This Week in Startups - Fantasy startup investing NFTs + former Tesla CTO JB Straubel’s Redwood Materials | E1299

Episode Date: October 7, 2021

In a short news segment, Jason talks about a company that tried to sell "fantasy startup investing" NFTs and why they had to pivot (1:44). Jason gives a brief tribute to Steve Jobs (15:48). Then, he's joined by JB Straubel, Tesla's longtime CTO who stepped down in 2019 to found a new lithium-ion battery recycling company, Redwood Materials(22:08). JB and Jason discuss the early launches and setbacks at Tesla, overcoming challenges, and the possibilities created by battery recycling. To close out the show, we play a clip of Steve Job's 2005 Stanford Commencement Address (1:20:15).

Okay, we got a great episode with Tesla, CTO, and co-founder J.B. Schrable, who's going to talk about his new battery company and some of the great moments in the history of Tesla. He's working on a company called Redwood Materials, and they're doing a massive operation to recycle lithium ion batteries and just make the planet more sustainable. Really, really great interview. But before we get into that, I want to talk about NFTs and this fantasy startup investing project that popped up. Talk a little bit about fair use using other people's IP.

And at the end, I'm going to talk a little bit about Steve Jobs and the 10 years since his passing. Johnny I wrote a beautiful memorial to him in the Wall Street Journal. And I have some thoughts and some feelings on it. So stick with us. It's going to be a great episode. This week in Startups is brought to you by LinkedIn Marketing

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get an extra 10% off using offer code, Twist. All right, in our first story today, a company announced they were selling fantasy startup investing NFTs, and they launched a beta for this and then shut it down 24 hours later. The startup is called vision rare, and it was co-founded by a former French VC associate, Jacob Claire Ho. I hope I'm pronouncing that correctly, and a Belgian developer, Boris Gorditz. I hope I'm pronouncing that correctly. Both founders are seemingly young and based on their LinkedIn profiles, and the company has raised no outside funding to date, according to TechCrunch. But according to the TechCrunch article yesterday, quote, mimicking the appeal of fantasy sports leagues and giving users a way to compete with

friends by betting on startups they think will be successful. So the way it worked was users could bid on NFT shares of hundreds of different startups at auction and compete to build the best performing fake portfolio, just like in stock trading or fantasy, you can do this. The crazy thing about this, though, which I thought was interesting, was, and I made this observation, you as a non-accredited investor cannot buy shares in a private company here in the United States. The SEC has accreditation laws mean you have to make two or three hundred thousand dollars a year or have a million dollars in liquid net worth

outside of the cost of your home in order to make the very scary, dangerous bet of betting on Uber when it was private or Robin Hood or, you know, today, Stripe, SpaceX. Like, you're too dumb is essentially what they're saying to you. You're too dumb to buy SpaceX, right? You see all the Rockets go up. Your friend has, you know, Starlink and you played video games on it, and you're amazed at how awesome it was. And, you know, you used Stripe for the last seven years on your, you know, e-commerce site. But you're too dumb because you don't have $300,000 a year in salary or your parents didn't gift you a million dollars in your trust fund. Therefore, you can't buy private company stop. That's what the accreditation loss here in the United States.

say other countries don't have these. And here in the United States, you can buy NFTs, which are securities. And in this case, they literally made them as shadow securities. So the great irony here is people are buying NFTs to gamble, to watch them appreciate in value. We all know, nobody's buying these NFTs because of the, you know, inherent value of the JPEG,

of the image or the 3D model, because before NFTs existed, people weren't paying for them, right? Like, maybe people would buy a logo, but they weren't buying JPEGs, right? We would go on the internet, there'd be JPEGs everywhere. I mean, there were stock photos for commercial use. There were logos you could have designed. And so what this has really got me tilted a bit on is, you know, the SEC is allowing NFTs to be sold and traded for fun and profit. And the profit is the majority of why people are doing this.

Let's be totally candid here. If these things were all worth a dollar or $3 and they didn't appreciate in value, you know, if they appreciated it five or 10% a year, would there be a mania going on here? Absolutely not. The mania is caused because I don't know what the floor price is for a drunken monkey or a, you know, a crypto, emo nerd. You know, like, but it's hundreds of thousands of dollars. Like, it's ridiculous. It's the cost of an average home in the United States. It's, you know, four times, five times, ten times the average salary in the United States.

This has become something wildly different in practice. Now, does that mean I think people shouldn't be allowed to buy NFTs? No, no, it's your money, right? Be aware that it's probably a rigged game. There's probably people painting the tape. There's probably people front running the market, as we saw. An employee at OpenC was buying NFTs and then flipping them and making suckers out of OpenC's customers, right? an insider trading basically front running of the market.

So if they caught one person, you know, I'm not singling out OpenC, you can be certain that there are collective groups manipulating the market. But you can't buy private companies? Really? Now, somebody pointed out like, oh, I'm talking about my book here. I just want more people to invest in startups. Well, I do want more people to invest in startups, but not because I profit from it. You know, 99.99% of startups that are invested in, I'm not on the cap table.

surprise. This is something I think would be good for all Americans, and it's a freedom issue for me. And it's about people moving from one station in life. Maybe they're poor. They want to be middle class. Maybe they're middle class. They want to be upper middle class. They want to be rich. They're rich. They want to be elite. Well, the rich people can already do this and the upper middle class can already do it. So why can't the middle class or people who are just starting their careers do it? It makes no sense. It's silly. It should be like a driver's license. It should be like a gun license. If you can take a driver's license or you can get a gun license and take a certification test, seems to me that more dangerous to own a gun or drive a car down the highway than it is to own private company stock.

I think we could all agree on that, right? Or maybe you would rank those three things in a certain order. I would put owning a gun. No, I put driving a car owning a gun and then probably owning stock, a distant third. So anyway, quote, the founders hope that the game like nature of the platform will discourage those companies from sending out cease and desist letters because they didn't get permission from the startups listed in the marketplace, according to the article.

And this is the key issue. There was another website that Bology and some other people invested in that was using people's likenesses to create a market in crypto and they would take the top Twitter handles and they automatically put them in the marketplace and let people start trading on them. BitCloud is the name of the company. This is called trading on somebody's likeness.

You're stealing somebody who's a celebrity's likeness. BitClout should have been sued by that. I guess I think nobody really took the time to do it. You can't trade on other people's likenesses and their images. That's illegal, especially when they're celebrities. So, you know, listen, I'm not going to start a war over it, but, you know, I was a high profile person. I would certainly send a cease and desist, take my image off there because you're confusing the

public. So when I saw on BitClout, you know, Naval, Elon, whoever high profile crypto people, I assume that they had signed up. And in fact, there's no indication they didn't. It's totally not clear. You see their image. You see their likeness. So I think the BitClout people are lying and deceiving people.

And that's not right. And you're doing that on top of crypto, which has its own issues. Like, how dare you put somebody's image on your homepage and let people start trading in their stock or showing interest? It's really, it's gnarly. You've got to make that super clear. You make a list. These are people who've signed up.

And you could say, these are people we would like to sign up. So put that on a separate page or put it on a separate, you know, a list. When people do devious stuff like that, like BitClout, was doing all this like, smarmy, devious, lying kind of stuff. That tells you all you need to know about those individuals in my mind. If they would lie about that, what else are they lying about in their business? What other corners are they cutting? That's the way I look at the world.

When I see people bending the truth or a being like that, I wonder. Now for this one, if you said, I want to make a bet on companies and I want to make a fantasy group of this, and maybe you didn't use their logos and you let people put in the name of the companies and you're not profiting from it, that would be different. So once, if it was a non-commercial project, that also is different. BitClout stands to make hundreds of millions, billions of dollars building their service. That's their goal. This company was selling the NFTs.

