How I Built This with Guy Raz - Rivian: RJ Scaringe

Episode Date: September 12, 2022

When you consider the risk of doing business, it doesn’t get much bigger than starting a car company: competition is formidable, startup costs are in the billions, and very few people believe you can pull it off. That’s the massive challenge RJ Scaringe walked into in 2009, when he launched his truck and SUV company, Rivian. To add to the risk, RJ wanted to build fully electric vehicles while attracting drivers who’d never bought them, so he knew his trucks had to be fun and sporty: appealing in their own right. Rivian’s journey has taken RJ from an old warehouse in Florida to a massive Midwestern car manufacturing plant; and from years of stealth planning to months of anticipatory buzz from buyers and the industry. Rivian rolled its first trucks off the line in 2021, and is hustling to fulfill tens of thousands of vehicle reservations from excited customers. There have been pivots, sleepless nights, and, of course, multiple supply chain issues, but today, Rivian is valued at $30 billion and is a major player in the electric vehicle industry.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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Airbnb.ca.ca. slash host. Hey, so before we get to this brand new episode of how I built this, I wanted to make sure that you all knew about the how I built this shop where you can find t-shirts, hats, mugs, tons of other merch for you or any trailblazing entrepreneur or builder or innovator, or just fan of the show. We created a collection of how I built this apparel, accessories, drinkwear, and more just for you. It's currently available at Wonderyshop.com. So go check it out right now. Okay, on to the show. One of the things that is interesting with electrification is it completely changes

performance boundaries that we previously accepted. So our pickup, I was on the PCH, the Pacific Coast Highway in California. This was maybe three, four weeks ago. I pulled up to a light. It was early morning. And a brand new Ferrari pulled up right next to me. The guy looks over me. I look over with him and said, hey, you want to see what we can do here. And so we both accelerate quickly off the line. And I out accelerate by quite a margin. Oh, yeah. And we get to the next light. And he says to me, I can't believe my Ferrari just got roasted.

Smoked. By a pickup. Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements. they built. I'm Guy Raz, and on the show today, how RJ Scorange was laughed out of the room when he set out to make an all-electric pickup and how that motivated him to build Rivian, a truck to push gas-guzzling vehicles off the road. Most startup founders are motivated by a purpose. You have to be in order to withstand the volatile ups and downs of building a business. And that purpose is often about introducing a product or service that you believe will have an impact, either in your community or

industry or in the world at large. And this applies to many of the brands we've profiled on this show. For Paulina Vexler of Universal Standard, the purpose is to create a more inclusive clothing brand. For Sam and Mariah Caligone of Dogfish Head Brewery, the purpose is to bring culinary techniques to the art of beer brewing. And for RJ Scouringe, the purpose is about building a better car, better for drivers and better for the planet. But the difference between RJ and the vast majority of the brands we've profiled on this show is timescale. It would take more than a decade of research and development before his company, Rivian Automotive, was able to sell anything. So this is the story of someone who found a way to merge his idealist. with a huge market opportunity.

Rivian is trying to solve a very hard problem, actually several hard problems, and it's why RJ Scorange has been at it since 2009. That was the year RJ and a group of collaborators started a small car company that would eventually become Rivian. RJ wanted to build electric cars, but he knew then, as he does now, that to really make an impact with consumers, you have to make it easy and appealing. And for RJ, the way to get there was going to be with electric trucks.

Now, even though you may think you see electric Teslas and Kia's everywhere you look, electric vehicles only make up around 4.5% of all cars on the road in the U.S. And most of those electric cars are sedans. But the top-selling vehicles in America aren't sedans. They're trucks. Ford's F-Series, Chevys, Silverado, and M. the RAM pickup dominate car sales in the U.S. So to get most people driving electric cars, you really have to win over the truck owners. When RJ got into the car business in 2009,

GM and Chrysler were cratering. Both companies would be bailed out by the government. This was not an obvious time to get into the industry. But what RJ had and has is patience and a long-term vision. He knew and still knows that to mass-produce electric cars in the U.S. and then get consumers to buy them, we'll take time. By the end of 2022, Rivian expects to deliver around 25,000 electric trucks to waiting customers. It's a drop in the bucket when it comes to overall car sales, but within a few years, the company hopes to become the biggest electric truck maker in the world. There are growing pains for sure, which you'll hear about. Supply chain challenges, costs, manufacturing delays.

But given what RJ and his team have already been through for the past decade, these are just more bumps in the road. RJ grew up in the 1980s on the space coast in Florida. His dad was also an engineer and an entrepreneur. And my dad and I are really close, so we would always talk about the business, and he's an engineer's engineer. So he's the type of personality where he understands how, everything works and if something's broken, he attempts to fix it. So that certainly was something

that I grew up with. And as a kid, it would, I would get very frustrated if I didn't know how something would work. So I would want to understand how everything worked. And I also always had this view that anything is possible. I mean, it really because of my dad, he would look at these complex problems and be like, oh yeah, that's something we could solve. And so he's such an optimist. And he's always been so incredibly supportive of me thinking about things that, you know, now I think back. Imagine your six-year-old son says, do you, I want to start a company? And he's like, yeah, of course, you should definitely do that. So even as a six-year-old, you already had an idea of what you wanted to do when you grew up.

Like, you were that focused? Yeah. I mean, I knew from my earliest memory, I knew I wanted to be an engineer. And it's sort of funny. even as a kid, I would be building these little businesses. So I had made these little business cards when I was probably seven or eight years old and I said my name and then I said, I polished metal. So I'd go around people's houses in my neighborhood and say, do you need any metal polished?

And I had a polishing wheel and polishing wax and I would polish metal. So it was always just this perspective of let me go build something. And I also was deeply enamored with automobiles. and just a extreme car enthusiast from my earliest memories. It was fortunate to have a really a premier classic air-cold Porsche restoration expert that lived by chance close by to me where I was growing up. Just like a neighbor? Yeah, just a neighbor.

So I got very involved just through observation and through my neighbor in this case, taking the time to really explain to me how everything worked. All right. So you were, and in high school, if I knew you in high school, if I met you in high school, would I have known you as like, that's RJ, he wants to build things, he's going to be an engineer. Was it already clear at that point? Yeah.

You know, in the senior description of what I wanted to go do, I said, I'm going to go start a company. And then shortly after high school, I started to figure out what that actually meant in terms of what kind of company and the fact that I wanted to be a car company. Wow. Did you watch, like, I don't know, would you watch like those films about like, like, those great sort of captains of industry who started car companies? Of course, but when I say I was a car enthusiast, I was deeply embedded in just understanding the history of the automobile. And it was funny when I was growing up, I would say to my parents, I wish I was born in 1890. Because that's, you know, that was when all the excitement happened in the auto industry.

