At the end of the day, the reason we're called Founders Fund is we're investing in founders. That's it. It's like with Roadrunner, it's because Jubin, it's like we're investing in the person that we believe is the person that's most likely to pull this off. Do you as an investor, do you believe in the person and do you believe in their founder market fit? I distinctly remember in the first year of the company, I was hanging out with Joe Lonsdale smoking cigars and he was like, 'This company is going to be worth tens of billions of dollars.' And I was like, 'Okay, Joe, let's settle down for a second. We're trying to do something that's incredibly hard.' And now it's worth what, like $350 billion, $400 billion. I don't know what the price is today, but like it never felt inevitable. It felt hard the whole time.
Welcome to Grit. I'm Jubin, partner at Kleiner Perkins, a show where we go beyond the highlight reel and explore the personal and professional challenges of building history-making companies. Today on the show, we have Trae Stephens, a Roadrunner's new board member, co-founder, and chairman of Anduril where he incubated it out of Founders Fund where he's also a partner. We talked about starting Anduril in 2017, what the world looked like then and why it's changed now, some fun things about Roadrunner and why he decided to join the team, and a bit about X-Men. Enjoy the episode.
It's always serene when you come here, isn't it? It's like peaceful.
Yeah, I mean, the Presidio is like the Garden of Eden in San Francisco. I feel like so many of these other places that people set up companies that are like the hot cool places like SoMa or the Mission or something, it's like, wait, why are we doing this? This is crazy. You realize the Presidio is like a real place that exists. Like you can have an office here.
It's amazing. You didn't want to set up Anduril's office here.
I mean Anduril would not have worked in 2017 in San Francisco. I just think that there was a lot of hysteria around defense in 2017 that obviously doesn't exist today. And I think it would have just made it very difficult to operate day-to-day. Like at that time, Palantir was headquartered in Palo Alto at 100 Hamilton and there were protesters almost every day outside the office, which is like hard to even fathom as we've gone through this window of time with Ukraine and things like that. And I think people are starting to kind of wake up to the reality that the geopolitical situation is somewhat tenuous in the world. But yeah, in 2017 it was like a whole different world.
I didn't know Anduril has a product called Roadrunner until recently.
Yes, it's true. Yeah, we have a reusable sort of counter-air system called Roadrunner. It's also the state bird of New Mexico where I have my bunker home.
What do you mean bunker home? Is it actually a bunker home? I saw like a report on that and I was like I wonder how much of a bunker is a bunker home.
I mean, it's not like nuke-proof or anything, but I mean, it's intended to be like an off-the-grid getaway. Yeah. You know, there's a bunch of things in New Mexico that are named Roadrunner. Like the waste management service is called Roadrunner Waste Management.
Well, I'm excited for you to see. We're doing a rebranding for launch in a couple of weeks. And the icon is a play on the bird.
Okay. Nice. I think you're going to like it.
Nice. They're really cool. Like they literally just run down the roads in New Mexico. Like I think they prefer the flat kind of consistent level ground to the bumpy rocky desert. Do you see them all the time?
Yeah. Yeah. They're all over the place.
Can you send me a picture next time you see a roadrunner in the wild? I don't know if I've ever seen a roadrunner in the wild.
Yeah, they're everywhere. It's like a very common bird in New Mexico.
You know what I was thinking when I was driving up here? Speaking of things that seem maybe atypical in the valley for a while that are now becoming a little bit more commonplace. Mimoon and you are both like actually deeply rooted in faith. I kind of put two and two together when I was driving up. I'm like that seems unique. Two people in Silicon Valley that have the roles that they do at their respective places and that seems atypical. Anyway, I don't know what to make of it but I was just like, 'Huh, that's a thing.'
