{"id":"1775224371563-Qc6hjJ9Zze0","videoId":"Qc6hjJ9Zze0","url":"https://www.youtube.com/watch?v=Qc6hjJ9Zze0","title":"99% of Drone Companies Will Die & Why Anduril’s Products Aren’t an Ethics Debate | Matthew Steckman","type":"youtube","topicCount":16,"segmentCount":153,"createdAt":"2026-04-03T13:52:51.563Z","uploadDate":"20260323","chunks":[{"title":"Introduction & Guest Welcome","summary":"The host introduces Matthew Steckman, referencing Anduril's massive recent defense contract, and kicks off the conversation.","entries":[{"text":"Matthew Steckman: You basically can't have a defense company if you don't have a large US business. The government thinks that we can deliver some pretty major stuff, now and in the future.","offset":0,"duration":8},{"text":"Host: I am so excited, we've got Matthew Steckman, President and Chief Business Officer for Anduril. Just last week they announced a monster $20 billion dollar contract with the US military, one of the largest ever. We could not have a more apt or pertinent guest, as he takes us behind the scenes of both the contract and of Anduril.","offset":8,"duration":18},{"text":"Matthew Steckman: There are very few drone programs that would create a material enough amount of revenue to actually create a real business. You have to create a monopoly. There are lots of VC companies I would love to buy if I had an unlimited checkbook.","offset":26,"duration":13},{"text":"Host: Is there ever like an ethical question of, do we agree with sending thousands of missiles to Iran?","offset":39,"duration":21},{"text":"Host: Matt, I am so excited for this, dude. I just got off a chat with Christian Garrett and Matt Grimm and they gave me, like, incredibly tough questions, so this is going to be a grueling hour for you. But thank you for joining me, dude.","offset":60,"duration":13},{"text":"Matthew Steckman: Yeah, thanks for having me. It's really great to be here.","offset":73,"duration":3}],"startTime":0},{"title":"The Anduril Founding Team","summary":"Matthew shares anecdotes about his co-founders and explains why a blend of inside defense knowledge and outside tech perspective is vital.","entries":[{"text":"Host: I actually want to start with Trey, weirdly, which was Christian Garrett said that I had to ask this. He said, what was Trey like at Georgetown? And what is it about the Anduril founding team that has made Anduril so successful?","offset":76,"duration":15},{"text":"Matthew Steckman: Well, Trey and I were, were classmates, um, met freshman year, um, played Ultimate Frisbee together on the team. Um, so went on a lot of road trips with one another. Um, you know, I don't think Trey has changed at all. You ever seen the movie Hot Tub Time Machine?","offset":91,"duration":17},{"text":"Host: Yeah, great movie.","offset":108,"duration":2},{"text":"Matthew Steckman: Yeah, there's a line in it that's, like, \"every group of friends has an asshole, but Trey is our asshole,\" you know, you know what I'm saying? Yeah, that's Trey in a nutshell.","offset":110,"duration":12},{"text":"Host: And he's gone on to such things.","offset":122,"duration":2},{"text":"Matthew Steckman: It's crazy how that works, yeah.","offset":124,"duration":2},{"text":"Host: It has hope for you. You know, I've never had such a weird start to a show.","offset":126,"duration":5},{"text":"Matthew Steckman: There you go. No, we're kicking this off right.","offset":131,"duration":2},{"text":"Host: It's like a movie reference and then \"Trey is our asshole.\" Yeah, yeah, he'll love that one. Yeah. In terms of the team itself, I have so many defense companies pitch me, and I think bluntly the team is always lacking. What do you think it is about the team that Anduril has in terms of founding team, that has made it so successful?","offset":133,"duration":24},{"text":"Matthew Steckman: Well, first, like, there's kind of some magic in the fact that it's the same leadership team today as it was when we started the company. Um, that, that implies a whole lot of things, I think, um, mainly it's that we're all friends. So I think that's actually pretty critical. Um, there, there's a bond there that basically can't be separated by business or stress, um, or life. Um, we, we all know each other really well. Um, but then on top of that, um, we all come at the industry from really different backgrounds and lenses. And especially in defense, which is, um, it's like everything works against you to get into the defense market. There, it's like every headwind you could possibly imagine. If you don't have a lot of perspective and knowledge about what's about to come, it's hard to think around corners and you get yourself kind of mixed up and gummed up a lot. Founding teams, one of the most important things in, in defense is some of them can be outsiders and, you know, brilliant technologists, um, and thinkers. Um, it does take a lot of inside knowledge. Um, and I think that, um, one of the things we, we got right and keep getting right is that blend of, um, like the outside-inside process. Um, who can think, um, differently, um, and bring in sort of commercial perspective, high tech perspective, uh, add kind of entropy into the system. Um, and then who can really deeply represent, um, our customers, how they think, how does that come together uniquely? That, that becomes super important to, to having any success in the defense world.","offset":157,"duration":109}],"startTime":76},{"title":"Go-To-Market in Defense Startups","summary":"The conversation highlights the crucial need for defense founding teams to possess go-to-market expertise and a deep understanding of government procurement.","entries":[{"text":"Host: I think one of the things I most look for honestly is like GTM experience and ability in a team that I'm looking at in defense. Um, how should we think about analyzing teams for their ability to actually sell and go through procurement? Does it matter if you've got technologists and people with military and combat experience but no one with GTM experience? I know procurement better than fucking anyone.","offset":266,"duration":24},{"text":"Matthew Steckman: It's multidisciplinary, right? So the, the challenge becomes in defense that if you're missing any of the 12 different types of disciplines it takes to really capture a large program, you will fail. Um, and so one of the things that we've done is over the years we've built up a pretty sophisticated apparatus to kind of round out these teams with all of the various skills in acquisition and budgeting and technology, um, and then again, mission and operational analysis and doctrinally how these types of technologies will integrate into the military. You have to have it all. I think the one, um, maybe, uh, interesting piece here is there aren't actually a lot of big programs in government. And so one of the things you don't need to necessarily look for, I think, which you would in a traditional hiring process, you would look for someone who has demonstrated the ability to capture a large program in the past. But, but since there's so few of these things, you, you can't really look for that. Sometimes you luck into it and like, great, you should certainly hire people who have shown to be able to capture large programs. Um, you generally don't actually have that in the hiring pool. And so what you ultimately have to do is piece together the right puzzle for everything that you're going after.","offset":290,"duration":79},{"text":"Host: Does it matter if the founding team doesn't have that experience in terms of going through procurement and GTM?","offset":369,"duration":5},{"text":"Matthew Steckman: I think it does. Um, and I think that, you know, I advise a lot of, of companies and um, if I notice that the founding team, at least a portion of it or a person on it hasn't kind of been there, done that, the first thing I recommend is they have to find someone who represents that piece of the puzzle that, that's missing to their team.","offset":374,"duration":23}],"startTime":266},{"title":"Red Flags for Defense Startups","summary":"Matthew discusses common mistakes emerging defense companies make, such as technological hubris and overestimating their total addressable market outside the US.","entries":[{"text":"Host: When you meet all of the defense companies that you meet today— again, I'm an, you know, I'm an investor, I do— we have so many different European drone companies, every fucking UAV— I, dude, I don't, I honestly don't get it at all, they come with some other thing and I'm just like, \"Matt Grimm, please tell me if this is good.\" No, I really do, I ask Matt about it, it's very funny. Um, he sees everything in Europe because of me. Um, and tells me that it's shit. Um, but like when you look at them, what is the most common red flag that you see when you look at the emerging class of defense companies trying to be, as awful as it sounds, the next Anduril?","offset":397,"duration":34},{"text":"Matthew Steckman: I think it's basically two things. It's, um, uh, not realizing that what they are doing, uh, already exists. There's too much hubris, I think, in the technology market that, um, as high tech people we can, we can do everything better than everybody else. I think, um, that causes, uh, some companies to think they have an idea that isn't actually an idea because it already exists and that's pretty common. Uh, I'll give you an example. I, years and years ago I, you know, was looking at a pitch or I forgot, maybe I was advising someone and, \"Here's my idea,\" and I said, \"Well, the thing you don't know is in the 1960s we invented that.\" And so, so there's a, there's kind of a hubris to thinking like, um, the technology sector has all the answers when, like, actually since the '50s we've had the most brilliant people in the world working on these problems and a heck of a lot already exists. And this is sort of the point of like, if you don't actually have the inside knowledge you don't know what mistakes you're making. So that's one. The second, uh, which will be more familiar to you, is, is addressable market. Um, I think there's, uh, in many cases an overestimation of addressable market where like actually what ultimately they're going after is a very small sliver of a problem, um, which might materialize in a, a single large contract, but a single large contract is not an enduring business.","offset":431,"duration":91},{"text":"Host: And this is one of the big challenges that I face, is when we see a company that in France is saying \"we're selling to the French military.\" Dude, I don't know how to say with— I upset everyone these days, I just get used to it. The French military spend less than I do in Chanel for my mother. I mean, it's like fuck all. And so my point is, like, can you be a European-only next-gen prime or do you have to be selling to the US as well? How do you think about that?","offset":522,"duration":25},{"text":"Matthew Steckman: Yeah, I mean, you basically can't have a defense company if you don't have a large US business, right? So 50% of defense spending is in the US and 50% is in the rest of the world. And so if you are cutting off half of your market from the get-go, that's, that's probably a big problem. The, the challenge in Europe is it's not, it's not like a European Union in defense spend, right? Each country has its own sovereign, uh, companies and has its own sovereign agenda and so you keep getting winnowed and winnowed and winnowed and you're like, \"Oh, well Europe is my market.\" Well, if you're a French company, it kind of isn't, right? France is your, your market. Um, and so you have to be really careful around how you're actually analyzing who your ultimate customers can be.","offset":547,"duration":45}],"startTime":397},{"title":"Unpacking the $20 Billion Contract","summary":"Matthew clarifies the details of Anduril's major US military contract, explaining that it acts like a credit card limit to streamline future procurement.","entries":[{"text":"Host: You mentioned 50% of that spend is in the US. You guys signed a $20 billion dollar contract. Um, it's pretty incredible. It made me feel thoroughly irrelevant when I look at my companies going from 1 to 4 million in ARR for an HR software company and the whole team's like, \"Ah, bugger.\" Um, my question to you is, what's actually entailed in the $20 billion dollars? Was it like an accumulation of all the little contracts brought together? 'Cause it's a big headline number but I didn't actually get it and I don't think a lot of people did.","offset":592,"duration":32},{"text":"Matthew Steckman: Yeah, yeah. So let's, let's, like, actually define it because the stuff I saw posted about it was all over the place. It was like a rainbow of interpretations. So this is, think about this as like a, um, a credit card limit. Um, so the government has said up to $20 billion dollars they can spend on a class of Anduril's commercial technology. Um, there's no obligated money, but it basically creates, uh, a process that reduces a ton of friction that you would ordinarily see in defense procurement, where each individual office would have to go through financing and contracting and evaluation. Um, and all of these repeatable things now, can now only have to happen once. And they did, and they just did. And so, um, maybe a fast track is probably the wrong word, it's more like in the arduous process to actually get something contracted we've cut a lot of the first steps out. Um, there's still a lot of hard work. We've just made it slightly easier for the government to access all of our gear.","offset":624,"duration":70},{"text":"Host: When they say, like, \"dependent on delivery,\" what does \"delivery\" mean?","offset":694,"duration":4},{"text":"Matthew Steckman: They will obligate the dollars as the products, which is hardware and software, are actually materialized. So delivery is revenue to us, right, in our world. So when I deliver something I recognize the revenue, um, same thing in government. When we deliver something, they actually then the actual procurement orders and dollars flow.","offset":698,"duration":20},{"text":"Host: Again, I'm so sorry for being dumb or naive, I'm a venture capitalist for a living, you should be used to us by now. Um, is this replacing prime spending? Is this net additional? How should we think about this? And is this just the sign that Anduril is now another prime?","offset":718,"duration":16},{"text":"Matthew Steckman: Yeah. It basically means that we have enough business with the federal government to justify putting together what is a fairly sophisticated contracting vehicle. Um, so yeah, the short version of it is like, yeah, the government thinks that we can deliver some pretty major stuff, uh, now and in the future. Um, it took a lot of work by a lot of people on the government side to actually make this thing happen. They are not going to do that unless they think that it's worth it.","offset":734,"duration":26},{"text":"Host: What do they spend with, like, a Lockheed or a Northrop for, like, comparison?","offset":760,"duration":5},{"text":"Matthew Steckman: So Lockheed I think is in the, like, 100 billion revenue a year. Um, I think we'll do a couple billion in revenue this year. So we're still, you know, small in the grand scheme of things.","offset":765,"duration":10}],"startTime":592},{"title":"Business Models & Contracting Challenges","summary":"Matthew explains how Anduril flexibly offers hardware, software, and services, and discusses the difficulty of surviving the unpredictable periods between large government contracts.","entries":[{"text":"Host: When you look at the software and the hardware element, how do you guys sit internally? Are you a hardware company? Are you a software company? Are you a services company? Ultimately, how do you sit?","offset":775,"duration":11},{"text":"Matthew Steckman: There's a lot of ways to look at it. So I think one of the things we've done maybe uniquely is we've given our customers a lot of ways to access our company. So what I mean by that is, um, um, we've been very creative in, \"Okay, a customer wants a piece of software, uh, but it's difficult in government to contract for software.