That's when it was all formed. And what's interesting sitting here today is I'm so glad that I was born in 1983 because I do think that, The change is going to be larger over the next two decades than what we saw in the first two decades of the auto industry. You know, the sort of the shift from a horse to a car, as we now think about going from a combustion powered, non-connected vehicle, which is the majority of the vehicles in the road today, to connected electric and increasingly autonomous vehicles. It's a massive shift. Totally. This is an equally exciting time.

Yeah. I mean, there's a complete renaissance happening. which obviously is what we're going to talk about today. But I wonder, when you, I mean, you knew you wanted to make cars, right, from a young age. And you ended up studying engineering, I know, at Rensselaer Polytechnic in New York. And then you went on to get your doctorate at MIT. But I get, I'm wondering, you were hoping to start a car company. You knew this from the time you were young.

So why did you think you needed a Ph.D.? The reason for that was really. quite simple. I knew that we would need and I would need a lot of capital to start a business like this. And I felt that if someone were to invest in a company, a car company, which admittedly is an extremely high risk proposition that demonstrating some level of intellectual rigor and intellectual capability through a PhD would be helpful in that regard. So I studied and worked really hard. I graduated number one in the school from RPI with a perfect GPA. Wow. You were single-mindedly focused. You wanted to go to the best graduate school, presumably. Yeah. I was very

close and in fact signed onto a position at Stanford, but ultimately switched a few days into that to MIT. And the reason was I was selecting the grad school based upon what I thought would best position me for starting Rivian. Wow. That is unbelievable. You're like a unicorn in that sense because I almost never meet people who were that sort of had that much foresight. You were literally thinking about how MIT could help you in your quest to start a car company one day. Absolutely. Yeah. So at that point, this is back in 2005. Yeah. Stanford did not actually have a very strong car program or vehicle program. MIT's was the best in the world. So the Sloan automotive research lab. And that lab was supported by and integrated with a number of different auto manufacturers. Wow. So they have like a pipeline right to G.

and Ford and... Yeah. So you'd beat with engineers and research staff from those respective companies and be able to dive into their technical challenges. You'd get a chance to go visit and meet with them on their R&D centers. And what I realized is that the likelihood of me being successful starting a car company with no capital, no team, no technology, no brand, no facilities, no supply chain. I actually felt the likelihood of me having impact doing that was still higher.

than the likelihood of me being able to impact the trajectory of a large existing OAM and the challenges, I would say, of holistic or system-level innovation. Yeah. All right. So if I met you in 2005, 2006, when you're doing a graduate degree at MIT, and I would said, so, RJ, people are telling me that you're really interested in starting a car company, but at the same time, you want to start a business. So you've got to solve a problem.

And there's a number of problems you can solve. You can say, well, you know, the existing American cars isn't compact enough or it's not cool enough or there's no Italian designing, you know, design schemes in American. Like, we need beautiful American cars or we need faster American cars or what were you, what was the problem you want to solve? Was it was it about fuel efficiency? Was it about emissions? Was it about design? Was it about quality price? What?

the question we were trying to solve, and what I was focused on is how do we create a transportation system that will work in 100 years or in 200 years? And the challenge we have as a society is, our current transportation system is, it's causing, without question, some of the biggest challenges we face as a society. So everything from almost all of our major cities around the world have severe air quality issues to a lot of the geopolitical conflicts we have around the world, to perhaps most challenging, not perhaps, I'd say definitely the most challenging, is we are fundamentally changing the composition of our atmosphere.

That was what was motivating you. For sure. It was a central focus. It was the internal combustion engine has got to, we've got to figure this out. This is a problem. We have to move to a carbon-free system. And so while I was at MIT,

I was spending a lot of time thinking about what type of car needs to be, what type of products are going to be necessary over the next several years. And, I mean, it was pretty wild. The beauty of a clean sheet is you can think really broadly. So it was we were thinking about, or I was thinking about everything from pedal-powered cars to diesel electrics to pure electric. But I actually was really sort of intrigued by this idea of a pebble-powered. hybrid, like something with what we now see with e-bikes, but doing that in like a covered format. Yeah, like a Flintstones car.

Yeah, but where there's an electric motor to sort of help you, but sort of like that, yeah, with pedals. And I realized that as cool and interesting as that might be, the reality is there's not a lot of scale. People are not going to want to buy that. It's interesting because around this time, it may have been around this time, 2004, 5, 6, and maybe earlier, I can't remember. But there was a documentary. It was called something like how GM killed the electric car or something. And I remember there were a lot of conversations around like GM made this amazing electric car and lots of people loved it. And then they just killed it.

And there was this conversation around this time, 2005, 2006, like electric cars really were not viable. Do you remember those conversations? Of course. Yeah. Yeah. Very much so. But, you know, for myself and I think in academia, it was never. question that electrification is the future. The question was solely around what's the path to get

there. All right. So this was what you're focused on. And when you were set to, you know, to get your PhD and go out into the world, was it clear to you already that you would not go and work for another company from the get-go that literally you get your cap and gown and you would take it off and you would start your own thing. Yeah, so the interesting thing, though, is I didn't talk about it. So I kept this all to myself. You didn't tell anybody. In my last year, I should say, as a graduate student, I talked to a few professors about it. And Jim Womack, who's now become a close friend and a great advisor, I was in a class he was giving on the future of automotive, this was in 2008 or 2009. And near the end of the class, end of the semester, I walked up to him and

said, hey, I'm starting a car company, and he sort of looked at me, and said, you're crazy. But other than that, I really kept it very much to myself. And then, of course, we graduated, and I started the company the next day. The next day. This was not Rivian. This was the company you found it called Mainstream Motors. Yeah, so I didn't have a good name. So I had to incorporate something.

So I incorporated under a temporary name. And I used Mainstream Motors. My dad's company was... That's a sexy name. Yes. That's a really, that's a hot name. You're going to sell a lot of cars. This is a mainstream motor.

Yeah. So that was, I think, the name for a couple of months. I don't remember exactly how long, but very short period of time. And then we came up with what we thought was the actual name, which was Avera, A-V-E-R-A. And Avera was a portmanteau of a couple of different words, right? Yeah. We took the word, Verde and Terra, so green and earth. and the idea was a green earth.