Yeah. You know, I think it's probably like more common than people realize. There are a lot of people that, you know, even if they're not like regularly practicing faith, I think there's like a deeply Christian culture in Silicon Valley. And I guess what I mean by that is that like, you know, there's this deep kind of approach to making the world a better place that only exists in the Western canon. This is like a very Judeo-Christian idea that it's not about the first thing isn't about making money or about like dominating your competitor. It's actually like people will go around saying like I'm doing this because I'm mission-minded. I want to make the world a better place. Super Judeo-Christian. And then Silicon Valley is one of the only places where you can build something or try to build something and fail and then like recover to build additional things, continue to get funding. This is like deeply embedded in forgiveness and second chances. Also super Western Judeo-Christian. And that's something that doesn't exist in many other cultures. Like usually a business failure is kind of like the end of your opportunity to be entrepreneurial and risk-taking.
Yeah. You know what I was thinking? Like startups are so damn hard and there's like so many things that tend to go wrong along the way. Far more often things are going wrong than they are going right. Totally. It seems to me that like a founder like default likes to have everything in control and believes that they have everything in control. And I think as things are going wrong, they tend to take those things really hard because they believe that there's like this notion of control around all of the things that they're doing. And one of the things that it seems to me that faith can be very valuable for in that respect, whether it's company building or just life, is like there's like some, you know what, like this I don't have control over this situation. And I think that's like somewhat freeing. Like you don't actually have control over every minute detail. And I think founders are like the extreme version of control freaks, if you will.
Yeah. No, I think that's true. I think that there's like a deeply embedded hope that comes out of that. It's like this belief that there is a plan and there is like some supernatural force that's controlling the eventuality of that plan. It does like kind of free you a bit from the responsibility of like it's all on my shoulders. It's like, you know, there's providence, there's agency, sure, there's all those things, but like at the end of the day, like, you know, what is going to come is going to come and we're playing our own individual roles in that in some way.
Do you find the like metaphor to company building as a spiritual movement like off-putting? Like are you like those two things are separate or I don't know like everybody has a common cause, we're all moving towards that common cause together?
Yeah. Yeah. No, I mean I think that there are definitely parallels. I wouldn't say it's something that like, you know, I'm dragging everyone into believing alongside of me, but you know, I think that the idea of creation. So in the book of Genesis, it says that mankind was created in God's own image. So what does that mean? It means that like we are image-bearers. So like there are aspects of God that are mirrored in humanity. And you could say some of that is about like love. Some of it is about service. Some of it is about, you know, whatever. All these characteristics of God. One of those characteristics of God is that he's a creator. He creates things. And there's like an abundance that's attached to that. This idea that like we don't have a fixed set of resources and like everyone's just fighting over these like smaller and smaller pieces of the pie. It's this idea that you can create something from nothing. That's like a super, you know, image-bearer aspect of humanity is that we have the ability to step into abundance to create things that have previously never existed. And again, I think that there's something super Christian about this idea of creation, abundance, forgiveness, you know, mission, calling in the world. These are all like we take it for granted in 2026 because we're just like, well, this is the culture we live in. It's like, but where did that culture come from? Like none of these concepts existed.
Super cool. Were you always this way? Like when you were a kid growing up, were you the same way?
I mean, I was raised in a Christian home. I think like a lot of the ideas around like vocation, like, you know, our literal calling to work in the world. A lot of that was developed more in my adult life. That wasn't something that I was like drilling into my head as a 10-year-old in rural Ohio. But I think it's become more and more clear as I've gone through my career that there are these characteristics that I think are really important for people to learn and lean into because the alternative is actually really sad if you think about it. It's like people that go to work and it's just like it's just a paycheck, right? Like there's no mission, there's no particular passion or interest in the thing it is that they're doing. But Martin Luther, Protestant reformer, you know, he would talk about vocation as like even the milkmaid has like a significant role in the world. Like, you know, how is that calling affecting people, affecting children, the health of children, affecting families with providing them with sustenance. Like everybody has a role to play and it's our choice to view it that way. Like it's one thing if we're just like, you know, I'm clocking in and clocking out but it's another thing to say like, yeah, I'm clocking in and when I'm here, I'm going to be the best at whatever it is that I do because I can see the connected tissue to how society works, like how a functioning society works. And I think we should be imbuing people with that sense of purpose.
