This Week in Startups - E1102 The Next Unicorns E15: Zero Mass Water CEO Cody Friesen is perfecting drinking water with hydropanels, aiming to create essential resource UBI for the world

Episode Date: August 29, 2020

Check out Zero Mass Water: https://www.zeromasswater.com FOLLOW Cody: https://twitter.com/CodyAFriesen FOLLOW Jason: https://linktr.ee/calacanis Thanks to our partners... LinkedIn Jobs - Get a $50 credit toward your first job post at https://www.linkedin.com/unicorn Embroker - Get 10% off by using code ANGEL10 at https://embroker.com/angel Zendesk - 6 months free at https://www.zendesk.com/twist

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Listen to Zendesk's new podcast, sit down, start up to hear conversations with Zendesk's leaders and the founders, CEOs, and makers on how to start up, even when the world goes topsy-turvy. Download and subscribe on Spotify, Apple, or wherever you. get your podcasts. Hey, everybody, welcome to another episode of this week in startups. We started a series last year, I think, called The Next Unicorns, Sunicorns. And we said, let's look for companies that we think fit a certain profile. They, typically, they're building a product that has the possibility, if not the probability,

to change the world. Typically, these companies have a founder who is so aligned with that mission that they will fight to their last dying breath to see the mission succeed. And they build a product or service that the world desperately needs. And we have had a tremendous season so far. We had Daphne Kohler who is with Encitro and she's using machine learning and AI to try to find drugs that can solve all the different diseases that we suffer from, an incredible, incredible mission. And then we had Nikki Peckett from Homebound. trying to solve for building more homes.

The housing crisis, very real. Then we had Gary from Roofstock on, and then we had Spencer from Cockroach Labs. We've, you know, to build databases that are redundant and to solve the big data problems in the world. And today we're going to talk about something that everybody needs and everybody is literally the foundation

of our lives, which is water, right? And so welcome to the program, Cody Freezin, from Zero, Mass Water. Hey, great to be with you, Jason. And paradoxically, I just got off a podcast with my good friend Rick Fuller from Desktop Metal, who you happen to know as well. How do you know Rick? Going back to the A1, two, three days, his co-founder, Yep, Ming Chang and I go way back to when I did my PhD at MIT. And, you know, Rick is just a phenomenal entrepreneur, as you know. Yes. Super high energy. Yes. Relentlessly positive.

Relentlessly positive, thinks outside the box, thinks ahead of the curve, you know, and necessary but insufficient condition is that people think that you're nuts when you start down the path that becomes a company. He's often at the vanguard on that front, as you know. So, yeah, no, big mutual fans of Rick. And that, I guess, leads us to zero mass water, which is, you know, sometimes the biggest problems and the longest odds are the ones that are worth pursuing tell everybody what zero mass water's mission is and why he started it?

Well, our vision is to perfect water for every person, every place. And my background for the last circa 20 years has been in the renewable energy space. And sort of traditional renewable energy, I founded a battery company called Fluidic Energy, took that global. I served two terms as the co-chair of the Energy Subcommittee on the U.S. Manufacturing Council during the Obama years. So I've been thinking about, you know, kind of the cost down that was going to happen in solar that now did happen, the cost down that was going to happen in lithium ion, that now did happen.

And what was next? What was going to be next in renewable energy? I think when most people think about renewable energy, they think about renewable electricity. Sure. The global energy mix, right, only about 20% of it is electricity. The rest of it is transportation, embedded energy in the food you eat, embedded energy in the water you drink, in the stuff you buy, you know, this embedded energy in these headphones, etc., and so on. And so the idea was, could we apply the principles of renewable energy to resources? And what's the most critical resource on the planet? Drinking water.

You know, you've had a couple of guests on in this latest season or series, folks on housing, right? Base of Maslow's hierarchy, food water shelter. Right. You can't get to those next levels unless you have those basic fundamental needs met. And so that idea of, okay, let's do for water what solar did for electricity. Which is what? Make it ubiquitous and free? Yeah. So one, right, distributed to infrastructure free and three, and most importantly, I think most people miss this point, zero feedstock cost, right? Sunlight. And in case of source hydrop panels, sunlight and air. Okay. And so because it's zero feedstock cost, you can, just like you can do in solar, effectively program the cost of operating for does some. of years. So zero feedstock, what was the last word in that phrase? Cost. Cost. So zero feedstock

cost means that acquiring the asset, acquiring the resource is zero. Yeah. And if the, and also you said, it's distributed. So solar, once you've paid for the panel, the electricity is free and you don't need to be connected to anything. So you now are unconstrained. So what you hope to do with zero, mass water is what a solar panel does for somebody who's living off the grid, just to use a word, they can get electricity without having to run a wire to their house. You want to get water to that house without them having to run a pipe. Am I correct? Precisely. How does that happen? How does that manifest itself in terms of technology? Yeah, so my background, I'm a material scientist, and the simplest way to think about how source works is to think about, you know, a good example is like the sugar and a sugar bowl when you leave the lid off over time it gets a little bit clumpy, right?

Yeah. And it does that because it's absorbing water vapor from the air because the sugar, the sciencey word is that it's hygroscopic, right? Hydroscopic, it's absorbing. Highgro with a G. With a G. With a g, hygroscopic, which means it's absorbing water? Water vapor, yep. Got it.

And so now imagine that not sugar, but now a nanostructured material that does that same process very fast. So it concentrates the water vapor in the air by about 10,000 times by volume. Okay. And then we use sunlight to basically respire that water vapor back out inside of the hydropanel and therefore produce a condensable vapor that then is passively condensed inside the panel. Okay. So I just want to stop for one second to make sure I'm following. There is a panel. And this panel goes. on the top of your house or next to your house. And the panel has some type of nano fiber or tubes or technology in it, which is a fancy way of

saying small materials. Yep. So a material that has a very fine poor structure so that it perfectly holds water molecules. Perfect. So in a way, in the sugar analogy, sugar might be very good at doing this. It seems like any time I've had a bag of potato chips on a boat or at the beach house, they're soggy very quickly because of the same effect. So you're saying let's 10,000 that effect and let's make these soggy potato chips and

clumpy sugar real fast and then have the sun do its process by heating this panel in some way to make it absorb more moisture from the air, correct? Correct. And then we run that cycle many, many, many times per day in order to produce a sizable amount of water. And then, of course, that's sort of the elegant, the elegant. material science part of the solution. And then there's the kind of the machine learning element, deterministic algorithms, there's the computational fluid dynamics, the thermodynamics, and so on.

That is sort of solving an eight-dimensional problem every second of the day inside the panel. And so then you end up with a very efficient process. Got it. So there have been solutions to pull water from the air. Like there, but it's typically energy inefficient. to do so. So when you have a room that has too much moisture in it, you have a dehumidifier. Yep. So in a restaurant or in a location, you might have a dehumidifier, you turn on the dehumidifier. Energy is sucking the air into it. It's going through some type of filtration system. And at the end of the next day, you have a bucket of water. It's pulled the air out of the water. So the water in your apartment or whatever space isn't too wet. But that requires it plugging in

using electricity, which is inefficient. Yeah, so typically how those work is it sort of like an air conditioning unit almost. There's a cold surface inside, and you are literally directly condensing that excess moisture out. So yeah, it's very energy intensive, and it needs to be actually relatively high humidity. Got it. So I'm making water on my roof today. It's probably, you know, five to 10 percent relative humidity out here in Scottsdale.

So, you know, we work at a very low relative humidity. and also obviously with no electrical input and clearly no pipe input. Okay. So in order to do this, you would put on your house some series of panels that would act as a way to collect water. What do those panels cost? And to outfit a home that has a family of five in it, how many panels and at what cost would it be to do that today? Yeah. So today and just for a single home.

the U.S., which obviously not very, not very much of economies of scale if you're just doing one or two panels on a home. Sure. But let's say for a family five, it would be two panels. So each panel does up to about five liters of water a day, which is, to put in American context, sort of 10 standard 16 ounce bottles of water a day per panel. So it'd be like a case of bottled water per day. So you can get a case of bottle of water from two of these panels.

And I'm looking at the panel now. But because I'm looking at the panel at your website, there's nobody standing next to it. So I don't know if this is the size of a car or the size of a laptop. What is it the size of the hydro panel that you have on your website? Yeah, sort of the size of like a sheet of plywood. Okay, so like a large 72-inch TV screen. Yeah, perfect. Yep. Okay.