\" And so we can wrap it in a hardware appliance, right? Or they want a piece of hardware but they know the software is the sophisticated piece of it, um, and so they're willing to pay more for it because of that sophistication. Or, uh, in government, um, you get these weird things where, uh, money is, it's called \"the color of money,\" so money is obligated to certain types of spend. So maybe a customer only has money that they can spend on services. Well, okay, can I do an as-a-service product? Um, and actually one of our, our first major contracts was with, uh, US Special Forces, uh, for, uh, all of their counter-UAS, uh, systems. That started as an as-a-service contract where they weren't buying hardware, they weren't buying software, they were literally buying, uh, a service that obligated us to defend certain sites from certain types of threats. And as long as we were meeting the KPIs on the contract, um, we were fulfilling the obligations of the agreement. Um, so quite novel, uh, and that contract has, you know, since gone in a lot of different directions and we do a lot of different things on it, not just that, but we have been kind of dogged in our, uh, approach to this by basically realizing that the more ways we give our customers to get at us, the better it's going to go.","offset":786,"duration":106},{"text":"Host: What's the hardest thing about working with the government when you look at the structures that you have to contort yourself in to get a deal done? What's the hardest thing? I've interviewed Shyam, who I presume you work with from Palantir.","offset":892,"duration":15},{"text":"Matthew Steckman: Yeah, yeah, I worked for Shyam for a really long time. He's a good friend of mine. Um, there's a lot of answers to this question, but maybe from my lens, uh, it is, uh, it is how few and far between the large wins are and how hard it is in between those periods of time. So if you look at our business, you know, this year we'll do a couple billion in revenue. We'll do 600 separate contracts this year. Um, only 20 of those are probably of material revenue size. I think the hardest thing is, like, what happens in between the 20? And what are you doing to position yourself for the 21st? And because it's so concentrated, every single one of those deals is considered risk to the business, right, if it goes right or if it goes wrong. So.","offset":907,"duration":49},{"text":"Host: Why specifically is it hard in between? Is that morale? Is that revenue predictability? What is it that's hard in between?","offset":956,"duration":8},{"text":"Matthew Steckman: The government can sometimes tell you where they want you to go, but often times they don't. And so a lot of this, uh, is trying to predict an unpredictable system, right? So how many lenses can you look at at sort of the next couple of years? I can look at it through what the government is saying through their rhetoric and through their budgeting. I can look at it through a war fighting lens and what general officers are saying and what, um, military theorists are saying. I can look at it through a technology lens, like what technologies do I, I think are going to influence the battlefield in the future. And I need to kind of blend all of that together today to make decisions on what I want to build that will be available, you know, five to seven years from now. Um, no one is saying today, \"this is what I need five to seven years from now.\" It's, it's all sort of a, an educated guessing game over time.","offset":964,"duration":54}],"startTime":775},{"title":"Offensive Cyber Warfare","summary":"Matthew reflects on the missed opportunity to enter offensive cyber warfare earlier, explaining its asymmetric threat and the urgent need for robust capabilities.","entries":[{"text":"Host: What did you not do that with the benefit of hindsight you wish you had done, and what did you learn?","offset":1018,"duration":8},{"text":"Matthew Steckman: Um, there's been a couple of areas that, you know, have, have kind of emerged that maybe we were a bit slow in, that we would have accelerated. I'll give you an example. Um, uh, there's a huge movement in, uh, not just in the US but NATO and the rest of the allies, um, into offensive cyber warfare. Um, and you're seeing this now becoming public for the first time, which is really, really interesting. Um, you know, to date this has been one of the, the spookiest of all spooky things, right? Like something that just no one ever talks about and now you're, you're literally seeing public officials talking about it for the first time. We should have moved into that seven years ago and been the first, the first in it. We weren't big enough probably to really even understand it seven years ago, but like in hindsight it was kind of obvious. Um, you know, we'll probably try and play some catch-up here and, and get into the game, but, you know, there's a couple of examples like that where you see these things kind of thematically in hindsight, um, and you're like, \"Well, obviously five years ago I should have done it,\" right, and you only realize that today.","offset":1026,"duration":64},{"text":"Host: What is the fear with offensive cyber, when we look at, like, the worst case scenario? Just so I understand it.","offset":1090,"duration":6},{"text":"Matthew Steckman: Well, it's a lot of things. So it's both what are our adversaries doing and do we understand it, and are they asymmetrically influencing, uh, battlefield tactics? And the answer is yes, they are. Um, and then it's, okay, well if our capability—","offset":1096,"duration":18},{"text":"Host: Sorry, sorry, can I just stop you again before I get lost in your next statement. What does it mean like \"asymmetrically influencing battlefield tactics?\"","offset":1114,"duration":6},{"text":"Matthew Steckman: Yep. So for a very, uh, one version to think about this is just cost. For a very low cost they can create an effect that has, uh, major implications for us, NATO and our allies. That's asymmetric. So, uh, often people refer to terrorism as an asymmetric tactic, right? For a minimal set of people—","offset":1120,"duration":22},{"text":"Host: But this would be like a $10,000 dollar drone that hits a $1 million dollar—","offset":1142,"duration":5},{"text":"Matthew Steckman: Drone warfare is as— an asymmetric battlefield tactic, exactly. Um, and cyber being not only asymmetric but you'll often hear the term \"non-kinetic\" associated with it. So I'm asymmetric as in I'm, I'm cheaper and more, more nimble and I can get a large effect, but I'm also non-kinetic. And, and why is that so, so dangerous? Well, when something explodes, uh, we react to it and we react to it, uh, with the full force of, uh, of the military. When things are kind of simmering beneath the surface, and sort of a cold war-ish type of a way, it actually becomes really hard to react. And so in cyber warfare in particular, if assets are affected that we care about, well can we— can we do attribution? Do we know where it came from? How do we respond? Do you respond with a non-kinetic attack by going kinetic? Is that an escalation of force? How is that perceived by the global community? Right? So you, you get into all of these really challenging doctrinal, uh, positions because of, uh, just sort of unexplored offensive cyber is. Um, and then on the flip side, right, it's like do we have the ability to amass cyber effects on our own? Right? 'Cause what you would want to do is you would want to do tit for tat. You wouldn't want to do, in- for the most part, a set of like escalatory decisions. You would want to, you know, match force with force. Do we have the ability to amass the same kind of force non-kinetically? Right? So all of these are super important questions that, uh, in my opinion to date have not been debated publicly and, and absolutely need, need to be.","offset":1147,"duration":103},{"text":"Host: Can I ask you what cyber assets do we care about versus not care about?","offset":1250,"duration":5},{"text":"Matthew Steckman: What do we care about protecting or what do we care about affecting?","offset":1255,"duration":4},{"text":"Host: Both actually, if that's—","offset":1259,"duration":1},{"text":"Matthew Steckman: Yeah, well protecting, right, probably the main one is like the list of critical industries. Um, the military is included on that list. Um, but think about infrastructure, think about power, think about, um, energy, think about all these things, right?","offset":1260,"duration":14},{"text":"Host: Okay, so it's like a foreign adversary impacting energy supplies in large cities or water supplies. For sure. Um, healthcare data or financial systems, I guess.","offset":1274,"duration":12},{"text":"Matthew Steckman: Yep, yep. But even, even now though on the battlefield, it's a foreign adversary impacting our military systems such that we can either not mount an offense or we can, uh, not, uh, successfully defend ourselves.","offset":1286,"duration":12},{"text":"Host: Okay, gotcha. And so that, that's the cyber assets that matter on the defense side. On the kind of offense side?","offset":1298,"duration":6},{"text":"Matthew Steckman: Everything that they would do we would do too. Yeah, exactly. That's the way to think about it.","offset":1304,"duration":7},{"text":"Host: Is there any part of you that's like, Northrop or Lockheed have a $100 billion dollar spend, with the greatest of respects we have a $20 billion dollar spend, we're nowhere in offensive cyber, fuck it, let's not try and catch up. No, I mean in the nice way, you can laugh at me and maybe I'm going to get killed for this but I don't really care. Like, let's just accelerate where we're doing great. Like why bother catching up when you're 70 years behind?","offset":1311,"duration":24}],"startTime":1018},{"title":"Horizontal Strategy & The Drone Market","summary":"Matthew outlines Anduril's strategy of building the horizontal Lattice platform to support multiple products, and predicts that the crowded drone market will inevitably consolidate to a single winner.","entries":[{"text":"Matthew Steckman: Well let's like talk about just like our strategy as a whole. So when we started the company we knew we had to go really wide really quickly, right? 'Cause to the point of like what do other defense companies or newer founders get wrong, it's that addressable market question. So in every technology class in defense there's probably one, sometimes two actual programs that if you capture them you have a business and if you don't you have no business. Um, so take small drones as an example. There are very few drone programs for small drones that, uh, would create a material enough, uh, amount of revenue to like actually create a real business, right? And so like you're basically shooting the moon, uh, you have to create a monopoly. We knew that and so what we did is we created a bunch of fundamental technologies that are applicable to a lot of different types of problems. Um, if you read about us, um, this is called Lattice in a lot of our, like, published literature. Fundamental tech that allows you to consume data, make sense of it, and then, uh, manipulate robots basically, like that's what it is. Those technologies apply to tons of different things and so we have 20 different P&Ls at the company, uh, all that are going after different parts of the defense apparatus that take a lot of these fundamental technologies that we built and kind of piece them together in different ways. And so.","offset":1335,"duration":91},{"text":"Host: So just so I understand, so it's kind of like a horizontal foundational technology that you then verticalize and specialize to fit individual P&Ls.","offset":1426,"duration":8},{"text":"Matthew Steckman: Lattice is a software platform, exactly. Like, uh, I can talk about software platforms with you. It's hard to actually talk about software platforms with a lot of people 'cause it's, like, if you don't actually understand, like, what we're talking about it's, it gets a bit weird. But yeah, Lattice is basically just a software platform that we can branch from. Um, and it's led us into all of these, uh, interesting places. So, like, um, as a really crazy example, uh, the first product we built was a sensing tower, uh, that just allowed us to automatically through a bunch of computer vision technologies— and this was by the way pre-like cool AI, this was like old school CV AI, um, in 2017— just allowed you to spot threats at distance, right, but automatically without a person having to look at a screen. There are pieces of that technology that are resident in our autonomous jet fighter today. Right? Not, not all of it, right? Like there's been a lot of advancements since then, but there are code blocks, right, that are, are shared in common between all of our pieces of technology. That becomes like pretty magical when you approach whatever the next problem is, because you've already got pieces of it solved. Um, gives us a head start, allows us to get to market at usually reduced cost, usually a better schedule, kind of hitting all of the performance characteristics that our customers care about. So. Okay, so back to the actual question on cyber, right? So, so why go after it? Like we, we kind of have to go wide and we have to believe that we have parts of the problem already solved with the platform in order to even approach a market. We wouldn't get into a market if we didn't think we already had applicable technology or a technology tailwind, but where we do, we're, we're definitely going to go after it.","offset":1434,"duration":106},{"text":"Host: What you said was, was fascinating to me. You were like, \"basically you have to assume a monopoly market if you want to build a big enough company for drones.