I think this is like some of where the AI stuff gets really tricky because it's like, sure, we could figure out some form of universal basic income. Maybe that's like, you know, going to happen. There's no way around it. But like, man, where does your sense of purpose come from? And that's ultimately like what makes us human.
When I was growing up, like at my dinner table, the conversation between like my parents are scientists and the conversation was always around work. But the way that work was described was as work. It was like complaining about their team and their boss and this and that. And you know, like it's different. They, you know, were immigrants from Iran and like, you know, like work was their sustenance in many ways, like they had to like make a life here. So, like I think I kind of get to stand on their shoulders, if you will, and get to focus on more of a calling and a vocation. But I always remember thinking, man, like they spend most of their days like every day doing this thing and then they come home and I'm like, you know, like little Jubin, like sitting at the dinner table hearing them talk about like work and there was like one aspect of it that I think always satisfied them, which was like the intellectual stimulation, right? But at the end of the day, there was always like a negative undertone that it was like a drag. Like there was just something that was dragging them that they were like kind of like dreading going to the next day. And I always remember thinking like really young like I just don't want to feel like that. Like whatever I do, I just really want to make sure that like the thing that I feel is like I'm stoked on. Just like anything else like my partner in life, like anything that I'm spending meaningful time on, I really want to wake up in the morning and be like I'm excited to do that. Otherwise, like why am I doing that thing?
Well, it's a choice at the end of the day. You know, we all have whatever it is that we're doing in theory, if we're getting paid to do it, there's some productive output that's involved. You're either literally producing something or you're providing a service to someone or, you know, if you're a professional athlete, it's like you're providing entertainment. We can choose to view it as a mercenary task like it's an exchange of goods and services like we get paid that way we can provide for our family or whatever. But we also have the choice to say like yes, but my output is productive and I'm proud of the output that I'm creating. My dad was a roller coaster engineer, so he like built and maintained amusement park rides essentially. I love my dad. He was kind of a rock in my life growing up and certainly appreciate everything that he did for our family. But he also like your parents, he sort of viewed it as like I'm clocking in and clocking out. Like I have to wake up really early. But like there was another lens on that that was look at the joy that this is creating. People come to this amusement park on vacation and the kids are laughing and playing and like he was creating that opportunity in some way. And I think that like there's a deep pride that you can have in really anything that it is that you do.
Did your... Can I ask you about your dad? Do you mind?
Was he around to see like who you've become?
Well, he died in 2013 from Alzheimer's. So, he was kind of like mentally pretty gone by I want to say like 2010 or so. You know, he saw me graduate from college. He saw, you know, my first job out of college. He was aware of the work I was doing at Palantir in the very early days. He was at my wedding. He had at least an awareness that he was going to be a grandfather at some point in the near future. But we lost him way too young. I was 30 when he passed away. So, you know, it's... I still feel like I'm learning things constantly about like reflecting on how I was raised, how he interacted with me. And so in some ways I feel like he's still sort of there with me as I've been growing as a person, as a father. But yeah, we lost him way too young.
Did he think when you were young that you would be like in politics, like you went to Georgetown, you did like political stuff?
Yeah. Yeah. I think well it was less political and more just like government bureaucracy. But you know he I think he always perceived that I was going to be some like plucky, annoying, you know, provocateur of some sort that could have been as an attorney. It could have been as like a government person. It could have been a lot of different things. But he definitely knew that even at a young age like it was highly unlikely I was going to end up following in his footsteps working at an amusement park. My mom always thought I would be a lawyer because I was cantankerous as a kid. I would always argue and I'm glad I didn't go down that path, but that...