So I put two TV screens on my roof of my house and it looks pretty elegant. And then I now have a case of drinking water. And I'm off-grid. and it doesn't need to be plugged into electricity or it does. Zero. You and I could set one up in the middle of the desert in 15 minutes and half an hour later get a glass of water. When we get back from this quick break, I want to know what the cost of those panels are today

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All right, everybody, welcome back to this week in startups. It is episode five of the next unicorns, Sunicorn's Coddy Friesin. But it's spelled Frizen, but Friesen, I'm pronouncing correct, I hope. And it's Cody A. Friesen on the Twitter. I don't know how active he is. He's the CEO and co-founder of Zero Mass Water. Got his Ph.D. from a little place known as MIT, somewhere in the Northeast.

I've been there a couple times. and we're looking at this panel here. What's the name? What's the exact name of the zero mass panel? Source hydro panel. Source hydro panel. It's about the size of a 72-inch flat screen TV8. Two of them make a case of bottle water.

That's fantastic. It's not enough for everybody to take a shower, but certainly in a zombie apocalypse these would come in handy. What is the cost of these panels today? and what will the cost be in 2030 if you had to make a guess? Yeah. So today, in the U.S. context on your home, it's $2,000 a panel. So what that equates to effectively is about one-tenth the cost of bottled water,

about the same cost over the 15-year life of the panels as an undersync RO system. I don't know what that means. Tell me what under-sync system means. Yeah, sir, are those undersync kind of reverse osmosis systems that you put in? place that you can get like a Home Depot and then you kind of replace these. Oh, you mean the ones that filter the water? Yeah, and it's sort of a next level filter, if you will. So does your hydro panel, is the water coming out of their perfect water? Is it perfectly clean? Does it do the filtration there? Or is the water in our air that is going through these in some way dirty because there could be airplane

exhaust or whatever in the air? Yeah. So it's an easy starting point. to talk about U.S. residences, but we're already in 45 countries. Okay. And we're in Mexico City as an example, Jakarta, Mumbai. Okay, so you're in places where 200 particles a day is not unheard of. Exactly. Tell me what happens in a 200 particle place like California doing the wildfires or Mumbai every day, sadly. Or Scottsdale right now with all the fires going on.

Oh, my goodness. God bless. Those firefighters out there doing that work, we love you. I mean, the bravest people in the world. It's remarkable, actually. Just as an aside, we have a great volunteer fire department out in my area and I ran the water tender truck a couple weeks ago for them. And those hot shot crews are amazing.

You know, it's 115 degrees out. They jumped into the bush at 3 p.m. I could see their headlamps up and up on the hill at like 2 o'clock in the morning. I mean, what heroes. I mean, as I always told my brother, my baby brother who was a firefighter and just recently retired, we spent a lot of time at 9-11 cleaning up the. mess. The bravery of running into a burning building when everybody else and every instinct tells you to run away from fire. I mean, I literally, I'm just showing my middle finger right now,

I got a blister because I burn myself making a Pop-Tart and I got a second-degree burn. And getting burned is like the worst experience. I think like if you think about injuries that suck really and are terrorizing on a human psyche level. Fire is just perhaps drowning is the only one I'm, now I got to put fire above drowning in terms of how horrific a death they could be. And these firefighters run into harm's way to save people. God bless you. So back to these panels.

Is the water in Jakarta, is the water in Cheyenne pick a place where maybe air quality is a challenge for whatever reasons? does the water come out dirty and then has to be cleaned or does the water come out clean as a process of this panel? Yeah. So from a theory perspective, right, there's a selective process for those water molecules because they're highly polar. And then it's sort of like a double distillation process. So in principle, the water should be effectively like double distilled by the time it's in the reservoir. From a practice perspective, we've done these measurements now consistently over, you know, as I mentioned in 45 different countries. And that is, in fact, what happens.

So the water starts out distilled, and we then run it through a mineral block that adds calcium and magnesium, brings the pH up. So the water has sort of a soft mouth feel and a crisp finish, so really truly better than what you're used to drinking. And then inside each panel, there's an ozination system that keeps it sterile. So there's no bacteria build up. Water is the stuff of life, both good and bad, right? You get a lot of things growing in your water. It can get funky. Yeah.

And then every single source hydropanel is connected to the cloud. to a standard aid base sitting on AWS. And so around the globe we're seeing in real time, you know, rather than thinking about just the two panels on the rooftop, you know, hundreds of panels in a community in Australia or a couple dozen panels at an eco resort in Southeast Asia or at a school in San Buru, Kenya, wherever it may be. Or we just did a couple dozen homes in the Navajo nation where they have only 150,000, 50,000 people, an area land the size of West Virginia.

Yeah. And a third, 54,000 people have no water at their home. Unbelievable. Wow. So the cost of these panels today, remind me again what you said, each panel costs what? Yep. $2,000. $2,000 per panel.

So for the two of them, you'd be $4,000. Let's just go with the 2000. You've been working on this for how many years? We closed the Series A in May of 2015. So we've been at for five years. What was it costing you in 2016, 2017 when you had the first couple prototypes, I'm assuming, per panel? Prototype level, I mean, it was all machine parts. So you're probably talking, you know, $20,000, $30,000 a piece.

Got it. Okay. So you went from in the prototypes, you know, $25, $30,000. Now you're at but $2,000. Price. If you build a million of these in 2030, what would the cost be per panel? Yeah, so two effects. Yeah.

Yeah, two effects. So first, yeah, volume and obviously engineering for manufacturing for manufacturability, blah, blah, blah, blah. Probably I'd say in the $400 range, let's say, I mean, that's probably conservative. It could be cheaper. But I think as importantly, we're also on this Moore's Law learning curve from the point of view of performance. So we're not at the thermodynamic limit of what's possible. And so I think there's another factor of two to three on that side. Oh, my Lord.

You're looking at, you know, a factor. So instead of having to buy three of them, I would buy one of them and have the same performance because of AI, material science, and other efficiencies you're going to add to it. In the same way, the Tesla has gotten better at being more aerodynamic, being lighter, and, you know, recharging the batteries more efficiently. Yeah, a couple of things there, you know, fundamentally, we ultimately will be the lowest cost landed cost potable water in the world.

Ultimately being in 10 years, 20 years or 30 years if you had to pick a decade. I'm an entrepreneur, so let's say seven years. Okay, great. I love it. So in seven years, this is cheaper than anything out there. The water is cleaner.

And so when you look at the world and you think about the problem of drinking water and clean drinking water. What is the state in 2020 when we're recording this? Because people will be watching this historical document, you know, 100 years from now. It's the reason I do the podcast, honestly, is I know 100 years from now people are going to want to know how you get it. And when we're sitting here chopping it up. What is the footprint of people without clean drinking water today? Of the people on the planet, ballpark, how many need this today? This is where it gets just crazy to me.

because depending on where you look, you'll get all kinds of different numbers, right? So you'll get like a WHO number that's like 800 million people don't have water. Well, those are people that are literally walking for water. It's actually about a third of the planet, about two and a half billion people that don't have consistent, safe water

that comes to their home. Got it. And then that doesn't even count like Mexico City residents or Mumbai residents or whomever that don't drink that water. They can't drink that water. So they have water coming that is like Flint, right?

We had, was it Flint in the United States where we had lead in the water? So if you, at two, that, even today, those two and a half billion people, for a mere, if I'm doing my math correctly, if it was $1 for a panel, if it was $2 for a panel, those two and a half for $5 billion could have it. And if we had three zeros for $5 trillion, we could, today for $5 trillion, which seems like a lot of money, but is, literally nothing, these could be deployed, and the idea of people having to walk miles for dirty water or drink dirty water or filter water would go away. In other words, the problem's been solved. We just have not deployed it. Precisely. Think about just two numbers. There are 3,500 jurisdictions in the United States with the exact same problem as Flint. Three thousand 500 jurisdictions, the same promise point.

That's problem one. That's number one. The second number I give you is that the Flint settlement just now, that was $600 million. Yes. We could put source-hided panels on every roof for one-twentieth of that, about $30 or $40 million. And so when we get back from this quick break, I want to understand how you plan to deploy this and scale this business. because many times the solution is there, whether it's electric batteries and Tesla and, you know, the work he's done there, or solar or now water, we literally have the solution and we have an inability to execute effectively on deployment.