Right. Okay. And I guess the goal, this idea of this company, the goal was to make a more fuel-efficient sports car, right? Like a hybrid. That was what you were planning to do, right? Yeah. Well, in terms of the first product, it was even more crude and simple than that. It was let's build a first product that helps us build a brand. The idea was a 100 mile per gallon sports car and build a brand around efficiency and sustainability. And then from there continue to develop more and more technology, different products. And so we started working on that. And you say we. It was you and who else? Well, it was me to start. Yeah. And then hired one or two people in the first six months. But, you know, very, very slowly grew the company. We did not have a lot of

capital. Well, yeah, I mean, this is my question. This is, I believe you started this. You founded this in 2009. Correct. Yeah. And anybody remembers 2009 knows that like all the auto manufacturers, like the big three, they were in Washington all the time. They were asking, not Ford, but the others were asking for help to make sure they didn't collapse. And I mean, the whole industry was in crisis. GM, Chrysler, for sure. And this was not a good time to be thinking about, A, starting a car company, B, asking investors to invest in a car company when the two, two out of the three big, big ones in the U.S. were asking for bailouts. Yeah, it's, it was in some ways the worst possible backdrop one could imagine for raising capital, walking up and down

San Hill Road and sort of knocking on doors and trying to get meetings. You were trying to do this? Yeah, I'd say very unsuccessfully, trying to raise capital. In 2009, you were trying to raise money from like, you know, the sequoias and the whatever out there. For sure, yeah. But the nature of it is, I mean, imagine I had no capital, no product design, no technology, no team.

You had the credential. You had the MIT credential. At a PhD from MIT. Yeah. And so I would basically go into meetings and say, I'm starting a car company. And they'd say, well, tell us about your factory or tell us about your team or show us the product. And I'd say, well, we don't have those yet. But we're going to build them.

So it was a, it was, you know, looking back, it was an incredibly hard pitch. You know, in starting a car company, it's different than most technology businesses or traditional venture-backed businesses because even the whole venture space is designed around the idea of being able to launch your minimum viable product. You can launch something quickly. So for very little capital, you can build your software platform, build your app, and show that there's market demand for it. And the challenge in starting this is if you're being honest with yourself and therefore honest with investors as you talk about the business, you have to say, well, we have to raise at least a billion dollars. If we had all that money right now, it would still take us several years. And do you want to be the first dollar in? Right.

So it's a really, really hard investor. So you have this classic like chicken or egg. You need money to develop technology and product. But if you have no product and technology, how do you raise the money? So you have to sort of almost like will it to happen. You have to just start working on the problem and start slowly making progress. Well, so I'm curious, in 2009, when you're going around asking investors if they want to invest, what you want to do is at this point is to build a prototype of a product,

which is going to be a fuel-efficient sports car. But you needed to do that. And you could do that for, what, $5, $6, $7 million? Oh, less than that. Less than that. Well under a million dollars, we built the first prototype. And so you raised no outside capital to begin work on the prototype. It was all like family and friends and stuff.

Yeah, exactly. In the beginning, it was just family and friends, mainly my dad and I. And I bought a house when I was in high school, and my dad refinanced his house. and we both put that money into the business. You bought a house in high school from like what your jobs? And just like you just bought like a cheap house that you rented out? Yeah. Yeah.

So I, um, late 90s summers, I worked two full-time jobs. So I worked as a, as a machinist during the day. And then I worked in a restaurant, uh, in nights and weekends. And my goal was to buy a house. So I saved up enough to, to buy a house. Yeah. I'm just amazed when I hear about like high school and college kids who are just so focused and then they buy a house and then they rent it out and that eventually builds wealth. But that's a different story. Okay. Now here's my question. I'm just thinking, my God, how do you build a hybrid? I mean, how do you build a prototype car that's going to work? Like you're in Florida. You're in this area where you grow up. It's you and get one or two people with you. How do you physically, like where do you start? First of all, we're in this area where you grow up. It's you. It's you and get one or two people with you. You know, how do you physically, like, where do you start? First of all, we're. or do you build the car? Do you just like rent a warehouse that you start working in?

That's exactly what we did. I rented a warehouse. It was actually a warehouse I rented from my dad. And that was what we worked out of initially. And then to make a prototype, it did to figure out how to do that. So started traveling back and forth to Detroit to meet with some of the prototype part fabricators. And as we were going through it, I mean, it was very scrappy. So we found people that could make things all over the place. whether it was in Florida, whether it was in Detroit area, that could sort of make some of the parts. I mean, I can't even imagine just all the problems, all the challenges you had to solve for, right? To make an engine. And then an efficient chassis and suspension, power train.

And, of course, this was not going to be a completed car that you were building. It wasn't going to look like somebody you'd find an auto showroom. But still, like, where does it start? At that time, we were really focused on how the car would be built. So we started with the process to assemble sort of what we think of as like the structure, the aluminum structure. So I was developing parts. I was designing parts in CAD. It was 24-7.

We never had enough, even close to enough money to do anything the right way. So everything was sort of hacked. How did you get like, I mean, were you just basically getting things made for you? Yeah, I mean, and just ship to you in parts and you would kind of assemble it in this warehouse. Yeah, and we do some assembly of it, depending on the parts, some of those parts would be put together in the Detroit area. But yeah, it was definitely a hand-built process. All right, it took, I took you guys, small team of you. You had about, like, 12, 13 people working on, I think, something like that.

Yeah, just over 10. Almost two years to come up with this. And you got some attention, press attention. There was an article in the Orlando Sentinel. and I mean, it's really cool. You said at the time that you were hoping that by 2012, you guys could build these in Florida and that, you know, they would go for about $25,000. Yep, yeah.

It's probably often the case. We thought the task was easier than it actually is. This is not for the faint of heart. And I think in those days, we had assumed we could do it with less time and less money than was actually realistic. And I often talk to people about this stage. And in some ways, it was helpful that we didn't fully understand how challenging it was because the steepness of the climb appeared less scary, so to speak.

We didn't look at it and fully appreciate how hard it was going to be. And what about the, so I'm looking at a photograph of a team of you around what would become with the eventual car, this Avera car, which looks pretty great. This is a blue car. It looks like a sporty little car. Yeah. And so this car did drive. You did drive it, right?

Yeah, yeah. It drove. In a video, it looks very real. But it was not a, there wasn't a supply chain built around it. And there was not a, it wasn't durability tested. It was a. It was like a hobby car, basically. Yeah, it was a prototype, very crude prototype.

And did it go, what did it, was it fuel efficient? Sort of. It had a long way to go to get to what the target state was. I'll say that. Yeah. But still, I mean, I can imagine, you know, it's kind of cool. I'm looking at a picture of this small team of people around a fully built car, which is kind of a cool achievement to, I mean, did this in under two years. And so you were probably excited about the prospect of like Florida could be this manufacturing center. You could make cars in Florida. And maybe you were kind of carried away with this vision, which I think anybody would that you could make this happen. I think that's about right. We really believed we could make something special. But I would say underneath the surface, and of course, I can say this now, I wouldn't have said this to the team at the time. I had pretty deep concerns just around whether we were solving the right problem and were we working on the right thing. You know, the kind of thing that you go to bed lying and bed thinking about, should we be building this? Is this what the world needs? do we deserve to exist as a company? That was a question I would ask myself all the time. What gives us the right to exist?