\" Why the fuck are there so many drone companies then?","offset":1540,"duration":10},{"text":"Matthew Steckman: Yeah. Um, I don't know.","offset":1550,"duration":4},{"text":"Host: I mean— I've seen— I've seen so many, like 30, 40 in Europe, just European ones.","offset":1554,"duration":6},{"text":"Matthew Steckman: Yeah. It'll be one that wins, right? It's, it's going to be really hard to pick it, I think is the problem. Um, like there will definitely be one winner. Um, I think the challenge for investors is actually figuring out which one it is.","offset":1560,"duration":13}],"startTime":1335},{"title":"R&D and Internal Capital Allocation","summary":"The discussion turns to Anduril's process for greenlighting new projects using internal tiger teams, rapid prototyping, and a venture-style investment committee.","entries":[{"text":"Host: So we should invest in, you know, offensive cyber and defensive cyber. How do we think next-gen? You're CBO, you're president. You like, \"Great, we should put a billion dollars against it and build that out as a separate business unit.\" Like, and please tell me where I'm wrong. Like what's the subsequent thought to that?","offset":1573,"duration":18},{"text":"Matthew Steckman: Yeah, so the way that we do this is, um, when we have a new idea, um, we basically start a really small tiger team that we generally piece together from various parts of the business. Um, and we, we kind of match our own internal motivation and, and spend, our own IR&D, um, to what the market is whispering to us. So in government what this generally looks like is you, you piece together, uh, some tech really, really quickly so that you have a demonstrator or at least a dart to throw. Um, and then you start to pulse the market and you see how, how close was that dart throw to what the customer actually cares about, how they think about the problem. Do you modify it? Were you totally off and you just need to scrap it and start over again? Um, and I think in government uniquely you know you have something when the customer's excitement starts to match your own and all of a sudden you're kind of walking down a path together as opposed to this weird like vendor-customer relationship. That's always how we kind of identify that we're on to something. I would say all of these things can be characterized by, like, a singular champion on the other side of the table that gets it, that believes in it, that wants to shepherd it. Uh, actually you mentioned Shyam, he talks a lot about this kind of heroism, like it actually comes down to a single person in government a lot of times. Same experience for us. Um, and if you do it right, it kind of tracks similarly. You know, the first year's low dollar spend but there's a lot of learning. Um, and you sort of jump from— I, I tend to use this like lily pad example, you kind of jump from pad to pad and this is what I mean by the 600 contracts in between the 20 that matter. You're basically jumping from contract to contract trying to figure out \"Do I have it right? Is the customer excited? Are they telling me things? Do we keep going? Do we keep spending?\" and ultimately the thing you're trying to jump at is something very large.","offset":1591,"duration":137},{"text":"Host: How do you know when you have something really special and when you should concentrate capital? Again, I think the best founding teams are the best resource allocators. When do you unleash the funding tap and open it up versus constrain and move from little lily pad to lily pad?","offset":1728,"duration":15},{"text":"Matthew Steckman: Yeah, there's a lot of ways to look at our business, but, but one way I think you hit on it is we've been very good at allocating capital. Like, we basically guess right most of the time. If you do this correctly you have enough data to develop conviction to open the tap, right? And so I think in the beginning we were working in areas where if we made a mistake, um, it wasn't, we weren't like too far in on spend that if we pulled back it wasn't like a disaster for the company. I think a lot of the stuff we're building now is quite sizable and expensive and so you're looking for certain proof points along the way and that can be, um, formal, uh, feedback from a customer. That can be informal. That can be, um, um, successful operator, uh, feedback. That can be, uh, successful engagements, um, with the legislative branch— like remember in the US, like your funder is, is the Congress, right, and so they have a say in all of this. What actually it is, it's all of those things pieced together. And so we run like basically an investment committee internally where, uh, these tiger teams ultimately have to present, \"Here's what we did, here's what we discovered, here's what we want to do next, here are the gates, here's what it'll cost.\" Um, and very similarly to how, you know, most financial institutions do it, um, the investment committee says, \"Go.\" And I think maybe uniquely when we say \"Go,\" um, we have the ability to do it faster and at a higher level of spend than most of our peers, which is a huge advantage. And so when we actually develop conviction in something, we pretty much believe we can get there faster than everybody else because of it.","offset":1743,"duration":101},{"text":"Host: If we think about it as an investment committee, we're speaking a language that I know now. Which tiger team was the most successful bet and which was the least successful bet?","offset":1844,"duration":10}],"startTime":1573},{"title":"Disrupting Missile Manufacturing","summary":"Matthew shares the surprising success of Anduril's Barracuda missile portfolio, which leverages commercial manufacturing to achieve scale, elasticity, and solid gross margins.","entries":[{"text":"Matthew Steckman: The most surprising, uh, cases to the upside right now, uh, is in our missiles portfolio. So we started our missiles business a couple of years ago. Um, if you read about us, um, the best example we call the Barracuda family of systems. So it's, uh, it's basically a, a set of, uh, cruise missile, uh, systems, different sizes, different shapes and things like that. We basically got into the missiles business, um, looking mainly at, um, sort of this, the actual like military warfare lens. Like there is clearly a gap in capability, we clearly believe that we can be ahead of everybody else if we've already developed it and when the customer asks for it we'll have it. And that turned out to be quite, like, quite prescient. Now, uh, I don't know if you've seen but there's like a war going with Iran. Um—","offset":1854,"duration":58},{"text":"Host: I, uh— have seen, yeah.","offset":1912,"duration":2},{"text":"Matthew Steckman: Yeah, and so it's like okay, so we, we got into this market years ago with a certain set of theses and geopolitics now has dramatically changed what those theses are, to the upside.","offset":1914,"duration":17},{"text":"Host: When you say it's changed them, do you mean it's confirmed them?","offset":1931,"duration":2},{"text":"Matthew Steckman: It's confirmed them, but it's confirmed them in such a way where it feels wholly different. You know, I think the original theory was we have to get low cost, we have to get more ubiquitous, um, we have to have a mix of exquisite systems and mass, um, like all of these kind of major theories of warfare are kind of all converging at the same time. Um, we have to be able to build something that takes advantage of commercial supply, uh, and commercial manufacturing techniques as opposed to aerospace and defense supply and technique. You know, this kind of like crazy crystallization of a lot of things at the same time. And now, okay, we, uh, there's a war in Iran, we fire a lot of our arsenal. Um, you know, now there's public reporting that, um, you know, large percentages of our offensive and defensive missile systems have been expended. And they're really hard to replace. They take a really long time and they're very expensive because they take advantage of parts of the market that are kind of strange and very specific and very exquisite. You know, just to give you an example, the cruise missile we build, the, the actual airframe is built like you build a bathtub. Um, and so we can take advantage of tons of contract manufacturers in the United States that can actually build a bathtub, right? So just thinking through the design differently from the very beginning has led us to build something that we can just turn on. It's like, uh, another way to think about it is you can handle elasticity of demand for the first time. Um, and that, that's not really a thing that's ever existed in the missiles business, right, where you have a fairly, uh, labor intensive process to increase or, or frankly sometimes decrease demand. Um, I think we've, we are on to something and that we've built kind of a first-of-its-kind that can handle the ebb and flow of geopolitics and warfare. Uh, we can turn lines on and off, we can scale up and down based on the number of contract manufacturers that we engage.","offset":1933,"duration":126},{"text":"Host: What do margins look like for these types of products? What, what is good?","offset":2059,"duration":6},{"text":"Matthew Steckman: Yeah. As a business we run, uh, sort of 40% plus gross margin across the board. Um, and which by the way in hardware and defense is quite good. Um, uh, but every product like kind of lives along a spectrum as you can imagine. The best way to think about this is things that you make more of, like missiles where you're selling thousands and thousands, tend to be a little bit lower gross margin, um, and things that you make less of, uh, you can, you can tend to, to get a decent price for it.","offset":2065,"duration":32},{"text":"Host: Sorry, I'm naive. Why is that? I thought the more you produce, the better the margin would be because you have bulk materials, bulk buying. No? Like help me understand that.","offset":2097,"duration":10},{"text":"Matthew Steckman: It mostly comes down to customer expectation for what these things like should cost over time and then your ability to, uh, gain back margin by cost saving in the long run. Yes, you can close a firm fixed price contract, it doesn't necessarily mean that you can fix that cost forever. Um, and again, it's just like another weird aspect of government business.","offset":2107,"duration":21}],"startTime":1854},{"title":"Ethics & Geopolitical Conflicts","summary":"Matthew addresses the moral framework of working in defense, the company's long-term perspective on global conflicts, and their defensive footprint in the Middle East.","entries":[{"text":"Host: Can I ask you a weird one? But Matt did say I could ask it. Is there ever like an ethical question of, like, \"Do we agree with sending thousands of missiles to Iran?\" I'm not saying right or wrong, but is there ever an ethical question of how your products are used?","offset":2128,"duration":16},{"text":"Matthew Steckman: If you, um, if you work in defense and if you start a defense company your moral compass tends to be pretty clear on this question, which is we have a democratically elected set of governments that represent the US, the alliance, NATO, all of the countries participating. They set the rules. Uh, and we abide by those rules. Um, and if you start to mess around with anything within that framework you create a, a pretty dramatic set of slippery slopes that, that if you play the actual thought experiment to its end, um, end up in a pretty messy situation. And so the, the key here is people that live in the world that I live in, we, we tend to think a little bit differently than, um, uh, a person not connected to the national security community on this front. We tend to think a bit more long term as well, where I'm building missile systems that might only field in 2035. All right? And so if you fundamentally lack a trust in democratic institutions, this is not the game and this is not the business for you.","offset":2144,"duration":69},{"text":"Host: As weird as it sounds and as horrible as it sounds, is war not great for business?","offset":2213,"duration":5},{"text":"Matthew Steckman: I think that's the wrong view. I, I think, um, if you look at, again, if you look at things that span multiple decades, which is probably the right horizon to think through, everything kind of nets out. Um, and so yes, you'll have spikes in, in conflict. Um, but like as an example, there are many companies that are, uh, profiting off of, uh, the war in Ukraine. Um, and I would posit that for the most part if those companies are myopically focused on that conflict they will not have a business coming out the other end. So it's very— you have to be very careful around over rotating on the problems of today, um, because it can, it can really mess up your strategic thinking.","offset":2218,"duration":45},{"text":"Host: Do you think you took advantage enough of the opportunity in Ukraine?","offset":2263,"duration":4},{"text":"Matthew Steckman: We were still a baby company when the conflict started. Um, so just as a reminder, we were zero people in 2017 when we started the company. Uh, we're about 8,000 people today. Um, we were quite small, a couple hundred people when, um, when the war in Ukraine started. Um, and just sort of as a reminder and now this is kind of lived experience for me and my colleagues: you go to war with what you have. Like that, that saying is very, very true. Like, you, you do not invent new stuff along the way. Um, you, you, you take what you have and you, you see if it works and then you adjust. And so we, we had some stuff in Ukraine but we were just too small. Um, I think if you, I, I think if you play that forward to today, we're heavy participants in the current conflict in the Middle East, um, mainly on the defensive side. We build, um, some pretty sophisticated air defense systems that are widely deployed. So it's a wholly different experience because we're a wholly different company.","offset":2267,"duration":61},{"text":"Host: Are Anduril drones used in Iran?","offset":2328,"duration":3},{"text":"Matthew Steckman: I can't speak to specific weapon systems used in specific situations, uh, but we are for the most part a defensive company in the Middle East, as in we are defending against, uh, incoming threats. So if you've read about, uh, the Shahed drone as an example— yeah— um, we're one of the principal systems today to defend against, uh, that threat in the Middle East. Yeah, other than that, it's, you know, it's hard to get into specifics.","offset":2331,"duration":25},{"text":"Host: Yeah, I would hate for you to reveal some inherent military secrets on 20VC.","offset":2356,"duration":5},{"text":"Matthew Steckman: You become, you become pretty good at talking around these things when, when you do this work.","offset":2361,"duration":3}],"startTime":2128},{"title":"M&A Strategy & Space Innovation","summary":"Matthew explains why high VC