I want to know what your deployment strategy is when we get back on this week at startups. I need to give you an important message right now. You need insurance for your startup. I know that you got a lot on your mind. You got a lot to think about hiring product market. fit. This is one of the checkboxes that you have to get right if you're going to grow up and you're going to be an at-scale startup and you better get on it early and it's not that hard because of my friends at in broker. They love startups. They put a lot of effort into startups and they've

been supporting this podcast now for a couple of years and you need insurance for your startup for a number of reasons. I'm going to just break it down for you because I have this conversation all the time when I join the board of a company. Do we have directors and officers insurance? D and O. What does that mean? It means that if your directors, i.e. board members, officers, the people who run the company, i.e. you, if something happens and somebody does something stupid on your team, you need to protect the officers of the company, i.e. you and your co-founders, and you need to have your directors protected in case somebody does something stupid or you make a mistake. That's called directors and officers referred to as D&O. And of course, you need

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Capitalism, individuals, and capital allocators picking problems to solve for society has been the most effective system for increasing the quality of life of humanity, period, end of story. If you want to debate this with me, you can, but you will lose the debate, even with somebody who's an inexperienced debater like myself. My guest today is proof positive. We have the ability for every person on the planet to have clean drinking water for but $5 trillion, which, to give you some context is what we're printing today to deal with this pandemic and putting stimulus tax. By the end of the day, we're probably going to put $5 trillion to work. That's just in the United States.

We can solve this. So, Cody, we have the technology. It's going to get 10x cheaper and more efficient. We just know how Moore's law and efficiency and AI are all spiraling to make things work better. What is your go-to market strategy? How do you plan on getting these things out there? Because right now what we're looking at is not a solution. problem, but a distribution problem.

Yeah, really good question. At the top, I mentioned to you the vision for this company, right, which is to perfect water for every person, every place, right? And the word perfect is chosen very explicitly to represent something that is aspirational, continually that bar has to continue to rise, right? It's never done. We now have the technology entitlement to that vision. We have to go earn the execution entitlement to that vision, to your point, right?

So when we say, oh, we're now in 45 countries, well, how did we do that? we've only been around for five years, a hard tech startup. That's a lot. We have a big distribution. And it's all about, for us, it's all about leveraging the ecosystem that was built on the backs of the last, I guess, three decades in the solar space. You know, solar installer dealers in every corner of the world that have themselves seen massive margin compression, bad for them, good for the world, in the solar space. And here is another product of a technology, that installs very similarly, actually simpler, because there's no high voltage DC, right?

I mean, you literally just have to screw it down and run a pipe. Like you do not need to have an electrician. Yeah, exactly. And once it sees sunlight, it basically reaches out to our cloud and it's self-commissioned. So it's straightforward. We do this all over the place in really tough places that have been underserved for a long time,

all the way to very high-end, you know, multi-billionaires homes in Berkeley to, you know, parts of Puerto Rico after Hurricane Maria, so, you know, the full spectrum. So it really is about how do we efficiently continue to ramp both sort of production efficiency, get the economies of scale on that side, but also the other area we've sort of been able to benefit from all the learnings in solar is you may remember the PPP that purchase, the power purchase agreement in solar space, or the PPA, sorry, power purchase agreement. PPP tells you the sign of the times given the COVID response stuff.

But anyway, the PPA. You know, we have something very similar, WPA, water purchase agreements. And that, as you might imagine, has kicked the doors open on the scale of the types of contracts we're signing. The current largest one is a 10,000 panel array that's going in in Dubai. We have multiple multi-thousand panel arrays that either have gone in or going in in Australia. And we do work with everything from private industry, mining groups, hotels, etc., all the way to governments and NGOs. And I never think about the tension between those things.

They are all good for business, good for what we're trying to do for the world. At the end of the day, the more panels you move, the lower the price gets. And that's good. And that's capitalism. So when we saw the Senate or House hearings on Amazon basics competing, you know, the competition, there'll be other competitors. Desalinization is one, obviously, that comes to mind. There'll be other people competing to get water to people's homes, including the water utilities that we have.

How do they feel about you? How do the desalinization industry look at you? If I were to say, what's better, you know, about desalinization, ask them, you know, to criticize you, what would they say? The desalization crew, because there's a crew saying, hey, desalization is a solution. Yeah, absolutely. And desal is a solution. Desal is a solution in certain places, certain contexts, where capital is cheap, where infrastructure is good, right? you're still making the water in a centralized place.

It has to be able to get from one side of the hill to the other, right? So you need the network, right? Yeah. And all the other things, right? And then it's energy intensive and there's a big economic externality that doesn't normally get accounted for, which is the brine that's sent back to the ocean, which kills sea life and is a big problem. But like when we think about, for example, let's say in Dubai or UAE in general,

right, 98, 99% of their water, call it 100% of their water comes from desal. And we first engaged those guys, you know, four years ago or so, they were like, well, we have all this desa. I don't know why we would ever use you. Well, now they have huge issues in the Straits of Hermes and the Persian Gulf with sea life death, with the connection between energy security and water security, right? It's one thing if your lights go off. It's another thing if you don't have any fresh water, period, right?

And so on. And so now we are actually deeply partnered with- One kills you, one doesn't. Like literally one causes people to ride in the streets and die, and the other one causes people to be very frustrated and light candles. And to put a finer point on this brine issue, the way desalienization works as best as I know is you use a bunch of energy to push the water, salt water, through filters that take the salt out,

but then you redeposit that back in the water and you kill some wildlife in the process to some degree. but you're causing a problem of effing with the balance of the water. So if you rely on it too much, it can kill sea life. And it still requires pipes to go everywhere. So you're telling me, Dubai was like, well, listen, we have unlimited capital. We can burn oil to do desalconization, but we don't want to burn the oil because it's bad for the ozone layer. And why not have another option?

More options equals better. Yeah. And I mean, you think about in Saudi Arabia, what was that a little over a year ago when the oil refinery where he was hit, right? Yeah. That is the energy that ultimately drives those desal plants. Yes. Right? So you're thinking, talking about a whole peninsula of people. When we think about, like, so just on that brine point, which is sort of fascinating, right, it's people think of sort of like, it's just salty water. Well, it's actually full all these nutrients. You make this concentrated brine, and it's like a, it's basically a biohazard. It's not good. And then if you go to like,

if you're a scuba diver, right, you go to some island where they have desal plants. And it's like, You know, it's usually diesel generator powered. And it's always on the other side of the island from where you scuba dive because, you know, the coral is kind of all screwed up over there. So it is a solution. And I don't want to, you know, I don't want to bag on it too hard because I think any technology that's, that is providing additional fresh water. Yeah. Additional potable water is like, all right by me, right? Bring on the competitors for zero mat.

It's better than death. But it's not better than. sucking air out of the water. Is there a downside to sucking the air out of the water, at the air rather? And I know this is a stupid question because I'm a neophyte at this, but if everybody had these on the roof of every house, would the amount of moisture being taken out of the air create a similar brine-like effect? In other words, we're now making the air drier, and then that screws up the rainforest as an example, or is it just not enough water being pulled? Yeah, what's fascinating, and you'll appreciate this as we live on a very wet planet.

One, there's in the troposphere, the lower part of the atmosphere where we all live, there are 1.6 times 10 to the 16 kilograms of water vapor in the air. So that's 1.6 or 1, 6, and then 15 more zeros. Got it. Kilograms, right? So that is more than six times the volume of all the rivers on the planet. and that water, its average lifetime in the atmosphere, is about a week. So you want to talk about a new renewable resource. It's massive.

Now, you say, okay, well, that's a huge number. How does that equate to if every single person on the planet had a source hydropanel? Well, it turns out that it's like one part and 100 million of that water taken out every day, something like that. Right. And then you ask, okay, well, okay, that's a tiny number. well, what about how much excess water vapor is in the atmosphere associated with one degree Celsius increase in Earth's average temperature, which is where we're at now in climate change, right? And it turns out that even that number is orders of magnitude bigger than what you

could pull out. So it's sort of this interesting, if not a little scary. Yeah, I mean, in a way, it's almost like we're in some Star Trek, we're in like some Star Trek or science fiction arc where we're starting to understand the ecosystem and our impact on it, whether it's desalienization, whether it's solar, or what do you call this general area of pulling moisture out of the air? Is there a category name? Yeah, so we refer to it as what we do as just literally as a hydropanel. Yeah, so hydro, but is there another word for it beyond the description of the panel? What is the act of taking water from the air?

Yeah, so you could, I mean, it's condensation. It's, you know, it is a, from a thermodynamic perspective, it is no different than when you walk out of your home and there's dew on leaves. Got it. It's that simple. So when we look at this, when we come back from the break, what I want you to answer is what is the damage we would do if we went all in on this versus the damage we are currently doing by going all in on pulling water from rivers when we get back on this weekend service. All right. Listen, everybody knows Zendesk is the go-to tool for customer support. You know that.