I read a quote from one of the engineers who worked on this project, I think that works with the Orivian, who said, when the vehicle was done, literally, you guys finished as a very vehicle, great achievement, pop the champagne corks, and, you literally said, we're switching course here. This is not the right direction. Yeah, it was at this point,

We did bring in a small amount of outside investment. So we had, you know, investors to think about. We had employees and everyone had poured our heart and soul into what we were building. But I just knew it wasn't the right thing for us. And I knew it wasn't solving the right problem. So I said, look, we've got to shift. And that was the easy part. The hard part was that we didn't know at that point what we were shifting to.

When we come back in just a moment, how RJ and his team begin to design a whole new vehicle and why they decide to do it very, very quietly. Stay with us, I'm Guy Raz, and you're listening to How I Built This. Hey, welcome back to How I Built This, I'm Guy Raz. So it's 2013, and RJ is in pivot mode. He's already built a prototype of a fuel-efficient sports car, but now he decides that to really make an impact. he needs to make a vehicle that's fully electric, two vehicles, in fact, an SUV and a pickup.

Which was sort of the craziest thing back in like 2013 to even talk about electrifying. You can imagine if people thought I was crazy to start a car company when I said I want to make electric pickups and this is 2013, it wouldn't be an exaggeration to say we'd get laughed out of the room. But we said this is actually a really good thing. If people are laughing us out of the room, we need to, we have an opportunity to demonstrate that this is a segment that it's the least efficient vehicles of the road. It's among the most profitable segments. So it's the type of vehicle that actually the world needs to see there's demand for electric and the world needs to see that it's possible to electrify.

All right. When you realize that you want to, you need to switch direction, you knew that it was going to be all electric. I remember test driving a Tesla roadster. I did a story about it back then. And it was a sports car, electric sports car. And it was really cool. So you could have said, hey, you know, let's focus on electric sports cars, or you could have said, let's focus on electric sedans or let's focus on an electric family car. So there were different directions you could go in. Yeah. Did you think about maybe going in that direction? Oh, of course. But Tesla launched its roadster in like the 2006-2007 time frame. And the thought of going out and building what Tesla had already done, you know, 10 years later, just it felt like that wasn't a problem that the world needed worked on. But how did you land on this idea of making a pickup truck? What were the factors that got you to that point? What were the things you realized about this particular kind of car? Obviously, it's a very popular segment. Yeah. But we also saw it was, it's a segment that perhaps more than any other has been characterized. by compromises. So a truck drives like a truck. It can be capable and robust, but it's not going to

ride as smooth as a car. A truck is going to be inefficient. A truck is not going to have a lot of trunk space like a truck cannot be sporty. And all these like really wonderful, wonderfully interesting opportunities to demonstrate how technology can eliminate a compromise. And so when we thought about the role of technology and the role of driving electrification, we said we need to not just make a truck that's electric. It needs to be something that's totally different and turns things that are today weaknesses into strengths. Yeah. But were you, I mean, put on your business hat for a second, not the engineering hat. Did you see a market opportunity and focusing on SUVs and trucks? I mean, because this is still the biggest, I think the biggest segment of car. sold in the U.S., SUVs and trucks. Did you realize that and say, wait, we should really go in that direction? Oh, I mean, we were, yeah, very much analyzing the different segments you can go into, analyzing the size of the segments, the efficiency of those segments. But what was incredibly clarifying as we thought about what to do was we knew the right question to answer. And

it was a single question, and the question was, whatever we do, it needs to have. the most positive impact. And that even if the company wasn't successful, if we were working on problems that were big enough and hard enough, that inspired competition, that inspired existing OEMs to change the way they looked at things, that would be a success from the measure of reducing the amount of carbon emitted into the world. So, I mean, this is one of my, in the moment,

most perplexing and challenging times, but looking back, it was actually one of my favorite times in Rivian's history because it was so freeing to say we're trying to solve for impact. Now let's go iterate through lots of different concepts and ideas and strategies that can do that. And, you know, the freedom we had at that point was so unique. We could pivot wildly. Like on Monday we think we're doing this and on by Wednesday we're 180 degrees different from that thinking.

And so the fluidity of. of concepts that we wanted to focus on was just, I mean, it was extraordinary. It was awesome. Yeah. All right. So you know that the future is electric and you're going to be building trucks and SUVs. And then I guess in like 2013, you guys decide to relocate to Michigan, like just outside of Detroit. And it means it's for obvious reasons, right?

The whole sort of U.S. automotive industry is based in the upper Midwest. But, and just had a curiosity, at this point, what the company is like 10 or 12 of you guys? Yeah. I guess it was probably about, yeah, around 12 people. Half of us all moved into a single house in a place called Ipsilani. But yeah, it was, I mean, it was a very interesting time. My now wife, we were dating at the time and she moved with us and none of us had any money. The company had no money, of course. So we were really running lean and hard to try to come up with and scale some of these ideas that we were thinking about.

All right. Let's break down some of the things that you had to do. First of all, you changed the name from Avera to Rivian. What was the name change about? Why'd you do that? Because Avera is a pretty good name. Yeah, it's a pretty good name. This must have been 2010. We were sued by Hyundai. So Hyundai had a lot of had a product at the time called the Azera, A-Z-E-R-A, and they were concerned that the name was too similar to our name. So they basically said, you need to change your name. And we said, okay, we're not going to fight Hyundai and use the very small number of dollars we have to fight over a name that very, very few people around the world had ever even heard of. So we had lots and lots of different sessions and ultimately arrived at Rivian, which I'm so glad all that happened because I can't imagine the company with a different name. I love the name. It's

something that just works so well. Where does the name come from? So I grew up on the Indian River. In Florida, right, which is not actually a river. It's the ocean, right? Yeah, it's essentially, it's part of the intercoastal waterway. So it's a, it's a path for large ships to move if there's large storms that come in, you know, they come inland through this waterway. Yeah. But anyway, so, So we took the first three letters of the word river, RIV, and the last three letters of the word Indian, IAN, and merged those two together into Rivian. And we wanted something that was phonetically easy to say. We loved the basis of it coming from the word river. It sounds like a word that's flowing and moving.