So once you start actually doing commerce, that changes it. Fair use is a test. And so the fair use doctrine here would apply if you were not making money, perhaps, and not using their logo and not confusing the public. Those would all be part of the test. A judge would put this through if it actually went to court. Of course, it wouldn't go to court. So 24 hours later, they've pivoted to a free to play model because they know they're going to get sued. So no new vision shares will be auction users that above vision shares will be refunded. So, you know, young founders don't understand. Young people don't understand copyright law. I didn't when I started my career.

They don't understand trademark law. And it's something you got to get your head around. And then Ultimately, what you learn as you do it is there is a legal system and almost, I would say, out of 100 trademark or copyright issues, I would say one in a thousand actually goes to court. One in a thousand. 999 gets settled. And I would say out of the 99, 900 of them get settled with an email. 99 of the disputes get settled with one legal letter. So when somebody steals your brand or creates confusion, that's a big part of it. And here, I think they realize they're making money, they're creating confusion. If you take the money out of it and you make it a non-commercial project, that really does help you. Listen, right now LinkedIn is going to give you a $100 credit towards your first ad campaign. I want you to go to LinkedIn.com slash this week in startups and get that hundy right now. Now, why would you use LinkedIn marketing? High quality leads. We all need leads. We're all running business.

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and terms and conditions apply because they're giving you a Hyundai. As an example, fair use. If I wanted to play a clip right here, you know, pre-interviewing Gensler, well, if I'm doing commentary before and after it, and it's a, let's call it 90-second or less clip, And I give credit to him so you know who the source was. And it's only 90 seconds, a small portion of the original work. And I'm doing commentary before and after. And there's no confusion about what's going on here.

Even though this is commercial, I could do that. There was these like kids taking our entire podcast all in, This Week in startups, Tim Ferriss, everybody's podcast. And they would take the entire podcast, cut it into 50 clips, put all 50 clips here, the whole, I think they were called pod clips. And I had like talk to these kids. I was like, you can't take the whole show. If you clip one and you give commentary,

okay, fine, I'll consider that fair use. They literally took every one of Tim Ferriss's podcasts and clipped every single one. And Tim doesn't get those views on his podcast. And they're like, well, we're helping you promote. And it's like, does Tim Ferriss are all in or this weekend startups need your promotion? You have 300 followers on your pod clips.

No, you're stealing. And then on their own website, they were not linking back. So I told them, guys, you're taking the entire show, you're clipping it into 60 clips. And no,

you can do two clips. If you do an intro, you say why you're clipping it, you write a blog post around it, that's fine. You can't just wholesale, send our podcast to Manila, have somebody getting paid $12 a day,

put it into a ton of clips, and then just take the entire archive, which is what they were doing. and so I asked them like very nicely to stop and they were like you J-Cal and I was like excuse me okay I just went to my assistant and I was like um here's a DMCA notice here's who's hosting send a DMCA notice to their hosts and when you get a DMCA notice to your uh hosting provider the hosting provider's like well I'm not dealing with this bullshit and pretty obvious what you're doing and I know that person they're credible and I said the

DMCA I notices and magically they took it all down. So it's really, really simple when that happens if you're wondering how to do it. Take the first step, say to the person, hey, I'm, it's very delighted that you're a fan and you're using our content. Here's some rules of the road that I'm comfortable with. It is my IP, my intellectual property. And that's what I did. I just told them like, hey, listen, here's what I'm comfortable with. And that goes for you all too, anybody who's listening. If you wanted to clip a portion of this podcast, if you wanted to take your favorite clip from every episode and then you do what I do, you come on. on air and you say, hey, this is, this was a really great moment from this interview. I really

love this moment. And I'll be back on the other side of the 60 second clip to talk about it. Totally okay. Encourage you to do it. You could literally make your own show, you know, best of J-Cal or best of this week in startups. And as long as you introed each clip and talked about it and were doing commentary, totally fine. In fact, I encourage somebody out there, if you're fan of All In or This Week in startups, you and your besties or you and your founder friends could take every interview I've ever done and talk about your three favorite moments in it and create a derivative podcast on this one. As long as you're not confusing the audience, as long as you're doing commentary, I am fine with it. That's fair, right? Fair use. So you always want to put the fair

in fair use. And for these folks, I don't think they did. All right, in other news, it's been 10 years since Steve Jobs passed away, and Johnny Ive, his collaborator, wrote a beautiful article in the Wall Street Journal on what he misses most about Steve Jobs. Curiosity came up. I think about Steve every day. He was, without a doubt, the most inquisitive human I have ever met. And then he goes on to talk about the quality of Steve's thinking. Steve was preoccupied with the nature and quality of his own thinking. He expected so much of himself and worked hard to think with a rare vitality, elegance, and discipline. His rigor and tenacity set a dizzyly high bar. When he could not think satisfactorily, he would complain in the same way I would complain about my needs. In terms of ideas and his support of ideas, ideas are fragile. If they were resolved, they would not be ideas. They would be products.

It takes determined effort not to be consumed by the problems of a new idea. Problems are easy to articulate and understand. And they take the oxygen. Steve focused on the actual ideas, however partial and unlikely, on being quiet. In the garden, I sat and thought how talking often gets in the way of listening and thinking. Perhaps that is why so much of our time together were spent quietly. And he goes on to basically talk about how the quiet times with Steve Jobs were his best moments of his life. And what a great collaboration they had. Obviously, you know, we know Steve's career.

But really with Johnny I, the iPad, the iPhone, you know, all these incredible. devices that they put out. And, you know, the industry does miss him. And you often have to think, what would this industry be like if Steve was still around? Like, what would he think of crypto? What would he have thought of Trump? What would he have said about Trump? Just anything in the world he would have had really interesting things to say. Would he have started a podcast? For those of you who, you know, are, you know, under the age of 30, essentially, you know, Steve, Jobs had an even bigger presence than Elon or Zuckerberg or Bill Gates because he would make things that were transcendent, you know, in a design way.

And he had a focus level, determination, an ability to just push the ball forward that, you know, It's just so rare in the human species. He was one of one, clearly. And his ability to be a conductor, a maestro of so many different aspects of business was really inspiring. He understood marketing and PR just so natively. He understood design and the design team. And even understood, you know, I think software, which wasn't something they did particularly

well, but that he quickly realized. and really boosted their ability to do cloud services and figure out iCloud, which was originally MobileMe, and it was that famous story of him saying to somebody who was working on Mobile Me. I mean, you know, that was a weakness in Apple. They said, well, what should Mobile Me do? And the person described. And so, why the heft doesn't it do that, I think was the story. Make that.

And I think he fired that person and put somebody else in charge. And so, you know, to the people who were touched by Steve Jobs, you know, I got to meet the man a couple of times. I traded emails with them a couple times. I was lucky that Engadgett was covering the iPhone and the iPad during that time. And Steve would reply to my emails, probably three or four of them over the course of a decade. You know, I met him in person a couple times at different conferences, and he was very engaging with the press. He saw one time I had a badge that said Engadgett and came up and said I read it every day. Your team is better than my internal team. You guys get incredible Intel and he was quite charismatic in that way. One of the most charismatic individuals I've ever met

in terms of like the presence in the room. So to the people impacted by Steve's passing, you know, I'm very sorry for your loss. And I do remember that day when he actually passed. And it was like the industry had a soul crushing moment. It was just all the air came out of the room, all this just collective sadness. There's a, there's a lot there with Steve Jobs. you're not being here anymore. A lot of lessons too. He was iconoclastic and he, you know, did his own thing. You're Mr. Steve.