multiples make startup acquisitions difficult for Anduril, and identifies the space domain as a prime area for future technological disruption.","entries":[{"text":"Host: I'm going to be totally honest, that's not in my interest either. Please don't. I'm really comfortable with my nice life. Um, can I ask you, if I gave you an unlimited checkbook, what would you spend on that you're not spending on today?","offset":2364,"duration":20},{"text":"Matthew Steckman: I think there are some venture capitalist-backed defense companies that are making some really, really awesome technology and they are entirely unaffordable to us today because of—","offset":2384,"duration":12},{"text":"Host: And when you say they're unaffordable, you mean they won't sell at an appetizing price to you given the amount of money that they've raised.","offset":2396,"duration":6},{"text":"Matthew Steckman: Correct. Yeah, yeah, the, their valuations are just too high for us to justify the buy. We, we've bought, I think, almost a dozen companies, maybe more, um, but for the most part they've been more traditional style defense companies, um, with what you would command in the commercial market for that type of company. There are lots of VC companies I would love to buy if I had an unlimited checkbook, but right now the multiples today are, they put them out of reach for us.","offset":2402,"duration":29},{"text":"Host: This was going to be one of my questions, which is is there a universe of buyers for the mass of VC funded companies that have been generated in the last few years, and what happens to them?","offset":2431,"duration":12},{"text":"Matthew Steckman: Actually, um, Trey, uh, I, I will always remember when he said this: that, um, never be surprised around how long a company can continue to exist. Uh, meaning like, you know, I think we were sitting around a table being like, \"Oh, like, uh, it's going to come to the point where the multiples will, you know, decrease\" and all this stuff and, and Trey's point was— and, you know, Trey has this annoying tendency to mostly be right, I don't know, I don't know if you know that about him.","offset":2443,"duration":29},{"text":"Host: But he's our— yeah, exactly. He's our asshole.","offset":2472,"duration":3},{"text":"Matthew Steckman: Yeah, he's our asshole. Um, his point was like, we don't know, but it might be a while before we can actually buy these companies. And so I, I don't know. Uh, there's still a lot of investment in defense tech. Multiples are still very high. I actually think our multiple's quite low compared to most of them.","offset":2475,"duration":16},{"text":"Host: Why would you say your multiple is low?","offset":2491,"duration":3},{"text":"Matthew Steckman: Because it is.","offset":2494,"duration":1},{"text":"Host: Hit me. At, like, what, 10 or 14X forward, something like that? Um, but you're seeing deals in 20, 30, 40X forward.","offset":2495,"duration":13},{"text":"Host: My dear friend, you're seeing deals a lot more than that. Like, you, I think you're sorely mistaken on that one.","offset":2508,"duration":5},{"text":"Matthew Steckman: Great. So it's even worse.","offset":2513,"duration":2},{"text":"Host: 20, 30, 40— why don't you times that by 5? Dude, I see like 200. Who would you most like to buy but can't?","offset":2515,"duration":9},{"text":"Matthew Steckman: Oh, man. No, that's a tough one for me to answer. I, like— I would probably either compliment or offend people that I don't want to compliment or offend. Um, but I'll give you like the classes of technology. Super interested in space domain, like the— there's a— a couple of companies that are doing some absolutely fascinating things both ground segment and on orbit. Um, there's a couple of companies flying fast and—","offset":2524,"duration":24},{"text":"Host: Why is ground segment and on orbit interesting?","offset":2548,"duration":4},{"text":"Matthew Steckman: There's this like interesting thing happening in space domain where, um, you've got the legacy primes on the military side that have these very large contracts, um, but they, they perform sort of traditionally, right? So it's going to be very, very high performance but it'll come at a, a cost and it'll probably take a while to get there, right? And then you have, um, SpaceX which is just dominating on the commercial side and when their commercial tech applies, um, you know, they do a bunch of government business as well. There's a weird kind of gap in between those two types of companies where the government wants to move really fast, um, but it's not necessarily commercially adjacent to what SpaceX is doing. And so there's a, kind of a dearth of providers. And, and, you know, it's certainly something that we want to run at. Right now we do a bunch of partnerships. Um, we build a bunch of our own stuff, we, we integrate a bunch of really interesting technologies. But it's a— it's a huge open hole I think in the market that is something we definitely would run at.","offset":2552,"duration":72},{"text":"Host: So we have that as one. Any other categories that you're like, \"that's, like, prime for the taking, I wish we had more money for that?\"","offset":2624,"duration":5},{"text":"Matthew Steckman: Most of the rest are like kind of uninteresting. It's just consolidating around where we're already winning.","offset":2629,"duration":9}],"startTime":2364},{"title":"Competitors & Capital Discipline","summary":"The conversation covers the importance of respecting competitors and avoiding hubris, as Matthew details Anduril's conservative capital management and long-term corporate vision.","entries":[{"text":"Host: Do you respect Helsing as a competitor?","offset":2638,"duration":2},{"text":"Matthew Steckman: I respect everybody as a competitor. I think the worst thing you can do in this business— again, you know, I at the start of the conversation I mentioned hubris— I think it's like the second you start to have, you think you're better than everybody else, you're, you're going to get knocked in your ass. And so I think I in particular on our leadership team hopefully people would agree I provide a check against the hubris. You have to respect everyone.","offset":2640,"duration":26},{"text":"Host: You do, you're unusually humble for the Anduril founding team. You are, honestly, dude. Like I love Grimm, but I wouldn't say he's like super humble. I don't think I would say it either. I know Palmer, great dude, wouldn't say he's super humble either. Takes all types, I know, it takes all types. And you are so thoughtful and kind. You're nice.","offset":2666,"duration":25},{"text":"Matthew Steckman: Never forget I am an international arms dealer, so just keep that in the back of your mind, you know?","offset":2691,"duration":5},{"text":"Host: Oh, well there we go. It's like the Nicholas Cage movie. Have you seen this movie?","offset":2696,"duration":3},{"text":"Matthew Steckman: Yeah, yeah, yeah.","offset":2699,"duration":2},{"text":"Host: That's amazing. But okay, I will push back on you, dude, you're Anduril's one of the hottest companies in a world where capital concentrates towards the few outcomes that are interesting. You could raise— I mean, you don't need to comment on the fundraises, but like it's reportedly raised 4 or 5 or 6 billion or whatever it is, at 60 billion. The amount of SPVs for Anduril— Matt Grimm tweets about it all the time, I see it. Like, you could raise another billion or two billion on some crazy price and go buy these companies. Why don't you?","offset":2701,"duration":33},{"text":"Matthew Steckman: It's not the company we want to run. Um, we want to create an enduring public company and so we're running it like that. We're running it like that right now even, even though we're pre-public. And so, um, I think protecting the valuation is important, um, not getting over our skis is important. The work is still hard. We will get knocked back if we make a mistake. We don't have the luxury of making mistakes. You know, a lot of our competitors, the really big ones, if they make a mistake they get paid to fix it. I think if we make a mistake, we lose money and we, we lose contracts. So there is a bit of conservatism on the team but I think it's warranted in terms of the market and in general, right? It's like we want to be a company in 2050 and 2060, um, and we're already thinking like that.","offset":2734,"duration":49}],"startTime":2638},{"title":"IPO Strategy & Product J-Curves","summary":"Matthew explains the rationale for eventually taking Anduril public, detailing the immense capital required to accelerate defense products through a shortened development J-curve.","entries":[{"text":"Host: Totally understand, but what I don't understand is why you want to go public. We see companies like Stripe who are able to not go public, be a brilliant business, uh, and avoid the glare of public markets very efficiently. Why would you want to go public?","offset":2783,"duration":17},{"text":"Matthew Steckman: There's a pedigree to it in the work that we do. And ultimately if you are a part of the national security apparatus in the United States, I wouldn't say it's like an expectation and no one would ever say it out loud, but when you are a public company there is an additional level of trust that is afforded to you that you don't have when you're a private company.","offset":2800,"duration":20},{"text":"Host: Do you want to go public in '26?","offset":2820,"duration":2},{"text":"Matthew Steckman: Still a couple years out, but we're close. We're in the window.","offset":2822,"duration":4},{"text":"Host: It's in the sniff zone, it's, like, close enough.","offset":2826,"duration":3},{"text":"Matthew Steckman: Yeah, yeah, yeah. Like we're already spending an insane amount of money trying to, trying to do all the internal system stuff and all that kind of stuff.","offset":2829,"duration":6},{"text":"Host: What do you not have ready yet that needs to be ready to be public?","offset":2835,"duration":3},{"text":"Matthew Steckman: So I mentioned we have 20 products, um, and um, only about a quarter of those are in any kind of rate production and throwing money back to the business. Everything else is in low rate or development, meaning they're losing money. Um, and so, right, it's, it's kind of your standard product J-curve. So we need more of those 20 core products to come up the curve to throw money back to the business and then, and then you trigger the, the public event.","offset":2838,"duration":33},{"text":"Host: What does that J-curve look like from a duration standpoint? Is it, is it months? Is it years? And then how long do you put up with a losing product before you shoot it?","offset":2871,"duration":8},{"text":"Matthew Steckman: Yeah. So in defense, typically in a traditional sort of product curve it's 7 to 10 years. Um, we're doing it in 3 to 5, which is kind of part of the magic of the company and the thing we've become known, known for with our customers is like you're effectively halving the traditional path to rate production. Roadrunner is a good example. Roadrunner was I think 24 months from like a back of a napkin drawing to a fielded system.","offset":2879,"duration":34},{"text":"Host: How much goes in in that 3 to 5 year period?","offset":2913,"duration":3},{"text":"Matthew Steckman: Oh so much. It's crazy amount of money.","offset":2916,"duration":2},{"text":"Host: But just like for my naive brain, is it 100 million or like 500 million or like a billion?","offset":2918,"duration":4},{"text":"Matthew Steckman: Yes, so Roadrunner is a moderately sized, uh, air defense kinetic intercept system and that's, you're over 100 million easily before you're generating revenue.","offset":2922,"duration":12},{"text":"Host: And we have 20 of these separate products?","offset":2934,"duration":2},{"text":"Matthew Steckman: Yeah, so it's a lot of investment, right? So you really have to believe that they're going to come up the curve. Um, and then to your other question about like when do you, when do you schwack a product, we schwack it before we even, like, the better way to think about it is like don't even enter the curve if you don't have faith that it's going to come through the other end. And so we kill a lot of developmental products well before they ever get into high spend because once you get into that curve you're, you know, 10, 20, 50, 100 million dollar plus in.","offset":2936,"duration":27}],"startTime":2783},{"title":"Learning from Early Mistakes","summary":"Matthew shares the story of an expensive early failure with an aerial system, noting how that misstep ultimately paved the way for their successful autonomous jet fighter program.","entries":[{"text":"Host: We spoke about like what did you not do and you said like offensive cyber and the cyber that we discussed earlier. What did you do that you shouldn't have done, and what do you learn from that?","offset":2963,"duration":8},{"text":"Matthew Steckman: That's a good question. Um, way early, I mean we, we got into some tech that we weren't ready for, um, we got into some markets that we weren't ready for. We tried to early on build a pretty sophisticated aerial system, we didn't have the core building blocks, we didn't have the core team. Um, I think we were 20 million or 40 million in before we kind of realized that it was, it was a scrap. We didn't have the sophistication with the customer, we didn't know how the customer was going to buy a, a vehicle of that sophistication. The kind of crazy part about all of this is like, well okay, given all of that and given that that was not a good business decision like clearly by most metrics, do we even get to build the autonomous jet fighter if we had never made that mistake? And so like it's hard to replay history sort of perfectly, right, and it's like I don't think so. I think part of that failure was a stepping stone to getting to success. Um, yeah we probably spent too much money on it and could have gotten out quicker, but like I think we had to learn that lesson in order to then re-approach the aviation market in a new way, which obviously has, has been quite successful for us, um, you know in recent history. And so if you, if you look at a lot of these failed things that we've done, it's hard to separate that from what came after it.","offset":2971,"duration":81},{"text":"Host: Final one before we do a quick fire. I always think to this question of, like, the biggest challenges in life are not like— it sounds so corny— but like, not iron or gold but unmade decisions. I never made the decision to move to Silicon Valley and everyone always reminds me that it will be the decision that haunts my career. Is there an unmade decision that ever haunts you?","offset":3052,"duration":22},{"text":"Matthew Steckman: No, but I'm kind of weird that way. I have trouble separating indecision and failed decisions from the current success that we're actually seeing as a company. I, I just do. And so people talk a lot about, um, I think like these overblown, uh, sort of ideas around like, \"Oh you have to learn from failure and fail fast,\" like yes, all of that's true. Most people suck at actually doing that. And, you know, so for me it's I deeply learn from indecision and from bad decisions, um, but it doesn't like haunt me and it doesn't, like, I'm not going to like kill myself over it, right? I'm going to, I'm going to move on and I'm going to make the next best decision.","offset":3074,"duration":42}],"startTime":2963},{"title":"Quick-Fire Questions & Outro","summary":"In a rapid-fire closing segment, Matthew discusses the future of autonomous warfare, offers career advice, and jokes about choosing a co-founder for a hypothetical future startup.","entries":[{"text":"Host: Dude, I want to do a quick fire with you. So I say a short statement, you give me your immediate thoughts. Does that sound okay?","offset":3116,"duration":3},{"text":"Matthew Steckman: Sure.","offset":3119,"duration":2},{"text":"Host: What's one belief you have about modern warfare that most people think is insane?","offset":3121,"duration":5},{"text":"Matthew Steckman: I think a lot of my beliefs and our beliefs, uh, that we started the company on are now becoming a bit more commonplace. You know, when we started the company maybe we were a bit out of on a limb of like, \"Could I replace every single mission that the current set of technology provides us with an autonomous system?