We wanted something that didn't mean anything in any language around the world, which this satisfies. So for a bunch of engineers, thinking about it. about how to name a car company. That was what we came up with. Yeah. All right. So you're in Michigan and in Ipsilante in this group house and you know that you're going to focus on making SUVs and trucks electric. Man, I just cannot imagine what a daunting task you have ahead of you. You've got to make a battery. You've got to make an engine. You've got to design the car. You've got to, I mean, all every. And then the down. the road, you've got to figure out how to mass produce it, and then you've got to find a factory,

and then a supply chain. Forget about all that stuff. First of all, just to even do these things I'm talking about, you need lots of money. Yeah. So was it, I mean, now that you had the prototype of that sports car, you know, now that that you proved a concept, even though you weren't doing that anymore, was it, was it a little bit easier to attract capital? In a way it was. We were able to show as a very small team, highly undercapitalized that, you know, that we could build something. And so if the risk was extremely high before that, it was now very, very high. So it, yeah, it allowed us to start having different types of discussions with investors. But I, I think the other thing you have to remember at this time is it wasn't at all clear that electrification was going to

happen yet. And so that was, that was something we also had to overcome was to convince to convince people that there was actually going to be a big market for electrified products. And now, of course, it's a very different world. It's universally accepted that 100% of the world's vehicle production in the very near future will be electric. But that wasn't the case seven, eight years ago. So, all right, you had to raise money just to get this started. And I know you got, and how much money did you? I mean, even just to get to, I don't know, just start, I can't.

can't imagine how much money you needed. Did you start with a small amount or with 50 or 100 million? No, no, no. I wish we started with that. So the way it played out is we, as we were pivoting into this, into this new space, I sort of zoomed out and said, we're really far away from raising the amount of capital we need. Again, if you're being honest with yourself, you know, you look in the bank and it has, you know, more than a million dollars. You feel like, oh, this is great. And then you're like, but wait a second, we need more than a billion dollars to actually ram. So I started thinking about, well, how do I meet the people or the person that's going to help take this to the next level? And ultimately, the approach that actually worked the best was I went back to MIT and I met with some of the senior leaders there who I had and I still have a great relationship with. And I said, I need some help. I've started this company. We need a lot of capital. And I need to connect with people that might be able to help me in that way.

And that turned out to be a really smart approach because I guess you wound up getting in touch with an MIT alum, a guy named Mohamed Jamil, right? I think he's the CEO of a company called Abdul Latif Jamil. It's a huge family-owned corporation from Saudi Arabia. I think a big part of their businesses is an automotive. And so what you pitched him on Rivian? Yeah. I remember I went out and met with him. and it was just a great meeting because we ended up having a conversation around the future of transportation.

And at the end of it, I had a hunch that they would be willing to support us. And ultimately that played out. So it wasn't as if they walked in and said, RJ, here's $50 million. It was, they walked in and said, here's a very small amount of money. Let's see what you can do. And let's build a business plan. And once that was completed, they said, okay, this makes sense. Now let's build a more sophisticated prototype, built that.

Okay, that seems to be working. Let's engage with more suppliers. And we would then add to that more capital, but it was like less than a million dollars to a million dollars to slightly, you know, to $5 million to $10 million. So it was a very gradual growth because the risks were so high. Here's what I'm wondering about. You are the main engineer. It's your company. But now you're spending most of your time trying to raise money.

And, I mean, given that you love the engineering side, every single founder I've talked to you, with some exceptions, they're just the raising money side's a grind. They really don't like that part. How did you feel about having to really focus on that side of the business? I really have always thought at my job as my role needs to be constantly looking for what's the most important problem to solve with the company. And at that period of time, it was very important that we solved, it solved how we were going to capitalize the business. I mean, that was existential. The money issue. That was the issue.

Yeah, without money, there is no company. So it's sort of like it'd be nice to just work on the vehicles. But you can't. But you can't, yeah. Because this is not a cookie company. Yeah. You are not buying chocolate chips and flour and sugar. You're trying to build an electric car.

You can't even start until you have the money. Yeah. And that's one of the hardest things, not necessarily raising capital. That was hard. You're being told no way more often than you're being told yes. The ratio is crazy. You're probably getting 150 nos for maybe one partial, maybe yes. But that was fine.

I knew that going in. The hardest part was maintaining the morale of the team. Yeah. Yeah, I knew all of these folks really well. I knew their families well. I knew the names of their kids and sort of knowing that their livelihood, the livelihood of their families is dependent on us being successful, but also knowing that I needed to keep their state of mind focused on solving technical problems and not stressing about the fact that we have a half a week of cash. Yeah. And we haven't paid any of our suppliers in two months. And it's a very emotionally challenging state. I'm curious because around 2012, when you start raising this money, you did something, and this is interesting because there's, as you know, I think, and I hope our listeners know, we do a lot of research for every interview, very deep research.

But there is a significant gap in our research between 2012 and, let's say, 2017, because you very intentionally went into stealth mode. You decided we're going to just not talk about what we're doing. We're not going to publicize it. We're not going to go to the media. We're not going to. And was that connected to what you had done in Florida where you actually did talk to the media? And you said, hey, we've got this awesome car. We're going to make them in Florida.

Did that inform this strategy of just going into stealth mode and not talking about it at all? Yeah, absolutely. When I first started, we had targets. And as you would expect, the targets were not realistic. and you can find things where we said, we're going to launch this thing by 2012 or 2013. And I realized that the number of unknowns was so significant as we were beginning this sort of second part

or this new part of the journey that it would just be silly to talk at all about what we're doing externally. I mean, we didn't even have a website at this point. We just went completely dark. And it was actually really helpful because it avoided us getting overly married to any specific aspect of the strategy or any specific aspect of our timeline.

And it also created its own challenges. Recruiting was a challenge because people would joke with me. So I'm going to go home and tell my spouse, I'm going to join this company that doesn't have a website, that doesn't appear to have a lot of money, and intends to launch vehicles sometime in the future. I was like, yeah, some version of that, yes. So it was challenging to say the least. All right. So let's sort of dive into this stealth mode, period, right?

I'm trying to, because this is like a good sort of four or five, four year period in stealth mode. So can't tell me what's happening? Yeah. So we built our first truck, what would look like to most people a production ready truck by the end of of 2013. Okay. So similar kind of what you had done in Florida, you rented a warehouse and you were actually building a prototype. We were building a prototype. It was completed end to 13, beginning of 14, and we called this P1. And it was a pickup truck that you were building? It was a pickup, yep. Like a flatbed pickup. Well, not a flatbed, more like a little, it was a little two seat pickup. So it was a

very small pickup. Okay. And we realized that that conceptually wasn't right. We didn't really get the branding on it right, and we were trying to make it really low cost. So then we built another version, which we called Alpha, and this looked like it was from a 1960s science fiction movie where it was like looked futuristic, but looked like it was trying to look futuristic, if that makes sense. And then we iterated again, and really by that point had started to deeply understand the brand we were trying to build in terms of both enabling and inspiring adventure, but this idea of like, you know, a product designed to take kids to the beach and families, mountain biking and that kind of thing. But each of those iterations, you can imagine

spool up like there was clay models and there were teams of people doing research and we would build not just the vehicle, but then mules or like test vehicles to test the components on the vehicle. So these big iterations were at the end of each one, we said, oh, this isn't it. This isn't right. We don't have it yet. All right. As you're in stealth mode, which I wish I had some cameras in there because I think it would have been really interesting to be there. Me too. I should have taken more pictures. You probably didn't. You were nervous because you were, you know, you made that. But was at any point during that time, did you think, you know, this might not work out? I mean, because I'm thinking like