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All right, really happy that our current guest, who, you know, listen, he doesn't do a lot of press, and he decided to come on the podcast, like many CEOs, because on this podcast, we're really trying to have a meaningful discussion with founders about their vision. There's no gotcha here. There's no trying to pin you to the wall. I'm not trying to break anybody or do link bait here. I'm trying to have a long, deep, meaningful conversation with people who want to change the world for the better. And Cody from Zero Mass Water is here talking about making clean water. I think he's got the high ground on this one. When we left two,

go to break. We were talking a little bit about, you know, this fantastical moment we're at in humanity where technology is moving at an amazing pace and capital is flowing to projects, no, pun intended, that can really change the world. So this, this capitalism gone wild, this amazing amount of funding available is allowing us to be more audacious in capitalist capitalism. And it lets us question things we've done in the past. One of the things we've done in the past is build dams and tapped into rivers, the Colorado river being, I think, the source of some unbelievable percentage of agriculture and water. The damage that we've done, I don't even know if we know the damage we've done by using rivers

and lakes as our water sources for the growing population of the planet. I know in China specifically, they've had flooding issues that the CCP has been, let's just say not talking about all that much, but when you try to control nature's path of water, that is a very delicate thing to do. So I'm curious in your research, Cody, what is the ecological, ecological damage we've done with dams and rivers when compared to, say, you know, putting these panels on people's roofs? Yeah. So first of all, I'll beg off and say, I'm not a hydrologist, and so I'm not super knowledgeable on this front. But I will say that the Colorado River does not cross the Mexican border anymore.

Imagine if the Colorado River was a free running river and we put a dam today and stopped it from running across the border. And then you have to see a Cortez, right? The Baja, California is the peninsula on the other side of. That ecosystem used to have all that freshwater, all those nutrients flowing into it. Right. And as you may know, the almost all ocean life in the open Pacific is limited by the amount of iron that is present. And you only need, you know, PPM levels of iron for massive amounts of Santa bacteria to grow and so on. And of course, the Colorado River is so named because the water is, in fact, the color red because, in fact, it has a lot of iron in it.

And I actually did not know that. So thank you for that education. So we should be trying as society to restore the natural flow of things. For sure. And I think we are taking out dams regularly in the U.S. It's a major effort to return, you know, a lot of the historical wetlands to what they were and remove kind of the canal-like rivers that we have now, like the L.A. River, you think about that one.

That's like literally a canal. At the same time, you think about, you know, where I'm sitting right here was, you know, historically the land of the Yavapai, the Pima, you know, the Native Americans that were here, hand dug 20,000 kilometers of canals throughout the valley that is now Phoenix to pull the salt and Gila and Verdi rivers to be irrigation, right? And so there is a sort of historical process of utilizing rivers for those processes. When we take the Colorado River and, of course, put it into the dams that we have, you know, Powell, Mead, Mojave, and, let's say, oh, havasu, those four, right? We basically take out all the nutrients. They settle into the lakes and then that water runs clean, which looks good, but it's not all those nutrients are not running downstream. Right. Now, when we think about the human use side,

right, all the water that we have historically used is an extractive resource, right? You either pump it out of the ground, so you know about the water table dropping in the San Joaquin Valley. I actually don't know about that. Unpacked that for us. Okay, so San Joaquin Valley, right, the central Valley of California, you know, one of the, I think it could feed the Earth's population some number of times over, you know, you hear all these crazy statistics. They make nuts there and there's cows there. So if you ever, I just did the trip back and forth from L.A. You go through the central coast of California, you will go for half an hour through basically cow farms that just go for a hundred miles. Yeah. Yeah. And that, that huge valley

is watered by, you know, the runoff that comes from the Rockies and from the Sierra Nevada. And because of the fact that there's, you know, more water needed there to grow almonds and our things than what comes from the runoff, we've been pumping groundwater. So there's this great photograph that I think was taken in like 1970. And the top of the telephone pole it says, you know, 1920. And then there's like 1950. And the bottom is 1970. And of course, groundwater continues to subside. We're taking out more water than it's replenished.

So it's compressing. Yeah, taking out of the offer. feet lower. Since 1820, it's like 50 feet or something crazy. Oh, my Lord. So, you know, you think about the fact that all water historically is extractive. I'm going to take us back to that idea of kind of applying the principles of renewable energy to water. So a little quick story.

So you think about, I mean, just 10 years ago, 2010, that was a long time ago. It was. Different, different world. Yeah. I was like just thinking about this no dapple poster over my shoulder here. And that's early 2016. It's like, I mean, listen, right about now, I'm, I'm longing for like 2017, 18, given 120.

This 2020 is like the worst, if you took the last two decades of her life and compressed every worst thing that happened, it feels like we've, we've done that already in 2020. But continue to. You remember the old episodes of Twilight, the Twilight Zone with Rod Serling? And Rod Serling, you know, chain smoking or get on. Yeah. kind of give you a hint about what's coming and then you drop into the episode. Yes.

So I've been saying like, okay, we're in this alternative universe. I'm waiting for Rod Serling to come on and like chain smoking. Say, all right, it's over. I mean, at the beginning of the year, I had this cute little catchphrase, you know, what's your 2020 vision? That was kind of stupid, right? Whatever. I was like saying that's a few people.

Yeah. Now it's like, yeah. So now I've got a new one for 2021, which is like, okay, I've got the 20. I'm splitting my tens. I'm going for blackjack. I love it. I love it. I anyway what are you but you know since we're on this tangent staying sane while running an at-scale

company just on a very personal basis I've had my own struggles I've talked about it here on the podcast and how the podcast for me has been a great relief because I'm an extrovert I just love talking to people and I know people have bigger problems than I do economically with the race racism and then there are bigger problems than I have but I think everybody's feeling this isolation and loneliness that's what's hit me the hardest How have you maintained your ability to run an at-scale company during this cataclysmic year? Yeah, it's been incredibly challenging, as you might imagine. We also closed the Series C-1 financing in the middle of this May 8th.

What? Black Rock led that round. Let's come back to that. That's like another, that's a whole other thing. And I'll tell you about how scary that was. But, you know, and it goes to your point about capital that's flowing into important problems. You know, think about Black Rock, you know, 10 years ago, would they have funded something like what we're doing?

So I think number one is culture. I'm a big culture nerd. The idea that your culture has to be a living document, a living thing that sort of really reflects who you are and what you're all about as a company. We have seven culture elements. The first one is lead with love, right? And actually, you mentioned the firefighters earlier.

Yeah. You know, I refer to this thing as the triad of love, which is courage, vulnerability, in love. That is, it's only courageous to go running into a burning building. Right. Because you're vulnerable being burned. And you'd only do that if there's something inside you love. And I would argue that anything that is worth doing has that triad. So zero mass water and source, right? The product itself, the technology is an intrinsically loving act. It is a technology built for social equity to lift people up.

Therefore, our number one cultural element better live that every day, how we interface with each other, how we interface with the world, et cetera. And so, and then we have six more cultural elements that are, you know, we could do a whole whole hour on that. Let's do it. I like the idea of doing a little tangent here on culture because, you know, culture is one of those things that when I was coming up in the industry, people who talked about it were considered like goofy, loony, you know, Berkeley.

And then all of a sudden we realized, wait a second. culture is how, you know, how we relate to each other when we're pursuing this mission and it's the meaning behind what we do. And it actually, it sets a tone for who should join the team and who should not be on the team. And then it also creates this fabric that lets you get through times like this. So please do continue about your thoughts on culture. Yeah. Well, so, you know, maybe a little bit, Looney. My mom was a hippie and, you know, she sort of, you know, instilled this element to me. And I think, and in fact, just, to make it really clear, at the beginning of every single board meeting, I spend 20 minutes

and I go through all seven cultural elements, reminding everybody what we're all about, talk about where we're living, where we're not living it. With investors, when I'm doing my pitch, I'll take five minutes as an aside and talk about culture because I'm a big believer. What are some of those elements? Yeah. Yeah, I'm a big believer on the investor side that it's, you know, when you bring on an investor, it's not like getting married because you can always get divorced. It's like having a child. They're yours forever. Yeah. Married or not. That child's getting raised. That's right. So, yeah, so the first one, lead with love. The second one is think zero mass, which is actually, it's our company is named after the culture, which is all about taken data and remaining inertia free on path. There's this great poem from the, I think it was early 70s. Wendell Berry, this, I think the title of the poem is something like a mad farmer's liberation front, a manifesto. last stanza, he talks about make tracks like a fox, right? And this idea that a wolf goes from

A to point A point B in a straight line gets there and it's hungry. A fox is poking holes in the snow looking for mice, right? And taking data. And if you start with the intentionality that every single step that you take is an impression based on historical data. It's not fact. And all you can do is that it's like that finite differences method, remember applied math, right? You can't go more than a few steps forward without taking additional data points. And so if you take that and you sort of combine that, I'm trying to block this sun here. That's starting to come in. Now it's fine. Unless it's burning your face. No, no, no, no way. It's a good look. It's a good look for somebody in Arizona. But that triangulation is, there's humility in the triangulation, which is we know we want to get to a destination. But we have, no matter how much money we raise, no matter how successful we are at moments in time, let's be humble enough to reassess and triangulate and to look at this data. and then confirm, if I'm reading your philosophy correctly, is don't get ahead of your skis. Just because you went fast and just because you think you know the best route down this slope and this trail, you know, taking some data points along the way because you might want to slow down

or you might, this might be an opportunity for you to gun it. Yeah. And it comes out in two ways, right? A purity of purpose, right? That we, you know, this is all about fundamentally perfecting water for every person every place. Not about the solution of the day, right? Which supplier, which this, which that, right? Which customer?