\" I believe that that is true in the long run. I also believe that we're not even close to where a lot of people think we are on it. I think we're still in the early days on, on tons of this tech. Um, but as time goes to infinity, like absolutely every single mission can be replaced, uh, with this new way of thinking. In 2017 when we started the company not only was that not widely held, you know, that, that was a headwind for us. I think that's changed pretty dramatically.","offset":3126,"duration":53},{"text":"Host: What do VCs fund in defense that you think will most go to shit? What are you like, \"Oh—\"","offset":3179,"duration":8},{"text":"Matthew Steckman: It's really companies that there is only one large program to capture. That's like fundamentally what it is. Um, in defense you have to be wide by the very nature of how acquisitions occur. Um, and so I think anything is a risk where it's like, \"Nope, there's kind of one program and if you don't win it, you're not a good company.\"","offset":3187,"duration":22},{"text":"Host: When you think about your kids, what do you tell your kids or kids graduating college about the world when it comes to career advice, knowing and seeing all that you do?","offset":3209,"duration":12},{"text":"Matthew Steckman: Yeah, I mostly say, um, a couple of, of things. I think it's about the community that you surround yourself with. Uh, I, and that, that's a reflection on sort of my own personal story. I mean everything that I've done in my career, um, has been the community of people around me that, um, have helped me, have gotten me jobs, have afforded me responsibility. You know, it's not like some big machine or process, it's, it's really just the people you surround yourself with and um, I like to think I made some pretty good choices early on that helped. And then the other piece would be, I think people tend to overthink a lot of their steps and don't appreciate how much you just can learn along the way. Um, you know, I talk to a lot of, um, military folks that are transitioning out into the commercial world and I would say for the most part they, they kind of like hem and haw over what company they should go to and, you know, my main advice is I actually think you just need to start. And you're actually a really smart person. Um, if you don't like it you can leave. If you like it you got lucky. And you should talk to a lot of companies, you should pick, and you should change your mind when you need to. And I think, uh, often times there's a hesitancy to change your mind, right? And I, I don't think that's actually true. It doesn't need to be true.","offset":3221,"duration":84},{"text":"Host: Final one for you and this is the most unfair of all and that will get you in most in trouble. When you look at the founding team, in a hypothetical world in 10 years time you start another company but you can only take one of them with you as your co-founder. Um, which, which one and why?","offset":3305,"duration":22},{"text":"Matthew Steckman: I can't take them all?","offset":3327,"duration":1},{"text":"Host: No.","offset":3328,"duration":2},{"text":"Matthew Steckman: No? Huh. It's a trick question 'cause there's no way that I'm starting another company after Anduril. I don't know if you know this, but starting companies is really tiring. Um.","offset":3330,"duration":11},{"text":"Host: No, I'm a venture capitalist, we, we don't, we don't know that. We know it's tiring, so we're much wiser than you.","offset":3341,"duration":7},{"text":"Matthew Steckman: I'm just gonna— I'm just gonna retire to the countryside and live with my family and I'm gonna do that.","offset":3348,"duration":5},{"text":"Host: Dude, you've got to choose one.","offset":3353,"duration":1},{"text":"Matthew Steckman: Yeah. I'm not choosing. Don't make me choose. You know I live in Washington DC, I'm very good at not answering questions. Maybe it's Bobik just 'cause the contrast of his baldness and my hair would make us a pretty, pretty formidable duo.","offset":3354,"duration":13},{"text":"Host: Do you think Palmer's brand is helpful?","offset":3367,"duration":1},{"text":"Matthew Steckman: I do. Unequivocally. In defense anything highly regulated, right? Every single thing is a headwind. And so the main thing you do to cut through headwind is you try and establish trust relationships with people who matter. Um, I think Palmer is an N of 1 when it comes to establishing trust relationships with people who matter.","offset":3368,"duration":22},{"text":"Host: I, I've loved this. This is so not how I thought it would be, to be totally honest. It was so nice, it was so fun. I learned, I totally didn't do anything that I kind of thought I would, but thank you. This, like— it reminds me why I love doing what I do.","offset":3390,"duration":13},{"text":"Matthew Steckman: This was great. It— honestly it was great to meet you. I do listen to the pod most episodes, um, I love listening to it. Um, so thanks for having me on. It was cool.","offset":3403,"duration":15}],"startTime":3116}],"entries":[{"text":"Matthew Steckman: You basically can't have a defense company if you don't have a large US business. The government thinks that we can deliver some pretty major stuff, now and in the future.","offset":0,"duration":8},{"text":"Host: I am so excited, we've got Matthew Steckman, President and Chief Business Officer for Anduril. Just last week they announced a monster $20 billion dollar contract with the US military, one of the largest ever. We could not have a more apt or pertinent guest, as he takes us behind the scenes of both the contract and of Anduril.","offset":8,"duration":18},{"text":"Matthew Steckman: There are very few drone programs that would create a material enough amount of revenue to actually create a real business. You have to create a monopoly. There are lots of VC companies I would love to buy if I had an unlimited checkbook.","offset":26,"duration":13},{"text":"Host: Is there ever like an ethical question of, do we agree with sending thousands of missiles to Iran?","offset":39,"duration":21},{"text":"Host: Matt, I am so excited for this, dude. I just got off a chat with Christian Garrett and Matt Grimm and they gave me, like, incredibly tough questions, so this is going to be a grueling hour for you. But thank you for joining me, dude.","offset":60,"duration":13},{"text":"Matthew Steckman: Yeah, thanks for having me. It's really great to be here.","offset":73,"duration":3},{"text":"Host: I actually want to start with Trey, weirdly, which was Christian Garrett said that I had to ask this. He said, what was Trey like at Georgetown? And what is it about the Anduril founding team that has made Anduril so successful?","offset":76,"duration":15},{"text":"Matthew Steckman: Well, Trey and I were, were classmates, um, met freshman year, um, played Ultimate Frisbee together on the team. Um, so went on a lot of road trips with one another. Um, you know, I don't think Trey has changed at all. You ever seen the movie Hot Tub Time Machine?","offset":91,"duration":17},{"text":"Host: Yeah, great movie.","offset":108,"duration":2},{"text":"Matthew Steckman: Yeah, there's a line in it that's, like, \"every group of friends has an asshole, but Trey is our asshole,\" you know, you know what I'm saying? Yeah, that's Trey in a nutshell.","offset":110,"duration":12},{"text":"Host: And he's gone on to such things.","offset":122,"duration":2},{"text":"Matthew Steckman: It's crazy how that works, yeah.","offset":124,"duration":2},{"text":"Host: It has hope for you. You know, I've never had such a weird start to a show.","offset":126,"duration":5},{"text":"Matthew Steckman: There you go. No, we're kicking this off right.","offset":131,"duration":2},{"text":"Host: It's like a movie reference and then \"Trey is our asshole.\" Yeah, yeah, he'll love that one. Yeah. In terms of the team itself, I have so many defense companies pitch me, and I think bluntly the team is always lacking. What do you think it is about the team that Anduril has in terms of founding team, that has made it so successful?","offset":133,"duration":24},{"text":"Matthew Steckman: Well, first, like, there's kind of some magic in the fact that it's the same leadership team today as it was when we started the company. Um, that, that implies a whole lot of things, I think, um, mainly it's that we're all friends. So I think that's actually pretty critical. Um, there, there's a bond there that basically can't be separated by business or stress, um, or life. Um, we, we all know each other really well. Um, but then on top of that, um, we all come at the industry from really different backgrounds and lenses. And especially in defense, which is, um, it's like everything works against you to get into the defense market. There, it's like every headwind you could possibly imagine. If you don't have a lot of perspective and knowledge about what's about to come, it's hard to think around corners and you get yourself kind of mixed up and gummed up a lot. Founding teams, one of the most important things in, in defense is some of them can be outsiders and, you know, brilliant technologists, um, and thinkers. Um, it does take a lot of inside knowledge. Um, and I think that, um, one of the things we, we got right and keep getting right is that blend of, um, like the outside-inside process. Um, who can think, um, differently, um, and bring in sort of commercial perspective, high tech perspective, uh, add kind of entropy into the system. Um, and then who can really deeply represent, um, our customers, how they think, how does that come together uniquely? That, that becomes super important to, to having any success in the defense world.","offset":157,"duration":109},{"text":"Host: I think one of the things I most look for honestly is like GTM experience and ability in a team that I'm looking at in defense. Um, how should we think about analyzing teams for their ability to actually sell and go through procurement? Does it matter if you've got technologists and people with military and combat experience but no one with GTM experience? I know procurement better than fucking anyone.","offset":266,"duration":24},{"text":"Matthew Steckman: It's multidisciplinary, right? So the, the challenge becomes in defense that if you're missing any of the 12 different types of disciplines it takes to really capture a large program, you will fail. Um, and so one of the things that we've done is over the years we've built up a pretty sophisticated apparatus to kind of round out these teams with all of the various skills in acquisition and budgeting and technology, um, and then again, mission and operational analysis and doctrinally how these types of technologies will integrate into the military. You have to have it all. I think the one, um, maybe, uh, interesting piece here is there aren't actually a lot of big programs in government. And so one of the things you don't need to necessarily look for, I think, which you would in a traditional hiring process, you would look for someone who has demonstrated the ability to capture a large program in the past. But, but since there's so few of these things, you, you can't really look for that. Sometimes you luck into it and like, great, you should certainly hire people who have shown to be able to capture large programs. Um, you generally don't actually have that in the hiring pool. And so what you ultimately have to do is piece together the right puzzle for everything that you're going after.","offset":290,"duration":79},{"text":"Host: Does it matter if the founding team doesn't have that experience in terms of going through procurement and GTM?","offset":369,"duration":5},{"text":"Matthew Steckman: I think it does. Um, and I think that, you know, I advise a lot of, of companies and um, if I notice that the founding team, at least a portion of it or a person on it hasn't kind of been there, done that, the first thing I recommend is they have to find someone who represents that piece of the puzzle that, that's missing to their team.","offset":374,"duration":23},{"text":"Host: When you meet all of the defense companies that you meet today— again, I'm an, you know, I'm an investor, I do— we have so many different European drone companies, every fucking UAV— I, dude, I don't, I honestly don't get it at all, they come with some other thing and I'm just like, \"Matt Grimm, please tell me if this is good.\" No, I really do, I ask Matt about it, it's very funny. Um, he sees everything in Europe because of me. Um, and tells me that it's shit. Um, but like when you look at them, what is the most common red flag that you see when you look at the emerging class of defense companies trying to be, as awful as it sounds, the next Anduril?","offset":397,"duration":34},{"text":"Matthew Steckman: I think it's basically two things. It's, um, uh, not realizing that what they are doing, uh, already exists. There's too much hubris, I think, in the technology market that, um, as high tech people we can, we can do everything better than everybody else. I think, um, that causes, uh, some companies to think they have an idea that isn't actually an idea because it already exists and that's pretty common. Uh, I'll give you an example. I, years and years ago I, you know, was looking at a pitch or I forgot, maybe I was advising someone and, \"Here's my idea,\" and I said, \"Well, the thing you don't know is in the 1960s we invented that.