Man, what a run. What a run. Just entrepreneurially and creatively. Super inspiring. And I think actually the thing for you all to watch is his, he gave a great graduation speech, commencement speech. Yeah, maybe I'll play you out with a portion of that speech. Enjoy.

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Novo Small Business Starter Guide. Once again, banknovo.com slash twist. All right, next up on the program, J.B. Shrable is here. He is the founder and CEO of Redwood Materials, but you probably know him as one of the co-founders of a little electric car startup from here in the Silicon Valley called Tesla. And welcome to the program, J.B. Hey, great to be here.

Thanks for having me. Yeah, so we've known each other forever. I'm 50 feet away from my Tesla Roadster number 16 and my signature Model S, 0-000-1. What an amazing journey you had at Tesla. Tell me just if you were to recap the experience from Rhodes to Model S to Model 3 and all the near-death experiences for the company.

How do you look back on that amazing journey in your life? Oh, man. It's like trying to recap, you know, the Encyclopedia at Britannica here. I mean, it's such an adventure. You know, I just kind of look back on it all, you know, mild disbelief. And, you know, some of the brutal, you know, near death, most difficult stuff kind of gets, you know, a little bit tempered even with just a little bit of time. And, you know, I just feel incredibly proud to have, like, been a part of this, you know, crazy revolution and been at the right time in history when all this was possible.

And we were able to do these things. And the batteries seem to be the key component here. There was something about that time period when y'all started working on Tesla and making it work where, correct me if I'm wrong, but battery technology from the smartphone revolution and the laptop, you know, boom of the late 90s into the 2000s, played some sort of role in setting the groundwork. for Tesla to be able to do what you did, correct? Yeah, it was pivotal. And I think that that was, you know, if there's a luck to it, that was the lucky timing and

some of it was intentional. But lithium ion batteries, you know, were commercialized in about the year 2000 for laptops. You know, Sony did that. You know, it was bleeding edge, you know, then. And, you know, three years later, Tesla starts. And, you know, four or five years later, you know, we're building them into the first road stir next to you. So, you know, that, that was, it was that sort of beginning of, you know, that decade that, you know, presented that kind of opportunity. And before that, you just couldn't make a modern

electric car. They just, they weren't technically feasible. You could only do so much with, you know, nickel metal hydride or lead acid batteries. I remember one staff that, you know, we would constantly kind of talk about or think about. And it's that, you know, the roadster, when it was fully charged, the whole car, you know, with a person sitting in it, has an energy density higher than a lead acid battery. So, you know, there's no physical way. You could take this like old technology and make it, you know, perform that way. So that was what made it possible. And the cost of the original battery pack in that roadster was somewhere in the $40,000 range, $50,000 range, if I remember correctly?

Yeah, it was in that ballpark. It was, you know, close to $1,000 a kilowatt hour. Wow. You know, so I think 53 and change kilowatt hours in the first generation Roadster and yeah, probably around $50,000 to $55,000 something in there. Just for the battery pack. Just for the battery. I replaced my Roadster battery pack with the 300 plus mile one, I think, for $25,000,

X number of years later and I can go 350 miles. Although you probably wouldn't want to drive for six hours in a Roadster. It might be a better mission for the Y. need a chiropractor after that. You did feel the road in the roadster. But it was mind-blowing. Tell me what it was like to deliver those first hundred. If you take yourself back to that time period and people on the road in L.A.

and in the Bay Area and those first hundred getting delivered and I guess Larry, Sergey, and yourself, Bill Lee, David Sacks, myself. there was just like a group of people who put those $160,000 deposits down for those first 100 signatures. What was it like when you delivered those first hundred signatures? I mean, it was incredibly rewarding and exciting. You know, we were obviously pretty late delivering them in the first place. Just a year or two. Just a little bit. And, you know, and all these early customers just were such a key part of the company and the mission back then.

And it was kind of, you know, this sense of camaraderie, you know, making this happen. And yeah, I mean, we were super proud of it. You know, we'd put our heart and soul into that thing and, you know, worked on it for so many years as a pretty small team. And obviously it was a very different, you know, profile then, you know, much lower profile. But, you know, to see a modern electric car out there and having customers actually enjoying it and experiencing it doing, you know, multi-hundred mile drives, it was this. pretty amazing. I mean, that was revolutionary. People didn't, you know, most people would still think we were lying actually about

the range, you know, in those days, which was amazing. That is such an accurate description of that time period is the fear, uncertainty, and doubt that was being directed at you and Tesla was insane. And, you know, we're driving the cars. Yeah.

150, 200 miles. And telling people, look, it works. And they're literally saying nobody will ever buy an electric car because of range anxiety. And I'm like, I'm charging the thing once a week in L.A. You know, it's my daily driver. I drive, you know, whatever, 10 miles, back and forth to Santa Monica to the office. And I'd literally had people jump in the car when I would be at valets and just say, please take me for a ride around the corner.

Please, just I want to experience the exhilaration, even at that time before ludicrous mode. I don't know if the zero to 60 was on the roadster, but it was four seconds or 3.7 or something. Yeah, I think, yeah, just under four for the sport model. But it, you know, it was the same experience, though. I mean, it, you know, minus the whole, all the creature comforts and the NVH and the handling and a bunch of other things.

A few little things. But that same experience of getting in there, you know, feeling the torque, feeling a zero to 60 in under four seconds, you know, I was driving the roadster last weekend. And it's amazing how you could feel the DNA of what electric cars became and have our today, you know, even in that, that early thing. If you don't have business insurance, you failed one of the first steps in being a great entrepreneur.

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Let's fast forward. to the delivery of the signature 1000. What was that like and how was that different than when? Because I think at that point, yeah, Tesla was a public company. I remember this because I had people coming to my house to try to take pictures of the signature 001. Now, you all had, I think, 40 Founder Series that you had produced. And Steve Jefferson has number one of that, obviously.

And I'm sure you have one of them. So they were driving around. But what was that milestone like? when the signature 1000 come out and it's a, you know, it's a proper sedan that, you know, families and, you know, valets could actually park.

Yeah. Suppose the roads or which valets would be, I can't start your car. Couldn't get in it in the first place, yeah. They couldn't get in it, but that, you know, so many times I had to sit there with the valet and tell them the car's on. And they're like, I don't, the car's not on. I don't hear it.

And they would sit there and it'd be like, it's on. It doesn't make noise. Well, I mean, the Model S was, I mean, such a different car. I mean, that was the one that really, with the roadster, it was a technology validation. You know, we prove the batteries could work. They could go in a car. It could be safe. You could do the range and acceleration. But, I mean, the S was a whole different thing. And, you know, it was so good. You know, we put so much effort into that. And I mean, Elon was hell-bent

on making it, you know, the best car, you know, on the road. And we, you know, I think really delivered on that at the time. It was, it was phenomenal. You know, I still am amazed, though, at how much skepticism there was. You know, even after, you know, delivering those, you know, we kind of imagined, I imagined that, you know, people would see this and they'd say, oh, okay, clearly, this is the future. This is all going to work. You know, all the car companies are going to copy this immediately. Yeah. And, you know, we'll have to go really fast, you know, figure out how we can carve out a niche.

And it just didn't happen. You know, it's so strange. Customers loved it. You know, it was a runaway hit with reviewers and magazines. and customers, but the copying and the market change didn't happen. That was interesting. That was fascinating to me as well, because now, instead of taking one person for a ride, I've got five people jumping in the car.