The other one is it sort of leads to no traditions, right? This idea that, oh, well, we do it that way because we've always done it that way. Well, that's precisely how you build an edifice, not how you build a business, right? Yeah. That's great. Let's go build a brick building. That's great. That's perfect.

That's known how to, we know how to do that. Nobody's ever built Ceramouse Water before. Not you, not me. So we better be taken data and it comes back to that humility concept, right? Right. The third cultural element is build aggressively for divergence. This idea that diversity is not enough. It's that, you know, kind of, I don't use diversity because it sort of sometimes people think about it's checking a box.

Yeah, you get, here's your cookie. Here's your star. You're diverse. No. Divergence. What's the difference? Divergence. Because it includes all the things that we normally think about gender, orientation, race, all the things.

but then it layers onto it every other way that we might be different from one other. Because there's some like really cool HBR pieces on sort of the inefficiency of difference. So in other words, if we're like 10 Yale undergrads that are white dudes and we start a company, we're really efficient communicators, but it's all concave down in terms of our ability to sort of innovate because we have group think. Whereas if we're inefficient because we're all different, we're all speaking slightly different languages, we come from different places, where the slope starts slow, but it's concave up. Makes total sense when you just think it through. And it really, I mean, introversion, extroversion is one that people leave off the list.

Yeah. And I think it's just so important. You're clearly, I think on the Myers-Brigg and ENTJ, I'm going to guess. You feel extroverted now unless you're faking it. No, I'm E-N-T-P. See, there's a very interesting one. I was E-N-T-J my whole life. And then after I had my first daughter, I took the test again and I became E&P.

Interesting. Which I thought was kind of an interesting move. But anyway, we're talking about, I love that. Somebody said to me, Myers-Briggs is astrology for dudes. And I was like, wow, that's kind of an interesting way to look at it. But I do think having time for introverts, when you think about divergence, as you and I being extroverts and E-N-T-P's, E-N-T-J, we're really that gung-ho, you know, it's a certain prototype with typical, it's a certain prototypical person, but then you look at somebody who might have, be an I&TJ, and, you know, they might not

be able to do the keynote speech the way jobs did, but they might be able to make the product like Wozniak did, right? Or Johnny Ive. Yeah, that actually, you know, introversion, extraversion comes up almost in every job search. You know, we think about the superpowers of introverts. I love the superpowers of introverts, right? Like, just leave me alone, which I'll just jump. I'll jump actually. I'll just give you one more of all cultural elements. Otherwise, we'll take up the whole time.

The sixth out of our seven, out of our seven, the introverts love the most, which is cherish focus and non-interruption periods. So from 10 a.m. to 3 p.m. every single day, no meetings company wide. That's five hours of value creation. And what it does is it's recognizing that every team comes together to, assess the sort of contribution of individuals. And then ultimately, we have to go away and deliver something, right? Right. And the kind of proof that this is a good cultural element is that everybody who manages somebody else wants to break the rule all the time. And anybody who has no reports loves this cultural element because they're like, look, I have my meetings from

7.30 in the morning till 10, get them all in, 20 minutes shots at a time, super efficient, five hours of value creation, three p.m. on, do some more meetings or whatever else. But what you're saying is the manager, because they're sitting there at their desk and they actually don't produce something, their production is managing. They're like twiddling the thumb saying, who can I interrupt with a question? And they're not allowed to. I view that each of us at any given moment are some combination or purely facilitation or individual contributor. Right. So you're either facilitating individual contributors or you are an individual contributor. And you can swap. between the two, right? I'm today I'm probably 90% of facilitator and 10% as much as I'm coaching. You're saying, hey, what do you need removed from your path? How can I make you more effective at your job? And then once in a while, you pop on a podcast like this and you're doing the sale pitch and you're explaining the vision. And that is actually you facilitate. I love it.

So rule number six is that focus and that new meeting time. I love that. Exactly. And that one actually comes from really cool data around. I think it's actually for software engineers. So they tracked lines of code written after an interruption. And it turns out that after an interruption, it takes about 45 minutes to get back to a state of flow. And I would actually argue that that's not unique, that any time, writers, for me, I have a whole time as writing. If I, if I get into a discussion with somebody, or God forbid I get into an argument with people, if I, if I have a disagreement or an argument with somebody, I can't write for the rest of the goddamn day. And when I, when I did my book and when I'm writing the next one now, I can't be around people. I can only be around like one or two

people. And there has to be a no arguing rule. I can argue about the book, but I can't have an argument about some silly bullshit that because it just, for some reason, it just short-circuits my brain. I can't get back into the flow state. Yeah. And you think about, you know, if it takes 45 minutes to get back into a state of flow, let's take that as the minimum. If you have a meeting every other hour between when you get into the office and noon, you've created what, maybe 45 minutes of value, maybe? Maybe. Because it's 15 minutes, 15 minutes, 15 minutes. Whereas if you create blocks, And then it's not just meetings. Who fought you the most on this?

Who fought you the most on this one? It must have been a battle. It is a constant headwind of anybody in senior leadership who wants to break through all the time. And it's, I think it's actually a good tension because I actually kind of like the fact that we kind of are constantly breaking that one. But we got way off on this tangent. No, no, no, no, no. I'm sorry. It's too good.

Okay, okay, okay, okay. All right. You gave me number six. I want number seven. I want number five. These are too good. This is like a... I think we got four, five, and seven left.

Okay. Okay. So, yeah, so four is... What is it? Oh, yeah. I have to remember I'm in order. Yes. Is demand yes if, reject no because.

Demand yes if. Yeah. Reject. Demand yes if, no because. No, because, God, okay. So the idea here is, hey, Jason, I got this idea. Da-ba-ba-ba-ba-ba-ba. And you're like, nah, because that breaks laws of physics.

Whereas you're like, well, actually, yes, if that didn't break the laws of physics now we're at the board. Or, hey, Cody, hey, sorry, I can't deliver that thing because the washers are stuck in Nogales. I'm like, well, Jason, get in your fucking car and go get the washers. Well, I have to cross Mexican border. That'll take me like six hours. Well, that's better than a week, right? It's the yes if, right? So it doesn't mean that you necessarily do it or that you can find your way around the lack of following laws of physics.

Yeah. But the point is that it enforces engagement, right? There's no way. And it was so cool, cultural, that's one that's like alive every day, is you'll hear people like in an exasperated way, say, yes, if we had $7 million. And it's like, okay, all right. Well, let's talk about how that could be, right? Right.

And so it's sort of like. Yes, if the sales and marketing department was 100 people. Right. Right. I totally get it. It's, it allows you, instead of saying no, you're saying that is a possibility if we had this resource if this problem could be solved, which is what they always have that term in improvisation where they do the end or something. Yeah, yes and. Yes and is the improv. It's a corollary to

that. And I think what I think it, where it's most powerful is it's really easy for people who are the four-letter E word experienced, right? Or, you know, senior or been around the company longest or whatever to give short shrift to a new idea to a different way of doing things or whatever. They're curt. They're stuck. They're stuck. They're developing tradition. They're not in, they're gaining inertia, right? Not how we do it here. Not in this company. Exactly. So that's number four. Number five is all about building, for quality, people, water, customers, investors, et cetera. So it's all about, it's all about. And so it goes from product to customer to investor, cap table, board members, everything.

The idea that everything has to go through a quality lens, right? We're sort of, when we start a company, I have this sort of this idea that there's, that criticality or importance is proportional to risk time scale, right? And so when you start out the company, you haven't retired any risk, right? The risk is like 100%. Basically infinite, yeah, or whatever. And, yeah, it's 100%. The first derivative of risk is infinite.

And yet criticality is zero because scale is zero, right? And so over time, criticality is going up. So your decisions become ever more important because scale is there and so on. And then eventually what you want to do is reach a shoulder and you want to have criticality be going down, meaning that scale is dominating. you've retired all the risk or, you know, as much as risk as possible. And so in that framing, this culture element is about, well, everything, every decision we have to make, whether it's about people or product or customers or shareholders,

whatever, stakeholders of any kind, we have to be thinking about it through that lens of making sure that they're matching are that then criticality, right, if you will. Yeah. And people might say risk, reward is another interpretation of this. same thing, but if you're taking risks and you're being bold and saying, hey, we got to get this thing down to $2,000, you're going to $1,000, if you take those risks, then at some point, when the price becomes so cheap for producing these panels, it unlocks a total amount of the risk in the business.