\" And so, so there's a, there's kind of a hubris to thinking like, um, the technology sector has all the answers when, like, actually since the '50s we've had the most brilliant people in the world working on these problems and a heck of a lot already exists. And this is sort of the point of like, if you don't actually have the inside knowledge you don't know what mistakes you're making. So that's one. The second, uh, which will be more familiar to you, is, is addressable market. Um, I think there's, uh, in many cases an overestimation of addressable market where like actually what ultimately they're going after is a very small sliver of a problem, um, which might materialize in a, a single large contract, but a single large contract is not an enduring business.","offset":431,"duration":91},{"text":"Host: And this is one of the big challenges that I face, is when we see a company that in France is saying \"we're selling to the French military.\" Dude, I don't know how to say with— I upset everyone these days, I just get used to it. The French military spend less than I do in Chanel for my mother. I mean, it's like fuck all. And so my point is, like, can you be a European-only next-gen prime or do you have to be selling to the US as well? How do you think about that?","offset":522,"duration":25},{"text":"Matthew Steckman: Yeah, I mean, you basically can't have a defense company if you don't have a large US business, right? So 50% of defense spending is in the US and 50% is in the rest of the world. And so if you are cutting off half of your market from the get-go, that's, that's probably a big problem. The, the challenge in Europe is it's not, it's not like a European Union in defense spend, right? Each country has its own sovereign, uh, companies and has its own sovereign agenda and so you keep getting winnowed and winnowed and winnowed and you're like, \"Oh, well Europe is my market.\" Well, if you're a French company, it kind of isn't, right? France is your, your market. Um, and so you have to be really careful around how you're actually analyzing who your ultimate customers can be.","offset":547,"duration":45},{"text":"Host: You mentioned 50% of that spend is in the US. You guys signed a $20 billion dollar contract. Um, it's pretty incredible. It made me feel thoroughly irrelevant when I look at my companies going from 1 to 4 million in ARR for an HR software company and the whole team's like, \"Ah, bugger.\" Um, my question to you is, what's actually entailed in the $20 billion dollars? Was it like an accumulation of all the little contracts brought together? 'Cause it's a big headline number but I didn't actually get it and I don't think a lot of people did.","offset":592,"duration":32},{"text":"Matthew Steckman: Yeah, yeah. So let's, let's, like, actually define it because the stuff I saw posted about it was all over the place. It was like a rainbow of interpretations. So this is, think about this as like a, um, a credit card limit. Um, so the government has said up to $20 billion dollars they can spend on a class of Anduril's commercial technology. Um, there's no obligated money, but it basically creates, uh, a process that reduces a ton of friction that you would ordinarily see in defense procurement, where each individual office would have to go through financing and contracting and evaluation. Um, and all of these repeatable things now, can now only have to happen once. And they did, and they just did. And so, um, maybe a fast track is probably the wrong word, it's more like in the arduous process to actually get something contracted we've cut a lot of the first steps out. Um, there's still a lot of hard work. We've just made it slightly easier for the government to access all of our gear.","offset":624,"duration":70},{"text":"Host: When they say, like, \"dependent on delivery,\" what does \"delivery\" mean?","offset":694,"duration":4},{"text":"Matthew Steckman: They will obligate the dollars as the products, which is hardware and software, are actually materialized. So delivery is revenue to us, right, in our world. So when I deliver something I recognize the revenue, um, same thing in government. When we deliver something, they actually then the actual procurement orders and dollars flow.","offset":698,"duration":20},{"text":"Host: Again, I'm so sorry for being dumb or naive, I'm a venture capitalist for a living, you should be used to us by now. Um, is this replacing prime spending? Is this net additional? How should we think about this? And is this just the sign that Anduril is now another prime?","offset":718,"duration":16},{"text":"Matthew Steckman: Yeah. It basically means that we have enough business with the federal government to justify putting together what is a fairly sophisticated contracting vehicle. Um, so yeah, the short version of it is like, yeah, the government thinks that we can deliver some pretty major stuff, uh, now and in the future. Um, it took a lot of work by a lot of people on the government side to actually make this thing happen. They are not going to do that unless they think that it's worth it.","offset":734,"duration":26},{"text":"Host: What do they spend with, like, a Lockheed or a Northrop for, like, comparison?","offset":760,"duration":5},{"text":"Matthew Steckman: So Lockheed I think is in the, like, 100 billion revenue a year. Um, I think we'll do a couple billion in revenue this year. So we're still, you know, small in the grand scheme of things.","offset":765,"duration":10},{"text":"Host: When you look at the software and the hardware element, how do you guys sit internally? Are you a hardware company? Are you a software company? Are you a services company? Ultimately, how do you sit?","offset":775,"duration":11},{"text":"Matthew Steckman: There's a lot of ways to look at it. So I think one of the things we've done maybe uniquely is we've given our customers a lot of ways to access our company. So what I mean by that is, um, um, we've been very creative in, \"Okay, a customer wants a piece of software, uh, but it's difficult in government to contract for software.\" And so we can wrap it in a hardware appliance, right? Or they want a piece of hardware but they know the software is the sophisticated piece of it, um, and so they're willing to pay more for it because of that sophistication. Or, uh, in government, um, you get these weird things where, uh, money is, it's called \"the color of money,\" so money is obligated to certain types of spend. So maybe a customer only has money that they can spend on services. Well, okay, can I do an as-a-service product? Um, and actually one of our, our first major contracts was with, uh, US Special Forces, uh, for, uh, all of their counter-UAS, uh, systems. That started as an as-a-service contract where they weren't buying hardware, they weren't buying software, they were literally buying, uh, a service that obligated us to defend certain sites from certain types of threats. And as long as we were meeting the KPIs on the contract, um, we were fulfilling the obligations of the agreement. Um, so quite novel, uh, and that contract has, you know, since gone in a lot of different directions and we do a lot of different things on it, not just that, but we have been kind of dogged in our, uh, approach to this by basically realizing that the more ways we give our customers to get at us, the better it's going to go.","offset":786,"duration":106},{"text":"Host: What's the hardest thing about working with the government when you look at the structures that you have to contort yourself in to get a deal done? What's the hardest thing? I've interviewed Shyam, who I presume you work with from Palantir.","offset":892,"duration":15},{"text":"Matthew Steckman: Yeah, yeah, I worked for Shyam for a really long time. He's a good friend of mine. Um, there's a lot of answers to this question, but maybe from my lens, uh, it is, uh, it is how few and far between the large wins are and how hard it is in between those periods of time. So if you look at our business, you know, this year we'll do a couple billion in revenue. We'll do 600 separate contracts this year. Um, only 20 of those are probably of material revenue size. I think the hardest thing is, like, what happens in between the 20? And what are you doing to position yourself for the 21st? And because it's so concentrated, every single one of those deals is considered risk to the business, right, if it goes right or if it goes wrong. So.","offset":907,"duration":49},{"text":"Host: Why specifically is it hard in between? Is that morale? Is that revenue predictability? What is it that's hard in between?","offset":956,"duration":8},{"text":"Matthew Steckman: The government can sometimes tell you where they want you to go, but often times they don't. And so a lot of this, uh, is trying to predict an unpredictable system, right? So how many lenses can you look at at sort of the next couple of years? I can look at it through what the government is saying through their rhetoric and through their budgeting. I can look at it through a war fighting lens and what general officers are saying and what, um, military theorists are saying. I can look at it through a technology lens, like what technologies do I, I think are going to influence the battlefield in the future. And I need to kind of blend all of that together today to make decisions on what I want to build that will be available, you know, five to seven years from now. Um, no one is saying today, \"this is what I need five to seven years from now.\" It's, it's all sort of a, an educated guessing game over time.","offset":964,"duration":54},{"text":"Host: What did you not do that with the benefit of hindsight you wish you had done, and what did you learn?","offset":1018,"duration":8},{"text":"Matthew Steckman: Um, there's been a couple of areas that, you know, have, have kind of emerged that maybe we were a bit slow in, that we would have accelerated. I'll give you an example. Um, uh, there's a huge movement in, uh, not just in the US but NATO and the rest of the allies, um, into offensive cyber warfare. Um, and you're seeing this now becoming public for the first time, which is really, really interesting. Um, you know, to date this has been one of the, the spookiest of all spooky things, right? Like something that just no one ever talks about and now you're, you're literally seeing public officials talking about it for the first time. We should have moved into that seven years ago and been the first, the first in it. We weren't big enough probably to really even understand it seven years ago, but like in hindsight it was kind of obvious. Um, you know, we'll probably try and play some catch-up here and, and get into the game, but, you know, there's a couple of examples like that where you see these things kind of thematically in hindsight, um, and you're like, \"Well, obviously five years ago I should have done it,\" right, and you only realize that today.","offset":1026,"duration":64},{"text":"Host: What is the fear with offensive cyber, when we look at, like, the worst case scenario? Just so I understand it.","offset":1090,"duration":6},{"text":"Matthew Steckman: Well, it's a lot of things. So it's both what are our adversaries doing and do we understand it, and are they asymmetrically influencing, uh, battlefield tactics? And the answer is yes, they are. Um, and then it's, okay, well if our capability—","offset":1096,"duration":18},{"text":"Host: Sorry, sorry, can I just stop you again before I get lost in your next statement. What does it mean like \"asymmetrically influencing battlefield tactics?\"","offset":1114,"duration":6},{"text":"Matthew Steckman: Yep. So for a very, uh, one version to think about this is just cost. For a very low cost they can create an effect that has, uh, major implications for us, NATO and our allies. That's asymmetric. So, uh, often people refer to terrorism as an asymmetric tactic, right? For a minimal set of people—","offset":1120,"duration":22},{"text":"Host: But this would be like a $10,000 dollar drone that hits a $1 million dollar—","offset":1142,"duration":5},{"text":"Matthew Steckman: Drone warfare is as— an asymmetric battlefield tactic, exactly. Um, and cyber being not only asymmetric but you'll often hear the term \"non-kinetic\" associated with it. So I'm asymmetric as in I'm, I'm cheaper and more, more nimble and I can get a large effect, but I'm also non-kinetic. And, and why is that so, so dangerous? Well, when something explodes, uh, we react to it and we react to it, uh, with the full force of, uh, of the military. When things are kind of simmering beneath the surface, and sort of a cold war-ish type of a way, it actually becomes really hard to react. And so in cyber warfare in particular, if assets are affected that we care about, well can we— can we do attribution? Do we know where it came from? How do we respond? Do you respond with a non-kinetic attack by going kinetic? Is that an escalation of force? How is that perceived by the global community? Right? So you, you get into all of these really challenging doctrinal, uh, positions because of, uh, just sort of unexplored offensive cyber is. Um, and then on the flip side, right, it's like do we have the ability to amass cyber effects on our own? Right? 'Cause what you would want to do is you would want to do tit for tat. You wouldn't want to do, in- for the most part, a set of like escalatory decisions. You would want to, you know, match force with force. Do we have the ability to amass the same kind of force non-kinetically? Right? So all of these are super important questions that, uh, in my opinion to date have not been debated publicly and, and absolutely need, need to be.","offset":1147,"duration":103},{"text":"Host: Can I ask you what cyber assets do we care about versus not care about?","offset":1250,"duration":5},{"text":"Matthew Steckman: What do we care about protecting or what do we care about affecting?","offset":1255,"duration":4},{"text":"Host: Both actually, if that's—","offset":1259,"duration":1},{"text":"Matthew Steckman: Yeah, well protecting, right, probably the main one is like the list of critical industries. Um, the military is included on that list. Um, but think about infrastructure, think about power, think about, um, energy, think about all these things, right?","offset":1260,"duration":14},{"text":"Host: Okay, so it's like a foreign adversary impacting energy supplies in large cities or water supplies. For sure. Um, healthcare data or financial systems, I guess.","offset":1274,"duration":12},{"text":"Matthew Steckman: Yep, yep. But even, even now though on the battlefield, it's a foreign adversary impacting our military systems such that we can either not mount an offense or we can, uh, not, uh, successfully defend ourselves.","offset":1286,"duration":12},{"text":"Host: Okay, gotcha. And so that, that's the cyber assets that matter on the defense side. On the kind of offense side?","offset":1298,"duration":6},{"text":"Matthew Steckman: Everything that they would do we would do too. Yeah, exactly. That's the way to think about it.","offset":1304,"duration":7},{"text":"Host: Is there any part of you that's like, Northrop or Lockheed have a $100 billion dollar spend, with the greatest of respects we have a $20 billion dollar spend, we're nowhere in offensive cyber, fuck it, let's not try and catch up. No, I mean in the nice way, you can laugh at me and maybe I'm going to get killed for this but I don't really care. Like, let's just accelerate where we're doing great. Like why bother catching up when you're 70 years behind?","offset":1311,"duration":24},{"text":"Matthew Steckman: Well let's like talk about just like our strategy as a whole. So when we started the company we knew we had to go really wide really quickly, right? 