80, 90 percent chance is not going to work out. Oh, I think much, much higher than that. I would say 98% unlikely. But did you think it was going to work? Did you think that the 2% was on your side? I didn't think about that a lot. I mean, it was something I thought about at least every week, but I didn't allow myself to go there. It's a, you know, because you can quickly start to get into the realm of, well, what's

plan B and what's plan C? And if we can't raise money, how do we take some of the things we developed and turn those into smaller businesses and like all that. But it's really, it's really distracting to focus. on failing, you know, to focus on how this is going to go wrong. And if it goes wrong, how you make it less bad for everybody. Yeah. And like in some of the darkest moments, you know, it would be the page of ideas on what we could turn the company into if it doesn't work. But I never found those to be particularly useful because they didn't drive actions. I wasn't going to go work on plan. The moment you

start working on plan B or plan C, the likelihood of plan A working goes to zero percent. How did you land on this idea of adventure? of branding this product as adventure. Because, you know, the F-150, I think of Home Depot. I go to Home Depot and there's like that part of the parking lot near the lumber area. And it's like all big, you know, trucks, Dodge, Ford, you know, I'm thinking contractors, right? Yeah, yeah. So that could have been a focus or like, you know, the sort of rural, you know, kind of independent-minded American, wide open spaces, you know,

self-sufficient, that kind of image we have of like a big truck with like, I don't know, American flag or something behind it. Like, that's a huge market. Yeah. This idea of adventure is really a deeper reflection of what we think about when we think about what is humanity. Humans are innately curious. And so that curiosity leads to us as consumers wanting to accumulate new experiences. is so we actually, we had a few objectives when we were designing the vehicle in the form you see today. We said, number one, we actually don't want this to be something that's heavily cross-shopped with existing trucks, meaning we actually want to be drawing in customers that are coming out of everything, not just trucks or SUVs, but pasture cars, sports cars, coups, hatchbacks.

And what's amazing is we now have the data to show it. And it's exactly that. So people who've previously owned a pickup truck represent just over 10% of our customers, meaning 90% have never owned a pickup before, which is awesome. And then the second objective we had is we, and this was one that I was even more focused on, is we were trying to target customers that were not electric vehicle customers, meaning it doesn't have impact if we're just moving a customer from a Tesla into a Rivian. We want to be moving a customer from a combustion powered vehicle in Thriven. And again, we now have data on this. We're less than 20% of our customers have owned EVs before, meaning more than 80% have it ever owned an EV.

Yeah. As you were sort of making progress on building these prototypes, you must have gotten to a point where you were confident that you could really now produce these. And you were raising money. You started to look for a plant to actually build these cars. And one became available as an old Mitsubishi plant in Illinois. And you guys had to be able. You had to be a you bought it, you were able to buy it. But that meant, I think you paid $16 million, but then you'd have to put a lot more money into getting it ready to be an electric car plant. But that meant that you were doubling down. Like now, 2016, early 2017, when you buy this plant, you're essentially saying, we're going to make this. Oh, yeah. I mean, in the automotive

space, there's been a lot of new companies over the last 50 years. And one of the biggest challenges is to go from the concept or the prototype to mass manufacturing. Yeah. And that step causes one to think about what are all the ways you can get there. Can we use a contract manufacturer? Can we, do we build a greenfield site? Do we find an existing site? So we were looking at every possible combination.

You were thinking probably maybe we could partner with Vokeswagon or Ford or GM. I think GM at one point even wanted to partner with you. Yes, we're looking at all different types of things and ultimately arrived on this idea of Let's find a facility that is in place that we can buy and repurpose. And in the world of used automotive plants, there's not, you know, it's not an overly liquid market. There's not a lot of used plants that are in a viable condition. This is a unique setup that this plant we purchased started production in 1989. So it's a relatively new plant and very good access to the supply chain.

And so we ultimately, as you said, we bought it for $16 million, which was just an incredible. incredible deal. Close in beginning of 2017. Now, we didn't have at that point the money to actually turn it into a plant for ourselves. So we sort of bought it and then said, okay, now we got to secure all the capital to convert this into a Rivian plant. So here's, I'm wondering, I mean, that's a huge step buying that plant. And it's in 2017. It's going to take some time before you can at that point manufacture there. At this point, Tesla is really, starting to make an impact, still struggling at that point, right? But it is making an impact. Certainly in California, people are starting to drive it and it's getting, the vehicles are getting

good reviews. I mean, did you see that, did that make you anxious? Like, oh, God, there's just so much more far ahead of us? Or did you see that as like, oh, this is great? They're just helping us build this market. We definitely looked at it as great for the industry, great for electrification. I think today there's around one and a half billion cars on the planet. And even today, this is now, you know, relative to 2017-2018, this is a lot further along. But of those one and a half billion cars, less than 2% of those are electric. Yeah. So we are so early, we're unimaginably early in this transition. And so the fact that Tesla was out earlier than us in building what I think of as a very strong brand. We saw that as a good thing, but the world needs more than just Tesla to convert

those one and a half billion cars to electric and to completely remap the industry. So I think the world often believes that we would be rooting against them or something like that. It's just not the truth. I think their success is good for the world. I think it's good for the space. We've designed products and a brand that feel and look very different than theirs. So their success and our success collectively help each other. All right. So you've got this factory. And at this point, I mean, I have to imagine it got a little bit easier, maybe a lot easier, for you to start to raise significant capital, in part because the economy was getting better.

venture funds flush with cash. Did it become, I mean, and you're talking about billions of dollars you have to raise, not a few million. Did that start to, when did you feel like it started to become easier? You didn't have to make the case as aggressively. It became easier, but not, it was not a, there was no binary step. The core decision we had, this was back in like 2017, was when and how do we come out of stealth. Because being in stealth at that point, it went from a, I would call it like an

asset. It was helpful that we were in stealth to becoming actually a painful liability where you needed awareness. We needed awareness. And so whether it's investors or suppliers or recruiting, it just became really problematic. And so we took the decision to say, let's come out of stealth. And we decided to show the R1T and the R1S, that's our truck and our SUV at the LA Auto show at the end of 2018. So you said in 2017, you said at the end of 2018, we're going to go to one of the biggest auto shows in the world, the LA Auto Show, and we're going to debut our pickup truck and our SUV. Exactly. So we had built some very solid technologies, some solid platforms. We were engaged in a variety of different strategic discussions with big partners. So we went into the LA Auto Show and we'd already

built a very deep relationship with Amazon. We hadn't yet announced our deal with them, but we knew it was coming. Amazon would eventually invest $700 million in Rivian and also order 100,000 trucks. Yeah. So Amazon is now our largest shareholder. They invested a lot through multiple rounds. But when we showed the vehicle at L.A., we hadn't yet announced them as an investor. Now, we knew that that was going to happen.