Right, exactly. And now, of a sudden, if these things cost $500 right now, you and I would be having a different discussion, you in the sales team, you and the CFO would be having a different discussion. So then you have to have that discussion of how do we get there, which was the discussion Elon was having, like, how do we take this $160,000 go cart, the Tesla Roadster and make it a $75,000 model S and then eventually a $40,000, $45,000 model three. Right, exactly. And it seems like you're halfway there. The best car that's ever put on the road, I have a model three and it's just absolutely. Isn't it ridiculous?

I'm upgrading to the Model Y. I don't know if you've been in a model. I don't know if you've been on the Model Y. Have you been in a model Y yet? No. Yeah. So I have one of the first, I have one of the founders series of the Model 3, and that car is just mind-blowing. And I also have the Roadster and the Model S, and I just prefer the three.

But the Y you're going to instantly upgrade to because it's a hatchback and you're a little bit higher in the road. And the amount of internal space in the Y, it's huge. It's huge. It's bonkers. It's like, I think the Y is, this is going to be, people don't understand the step function that happened between the three and the Y. I think the three, Tesla was under so much pressure to get that car to market. And it's so amazing that people didn't expect that they could then hit another step function with the Y, but they did. Yeah, because the platform they built is so

robust, right? And like, I would argue, I mean, I think probably everybody would agree that the Model S and certainly the roadster are cluges, right? They're kind of like putting it all together. Yes. But it's on that path, right? And then you get to the Model 3, and it's like, ah, it jelled, right? It jelled. Yeah. But then the Y, they've done things with, like, the HVAC unit. I had this guy on who takes the cars apart, and he was just freaked out about the HVAC system

and the electrical system. They redid between the three and the Y. It wasn't enough for Elon to just put out the Y and have it be more cavernous and bigger and higher and patchback. They decided, fuck it, we're going to just redo the HVAC system and make it even. more efficient and we're going to redo the electrical system and make it even more redundant and cheaper and better and faster. And that's their philosophy over there, which is never enough, which then makes each subsequent product better. Do we miss any now? Where are we at with our seven?

I want to get more. Deep respect for their approach for sure. The seventh is- Have you met Elon before, by the way? Yeah, we've met a couple times. Yeah, yeah, yeah. It's fascinating guy. Well, you know, I've talked to him a lot about water. And we were just a decade ago, we were talking, I was like, why can't, if this is such a, why can't we combine solar with, you know, pulling water from the air, condensation or desalinization. And if you were to build this, could you not, and I'm going to ask you the same question, at the rate your technology is working, if you and Elon took your panels and some solar panels and just had this unlimited energy water, could we not terraform a desert?

And who knows what impact that has ecologically? But let's say we're deforesting some rainforest some places for whatever reason. Could we not take a swath of land in the middle of this country from a desert and over the next hundred years terraform it into a rainforest? Of course. Of course we could. Yeah. And this makes me ultimately helpful because the cost of almonds, one of the most dense foods, is water.

Am I wrong? This is what I hear is that the entire cost of nuts is water. Therefore, if water is free and we have more landmass than we know what to do with, whether it's in Australia or it's in the United States, we literally are on the cusp in our lifetime of having free water, free energy, and free nutrition, because nutrition is a function of those two previous items, correct? Exactly. And when you get sort of the kind of advanced agriculture layer in there, right. Food cost and CO2 associated with food and all the other things. All the nutrient outflows from growing food and monoculture and all that stuff goes away. Right. So that first layer, right, Mazel's hierarchy, food water shelter, right? All of sudden, we're done, right? And just going to start

to layer on top of that. We can't get to social justice. You can't get to women and girls empowerment. Think about just just an African continent alone, women and girls fetch water. the tune of 40 billion hours a year. Let's talk about the free water that is fetching, right? Like, you want to talk about, okay, well, how does economics of water work? Of course, if you have cubic meters of water coming to your home, that's free effectively and taste good, right? That's not what I'm talking about. Let's say in India, right, the GDPPP per hour, right, the kind of value of human existence is about $3.40. If you're walking in India for water, the average distance that a woman walks, it corresponds to that water costing about 63 cents a

liter. Crazy. And that's not potable. It's not potable. And then so if you get, you know, diarrhea two to four times a year, that's about $2 to $400 a year costs directly to the Indian government. So free water is a massive headwind economically. Forget the knock-ons of obviously education and social justice, all the other things that we have

to nail, but again, we're stuck, we're stuck here at the first layer. You see, there needs to be, you know, when we think about how we want to change this world, you know, a lot of what Bill Gates has been doing in the developing world, in terms of, you know, he had this great quote at one point where he's just like, I know Zucker, he was kind of like, he wasn't shading Zuckerberg, but he's like, yeah, if Zuckerberg wants them getting people internet, that's fine. I want to get the mosquito nets first and get them water first. And really, if we can solve those problems and remove that human suffering and just the the way to judge a society I've always felt is how they treat the most vulnerable people and the ability to give

people clean water which then gives them free agriculture I think it would be amazing in our society America people talk about K through 12 education being free great we're talking about health care what if we had a system in America where produce a base level of produce was free for everybody. Right. And so nutritious food was available for free. You could literally go just like we can turn on our tap and essentially get free clean water. It's basically, yeah, resource UBI, right? So resource UBI. It's awesome. Yes. It would be produce UBI, resource UBI, because we do it for education. We're going to do it for healthcare eventually. People are demanding it and there's no reason not to do it. We do it. We kind of haven't done it for

electricity, but we're kind of on like, I would say we're cuspy on that, right? Yeah. Wi-Fi, we're on the cusp of. You feel, that's why I like talking to people like you. I feel optimistic about the world. Like, I feel like we're on the cusp of this. I feel like there's a, while there's all these other headwinds that we're feeling, you know, every day right now, I see, you know, I've gotten to know Bill Gates over the years. He's an investor through Breakthrough Energy Ventures in Zero Mass.

And I think history is going to look very favorably upon. him, right? You think about everything he's done for the world. Forget everything he's done for the world through his company. Yeah, computer on every desk was like, that was number one. And that's, by the way, like, they're going to be the footnote. Yeah. Right. Exactly. And then with Bill and Melinda Gates Foundation, all the things that he's done. And now his leadership on climate, you know, he pulled together 22 other billionaires. You know, I think the total wealth of the groups like over trillion dollars to form breakthrough energy ventures to go invest in things that offset climate change, which is what Really? I didn't even know that. What is breakthrough energy ventures? I didn't know that. Can

hey, Nick, take a note? We need to get whoever's running that on this podcast, that. I'll introduce it to you to the guys. I appreciate it. So there's a, wait, the billionaires on the planet put a, did you say a trillion dollars into breakthrough energy ventures? They are worth over a trillion dollars to combine, right? So it's like, they're worth a trillion, but they are backing a venture fund called Breakthrough Energy Ventures to solve for energy. Yeah, and that was about one and a half billion dollars in it. Wow. So that's, that's Branson and Bezos and Jack Ma and Masa and Patrice Monsepe and a bunch of other folks that are in that fund. And, you know, they are investing, you know, into these, into these solutions that will ultimately either off-ramp climate change or in some way account for resiliency and adaptation.

Zero mass water is all about offsetting mass amounts of CO2 associated with drinking water, massive, massive amounts. We didn't get into that. It's like a whole other set of beautiful, man. math type of stuff. And then on the on the data adaptation and resiliency side, obviously were critical. I mentioned earlier, BlackRock came in. You may be remember Larry Fink wrote that letter at the beginning of the year around ESG, right? And explain ESG to everybody. Environmental, social, and governance. So it's really taking into account all of the other factors

in the business that are other than, you know, just the P&L and balance sheet that that relate to your puts and your takes with respect to the world, right? Contributions and, and impact, negative impacts. And so they have a substantial ESG practice now at BlackRock, which is fantastic. World's largest asset manager, right? Seven and a half trillion dollars under management. And this is now becoming pervasive in all financing discussions, ESG, you know, at the Harvard's of the world and the pen. And there was literally an episode of billions where the arc

was Taylor, who was like the millennial manager. Oh, you watch the show? Yes. Great. So shout out Brian Koppelman, my man, who's going to be on the pod. We, you know, he basically created that arc of like, hey, these endowments were like, I don't want to get bullied into doing ESG. We have investments in things that produce for our university. And I can't be bullied by a bunch of millennial students and the, you know, the new, student newspaper into doing this. And they were just trying to come up with a way for them to save face and embrace ESG, which just shows you that a lot of this is, you know, generational. Like there's a generation who, you know, the Black Rock in a previous life owned or was a significant owner in SeaWorld and, you know, had Orcas. And

then they had a crisis of conscience and we're like we cannot keep orcas in captivity get this thing off the books and to their credit you know they they had a money printing machine and they said you know like i i don't want my kid i don't want to go to work every day and have my kids think i'm i'm holding orcas in captivity especially after you know the tragic deaths of some of the trainers so you know it is it is interesting to see the the capitalism the consciousness of capital is, I think, a trend that Bill Gates is the tip of the spear of, and he does not get enough credit. And I think, you know, it's fine to criticize the disparity in wealth. I don't know how you feel about it.