'Cause to the point of like what do other defense companies or newer founders get wrong, it's that addressable market question. So in every technology class in defense there's probably one, sometimes two actual programs that if you capture them you have a business and if you don't you have no business. Um, so take small drones as an example. There are very few drone programs for small drones that, uh, would create a material enough, uh, amount of revenue to like actually create a real business, right? And so like you're basically shooting the moon, uh, you have to create a monopoly. We knew that and so what we did is we created a bunch of fundamental technologies that are applicable to a lot of different types of problems. Um, if you read about us, um, this is called Lattice in a lot of our, like, published literature. Fundamental tech that allows you to consume data, make sense of it, and then, uh, manipulate robots basically, like that's what it is. Those technologies apply to tons of different things and so we have 20 different P&Ls at the company, uh, all that are going after different parts of the defense apparatus that take a lot of these fundamental technologies that we built and kind of piece them together in different ways. And so.","offset":1335,"duration":91},{"text":"Host: So just so I understand, so it's kind of like a horizontal foundational technology that you then verticalize and specialize to fit individual P&Ls.","offset":1426,"duration":8},{"text":"Matthew Steckman: Lattice is a software platform, exactly. Like, uh, I can talk about software platforms with you. It's hard to actually talk about software platforms with a lot of people 'cause it's, like, if you don't actually understand, like, what we're talking about it's, it gets a bit weird. But yeah, Lattice is basically just a software platform that we can branch from. Um, and it's led us into all of these, uh, interesting places. So, like, um, as a really crazy example, uh, the first product we built was a sensing tower, uh, that just allowed us to automatically through a bunch of computer vision technologies— and this was by the way pre-like cool AI, this was like old school CV AI, um, in 2017— just allowed you to spot threats at distance, right, but automatically without a person having to look at a screen. There are pieces of that technology that are resident in our autonomous jet fighter today. Right? Not, not all of it, right? Like there's been a lot of advancements since then, but there are code blocks, right, that are, are shared in common between all of our pieces of technology. That becomes like pretty magical when you approach whatever the next problem is, because you've already got pieces of it solved. Um, gives us a head start, allows us to get to market at usually reduced cost, usually a better schedule, kind of hitting all of the performance characteristics that our customers care about. So. Okay, so back to the actual question on cyber, right? So, so why go after it? Like we, we kind of have to go wide and we have to believe that we have parts of the problem already solved with the platform in order to even approach a market. We wouldn't get into a market if we didn't think we already had applicable technology or a technology tailwind, but where we do, we're, we're definitely going to go after it.","offset":1434,"duration":106},{"text":"Host: What you said was, was fascinating to me. You were like, \"basically you have to assume a monopoly market if you want to build a big enough company for drones.\" Why the fuck are there so many drone companies then?","offset":1540,"duration":10},{"text":"Matthew Steckman: Yeah. Um, I don't know.","offset":1550,"duration":4},{"text":"Host: I mean— I've seen— I've seen so many, like 30, 40 in Europe, just European ones.","offset":1554,"duration":6},{"text":"Matthew Steckman: Yeah. It'll be one that wins, right? It's, it's going to be really hard to pick it, I think is the problem. Um, like there will definitely be one winner. Um, I think the challenge for investors is actually figuring out which one it is.","offset":1560,"duration":13},{"text":"Host: So we should invest in, you know, offensive cyber and defensive cyber. How do we think next-gen? You're CBO, you're president. You like, \"Great, we should put a billion dollars against it and build that out as a separate business unit.\" Like, and please tell me where I'm wrong. Like what's the subsequent thought to that?","offset":1573,"duration":18},{"text":"Matthew Steckman: Yeah, so the way that we do this is, um, when we have a new idea, um, we basically start a really small tiger team that we generally piece together from various parts of the business. Um, and we, we kind of match our own internal motivation and, and spend, our own IR&D, um, to what the market is whispering to us. So in government what this generally looks like is you, you piece together, uh, some tech really, really quickly so that you have a demonstrator or at least a dart to throw. Um, and then you start to pulse the market and you see how, how close was that dart throw to what the customer actually cares about, how they think about the problem. Do you modify it? Were you totally off and you just need to scrap it and start over again? Um, and I think in government uniquely you know you have something when the customer's excitement starts to match your own and all of a sudden you're kind of walking down a path together as opposed to this weird like vendor-customer relationship. That's always how we kind of identify that we're on to something. I would say all of these things can be characterized by, like, a singular champion on the other side of the table that gets it, that believes in it, that wants to shepherd it. Uh, actually you mentioned Shyam, he talks a lot about this kind of heroism, like it actually comes down to a single person in government a lot of times. Same experience for us. Um, and if you do it right, it kind of tracks similarly. You know, the first year's low dollar spend but there's a lot of learning. Um, and you sort of jump from— I, I tend to use this like lily pad example, you kind of jump from pad to pad and this is what I mean by the 600 contracts in between the 20 that matter. You're basically jumping from contract to contract trying to figure out \"Do I have it right? Is the customer excited? Are they telling me things? Do we keep going? Do we keep spending?\" and ultimately the thing you're trying to jump at is something very large.","offset":1591,"duration":137},{"text":"Host: How do you know when you have something really special and when you should concentrate capital? Again, I think the best founding teams are the best resource allocators. When do you unleash the funding tap and open it up versus constrain and move from little lily pad to lily pad?","offset":1728,"duration":15},{"text":"Matthew Steckman: Yeah, there's a lot of ways to look at our business, but, but one way I think you hit on it is we've been very good at allocating capital. Like, we basically guess right most of the time. If you do this correctly you have enough data to develop conviction to open the tap, right? And so I think in the beginning we were working in areas where if we made a mistake, um, it wasn't, we weren't like too far in on spend that if we pulled back it wasn't like a disaster for the company. I think a lot of the stuff we're building now is quite sizable and expensive and so you're looking for certain proof points along the way and that can be, um, formal, uh, feedback from a customer. That can be informal. That can be, um, um, successful operator, uh, feedback. That can be, uh, successful engagements, um, with the legislative branch— like remember in the US, like your funder is, is the Congress, right, and so they have a say in all of this. What actually it is, it's all of those things pieced together. And so we run like basically an investment committee internally where, uh, these tiger teams ultimately have to present, \"Here's what we did, here's what we discovered, here's what we want to do next, here are the gates, here's what it'll cost.\" Um, and very similarly to how, you know, most financial institutions do it, um, the investment committee says, \"Go.\" And I think maybe uniquely when we say \"Go,\" um, we have the ability to do it faster and at a higher level of spend than most of our peers, which is a huge advantage. And so when we actually develop conviction in something, we pretty much believe we can get there faster than everybody else because of it.","offset":1743,"duration":101},{"text":"Host: If we think about it as an investment committee, we're speaking a language that I know now. Which tiger team was the most successful bet and which was the least successful bet?","offset":1844,"duration":10},{"text":"Matthew Steckman: The most surprising, uh, cases to the upside right now, uh, is in our missiles portfolio. So we started our missiles business a couple of years ago. Um, if you read about us, um, the best example we call the Barracuda family of systems. So it's, uh, it's basically a, a set of, uh, cruise missile, uh, systems, different sizes, different shapes and things like that. We basically got into the missiles business, um, looking mainly at, um, sort of this, the actual like military warfare lens. Like there is clearly a gap in capability, we clearly believe that we can be ahead of everybody else if we've already developed it and when the customer asks for it we'll have it. And that turned out to be quite, like, quite prescient. Now, uh, I don't know if you've seen but there's like a war going with Iran. Um—","offset":1854,"duration":58},{"text":"Host: I, uh— have seen, yeah.","offset":1912,"duration":2},{"text":"Matthew Steckman: Yeah, and so it's like okay, so we, we got into this market years ago with a certain set of theses and geopolitics now has dramatically changed what those theses are, to the upside.","offset":1914,"duration":17},{"text":"Host: When you say it's changed them, do you mean it's confirmed them?","offset":1931,"duration":2},{"text":"Matthew Steckman: It's confirmed them, but it's confirmed them in such a way where it feels wholly different. You know, I think the original theory was we have to get low cost, we have to get more ubiquitous, um, we have to have a mix of exquisite systems and mass, um, like all of these kind of major theories of warfare are kind of all converging at the same time. Um, we have to be able to build something that takes advantage of commercial supply, uh, and commercial manufacturing techniques as opposed to aerospace and defense supply and technique. You know, this kind of like crazy crystallization of a lot of things at the same time. And now, okay, we, uh, there's a war in Iran, we fire a lot of our arsenal. Um, you know, now there's public reporting that, um, you know, large percentages of our offensive and defensive missile systems have been expended. And they're really hard to replace. They take a really long time and they're very expensive because they take advantage of parts of the market that are kind of strange and very specific and very exquisite. You know, just to give you an example, the cruise missile we build, the, the actual airframe is built like you build a bathtub. Um, and so we can take advantage of tons of contract manufacturers in the United States that can actually build a bathtub, right? So just thinking through the design differently from the very beginning has led us to build something that we can just turn on. It's like, uh, another way to think about it is you can handle elasticity of demand for the first time. Um, and that, that's not really a thing that's ever existed in the missiles business, right, where you have a fairly, uh, labor intensive process to increase or, or frankly sometimes decrease demand. Um, I think we've, we are on to something and that we've built kind of a first-of-its-kind that can handle the ebb and flow of geopolitics and warfare. Uh, we can turn lines on and off, we can scale up and down based on the number of contract manufacturers that we engage.","offset":1933,"duration":126},{"text":"Host: What do margins look like for these types of products? What, what is good?","offset":2059,"duration":6},{"text":"Matthew Steckman: Yeah. As a business we run, uh, sort of 40% plus gross margin across the board. Um, and which by the way in hardware and defense is quite good. Um, uh, but every product like kind of lives along a spectrum as you can imagine. The best way to think about this is things that you make more of, like missiles where you're selling thousands and thousands, tend to be a little bit lower gross margin, um, and things that you make less of, uh, you can, you can tend to, to get a decent price for it.","offset":2065,"duration":32},{"text":"Host: Sorry, I'm naive. Why is that? I thought the more you produce, the better the margin would be because you have bulk materials, bulk buying. No? Like help me understand that.","offset":2097,"duration":10},{"text":"Matthew Steckman: It mostly comes down to customer expectation for what these things like should cost over time and then your ability to, uh, gain back margin by cost saving in the long run. Yes, you can close a firm fixed price contract, it doesn't necessarily mean that you can fix that cost forever. Um, and again, it's just like another weird aspect of government business.","offset":2107,"duration":21},{"text":"Host: Can I ask you a weird one? But Matt did say I could ask it. Is there ever like an ethical question of, like, \"Do we agree with sending thousands of missiles to Iran?