People are using it as their daily drivers. And now you're starting in Los Angeles and in the Bay Area to see them flood into people's parking lots at Google, Facebook. You couldn't go anywhere in Silicon Valley without, you know, 10, 20, 30 of them being. in the parking lots at Apple, etc. And yet no competitors arrive and you're blowing past 200 miles and people are still claiming

that there is a range issue and the supercharger start hitting you know, two, 300 miles added in 40 minutes or whatever it was. And that was always what I found so strange about the criticism. The car has won

not only car of the year. There were people who said this is the greatest car ever made. I think car and driver, correct me if I'm wrong, was one of them, said the greatest car ever made. Yeah, I think they did. I mean, they were just blown away. It's like it wasn't, didn't compute. It didn't even fit into their rating system in terms of efficiency and performance and luxury. They, yeah, didn't work. In the way they'd reviewed cars previously. Now, the Model 3 now, that was, that was a hard one. That almost killed the company.

you guys just worked yourself to the bone to get that out. Let's fast forward to that and then we'll switch over to your new company. Tell us about making the $50,000, $60,000 car that ultimately, I would say, and I think you probably would agree, you'd tell me if you do, was the completion of the mission. The mission was always to have a car that was really accessible. Some people might argue the $30,000 car is the ultimate slam dunk, but I consider the Model 3 and Y

just so transcendently good as cars and so accessible to such a Y group of people that y'all succeeded in the mission of creating a long-term sustainable electric car company and electric future. Tell us about how horrible that was up until the deployment of it and then how rewarding it was

to not have the company go out of business again and deliver it. It was pretty brutal. you know, it's just such an unbelievable exercise in learning how hard it is to make large quantities of things and, you know, deep respect for manufacturing and scale.

You know, I think, you know, there aren't that many startup companies that sort of have to tackle that level of, you know, automation, production, supply chain, all those other complexities. And, you know, it, it kind of brought us to our knees, you know, for, you know, a good year or two in the midst of that whole thing.

You know, it was all hands on deck. You know, the whole company was pulled into this, you know, every level of, you know, engineering and, you know, every other function for that matter. I mean, I pretty much, you know, moved to Nevada in those days and, you know, camped out at the gigafactory and, you know, did everything I possibly could do to make batteries possible and battery packs and motors and everything else. Yeah, it was. it was pretty crazy, you know, hard to expect and looking back into it, we knew it would be hard,

but we didn't know how hard. Yeah, I mean, it's one of the great things I think about entrepreneurship is that if you actually knew how hard it was going to be, you just would not do it. It's one of the great ironies or paradoxes. So true. I mean, you guys had, I remember visiting the factory and the gigafactor at that time period, and you literally had executives from the corporate. office on the line, delivering cars, interact. I mean, literally people who were in accounting

were there delivering Model 3s to customers just to keep the company solvent. I mean, the esprit of corpses was just palatable. And, you know, I just think the world, you probably don't hear this enough, but I think the world does thank you ultimately for the massive sacrifice it took to make the world pivot to electric. And it's, it's so, clear, I think, and I'm curious your thoughts, that now that Tesla has done this and succeeded, it is now inevitable that the ice engine will be retired and we will be 100% electric in the next decade two or three. What are your thoughts on that? I 100% agree. I mean, we've passed the threshold here, the tipping point, or whatever analogy you want to use. You know, there's no,

there's no going back. And, you know, there'll still be bumps along the way. I mean, it's sobering to remember, you know, what a small percent of the fleet is still electrified. I mean, we're still, you know, broadly in single digit percent, maybe approaching 10, you know, depending on which region. But, you know, we've got a long way to go still. But, you know, it's clear now to every major, you know, auto company, maybe bar a few holdouts, but, you know, people realize this is the future and where it's headed. And it's, it's really cool, you know, because that was actually one of the,

of the main missions of the team at Tustle in the earliest days was, you know, even despite how hard it was and, you know, maybe we'd fail trying, but, you know, damn the torpedoes, we were going to try and, you know, convince the world that this was the future and accelerate it as much as we could. And, you know, having that shared mission and that sense of purpose, you know, made it possible, I'd say, to get through the production hell and, you know, keep everyone engaged and aligned and create that, you know, that spirit that you felt? Norway, 75% of new passenger car sales in 2020 are electric. It's amazing.

I mean, they heavily subsidize it, they're incenting, but it just shows what this combination of excellence from Tesla and the product combined with a country that takes it seriously. And by the way, Norway has the biggest oil reserves and largest. largest sovereign wealth fund in the world. People don't know that, but their offshore oil is unbelievable. And it's quite paradoxical that Norway is 75% new car EV, and they have the largest reserves of oil.

Let's just say something about what they're doing domestically versus what's there. If Tesla, and we'll go over to Redwood materials next, if Tesla had failed, what would the state of EVs be today? in terms of, you know, let's say you fell at the Model S, you know, time period. Just Model S never got delivered.

Model S doesn't get delivered. Where are we at in the world with EV production? Well, I mean, personally, I think the technology is so compelling that it, it was going to happen at some point no matter what. I don't think it would have happened as fast. And I think, you know, we may still be, you know, bumbling along if Tesla had failed, as you said, somewhere in one of those production ramps, S, or even three, you know, I just think it would have

taken much longer. And the world wouldn't be as far along as we are now. And we'd have higher carbon. Do the electric truck? Do you think they would be doing it now or they would do it 10, 20 years from now? Hard to predict. You know, I'm pretty sure it would have been later. I'm going to put it at closer to two decades than one.

You know, it's, and that really matters. You know, this stuff, I mean, we can't go fast enough in terms of decarbonizing the world. It's terrifying to realize how screwed up we are and how far we still have to go. So, you know, that acceleration and that pulling ahead of, you know, other companies launching this is really, really important for the world. If extreme weather, no matter how you look at it, the extreme weather we're seeing is, you know, it's getting worse. I think seven of the eight fires we had in the last year are the record. fires in California history. So this is in a very acute situation, even with the massive progress we're making.

But founders plus technology can change the world and you did. So we're thankful for that. Tell us about redwood materials, which you started in 2019. Yeah, redwood materials. So, you know, I started this, you know, to kind of look ahead at, you know, some of the issues and infrastructure and materials, supply chain problems that were coming at us, you know, as the whole fleet electrifies. So, you know, first off, I love being an entrepreneur. I love building things.

I love, you know, building teams and companies and projects. And, you know, I really believe strongly in the ability of, you know, small teams to have big, you know, leveraged impacts on the future. And, you know, we just talked about that at Tesla, of course. but what I saw that wasn't getting addressed, I thought, fast enough was first off, looking at the end of life for EV batteries. It seems like a small issue and it seems far in the future and not something to worry about, but it is a substantial scale problem. And it's going to take us quite a few years to get ready at scale to fully de-manufacture all of these batteries. and I think it's the challenge of reaching scale and economies of scale around that. A lot of people forget.

And the other thing for me is sort of imagining where this all ends up. And, you know, pretty bullish that the whole fleet is going to electrify. All the cars on the planet will be electric. And, you know, once you do that, you know, all of those materials that make up those cars are going to be in a closed-loop ecosystem. You know, they don't go away. They're in the car for the life of the car. And, you know, that combined industry is bigger than all of the mining that feeds it.

It's, you know, bigger than the existing kind of, you know, parts industries that supply it. And it doesn't exist today. So to me, it's sort of seeing this massive industry that is going to be created. It's a certainty. And also seeing nothing happening yet and it not existing. That, to me, was part of the really compelling reason to jump into Redwood. What happens if a Tesla gets totaled, the battery pack maybe has whatever 10% degradation and it's, you know, five-year-old battery pack? What actually happens to the battery packs today?

And then what is your plan for used battery packs in the future? Yeah, there's a, luckily, a small number of battery packs from EVs today that are actually reaching end of life. You know, they last pretty long. And it's like you said, a few that get totaled or rec. generally those get, you know, taken apart. You know, the modules come out of the pack. You know, a lot of components can get salvaged and reused. You know, even in a damage pack, some can get reused.