But I keep seeing people who give their money away getting attacked for doing it. Jack, Twitter has been giving away at an old, I would say it literally at an alarming pace for a young person. Like, I mean, I'm like, Jack, are you going to have anything left? You know, and it's like, he's kind of a lot. a monk anyway, not having known him since before he was the CEO of Twitter. But, you know, like, look at, I mean, Bezos just said I'm putting 10 billion into climate change. Yeah. I think, largest gift ever. There's a lot of arguments for why, you know, people shouldn't have that kind of wealth. I would argue the singular good argument for people

having massive concentrations of wealth is to go fucking do something that improves the world. And if you can do that, good on you, right? I mean, I think that's, that's the biggest argument for those types of sort of efficiencies in solving big problems. Well, see, this is a fascinating aspect of human nature with great wealth comes, I believe, and I know that I'm going to get criticized. Maybe they'll cancel me finally for this. I actually think you have a crisis of consciousness most often. Now, there are some people who just go buy a bunch of boats and go crazy.

But most often what I see with people who come into wealth, is they mess around for a couple of years, they have fun spending it, and then they realize it had zero impact on their happiness. In fact, some of them, it just becomes a weight. And you've probably seen this as well, because we run in similar circles. It becomes a weight, and it becomes just a heaviness.

And then at some point, you've checked off every box, whether it's things that you wanted to own or experiences you wanted to have or companies you wanted to build or missions you wanted to accomplish. And then you just do what Gates is doing, or you do what Buffett did, which is just give all the money to Gates to do what he's doing. And you then have the people who the capital allocators made the proper bets on, society bet on their products, i.e. Amazon.

They joined Amazon Prime, which then led to Jeff Bezos, which then led to McKenzie Bezos and Jeff Bezos, I predict, will give their money away more effectively than any nonprofit ever could. So in a way, capitalism with consciousness comes the ability of we might have actually stumbled on the perfect session, which is the polarization of wealth, put so much focus on a Gates, put so much focus, Gates was the most hated person on the planet for a couple of years. Bezos is now the most hated person on the planet for the last couple of years, that they then wind up giving it away and saying, here, I'll prove to you that I can give this money away in a way and change the world forever. Yeah, and it's interesting because, you know, I think I would argue, you know, in the early days, let's say when, you know, let's say Amazon, circa, what, I don't know, 2005 or something. Yeah. It was still when it was a valuable company, but still unclear what it was going to become, at least to the rest of the world, maybe not to Jeff. You know, you think about, okay, well, he's a very rich guy at that point.

But really, he's continuing to push the chips in, right? He's betting on the win. And so he never stops. Most people, most people at that point are rational and they, they, they, they rational financially and they off ramp, right? And so then they have pretty large amounts of wealth. And then their company gets bought by some PE firm or whatever and it doesn't become Amazon that is today. So because of that concentration, because of that, that leadership, Amazon became something really valuable to the world. Now, of course, it has its own PR problems. But I would argue that it's it's done more good than bad. And now there's an opportunity for Jeff to go do something with his wealth. There's an opportunity. It doesn't mean that he necessarily will. But if he does, I mean, he's already investing in a number of areas where he'll clearly have a net positive impact.

And again, as I said for Bill Gates, beyond his company, right? What's Bill Gates like today? You know, I met Gates a couple of times, you know, had brief conversations with him at different dinners, but not in the last 10 years. What's Gates like? When you talk to Gates, what makes them so special? What makes them unique in the world? Fundamentally, I mean, you and I both run in circles with a lot of really smart people. I feel really humbled by just the intelligence of the people that I get to be around all the time. Gates is another level, right? He's a polymath, you know, he's a polymath that is able to synthesize across highly disparate topics, recognizing kind of where the best

efforts need to be deployed in order to have the largest impact and all sorts of things. And I think age has, I mean, obviously, I haven't known him that long. I would imagine going back, if he's anything like most other entrepreneurs that you and I know, if you go wind the clock back 20 or 30 years, he probably was a pretty tough guy to be around, right? He's probably pretty high, high energy. It was notorious for, yeah, if somebody said something stupid or whatever, just, you know, in the 80s or 90s, people forget, like, the idea was if you said something stupid in a meeting, the CEO would absolutely demolish and destroy you and make an example of you. Like, it was literally like a wartime mentality, I think, at Microsoft for decades. That's at least, and the same thing with Steve Jobs. Like, they say, like, in his first tenure, he was like a war.

four-time CEO and then he became enlightened. And how we all behaved in our 20s and 30s versus our 40s and 50s? Right, right, exactly. Well, and I think actually, you know, I'm sort of guilty of severe, you know, having a type A personality, wanting to win and sort of, you know, in my first kind of entrepreneurial forays, you know, was much less dimensionalized. And it was actually kind of those experiences that went, wait a minute, actually, there's this amazing brain trust that we have that can go solve.

like fundamental problems like drinking water and make a heck of a lot of money doing it, which is, you know, that catalytic, that flywheel effect that will, you know, improve the world. And if I build it with the right culture, then then it sort of will build itself in the sense that people will come to work to improve the world and it'll be their company and their culture, right? And so it's been that that evolution for me personally that has made when you ask me about like, what's it been like this during this pandemic. It's not been easy, but the team has absolutely stayed jelled. I mean, through some of the hardest times where we've got, you know, family members.

That is the test of leadership because I think the fiber and the fiber that you build, the connection you build in the good times is what gets you through the bad times. And I've seen it in my team is just absolutely come together, you know, the two companies I run and I invest in. I've just, it's been wonderful watch as we wrap up here and I really appreciate you taking so much time with us. Tell us about that. last round that came together in the middle of the pandemic. Perhaps the peak of the pandemic and the

debts in New York, tragically, you were literally raising money when New York was at, I believe, like the peak of the pandemic. Yeah. And this goes right to, I think, the core, one of the cores of building a great company is who are your shareholders, who's around the table? Are your board members able to also be rational during, you know, a pandemic and so on. And we have all of those things, which has just been fantastic. I mean, we really do have, I like to say we curated the cap table. And most of the people I can't share with you publicly, unfortunately, but the ones that are public, you know, Duke Energy and material impact fund and break through energy ventures, now BlackRock. We've had two more

closing since that may 8th close with one really big investor that's pretty exciting that I can't talk about publicly, unfortunately. But anyway, back, you know, kind of at the end of the year, We had been having these conversations with BlackRock, and we went before the investment committee. Everything was all go to go to go. And then, you know, we were going into sort of confirmatory diligence in February. Oh, boy. Here we go. There you go.

And I had won the Lemelson MIT Prize back in September of last year and then donated that money to an indigenous tribe in Northern Columbia. So we were in Northern Columbia installing panels in early March, just kind of what we're fundamentally about, right? These women, we're walking six hours a day to get water now. They don't do that. So I get back March 15th. And, of course, the world is El Mundo and Puego. Literally the night the NBA called the game was, I believe, the 14th, that Thursday. March 12 was, I think, Tuesday.

That was when I started my shelter in place. And shelter in place order started the following Monday, the 17th in San Francisco. Yeah, exactly. I got home and I went into quarantine so that, you know, my kids didn't get it, you know, if I, if I had it. So I stayed in quarantine for three weeks. So then we're, you know, now we're in the depths of the, of the first wave of the pandemic. And the guy on the other side of the table at Black Rock, you know, to his credit, everything was super rational. Like, hey, this is where we're at. We got to go back before the IC and I'm going, oh, shit, you know. Oh, boy, investment committee and over Zoom. Yeah. So we did that in April. And to Black Rock's credit, you know, they didn't, they could have, they could have demanded a bunch of stuff. They didn't do that. And it's because, of course, they see like we do, right, obviously this is all going to pass. And on the other side of this is a great, a lot of opportunity for the business.