But it was actually really helpful going into the L.A. Auto Show with a level of confidence around what we knew, but the world didn't know, was going to come. over the coming six months in terms of partnership announcements and investment. And that was sort of the moment when we went from a company with no website, no background to a company that was out of stealth. And essentially from that point forward, we were then very much followed publicly, and we knew that that would happen. Yeah. You were at the L.A. Otto show, I'm assuming.

Yeah. Tell me what the atmosphere was like. What was there were there lines of people to come see? I know him got a lot of attention. It was fun in the sense that people were like, who is this company? Where the heck did you come from? When we come back in just a moment, how RJ's plans to get Rivian up to speed get snarled up in the supply chain. Stay with us. I'm Guy Raz, and you're listening to How I Built This.

Hey, welcome back to How I Built This. I'm Guy Raz. So it's 2018 and after years of near radio silence, RJ and his team debut their first two vehicles, a pickup truck and an SUV at the LA Auto Show. And because Rivian has been operating in stealth mode for like five years, it kind of seems like they've come out of nowhere. And we explained, well, we have a team of about 600 people and they're like, well, where did a 600 person team come from? And so I think that was what surprised the world. And it was it wasn't as if like we thought of this. concept a year ago. It had gone through so many iterations, but that was the overall tone in LA. It was

just like curiosity around the origin, curiosity around, you know, what's next, those kinds of things. All right. So you make this big splash at the auto show in 2018. And I want to fast forward here just for a moment because it's going to take you a while, right, to get these vehicles built for actual customers. But you start to get orders, like thousands and then tens of thousands of pre-orders from people who want to buy a Rivian. And then finally, I think something like three years later, 2021, the first electric pickups roll off the line. Yeah. I mean, it's funny. I even talking about here, it's hard to believe it was years of time iterating and grinding away without enough capital. But some of those constraints led to some of the best innovations.

the decisions to build electronics and software in-house were both strategic but also practical. We couldn't get suppliers to work with us. So we built with the benefit of time, a lot of capability. The scale of challenges can sometimes be overwhelming, but being calm is actually a really important aspect of solving problems because you think more clearly and there's a storm of activity in a storm of challenges, being able to make the right decisions as to how to navigate that, whether it's a supply chain challenge or a ramp-up challenge. These are all solvable items, but they sometimes take a lot of effort. They take the right team.

They take coordination within the team. But I'm incredibly confident in our ability to go solve all those. You know, we had a recent episode of this show with Max Levchen, the co-founder of PayPal and the founder of a firm. and that's exactly what motivates him, solving hard problems. That's what gets him out of bed, right? And when I was talking to him, I was thinking how hard the problems he's working on, you know, how hard they are to solve. But I talk to you, and I'm like, this is like at a stratosphericly different level.

Because here we are, and where we're talking about your company that is now public, it's worth $30, $40 billion, but whatever the market cap is today, you know, the stock market's been a little nutty. But even with this amazing rise, this like overnight success story that's, I don't know, 13 years in the making, right? So really, you still have massive challenges ahead of you. For example, just making enough cars. I mean, you've got tons of people who are excited about these vehicles, have put down deposits and have ordered them. You were hoping to deliver between 20 and 40,000 a year in 2021.

that hasn't happened. I'm not trying to criticize you for that. I'm just saying it's an enormous challenge. So walk me through why it's so challenging to make 20 or 30 or 40,000 of these cars a year. Yeah, sure. When you look at a vehicle, take our truck, our R1T, what we build in our plant, we're assembling roughly 2,000 different components or subassemblies that come from around 400 different suppliers. So some of the components we make ourselves.

We make our battery pack. We build our battery modules. We build all the stamp panels we build in house. But there are other things we don't make. So semiconductors are not made in our plant. Tires are not made in our plant. Headlights are not made in our plant. So those 400 suppliers make a lot of the components that come in.

And that supply chain to get that spool up is not just those suppliers. They have suppliers to them and those suppliers in turn have suppliers. So pick a simple part that we, by like a headlight, that part has over 100 individual components that are in it, just the light, just the projector. So if you look at the number of discrete components in the car, like individual mechanical components, there's around 25,000 components, and any single one of those could disrupt the production. So it's made this difficult for us is we're not just launching one vehicle.

We're launching four at the same time. We have our truck, the R1T, our SUV, our R1S, and then we have a commercial van. There's two different sizes of the van. For Amazon, right? Yeah, which we really haven't talked about the commercial side of the business, but that's another whole side of what we're building. Fleet vehicles, like basically commercial transport vehicles for huge companies. For goods, yeah.

Right, for goods. But where we've had challenges is the supply chain has been in a very weakened state, given the combination of the pandemic, and then the really the unexpected constraints that have happened in the last one and a half years with semiconductors. And what I think is often not fully appreciated is turning a supply chain on is not like a light switch. Each one of those suppliers has to ramp. So it's a very, very complex orchestra.

But the good news is it is now ramping. As of our last earnings call, we, We built over 5,000 vehicles. That is now ramping. So we are seeing the light, so to speak, at the end of the tunnel. But it has been a, it's been a challenging ramp up over the last six months. At full capacity, how many trucks and SUVs can the plant produce a year in normal Illinois? So the plant has a capacity of 150,000 units.

A year. A year. The challenge we have to come back to the supply chain point is we're not able to use the plant fully. So the lines are running at essentially 25 to 30 hours a week because we don't have enough parts. So a good automotive plant is running 110 to 120 hours, workable hours a week. So to only be using 30 hours out of 168, it's really painful. Yeah. You have, I think about more than 80,000 people who put deposits down on a car, which is awesome.

But I guess some of them are going to have to wait maybe two years before they see their car. Yeah, that's right. It's really frustrating when if you have to wait two years to get the vehicle, it is just challenging. Yeah, yeah. But that will take the next, we think the next year to fully ramp capacity. Yeah, I mean, and sometimes listeners accuse me of stressing founders out. And I'm not, I don't mean to do that because you've had a lot of stress over the years. But you've got to deliver 100,000 vans to Amazon by the end of this decade.

I'd just be a little stressed out about that. I'm excited about it. If I were to look at the risk of Rivian success today versus the risk a year ago versus the risk five years ago, I would say at this moment, this is the lowest risk we've ever had in terms of success. We have $17 billion in cash. We have incredible demand on the consumer products. We have an amazing partnership with Amazon. And we have a plant that's now producing faster than our supply chain can keep up, but the plant is running. Right.