The modules themselves, you know, if they're really dead, truly end of life, can't be refurbished or reused. You know, go into a recycling pathway. And, you know, today we do recycle some EV modules, but the bulk of the stuff we recycle is actually small. post-consumer, you know, stuff and also production scrap. Those are the biggest feedstocks. But those batteries then go through this recycling pathway, and the process we're scaling and inventing today is how do we essentially take them apart chemically

and reintroduce them right back into cell manufacturing as fast as we possibly can. And how does that work? Are the materials in, you know, for a neophyte like myself, are the materials in my battery pack spent and then, you know, cannot be reused or can they simply be taken apart and reconstituted? How does that actually work chemically and practically, you know, in layman's terms, obviously? Yeah, it's a little bit more complicated than, you know, recycling an aluminum can or something like that because, you know, there's multiple materials, multiple metals all mixed together. and they're not just in a simple metallic state.

You know, when you look at an aluminum can, you can pretty easily imagine, you know, okay, there's some aluminum here, I could crush it, I could melt it, I could make a new can. You know, the same high-level thing can happen with a battery. You know, those materials are fundamentally, all of the atoms are still fundamentally there. You know, they're not damaged.

They haven't been lost to the environment. The function of the battery has been degraded. And maybe the best way to think about it is that it's almost kind of corroded internally. You know, some of the atoms have recombined, you know, the elements have kind of reorganized themselves in a way that the function of the device is no longer there. But all of the elements are still inside. So, you know, we basically, you know, are able to essentially take it apart, you know, separate out one at a time using the different chemical properties of the metals and separate them back into, you know, pure streams of each of those components. And looking really thoughtfully at how is it made again,

we can figure out the most efficient ways to go, you know, to kind of jump and tunnel through from that recycling process into the manufacturing process. Got it. How long does a Tesla battery pack, modern battery pack, last two or three hundred thousand miles, it seems, and then it goes down to what, 70%, 80%. Yeah. And I mean, maybe even more than that.

depends on the use case. You know, it could be 15 years pretty easily, maybe even 20 years for some of the longer live batteries. So we don't know yet because they've been in the field. Is that the actual truth of it, is that it's hard to predict? You know, it is to some extent, but, you know, there's sort of a probability distribution for how long these things last. You know, they don't all die on sort of year 16 and a half.

You know, there's this sort of bell curve that happens. and that bell curve is different based on every chemistry and every car and every product. You know, the interesting thing is, you know, this is all much more deterministic than trying to predict vehicle sales or something like that. You know, that's really hard. You know, you're projecting people's behavior and everything else and incentives. You know, here, the cars are already sold. You know, we know how many there are.

We know where they went. The only real variable is that that curve. You know, how wide is it, you know, where's the center of it? So, you know, this is actually phenomenally predictable, you know, more predictable than, you know, if you were trying to look ahead and say how many would be sold and where would they be sold. It's fascinating to me that now that the batteries, we have a 300, I think our model Y is 320, and then we're thinking about getting the long rage model S. I was going to get the plan, but I was like, you know what, I think I want the long rage more. So it's easier to go to L.A. and Tahoe and, you know, not even think about the battery. if those degrade, even 50% the batteries,

you'd still be at 200 miles. So this concept, this big fear was that the battery packs would degrade. That actually hasn't come to pass, has it? Did you guys think that they would degrade faster than they did? No, I think, you know, I think there's probably too much focus on range degradation being the end of life. that I what you're saying is I think right on you know that probably won't be the way that batteries reach end of life you know a bunch of other things happen over time you know they start to lose power capacity when they get really old and eventually you know they sort of have a knee in their performance where you know something something else goes wrong and it accelerates and or functionally just won't work you know some part fails got it that's typically where I believe the end of life will be you know if it was an nice linear degradation, I think people would be

super happy driving them at 50% of their initial range. It'll be an old car in 15 years. How long are these electric vehicles going to last when compared to ice vehicles? Because without a transmission as such and a giant oil disgusting

carbon burning engine in the front, it seems like even like brake pads last forever because you have regeneration. What is the lifespan of an electric vehicle when compared to ice and it does seem to be that these things might be on the road a lot longer than traditional cars. Am I correct? I think, yeah, I think they absolutely will be. You know,

you're basically talking about electric motor, which, you know, has, you can run continuously in many cases, you know, for tens of years. You know, it's not going to wear out. And, you know, with a well-designed system, you know, there's no reason it shouldn't last many hundreds of thousands of miles or, you know, maybe a million miles. We've had a couple of those, right? There's been a couple in Europe that have hit a million miles. Now, they've changed their battery packs. I think in the one I read about that hit a million or close to it, they had changed the battery pack three times, which I think since the car is so old, it was probably one

of the original model S's and apparently that person probably wanted to keep upgrading it. But, you know, the warranties are eight years and 120,000 miles. So that's pretty bold for Tesla. I think that was increasing for Tesla, right? They kept increasing the warranty. Yeah, and I mean, it's always a little bit of a crystal ball trying to figure that out, but I think it's proving out to be really low risk and conservative. But on the material recycling, the other piece to kind of remember that if he isn't as obvious,

is, you know, production scrap and yield loss. And, you know, there's a surprising amount of material that actually starts into the production process that doesn't make it through to a finished car to a customer. and, you know, that stuff happens immediately. It happens day zero, you know, of a car's life. So, you know, depends on exactly where you look, but that can pretty easily be 10% of the material. Got it.

So when we're making battery packs, there's some amount of overflow, things are not getting included in the battery pack, and that just basically falls on the factory floor, so to speak, or maybe literally. And some of this is structural, you know, imagine the equivalent of like a stamping where you're trying to, you know,

make a circle out of a nice rectangular sheet, a paper, you know, all the stuff that's around the circle is production scrap. You know, it wasn't really wasted, but, you know, it's still material that didn't get put into the original or the final product. So, you know, that's equal value. It tastes just as good, right? It's the exact same material. It's, this is what happens when a sushi chef cuts a, you know, basically a loin of tuna. They've got all this scrap when they cut around it and that scrap goes into your spicy tuna roll. That's actually. That's a good. That's a good. That's a good analogy.

You know, and that's a really, you know, a significant amount of material. You know, when we're talking about one in ten cars, you know, equivalent of material, that's a lot. And, you know, it's a chance to have a pretty big impact on the near term, you know, price structure of these things. Well, the other, you know, piece that we're focusing on a lot is material manufacturing. What does it mean? Well, recycling is one part of the equation.

You know, it's a source of raw materials. ultimately it's a really critical part of the market. But we're also going all the way through to finish cathode material, anode copper foils, and really becoming a manufacturing company for these core battery materials. And that supply chain just doesn't exist in North America right now. It's sort of amazing how critical this is to us and to the world and how centralized it is right now in Asia. Where is it centralized?

I know Korea had a big manufacturing. Obviously, China does as well. Where are the materials coming from? Because I hear everything from Australia, the Congo, you know, all these different places. People claim the materials are coming from. But in reality, where is the material for battery packs coming from today? And where are they being manufactured? You know, it's complicated as hell.

You know, looking at the supply chain map for this stuff is like throwing spaghetti on the wall, literally. You know, the problem is you have four or five critical materials. you know, all of which come from really different continents and sometimes a mix of them. So you kind of have to pick which critical material you want to follow and then look at it. You know, lithium, for instance, you know, is coming from Australia, South America. You know, often it, you know, from South America, it might come to North America. Then it might go to China. And then it might go to Korea or Japan.