Well, you know, it's funny. When I was during one of my summers home from college, I went to Georgetown in DC. My family was in rural Ohio. I was driving my mom's car in Cincinnati, just outside of Cincinnati. And it was like a single lane in both directions of the road. This guy cut me off and clipped the front of my mom's car and the cops came and for some reason they like assess the blame to me even though I was like there's just no way this makes sense. So fast forward I go to court. I thought I was just going to traffic court, you know, where you like the cop is there, you're there, you each stand up and give a testimony, the judge makes a decision. That's not what it was. It was like an actual hearing. And so, you know, they call my name, I stand up, they're like, 'Do you have representation?' And I was like, 'What do you mean?' And so, I ended up like actually doing like a trial, self-represented. And, you know, the cop was kind of bumbling through some stuff. I had done some research. I had like pictures like exhibit A, exhibit B, and I'm like showing them to the judge. And the prosecution asks the cop a question that so far as I could tell was like definitely leading the witness if any of my like, you know, cop show, court show, TV experience was accurate. And I'm like, man, I'm pretty sure I can object because that seemed like a leading question. And I'm like, I'm going to do it. And I was like, 'Objection, your honor. Leading witness.' And everyone on the court staff starts dying laughing. And the judge is like, 'Sustained.' And the prosecution, she's like no further question. She goes and sits down. She has her head in her hands. And anyway, I win this case. And the judge calls me up afterwards and he was like, 'In all my years, that had to have been the funniest thing I have ever seen.' He's like, 'If you're not in law school, you should really be in law school because that was awesome.' And so I told my dad the story. This is the connective tissue. I told my dad and he was like, 'This is not surprising at all that you're that annoying 19-year-old that like rolls in and just steamrolls the prosecution out of technicality. It's like such an obnoxious thing for a teenager to do.'
It's like Jim Carrey in Liar Liar.
I know. I know. It was so bad. Oh man.
So you graduated Georgetown. You go straight to Palantir?
No. I was in the... I worked in the intelligence community. I was doing some like contract work on natural language processing.
Wait, I read is this true or not that you were working on like Farsi? Like were you working, were you around the Persian language?
Yeah. So the tricky thing is that it was less about the language and more about the script. So obviously Farsi, Arabic, they share a common script. There are some additional letters and some that don't exist in either language but it was really like Arabic script-based languages that I was doing natural language processing with. So yeah, I mean Dari, Pashto, Urdu, Arabic, all of the above.
You can't speak it, can you?
I mean, I worked in the embassy of Afghanistan in Washington DC, like the Afghan embassy in DC. So I learned all of the things that I would need to say at like, you know, a reception like 'toristan', 'hopan', 'tashakura'. That's basically all I know.
All right. All right. That's pretty good. That's pretty good. And then from there you went to Palantir.
Yeah. In 2008 I left my role in the intelligence community and was one of the early, early people at Palantir.
Well it started out as like what we call, what today at Palantir is called deployment strategist which is like sort of a deployment manager. So the forensics engineering ideas, you go in with the customer, you sit with them, you understand their problem, you work on correcting bugs on site, adding features. And the reason this is important is that in classified environments they can't articulate back to home office in Palo Alto what it is their problem is or what their data looks like because it's classified. So they needed to bring in people with clearances that could go in and sit with them and actually like touch and feel and address the real problems that they were facing at that site. And so I did that for the first part. And then we stood up later in the history we stood up a team called Leverage which was effectively the sales team for Palantir and that sat alongside the deployment strategists. And it was really my job to like figure out how to grow the business. Both like with new deployments, new agencies as well as horizontal expansion inside of the existing customer base.
Mhm. Palantir has a lot of good like rename fancy ways of saying sales.
Yes. Well, we did everything we could to not say sales. That was the important thing.
You might still try that like that still may be the case today.
Yeah. I mean I think there is more of a traditional sales motion inside of Palantir today than there was when I was there. Like I think that they actually have commission sales and stuff which we didn't have when I was at Palantir.
So it's maybe either maturing or becoming more lame one or the other.
Yeah. Sales definitely gets like a real bad rap in the valley. Like it definitely like, you know, when you have a lot of technical founders the like default state is like yeah you just build a great product and then like it sells itself and eventually you realize like it doesn't sell itself.
Right, it's just not true. It's not the field of dreams. That's not how this works.
