people you go after and they're probably not necessarily looking for jobs.

B

Baiju Bhatt49:31

I got to tell you, there's a lot of really smart people in the aerospace industry. Like, this industry is full of brilliant people. And there's a lot of people I mean, space is way more in the cultural zeitgeist than it was 15, 20 years ago. The number of people that have worked on stuff that has actually gone to space, way bigger than it was 15 to 20 years ago.

M

Matt Eert49:52

That makes sense. So yeah, it's pretty cool.

B

Baiju Bhatt49:55

It's cool. It's like it's fun being at the doorsteps of what feels like is going to be a big industrial change.

M

Matt Eert50:01

Does AI I mean this isn't what we're talking about today, but just kind of someone with the way you're thinking about things. I just got to ask does AI scare you at all or it's probably excites you but does it scare you as much as it excites you or you think we'll be able to control it?

B

Baiju Bhatt50:21

A little bit of both.

M

Matt Eert50:22

Okay.

B

Baiju Bhatt50:23

Little bit of both to be totally honest. I kind of go back and forth on this and there's I would say on the whole it excites me much more so than it scares me. Because I think that there's a version of looking at AI through the lens of oh it's going to like put everybody out of work.

M

Matt Eert50:44

Mhm.

B

Baiju Bhatt50:45

Um, I personally don't buy into that viewpoint because I think that it's a tool where, you know, like if I want to like, you know, write something down on a piece of paper and have it look nice, like I'm going to type it on my computer and the printer is going to print it out for me, right? I'm not going to sit there with a stencil and like, you know, do that. I'm not going to sit there with a typewriter and do it. So I fundamentally think that it's going to be a tool for human progress and I think it's going to take a lot of like mundane work and require people to do more creative sort of like higher level thinking and you see this already in for example software right software for the longest time one of the things that I personally never loved writing software that much because I found it was very syntactical like it was about how you formatted the code and like you know like making it you know it was very like for every unit of thinking there was like also like three to four units of like how do you format it correctly and how do you like represent the idea with the right sort of like language in this case code where like people don't write software anymore you know the majority of the software engineers I know today use AI to write the code for them And that doesn't mean you can do this without understanding like the principles of computer science, but like you're not going to be sitting in front of like, you know, a black screen typing in like lines of code. You're going to be giving the computer prompts on like what you want it to do. And I think that that's going to be at least for the foreseeable future like how we interact with AI where it's going to be an enabler for people doing work. But there's still going to need to be people that like tell the thing what to do and like make the most of what it does. Like I have a hard time seeing entrepreneurs going anywhere and I think it's going to change the way that we work. That being said, I think it inevitably is going to have an impact on the job market. Like I don't think that's a particularly hot take, but is going to make so that nobody works anymore. Like I don't think so.

M

Matt Eert53:09

Yeah, that's what some are saying though. So just curious.

B

Baiju Bhatt53:14

I don't see a society where we don't work. I mean life needs a purpose, I feel. And like hobbies and entertainment only I mean I haven't had a chance to enjoy life like that, but I know it from going on vacation after a few days. I'm anxious to get back and get back to work. Now, maybe I'm wired weird, but I can't believe like waking up every day just to consume and be entertained is a life worth living. It doesn't excite me.

M

Matt Eert53:45

Yeah, I totally agree with that. Do you miss Robinhood?

B

Baiju Bhatt53:48

I mean, I'm still on the board of directors, so

M

Matt Eert53:50

So, it's not like you're completely unplugged.

B

Baiju Bhatt53:53

No, no, no. Um, yeah. I mean, look, it's a thing that I created with my co-founder. I love it.

M

Matt Eert54:02

Now, that's why I wondered if you missed it being in the day-to-day grind, especially as the founder.

B

Baiju Bhatt54:08

Yeah, it's different, you know. It's different for different stages of life. Like I enjoy a new challenge, too, right? I do love building consumer products. I do love parts of it. And I think about it very, you know, like the journey of creating it was profound and the journey of creating a new thing is like it's a cool challenge and it's strong motivation to like want to do something that's very meaningful a second time.

M

Matt Eert54:36

Yeah, I get it. Do you post a lot on social media? How can our listeners stay in touch with you, follow you?

B

Baiju Bhatt54:47

Yeah, you can check me out on Twitter and on Instagram. Yeah, I post sometimes. Probably should post a little bit more, but I'm also pretty heads down these days building.

M

Matt Eert54:58

Understood. Yeah. Thank you so much for the time. Um, you know, we close this podcast with a question. We're all about championing people. So, I always ask the guest given the opportunity to speak about them. Who would you champion right now and why?

B

Baiju Bhatt55:15

Man, you know what I would do? I would champion the team that's working on this with me. These people are working their butts off and they're like, you know, they're pursuing a really novel application for space. There's a bunch of people at this office that are like working into the wee hours of the night, day in day out. So, yeah, shout out to our team. They're working their butts off.

M

Matt Eert55:35

I bet they are. Thanks so much, Baiju. This was awesome. Appreciate you taking the time.

B

Baiju Bhatt55:40

My pleasure, man. Talk soon.

M

Matt Eert55:43

Yep. I hope you enjoyed this conversation. If you want more podcast in your life, which of course you do, make sure to like, follow, and subscribe to us on YouTube, Apple Podcast, Spotify, or wherever you get your podcast. Catch you next time.

Robinhood Co-Founder Baiju Bhatt on Building Big Ideas That Sound Crazy

About Baiju Bhatt