Then it may come back to North America. That's just lithium. You know, copper can be even more silly. You know, North America, you know, is a big scrap market for copper, wire, plumbing, you know, all these things. We're a big generator of copper waste. Yet we don't have much copper manufacturing. So we actually export copper scrap back to China and Korea, you know, where it gets made into, in some cases, you know, the same anode copper foil, then sent right back to North America to be made into batteries. So really kind of crazy flow.

This should all be done on the continent, whether it's Mexico, South America, the United States. And so in sourcing this would be more efficient, certainly in terms of moving atoms around the planet, but would also be, would it be feasible on a cost basis to do this in, like, say, Mexico or even in the United States to manufacture batteries here and to do more of this here? Is that the goal? It absolutely is the goal. And it is feasible. You know, these things are not massive, you know, labor-intensive practices. You know, they have, you know, some technical jobs and some good jobs associated with them,

but it's more about automation and chemical engineering and process control. You know, the reason that they are done predominantly in Asia is, you know, it's a little bit legacy. You know, this is where the companies that initially had expertise in this were, and they scaled up. You know, that kind of makes sense. but absolutely this can be cost efficient done near where batteries are assembled and really should be and certainly will be in the future yeah it does seem to me we're starting to realize

that the supply chain optimization we did for the past 20 years might have been flawed in that we were arbitraging labor but at the expense of the resiliency of the supply chain which we experienced during the pandemic. And now we're seeing, you know, another issue, which is we're making EV batteries, but we're sending them on cargo ships that are massive pollutants. And that's a lot of weight to be sending back and forth around the world, I assume.

Absolutely. You know, the resiliency of that, you know, the lead time of it is really challenging. And the embedded emissions of all the movement and transportation is a major factor. You know, EVs are obviously, you know, they're great. for carbon, you know, and over the use of the EV, you know, they pay back themselves many times over. But when you kind of do that analysis, you know, making the electric car, you know, does have a pretty significant investment in emissions is kind of how I think about it. You know, we invest energy, you know, it invests some emissions from all the things that went into it. And then it has a payback

period as you use it and don't burn gasoline. And by doing things like, you know, localizing the supply chain, increasing recycled material content, you know, we can change the payback period, the emissions payback period of an electric car dramatically, right? You know, we can make it, I think, twice as good, you know, which is a really big deal. You know, that might mean the difference between 10 or 20,000 miles of driving before you hit your CO2 payback versus maybe a few thousand. That was another part of the fear uncertainty and doubt that was being spread, people saying, oh, these cars are, you know, so dammed, they're more damaging to create. grade and EV than it's worth.

This is poppycock, yeah? Yeah, that was never true. I mean, even in the worst grid, you know, driving the thing, you know, on coal power, which doesn't, it's not the best model, obviously. But even in that case, you were still very efficient and quite clean. So, you know, it's all upside from there. And, you know, I think people were trying to kind of, you know, find different, you know, flaws and complex arguments to make it seem that EVs weren't, weren't,

very good. But in any case, you know, doing these other, you know, issues like localizing and recycling, you know, it makes it, you know, an absolute no-brainer. Is there going to be a battery shortage? We keep hearing that there's going to be a battery shortage because EVs, power walls, grid systems are, you know, growing at a pace that maybe people, you know, even in the biggest estimates didn't anticipate people are buying more laptops, buying more phones. buying more upgrading their phones frequently.

Is there going to be a shortage, you think? Is that a potential risk here that more people will want cars than we can actually make battery packs for? Well, I mean, I think, you know, we already see a shortage, basically. You know, I think truth be told, I mean, this whole thing could be ramping up even faster if there was, you know, a full balance across the whole supply chain. what I sort of see from my point of view right now is, you know, so many different OEMs, you know, countries, you know, factories, customers are leaping into EVs, you know, making these huge announcements, you know, saying they'll be fully electric in their fleet, you know, this decade or next. They haven't, I think, really done the math fully on, you know, what that entails in the supply chain and tracing it all the way back, literally all the way back to the mines. you know, you need to do that or else, you know, it's not a, you haven't really fully solved it. And, you know, it has the feeling to me of kind of a giant overbooked flight.

You know, all these people are like, oh, this is great. Like, we're going to go to that new place. We all want to go there. It looks great. Sweet. You know, let's all get on the plane and go. And, you know, everybody's saying they want to go there at the same time. Right.

You know, meanwhile, you know, we have to sort of build the planes to get there. We have to, you know, figure out how to, you know, sequence. everyone. You don't even have enough runway. No, it's, and yeah, I mean, the, the figurative runway is like the time to do all this. And, you know, it can all get sorted out over time, but, you know, obviously we're trying to do this fast as a society and as a species. I do think, you know, we're going to have a really painful time of it. And, you know, it won't be just a simple battery shortage.

I think it's going to kind of ripple through different parts of the supply chain. You know, it may at one point be nickel shortages. maybe it'll be cathode shortage. Maybe another day it'll be separator shortage. Yeah. We're already seeing this, you know, manifest itself, you know, obviously during the PPE and, you know, issues around the pandemic. But then I just recently saw that the self-driving or assist driving in the Cadillac escalate,

which is supposed to be quite respectable, level two kind of system, that they took it out in the 22 model of the escalator. I don't ever saw this because they can't get the chips. So the chip shortage is just indicative of what can happen when you have a rush or any kind of disruption in these services. But we have plenty of material. It's just the cost of digging it up, right? I mean, we have material here in the United States

in some places of rare earth minerals. There's not a rare earth mineral shortage. It's just the ability to dig it up and build the infrastructure, correct? For the most part, yeah. I think nickel may be a little challenging as we go through all this. You know, there is enough of it, but it's been searched for more thoroughly than some of the other critical materials. You know, I think there's tons of lithium in the earth's crust. You know, it's quite prevalent.

You know, that's one where it's the whole industry to go from searching for it to developing it, refining it, just needs to scale and it takes too long. And some of these minds take eight years, you know, to go from exploration to production. It's a very, very slow process. You know, maybe we can cut that in half or do some dramatic things. But even as you do that, you know, you kind of start to cut environmental corners and you're pushing into more sensitive areas. So there's no free lunch there. You know, this, it's one reason that I'm so excited about, you know, going after every little bit of recycled material we possibly can. because it is the lowest hanging fruit.

You know, it's the lowest cost, the lowest emissions, and has the least disruption to everything else going on. So every atom of that should be recycled that we possibly can. If only we thought about water usage in the United States this way, we literally don't have water meters and we have massive leaks and we just simply do not focus on the leakage, literal leakage. And here, you know, you're talking about the stamping of, you know, circles into different metal sheets and it's just going on the

cutting room floor. It makes no sense. Yeah, and it's amazing even on the consumer battery side, how much leakage is a good word for it. Leakage there is in the supply chain. It's something like 90% of the batteries that get sold to consumers,

put in small devices, end up not recycled in North America. In a landfill somewhere. Landfilled, maybe stockpiled in somebody's garage or drawer or somewhere. It's pretty amazing. you know, those, you know, those contain an incredible amount of valuable materials, cobalt especially.