Like the number of things left to solve is much smaller than it was a year ago. Let's talk about Tesla. They are still sort of the biggest player and sort of most developed electric car manufacturer in terms of their network of chargers and the technology and the driverless technology. but they are also they can be litigious and they have I mean they've directed lawsuits against you guys

against other another EV company for technology infringement and so on so this is something that you have to deal with there is you are being sued by them

they contend that you that you hired the way their employees and got some intellectual property there so are those lawsuits that actually affect your ability to do

what you do, or are they just distractions that you don't really worry about? Yeah, it's not something I spend a lot of time worried about it. Today, we've got about 13,000 employees. A lot of our employees formerly worked at Tesla, so probably like 5,600. So that inherently, I think, caused some frustration at Tesla. And so they, of course, filed a lawsuit because of it, but we're very confident in our position there. And I'd also just say that I think that's, it's just an artifact of some of the talent battles that technology companies have to deal with. You see the same between Google and Facebook and sure. Yeah, you see it all the time. You see this kind of thing all the time. And it's, it is probably one of the biggest challenges of building a company around technology is just

competing for the best talent to go develop that technology. Yeah. When you think about, most people are driving gas and buying gas powered cars. I think there's 250 million cars on the road in the United States alone. And 98, 99% of them are powered by gasoline. Just kind of thinking about the math there, it's going to be a while before it's all electric on the roads at the U.S. Yeah, it will be. New car sales today are a teeny fraction of total vehicle sales. So first we have to get the world to 100% of new car sales being electric.

And even if we were to do that at the flick of a switch right now, it would still take us the next 10 to 15 years to replace the full global car park. So call it in the next 15 to 20 years. We'll see the fleet of vehicles in the world essentially shift almost entirely towards electric. But within, I'd say, 25 years, it would be fairly rare to see a gasoline-powered car on the road. It would be like seeing an antique. And the role that we play there is an important one, we believe. You are a vegan.

You don't eat any animal products. Yep. And even the car is vegan. There's a vegan leather. And you don't really, it's not really kind of pushed too much. Because some people that is seen as a, I think it's crazy, but some people see that as a political stance, not just a personal health stance or, you know,

wanting to help the environment out. So do you intentionally not kind of push that side of the car? We don't make a huge deal out of it. We could choose to like make a big deal about the headliners made from recycled soda bottles, those kinds of things. But but ultimately there shouldn't be the reason you buy the vehicle. The vehicle should just be fundamentally better. Yeah. And like we feel it's just like responsible of us to to make decisions that are lower carbon and utilize materials more efficiently. I do think your point, though, on unfortunately, sustainability becoming somehow politicized, for reasons I have no idea why, but it's become, unfortunately, a bit of a political topic. We just don't view it like that. So we try really hard to not make Rivian politicized or the idea of sustainability politicized. So that's also part of how you present the vehicle. Because you're not, you don't want to make a car for blue state, blue state America, right?

And I think, from what I've read, most electric car owners tend to be. politically left of center, which is unfortunate because in order to make it sustainable, everybody's going to want to buy these. You want to appeal to everybody. You want everyone from the most conservative and most liberal people, not even thinking about their politics. They buy a car. They just buy a great car. Is there a way to, you know, it may be Ford's F-150 electric vehicle that does it, right? That kind of opens the floodgates and actually opens a market for everyone. As we go to Electrify, I think we're going to have the need for lots of choice and the driving experience helps get people excited. I mean, one of the things that is interesting with electrification is it completely changes performance boundaries that we previously accepted.

So our pickup is faster than most hypercars. I was on the PCH, the Pacific Coast Highway in California. This was maybe three, four weeks ago. I pulled up to a light. It was early morning. And a brand new Ferrari pulled up right next to me. looks over me, I look over with him and said, hey, you want to see what we can do here. And so we both accelerate quickly off the line and I out accelerate by quite a margin. Oh yeah. And we get to

the next light and he says to me, I can't believe my Ferrari just got roasted smoked by a pickup, right? And so I think that's like that reframing of electrification is also going to help help in a big way where people are going to be excited about the products regardless of whether they're buying it for sustainability reasons or not, they're just fundamentally more exciting, more desirable to drive products. When you think about this path that you've taken, right, pretty amazing. I mean, you've got this facility and all these employees, 13,000 people and these two products that people love and want more of, you can't make them fast enough, you know, multi-billion, in the tens of billions of dollars and value this company is now valued at.

And I know you're still far away from being able to breathe. But how much of where you are today do you attribute to just a grind that you put in? And how much of it do you think has to do with luck? I think they're equal parts. I don't know. Some days I might say more luck and some days I might say less luck. I mean, I think every situation creates opportunities to learn. So if you ask me, do I wish we were launching into a different environment that didn't have semiconductor shortages and a pandemic?

And with the supply chain challenge, you could say, boy, this is pretty unlucky. But it also is creating skills and organizational knowledge around how to operate in these extreme circumstances. It's really great. But then we've also had really fortunate connections with investors and connections with the right people in terms of the team that we've built. But those days that are really lucky or those days that may be seeming really unlucky, all of it benefits from working and grinding away really hard. When do you know you'll be successful? When do you know that you can say, okay, we made it? Are you there now?

I don't really think that will ever be the case. It's sort of the journey that you hope never ends. So have we launched a vehicle? Yes. Do we have excited customers? Yes. Have we raised a lot of capital? Yes. Are we profitable? No. When we achieve profitability, would I say we've made it? I would say no. We'll continue to be pushing. But if I were to say, have we made an impact? I would say with absolute confidence, yes. That's RJ Scorange, founder and CEO of Rivian. By the way, Rivian loves to tout all the bells and whistles on its pickup, including a hidden cubby behind.

the rear seats that can accommodate a fold-out, portable camp kitchen, complete with stove, sink, pots and pans, coffee maker, and grinder. And if you don't want the kitchen, the space is also big enough to fit a fully grown, stretched-out human being, should you ever have a need for that. Hey, thanks so much for listening to the show this week. If you enjoy our show and want to show your support. Can you help me out and spread the word? Maybe tell a friend about how I built this or send out a message on social media. If you want to contact the team, our email address is hibt at ID.wondery.com. If you want to follow us on Twitter, our account is at How I Built This and mine is at Guy Raz. And on Instagram, we're at How I Built This and I'm at guy.

dot Raws. This episode was produced by Alex Chung with music composed by Rumpstein Arableu. It was edited by Neva Grant with research help from Sam Paulson and technical assistance from Robert Rodriguez. Our production staff also includes J.C. Howard, Casey Herman, Liz Metzger, Carrie Thompson, Catherine Seifer, Elaine Coates, John Isabella, Chris Messini, and Carla Estevez. I'm Guy Raz, and you've been listening to How I Built This.