So we ended up closing the financing May 8th. And that first closed was about $50 million. The total in the round that we've closed now is about a little over 100. and so, you know, sort of dramatically oversubscribed. And I guess part of that, going back to several of the points you've made, is the world is sort of waking up to, you know, that ultimately resources are where it's at. And if you can bring 21st century technology to something that's stuck in the Roman era, right? We still wait for this stuff to follow the sky and then we soak in the ground.

We pump it and put in concrete pipes and all that stuff. And what was interesting is we had like all of a sudden, all these headwinds kind of in the early summer around like our hospitality business and other areas where everything was sort of going sheltered. And then our, but on our government side, it was exploding. And so, and then now our hospitality business has come back. So, you know, sort of. This is why it's super important to have a set of customers who, you know, I mean, if you look at Uber, the fact that the Uber eats business, the Uber, you know, ride-chairing business, they gave them a specific, you know, resiliency. You know, I'm sure you're a fan of Nassim Taleb, you know, like what is, anti-fragile, you know,

your business gets, in chaos, your business gets better. And that is not an intent, but it is a fact, you know, in a crisis, you need water. Yeah, for sure. You know, it's a fundamental building back. back in January, we might be reasonably criticized for being, you know, spread, you know, kind of doing too many things at once or what I call optimizing for optionality. And we don't get that criticism right now because the areas where we had headwinds, we were able to just focus in areas where we didn't.

And so that optimizing for optionality was key in having a business that hunted through the period. It is one of the weird things that's occurred over the last decade is that, you know, individuals like Tim Cook were so brilliant at managing supply chain that they literally put the supply chain person in charge of Apple after Steve Jobs. Now, it's amazing that the support, and this is not a dig to Tim Cook. I think he's the perfect person to put in afterwards. I don't think he's the perfect person to put in long term, but we have gotten so good at optimizing supply chain that iPhones get announced and shipped from China with a label that was printed in China in a factory and get into your hands. And to the point at which, you know, when we have a crisis, there's no redundancy.

And people forgot about redundancy and resiliency. And we optimized for something that, you know, a level of efficiency that maybe works against us in a crisis. And now we have to rethink that. What I love about what you're doing or what Elon's doing with the power wall is, if every home in America, or even every other home in America or every third home in America had your system and a power wall and an electric vehicle, you just think about how that distributed network, how resilient it is to cataclysmic changes that we face. And, you know, I'm talking about environmental ones like hurricanes and heat waves and fires. You know, if we have more water and we can reverse climate change, we could come out of this redundant, a more just world.

with free produce and solve climate change. This could be the win, win, win, win of humanity. And that's why I'm so optimistic. I think we can solve all these problems. It's just the will to execute. It's the will and the imagination to think about what kind of world do we want. And how do we take the brain trust that sometimes gets put on to frivolity and apply it to our biggest problems? Right.

And those biggest problems, right, pain point, I like to say pain points pay, right? Those biggest problems are the biggest opportunities. And yeah, those resources, right? Food, water, shelter. If you're able to provide produce to everybody from a, I won't say vertical farm because that triggers everybody around labor and wherever else. But let's say advanced agriculture, which is, I think, a key part of where we have to go, where we stop using the dirt to hold up the plants, but rather take that and move it to a 21st century scenario

where you're using 120th at the water, 120th of the nitrogen and so on. It's so obvious. I mean, if we have walls of produce and there's solar panels and you're doing the hydration that you're doing with your panels, then the avocados and the basil and the spinach, the stuff is all going to drop 10x in price. And this deflationary effect, people look at deflation and they get worried about it. Deflation means that the standard of living goes up. The fact that you can buy three T-shirts for $5 or jeans,

less today than when you and I were buying them in the 80s. This is a very weird phenomenon, you know, and it's a good phenomenon that an airbag, you cannot buy a $15,000 or $16,000 car without an airbag, whereas an airbag was an $8,000 option at some point in time. Like deflation means better standard of living. Yeah. I mean, the economists may have had this wrong. Well, and it doesn't, you know, it doesn't necessarily have to mean, you know, because a lot of that was driven by automation and moving jobs offshore. But it doesn't have to mean just that, right? You can also, like our friend Rick Fulop, when desktop metal is ultimately successful, you know, your refrigerator hinge breaks. And before you go home from work, there's a new hinge

sitting there on the print plate, right? And you think about what that means for where we go is a society where, you know, kind of all the things that we think of as coming from somewhere far away or it has to be put together in a factory or whatever, or it has to be pumped out of the ground or has to be grown in a monoculture field in the middle of Iowa, if instead it can be done in a technological way that's much more efficient and local, that means more jobs in a way that is more efficient

that's more healthy for us and the planet. It's such a bright future of abundance, and we need only open, I mean, when we talk about heart, And I don't, you know, if you open your heart to innovation and you treat capitalism as a part of the eco, capitalism is a component of the operating system along with democracy that you need to keep working on upgrading those operating systems and keeping them in balance, not remove that operating system. You remove capitalism from the democratic operating system and we go into fascism or socialism or some weird combination. yet we cannot have unconstrained capitalism that does not bring the people who are at most risk up. And this, you know, when you and I have this discussion, you know, and people of good faith have these kind of discussions, I realize that how we frame discussions and how politicians frame discussions are so disparate. It's so disparate that they don't know how to frame the discussion.

If we were to, if I would, if you and I as entrepreneurs said, okay, currently we have pre-K to 12, that's 14 years of schooling. What if we added one year of trade school and two years of programming school that were available, that would be about 8% more, 12% more, is there a way to do that efficiently? But when you say free college for everybody, now everybody's triggered and it's a holy war, and now you have to pick a side. But what if we just said, what if we can make the system 8% better so we could add a year of vocational training for some group of people.

You and I as entrepreneurs would be like, easy, peasy. Yeah. We could get it done. Yeah, exactly. Eight percent more efficient? Easy. Exactly. And I think there's this sort of this idea that, and I've seen it, it's kind of come

through two different ways, right? So there's sort of the B-Labs efforts, right? The public benefit corporation efforts. And then there's the, you know, John Mackey, the founder and CEO of Whole Foods and Roshasota that came up with this conscious capitalism movement. And they're sort of both, I think, in very different ways, articulating something that is implicit in what you're saying, which is capitalism is a fundamental force. It's an imperfect, but the greatest force he's ever developed as humanity for lifting up all boats, right? For raising everybody.

At the same time, we historically have had our externalities basically stop at the shop front door, right? And we have to extend that externality, a few more layers, the ESG layers and other things. And we also have to be focused on the problems that are facing us as a prime, you know, as prime kind of motivators for new entrepreneurs. And it's, from my perspective, it's the reason to be most hopeful because there are only a finite number of problems facing us. It is not an infinite number of problems. Right. And there's a hell of a lot of entrepreneurs out there. And you know what?

They're so close. You know, it's like you just look at some of them. They're so close. And in some cases, they're here waiting to be deployed. One of the things that I, when I look at this pandemic and we look back on it, the driving through San Francisco or just driving in general and seeing no cars on the road and watching the air quality in northern California become perfect, you know, absent the fires that we just recently had.

I didn't realize that Northern California had a bit of smog, and certainly people in L.A. knew about it, and obviously in other places like Mumbai, I don't know if you saw that one photo where suddenly they could see the Himalayas. And they were like, I didn't know the Himalayers could be seen for my house, but yeah, there they are. Look at those snow cap mountains. That was always there.

We just chose not to see them. All we needed to do was move everybody to EVs. That's it. And it's, they're here. So why are we not doing it? It is the will and it is the will of the entrepreneur and the capitalist who comes to work every day and who picks the team and motivates the team and then inspires the capital and make the bet that makes the change in the world. And you know what? Cody, you're one of those people and it's been great to get to know you on this podcast.

I appreciate you immensely. You know, I didn't know we'd make that turn into culture, but you were very open, I think. And that's what makes for a great guest on this podcast. I always tell people who want to be on the podcast, like the currency of the realm here is honesty and just opening up and it's good to know you. And I think maybe when this is all over, I'd love to, you know, go on a hike with you

or do something, like get some ramen or whatever. Good to know you, Cody. So many friends in common too. And I know you don't do these pockets. You're not a press guy, huh? You don't like doing the press. Yeah, we do a little bit here and there. But, you know, I think it's so critical

that we put execution first, right? Yeah, so true. What we're working on, right, the idea that we fuck it up, there's just no, there's just no way that we can allow that to happen. So there's a lot of focus around that. And I think, so I spent about a week a month up in the Bay Area. So when this is all over, when you're here, I got a killer ramen place that I'll take you to from Tokyo that opened up if you, if you like the ramen. All right. I'm good to know you, Cody.

We'll see you all next time. Stay safe, everybody. Bye bye.