You know, and that, you know, that is sort of what we're aiming to, you know, build into a virtual mine. What would be the value in an average iPhone of the materials in the battery and whatever for recycling? Is it 10 bucks worth of the materials, 20, 5? If it was, if you were able to efficiently get it out. Yeah, it's, I mean, it's small compared to the value of the iPhone, of course. You know, the, the battery to device, you know,

cost ratio is way different than an EV. It's on the order of single digit dollars. It's not like you're going to get a huge payday there. But I think the bigger issue is the impact it can have on sourcing of those materials for an EV. Sort of amazing, but only a few hundred iPhones can provide enough cobalt to make a new Tesla battery pack. Really? Oh, wow. It's a difference in the chemistry used in consumer electronics.

devices that are very cobalt intensive relative to, you know, EV or power wall type batteries that are really very efficient with cobalt. So that's one of the really compelling reasons to do that. You know, we need to have a bit of a coordinated effort like we had around straws and plastic bags, where we ban straws in India, in the UK, in New York and California. And then the same thing with plastic bags where we said, hey, listen, you got to pay for it. There should be a very aggressive public campaign of if you have batteries sitting in draws, these go to this location. You can go to, let's say every post office just said,

you go to a post office, you give them a battery, they give you a $5 gift card. Just that simple, some really simple way for the government to intervene and say, you know, here's a use for post office, any, for recycling, any electronics you have, bring it to your post office and we'll try to, you know, sell that to recycling companies. because Apple now is doing that. Apple will return,

will take back anything you give them. Even old IMAX, they won't give you a credit for the oldest ones, but at least they'll take them. And I'm assuming they're doing some sort of, you know, I hope they're doing some sort of conscientious recycling. They claim they are,

but I don't know if they are or not. No, they put a lot of thought into it. They're doing some pretty creative things in this whole space. And, uh, but I think you're exactly right. I mean, kind of a call to arms,

across the country to have people help with this. It almost feels like kind of the World War II stuff where we're trying to rally critical materials that we already have in control. It's an exciting thing that I think people could really get fired up about. You just think about it as a generational thing. The boomers, I think, were a little too busy, just being successful that you have us as Gen Xers

who were really thinking about these things and trying to change the world. But now you have the millennials in Gen Z where I think that this is the first thing on their mind, right? Like, it's a consider, it was a consideration for us. Obviously, some people like yourself made this our life's mission, but we were very aware of it. But if you just look at the action set, you know, if people bring straws, my three daughters are just like, we don't want straws. We don't want straws.

Please don't give us straws. You know, they'll ask the waiter preemptively to not bring a straw. And then, of course, the waiter brings straws, puts them in the drink and like, they're just like, oh, why did you bring the straws? You know, it's like, it's soul crushing for them to get a straw, which is pretty awesome when you think about it. You know, it's incredible how much, yeah, I mean, the different generations really get this and it just makes, immediately clicks and makes sense on how it should all work. And, you know, this is also, I'd say, been on the mind of a lot of, you know, EV customers, you know, for a long time. I mean, people really want to think about, you know, the emissions, the embedded emissions, you know, what happens at end of life to the product. for me it was always kind of interesting to see that discrepancy because

we'd be spending all of our time on making more of them and making it better and cheaper, faster. But then sort of in the top 10 list of questions from customers, well, what about end of life and what about supply chain? And not that we'd not focus on it all, but it was harder to put as much balanced effort in that as consumers were putting in their mind. At least on what you know about manufacturing, which has been, you know, a large portion of your career's work, we constantly hear like, hey, listen, we can't make iPhones or laptops in America. But then we see Tesla and yourselves and, you know, supply chain being built here to build cars and to build power walls, to build solar, whatever it happens to be. Do you think if, because we obviously have some geopolitical issues right now around, you know, various authoritarian countries and. you know, our interactions with them.

This seems to me to be a national security issue that we would be able to have batteries produced here in America. Is this something we should be looking at as, you know, a critically important thing for, you know, the sovereignness of America? I absolutely think it is. I mean, it to me seems totally untenable that we would electrify our whole transportation fleet and have all of that dependent on a whole other sense. set of countries for every core component of it.

It just, I can't see that possibly working. And if we did that, you know, it would be this, you know, massive transfer of, you know, our whole economy, a big part of our economy somewhere else. Could iPhones be made here? Like, just straight up, like, you guys built cars here. People were like, that's impossible. You did it. Like, could iPhones and just, let's just say smartphones be manufactured here?

And what would they cost like an extra hundred bucks or something? I mean, I think, you know, it can absolutely build complicated things, you know, in the United States. I think part of it is, you know, we didn't try. And, you know, we made some strategic decisions that it wasn't, yeah, it wasn't a heads-up competition in some cases. You know, certainly there's talent here. There's, there's smart, you know, smart people. There's, you know, I'd say, you know, really a lot of innovation and creativity, especially around, you know, you know, automation and factory software and the way to improve this, you know, very, you know,

in quick, quick cycles. You know, I'm not, I'm not saying it's an easy competition. I mean, China's, you know, incredibly entrepreneurial and, and they're working, you know, really, really hard. You know, I think, you know, people can't take that for granted, you know, and can't understand maybe without really being there and going there, you know, how, how intense and how much work they put into this and succeeding. But we can compete. We absolutely can. I mean, I'm not willing to just like throw up my hands and give up and say like, oh, well, we're too, you know, too successful or lazy or something.

You know, I'd move to a different country if that was the case. As we wrap here, people have been talking a whole bunch about solid state batteries. I guess QuantumScape is one of the companies working on that. What are your thoughts in, you know, this ultra-fast charging concept, I guess, versus is lithium? Tell us a little bit about how the future of batteries is going to play out over the next two decades. Well, fundamentally, these are still lithium ion batteries. You know, the chemistry going on inside the battery is very, very similar.

You know, the big difference is in the anode material and the separator. So in the anode, instead of having something like graphite or silicon, where you have to basically kind of store the lithium inside of a matrix of carbon or, or, or silicon oxide or silicon, you instead can store the lithium as metallic lithium, just literally a sheet or a film of lithium. You know, to do that, you know, usually requires some really interesting changes to the separator and the electrolyte,

you know, whether it's a ceramic or whether it has, you know, different, you know, characteristics that allow that lithium to be a metal. You know, so that's really the main structural change that's happening is... Is it going to work? And if so, when? I think it will work. I mean, the performance from QuantumScape in particular that I've seen is really, really good. You know, the science of it is robust.

You know, the performance is amazing. Manufacturing of it is really difficult. So, you know, this is, you know, something where, you know, that whole set of technologies has to get scaled. It has to get, you know, made robust and made at the right price point. I'm confident, I'd rather bet on that than I would betting on like, you know, a chemistry invention, you know, to make, you know, a new chemistry situation work for a battery. You know, so I do think this is, you know, an important part of the future of batteries, but it has better density, I guess, is part of the concept here. So if it had better density, does that mean it's a lighter vehicle or you need less of them? Therefore, the cost would go down.

but currently it's very expensive to manufacture. Is that what we're kind of in right now in terms of the zone? Yep, that's pretty much exactly it. You know, it's higher energy density, higher in terms of mass and volume, both, much faster charge times. So that's another really potentially big benefit, of course. You know, the lithium doesn't have to like find its way into that matrix of graphite. So that's kind of a traffic jam for it. And you just avoid that.

And it has lower materials cost. like 15 minutes, you charge 80% of the pack or something like that, right? And it doesn't degrade it as much or something. Or even faster. Even faster. Oh, wow. So, I mean, what's possible and demonstrated at small scale is incredible. I mean, it's, you're basically, you know, back to, you know, a couple minutes kind of charge times.

When would, um, when would we see this in an electric vehicle, you think, best case, likely case? Tricky to expect, you know, I, five to ten years. I don't want to get in front of, you know, some of these different companies on their projections, but, you know, I, I think it's, it's a few years away, you know, it's not like, this is not going to be the 20, 23 model or something like that. You know, it has to mature and it has to, you know, really get, you know, scaled to gigawatt hours per year. You know, we just got, in the beginning of this, we talked about how brutally hard that is.