Yeah, if you build it they don't just come, right? And it's actually even worse if you build it and they do come because eventually they'll stop coming and in the meantime while you think you're doing the right thing the like spigot is slowly turning off behind you, you just don't see it. And somebody else likely your competitor is actually building the machinery that like they have to like bring the product to market, right? And you know like usually like during the COVID era like everything was going up and to the right it was like oh you see, I told you like you don't need to sell. I'm like okay fine whatever and then like a year later like turns out like no one was buying it. You have to go.
When the curve flattens and you haven't built the machinery, then you're in real trouble.
Yeah. Totally. Yeah. And you know, we're kind of seeing this with the AI thing now too, right? Like you just everyone's just like, 'Yeah, just build it.' Like they'll just come. And I'm like, 'Yeah.' You know, so I saw a tweet somebody on my team was like, 'Yeah, it's like how like we wouldn't say like if you're an engineer, like you don't have to code anymore because cloud code is there,' right? It's the same thing with sales. Like this doesn't stop selling, right? It gets a bad rap.
Yeah. You still are going to need people to like run things through to completion. That's pretty important.
Yeah. Yeah. So you did that for like four or five years, Palantir?
And how big was the company when you started?
It was in the like low tens when I started and small. And yeah, when I left it was I think right around a thousand.
And then somewhere along the way you met Peter?
Yeah. You know, it was funny like in the early days of Palantir, Dr. Karp, who's the CEO of Palantir, we would have these conversations and I would ask him like, 'Well, what does Peter think about this?' And he would give me kind of a short answer and he'd be like, 'But I'm not going to let you meet Peter because Peter will like you too much.' And then he'll like convince you to leave. And I was like, 'That's such a weird thing to say, but you know, Dr. Karp says a lot of weird things, so no big deal.' And then eventually I think Karp got tired of playing the middleman on the sales front. It was like Peter asks him a question and then he asked me the question, I answer him, it goes back to him and then he goes back to Peter. He was like, 'You guys should just, Peter, when you have questions about the pipeline, just call Trae and find out.' And you know, turns out Karp was right. Peter called me in 2013 and he was like, 'Hey, have you ever thought about working in venture capital? I'd love for you to come over to Founders Fund.' I think to this day I have no idea if like it was a clever way for Karp to fire me. Like I don't want to deal with Trae anymore. Let's let Peter take him over. Or if it was just like Peter thinking opportunistically. But yeah, he and I worked pretty closely together in the last few years that I was there as we were trying to figure out like how we could turn the sales kind of loose sales process into repeatable machinery that we could use with different, you know, customer segments moving forward.
Mhm. And were you like, 'Wow, venture capital, like this is the thing. This has always been my thing.'
No, I had no idea. I think like you know I told Peter when he first called me the only exposure I had had to venture capital was I think like Owen Wilson in Wedding Crashers told people he was a venture capitalist and I was like I don't even know what that is but it's in a movie that I think is funny. And so I wasn't tracking at all.
That was like what they used to get clout with her dad.
Yeah. Yeah. Exactly. And so that was my only exposure. I had no idea what it was. I didn't know anything, still arguably don't know anything about finance. And I told Peter that I'm like, 'Dude, I don't know why you would ask me.' And he's like, 'Oh, I think it'll be good. You should just talk with the team.' And I remember my first interview was with Lauren Gross, who's our COO here. She's sort of like this legendary venture fund manager organizer. And we sit down and she's like, 'So, what makes you interested in Founders Fund?' And I was like, 'Oh, no, no, no. You misunderstand. I am not. I don't know anything about this.' She's like, 'Wait, why are we talking to you?' I don't know. Ask Peter. He wanted me to talk to you. So, not something that I was tracking as being aspirational in any way. You know, 12 years in, I hope everyone on the team is happy that I came over. But I do understand the like one of my things when I meet someone and I've like been in the walls of a venture firm for a while is when they tell me they want to be in venture, I just have like a... it's a red flag. There's something that comes with that that I'm like, ugh. It's a red flag.
I don't know why. Why do you think that is?
Well, I think it's like because it's clout-chasy, because you're doing it for the like gravitas of it.