And I think, you know, there's a whole cycle that has to happen with some of these new technologies. But it's so compelling. I mean, this is, this kind of like paints a roadmap to me, you know, out. several decades where, you know, it's already sort of a no-brainer that everything will be electric. And then when you overlay, you know, technology getting, you know, even much better and cheaper, you know, it's absolutely assured. Yeah, that is one of the great things, I think, of people building on the shoulders of your legacy and Elon's and the whole team over there

is now it's inspired people to really think bigger, right? And I really think that what you did and what Elon has done, even more than the legacy of electric vehicles is an entire generation, and I see it as an angel investor all the time because they reference you all, is that you inspired people to just try to do something even more ambitious. And so for that, humanity owes you a great thank you. And so on behalf of humanity, I will thank you, J.B., for all the hard work you and the teams over there did, because the ramifications are everywhere. I mean, I'm seeing people who want to take on desalimization.

I'm seeing people who want to take on fusion. Just, you know, huge, huge, audacious projects, I think. And if it wasn't for Tesla, I don't think people would be as bold and ambitious to save humanity from, you know, let's face it, we got an existential crisis here, right? And how are you feeling optimistically about our chances against global warming? Do you wake up in the morning sometime and say, this feels 50-50? Or do you wake up and say, you know what? Knowing what I know about the human spirit and innovation and entrepreneurship, we're going to beat this thing?

Well, I mean, I'm an optimist and a technologist. You know, I know we're going to beat this thing, you know. But at the same time, I think it's going to be a bumpy ride and probably more bumpy than everybody expects and realizes. I mean, we have so much. change baked in to where we are even today. And really, we have a lot of work to do, you know, to get to truly zero missions. I mean, it's always shocks me because so many of the projections and everything else are

talking about, you know, like, oh, a percent reduction, you know, on, you know, let's reduce back to like 22,000 levels. I mean, we need to get to zero. You know, this isn't, this isn't about sort of a 10 or 20 percent reduction or 50 percent reduction. It's like, when do we get to zero? you know, that seems super obvious if you think about it. You know, it's like when you stop digging.

We need to stop. We're literally in a hole. In a hole digging a hole. And it's like, well, we're going to slow down the dig. And you're like, really? Like, you know, let's actually not dig at all. Yeah, we need to fill in the hole. You need to get back to the surface level here.

We're under water. I mean, this is dangerous, dangerous territory that, you know, as, you know, I think a lot of people have pointed out, this is a really stupid experiment to do. with our planet. It's unbelievably stupid. And I think, you know, sometimes it's almost the case, you know, again, we're, you know, it's almost hard to trust everyone with the data because you don't want to demoralize the whole planet either.

So we kind of set out little intermediate targets that seem, you know, motivational and whatnot. But anyway, I am optimistic. You know, we're going to solve it. You know, this won't be the end of humanity or something like that. You know, I think, you know, the next years and decades, are going to be pretty intense, though, in terms of people really realizing how bad this experiment was

and rallying more and more of our collective willpower to go fix it faster. You know, and we will realize what we lost when it's gone. You know, just a couple of years ago, I went scuba diving on the Great Barrier Reef, and, you know, the water is a degree and a half warmer or something. And you see these amazing coral formations, and then you see dead coral floating.

You come around one turn and it's heartbreaking and it's like, that's not coming back. You're not going to get the ocean to reverse a degree and a half in time for this coral to not be destroyed. And the number of homes that will burn, the number of forests that will burn, the number of species who will be displaced, you know, we can't even calculate it. You know, we have the technology that I think the frustrating part, I think,

for a lot of us is it's so obvious that the technology and the solution is there. It's about execution at scale. And I think that's one of the great things that you've done in your careers to execute at scale, right? Yeah. And it's hard, but people are excited to do it. And if we can make the products better, it doesn't have to be chasing everyone with a stick. That's just not going to work. And it's not going to be fast enough.

So, I mean, that was kind of always the mantra at Tustle was okay. To really do this faster, we have to make a better car. you know, it has to be better in every way. Yes. It can't be regulated into existence. Yeah, it's kind of like, yeah, telling people like you can't have a steak ever or like you're going to have to eat like a bunch of grass and that's going to save the planet. It's like not going to work. We need to work with human motivation here.

Listen, J.B., thanks for the hard work. I know you guys have done a great job with the fundraising, which I assume means you're hiring talented people. If people wanted to come work with you and save the plan. and do the good work that you're doing over there, how can they find out about job opportunities and careers to save the planet? Yeah, thank you for the reminder. I mean, if people want to learn more, they can come to our website, redwoodmaterals.com.

We've got a bunch of different awesome job openings. We're hiring, you know, engineers across the whole space. A lot of chemical engineers, automation, software, controls, mechanical engineering. It's a really fun problem. and I think, you know, a pretty amazing team to get in early and make some major changes to this whole industry. This is the ground floor, folks. So if you've got that engineering degree, this is a great, great option for you. So please go apply and the world needs you.

All right, J.B. continued success. And we'll see you all next time on this weekend startups. Bye-bye. Thank you. I'm honored to be with you today for your commencement from one of the finest universities in the world. Truth be told, I never graduated from college. And this is the closest I've ever gotten to a college graduation.

Today, I want to tell you three stories from my life. That's it. No big deal. Just three stories. The first story is about connecting the dots. I dropped out of Reed College after the first six months, but then stayed around as a drop-in for another 18 months or so before I really quit. So why'd I drop out?

It started before I was born. My biological mother was a young unwed graduate student, and she decided to put me up for adoption. She felt very strongly that I should be adopted by college graduates, so everything was all set for me to be adopted at birth by a lawyer and his wife. Except that when I popped out, they decided at the last minute that they really wanted a girl. So my parents, who were on a waiting list, got a call in the middle of the night asking,

We've got an unexpected baby boy. Do you want him? They said, of course. My biological mother found out later that my mother had never graduated from college and that my father had never graduated from high school. She refused to sign the final adoption papers. She only relented a few months later when my parents' promulgated. that I would go to college.

This was the start in my life. And 17 years later, I did go to college. But I naively chose a college that was almost as expensive as Stanford. And all of my working class parent savings were being spent on my college tuition. After six months, I couldn't see the value in it. I had no idea what I wanted to do with my life, and no idea how college was going to help me figure it out. And here I was,

spending all the money my parents had saved their entire life. So I decided to drop out and trust that it would all work out okay. It was pretty scary at the time, but looking back, it was one of the best decisions I ever made. The minute I dropped out, I could stop taking the required classes that didn't interest me and begin dropping in on the ones that looked far more interesting. It wasn't all romantic.

I didn't have a dorm room, so I slept on the floor in friends' rooms. I returned Coke bottles for the five-cent deposits to buy food with, and I would walk the seven miles across town every Sunday night to get one good meal a week at the Hari-Krishna Temple. I loved it, and much of what I stumbled into by following my curiosity and intuition turned out to be priceless later on. Let me give you one example.

Reed College at that time offered perhaps the best calligraphy instruction in the country. Throughout the campus, every poster, every label on every drawer was beautifully hand-calligraphed. Because I had dropped out and didn't have to take the normal classes, I decided to take a calligraphy class to learn how to do this. I learned about seraph and sans-serif typefaces, about varying the amount of space between different letter combinations, about what makes great typography great. It was beautiful, historical, artistically subtle in a way that's a way that's a very typeography. science can't capture, and I found it fascinating. None of this had even a hope of any practical application in my life. But ten years later, when we were designing the first Macintosh computer,

it all came back to me, and we designed it all into the Mac. It was the first computer with beautiful typography. If I had never dropped in on that single course in college, the Mac would have never had multiple typefaces or proportionally spaced fonts. And since, Windows just copy the Mac, it's likely that no personal computer would have them.