\" I'm not saying right or wrong, but is there ever an ethical question of how your products are used?","offset":2128,"duration":16},{"text":"Matthew Steckman: If you, um, if you work in defense and if you start a defense company your moral compass tends to be pretty clear on this question, which is we have a democratically elected set of governments that represent the US, the alliance, NATO, all of the countries participating. They set the rules. Uh, and we abide by those rules. Um, and if you start to mess around with anything within that framework you create a, a pretty dramatic set of slippery slopes that, that if you play the actual thought experiment to its end, um, end up in a pretty messy situation. And so the, the key here is people that live in the world that I live in, we, we tend to think a little bit differently than, um, uh, a person not connected to the national security community on this front. We tend to think a bit more long term as well, where I'm building missile systems that might only field in 2035. All right? And so if you fundamentally lack a trust in democratic institutions, this is not the game and this is not the business for you.","offset":2144,"duration":69},{"text":"Host: As weird as it sounds and as horrible as it sounds, is war not great for business?","offset":2213,"duration":5},{"text":"Matthew Steckman: I think that's the wrong view. I, I think, um, if you look at, again, if you look at things that span multiple decades, which is probably the right horizon to think through, everything kind of nets out. Um, and so yes, you'll have spikes in, in conflict. Um, but like as an example, there are many companies that are, uh, profiting off of, uh, the war in Ukraine. Um, and I would posit that for the most part if those companies are myopically focused on that conflict they will not have a business coming out the other end. So it's very— you have to be very careful around over rotating on the problems of today, um, because it can, it can really mess up your strategic thinking.","offset":2218,"duration":45},{"text":"Host: Do you think you took advantage enough of the opportunity in Ukraine?","offset":2263,"duration":4},{"text":"Matthew Steckman: We were still a baby company when the conflict started. Um, so just as a reminder, we were zero people in 2017 when we started the company. Uh, we're about 8,000 people today. Um, we were quite small, a couple hundred people when, um, when the war in Ukraine started. Um, and just sort of as a reminder and now this is kind of lived experience for me and my colleagues: you go to war with what you have. Like that, that saying is very, very true. Like, you, you do not invent new stuff along the way. Um, you, you, you take what you have and you, you see if it works and then you adjust. And so we, we had some stuff in Ukraine but we were just too small. Um, I think if you, I, I think if you play that forward to today, we're heavy participants in the current conflict in the Middle East, um, mainly on the defensive side. We build, um, some pretty sophisticated air defense systems that are widely deployed. So it's a wholly different experience because we're a wholly different company.","offset":2267,"duration":61},{"text":"Host: Are Anduril drones used in Iran?","offset":2328,"duration":3},{"text":"Matthew Steckman: I can't speak to specific weapon systems used in specific situations, uh, but we are for the most part a defensive company in the Middle East, as in we are defending against, uh, incoming threats. So if you've read about, uh, the Shahed drone as an example— yeah— um, we're one of the principal systems today to defend against, uh, that threat in the Middle East. Yeah, other than that, it's, you know, it's hard to get into specifics.","offset":2331,"duration":25},{"text":"Host: Yeah, I would hate for you to reveal some inherent military secrets on 20VC.","offset":2356,"duration":5},{"text":"Matthew Steckman: You become, you become pretty good at talking around these things when, when you do this work.","offset":2361,"duration":3},{"text":"Host: I'm going to be totally honest, that's not in my interest either. Please don't. I'm really comfortable with my nice life. Um, can I ask you, if I gave you an unlimited checkbook, what would you spend on that you're not spending on today?","offset":2364,"duration":20},{"text":"Matthew Steckman: I think there are some venture capitalist-backed defense companies that are making some really, really awesome technology and they are entirely unaffordable to us today because of—","offset":2384,"duration":12},{"text":"Host: And when you say they're unaffordable, you mean they won't sell at an appetizing price to you given the amount of money that they've raised.","offset":2396,"duration":6},{"text":"Matthew Steckman: Correct. Yeah, yeah, the, their valuations are just too high for us to justify the buy. We, we've bought, I think, almost a dozen companies, maybe more, um, but for the most part they've been more traditional style defense companies, um, with what you would command in the commercial market for that type of company. There are lots of VC companies I would love to buy if I had an unlimited checkbook, but right now the multiples today are, they put them out of reach for us.","offset":2402,"duration":29},{"text":"Host: This was going to be one of my questions, which is is there a universe of buyers for the mass of VC funded companies that have been generated in the last few years, and what happens to them?","offset":2431,"duration":12},{"text":"Matthew Steckman: Actually, um, Trey, uh, I, I will always remember when he said this: that, um, never be surprised around how long a company can continue to exist. Uh, meaning like, you know, I think we were sitting around a table being like, \"Oh, like, uh, it's going to come to the point where the multiples will, you know, decrease\" and all this stuff and, and Trey's point was— and, you know, Trey has this annoying tendency to mostly be right, I don't know, I don't know if you know that about him.","offset":2443,"duration":29},{"text":"Host: But he's our— yeah, exactly. He's our asshole.","offset":2472,"duration":3},{"text":"Matthew Steckman: Yeah, he's our asshole. Um, his point was like, we don't know, but it might be a while before we can actually buy these companies. And so I, I don't know. Uh, there's still a lot of investment in defense tech. Multiples are still very high. I actually think our multiple's quite low compared to most of them.","offset":2475,"duration":16},{"text":"Host: Why would you say your multiple is low?","offset":2491,"duration":3},{"text":"Matthew Steckman: Because it is.","offset":2494,"duration":1},{"text":"Host: Hit me. At, like, what, 10 or 14X forward, something like that? Um, but you're seeing deals in 20, 30, 40X forward.","offset":2495,"duration":13},{"text":"Host: My dear friend, you're seeing deals a lot more than that. Like, you, I think you're sorely mistaken on that one.","offset":2508,"duration":5},{"text":"Matthew Steckman: Great. So it's even worse.","offset":2513,"duration":2},{"text":"Host: 20, 30, 40— why don't you times that by 5? Dude, I see like 200. Who would you most like to buy but can't?","offset":2515,"duration":9},{"text":"Matthew Steckman: Oh, man. No, that's a tough one for me to answer. I, like— I would probably either compliment or offend people that I don't want to compliment or offend. Um, but I'll give you like the classes of technology. Super interested in space domain, like the— there's a— a couple of companies that are doing some absolutely fascinating things both ground segment and on orbit. Um, there's a couple of companies flying fast and—","offset":2524,"duration":24},{"text":"Host: Why is ground segment and on orbit interesting?","offset":2548,"duration":4},{"text":"Matthew Steckman: There's this like interesting thing happening in space domain where, um, you've got the legacy primes on the military side that have these very large contracts, um, but they, they perform sort of traditionally, right? So it's going to be very, very high performance but it'll come at a, a cost and it'll probably take a while to get there, right? And then you have, um, SpaceX which is just dominating on the commercial side and when their commercial tech applies, um, you know, they do a bunch of government business as well. There's a weird kind of gap in between those two types of companies where the government wants to move really fast, um, but it's not necessarily commercially adjacent to what SpaceX is doing. And so there's a, kind of a dearth of providers. And, and, you know, it's certainly something that we want to run at. Right now we do a bunch of partnerships. Um, we build a bunch of our own stuff, we, we integrate a bunch of really interesting technologies. But it's a— it's a huge open hole I think in the market that is something we definitely would run at.","offset":2552,"duration":72},{"text":"Host: So we have that as one. Any other categories that you're like, \"that's, like, prime for the taking, I wish we had more money for that?\"","offset":2624,"duration":5},{"text":"Matthew Steckman: Most of the rest are like kind of uninteresting. It's just consolidating around where we're already winning.","offset":2629,"duration":9},{"text":"Host: Do you respect Helsing as a competitor?","offset":2638,"duration":2},{"text":"Matthew Steckman: I respect everybody as a competitor. I think the worst thing you can do in this business— again, you know, I at the start of the conversation I mentioned hubris— I think it's like the second you start to have, you think you're better than everybody else, you're, you're going to get knocked in your ass. And so I think I in particular on our leadership team hopefully people would agree I provide a check against the hubris. You have to respect everyone.","offset":2640,"duration":26},{"text":"Host: You do, you're unusually humble for the Anduril founding team. You are, honestly, dude. Like I love Grimm, but I wouldn't say he's like super humble. I don't think I would say it either. I know Palmer, great dude, wouldn't say he's super humble either. Takes all types, I know, it takes all types. And you are so thoughtful and kind. You're nice.","offset":2666,"duration":25},{"text":"Matthew Steckman: Never forget I am an international arms dealer, so just keep that in the back of your mind, you know?","offset":2691,"duration":5},{"text":"Host: Oh, well there we go. It's like the Nicholas Cage movie. Have you seen this movie?","offset":2696,"duration":3},{"text":"Matthew Steckman: Yeah, yeah, yeah.","offset":2699,"duration":2},{"text":"Host: That's amazing. But okay, I will push back on you, dude, you're Anduril's one of the hottest companies in a world where capital concentrates towards the few outcomes that are interesting. You could raise— I mean, you don't need to comment on the fundraises, but like it's reportedly raised 4 or 5 or 6 billion or whatever it is, at 60 billion. The amount of SPVs for Anduril— Matt Grimm tweets about it all the time, I see it. Like, you could raise another billion or two billion on some crazy price and go buy these companies. Why don't you?","offset":2701,"duration":33},{"text":"Matthew Steckman: It's not the company we want to run. Um, we want to create an enduring public company and so we're running it like that. We're running it like that right now even, even though we're pre-public. And so, um, I think protecting the valuation is important, um, not getting over our skis is important. The work is still hard. We will get knocked back if we make a mistake. We don't have the luxury of making mistakes. You know, a lot of our competitors, the really big ones, if they make a mistake they get paid to fix it. I think if we make a mistake, we lose money and we, we lose contracts. So there is a bit of conservatism on the team but I think it's warranted in terms of the market and in general, right? It's like we want to be a company in 2050 and 2060, um, and we're already thinking like that.","offset":2734,"duration":49},{"text":"Host: Totally understand, but what I don't understand is why you want to go public. We see companies like Stripe who are able to not go public, be a brilliant business, uh, and avoid the glare of public markets very efficiently. Why would you want to go public?","offset":2783,"duration":17},{"text":"Matthew Steckman: There's a pedigree to it in the work that we do. And ultimately if you are a part of the national security apparatus in the United States, I wouldn't say it's like an expectation and no one would ever say it out loud, but when you are a public company there is an additional level of trust that is afforded to you that you don't have when you're a private company.","offset":2800,"duration":20},{"text":"Host: Do you want to go public in '26?","offset":2820,"duration":2},{"text":"Matthew Steckman: Still a couple years out, but we're close. We're in the window.","offset":2822,"duration":4},{"text":"Host: It's in the sniff zone, it's, like, close enough.","offset":2826,"duration":3},{"text":"Matthew Steckman: Yeah, yeah, yeah. Like we're already spending an insane amount of money trying to, trying to do all the internal system stuff and all that kind of stuff.","offset":2829,"duration":6},{"text":"Host: What do you not have ready yet that needs to be ready to be public?","offset":2835,"duration":3},{"text":"Matthew Steckman: So I mentioned we have 20 products, um, and um, only about a quarter of those are in any kind of rate production and throwing money back to the business. Everything else is in low rate or development, meaning they're losing money. Um, and so, right, it's, it's kind of your standard product J-curve. So we need more of those 20 core products to come up the curve to throw money back to the business and then, and then you trigger the, the public event.","offset":2838,"duration":33},{"text":"Host: What does that J-curve look like from a duration standpoint? Is it, is it months? Is it years? And then how long do you put up with a losing product before you shoot it?","offset":2871,"duration":8},{"text":"Matthew Steckman: Yeah. So in defense, typically in a traditional sort of product curve it's 7 to 10 years. Um, we're doing it in 3 to 5, which is kind of part of the magic of the company and the thing we've become known, known for with our customers is like you're effectively halving the traditional path to rate production. Roadrunner is a good example. Roadrunner was I think 24 months from like a back of a napkin drawing to a fielded system.","offset":2879,"duration":34},{"text":"Host: How much goes in in that 3 to 5 year period?","offset":2913,"duration":3},{"text":"Matthew Steckman: Oh so much. It's crazy amount of money.","offset":2916,"duration":2},{"text":"Host: But just like for my naive brain, is it 100 million or like 500 million or like a billion?","offset":2918,"duration":4},{"text":"Matthew Steckman: Yes, so Roadrunner is a moderately sized, uh, air defense kinetic intercept system and that's, you're over 100 million easily before you're generating revenue.","offset":2922,"duration":12},{"text":"Host: And we have 20 of these separate products?","offset":2934,"duration":2},{"text":"Matthew Steckman: Yeah, so it's a lot of investment, right? So you really have to believe that they're going to come up the curve. Um, and then to your other question about like when do you, when do you schwack a product, we schwack it before we even, like, the better way to think about it is like don't even enter the curve if you don't have faith that it's going to come through the other end. And so we kill a lot of developmental products well before they ever get into high spend because once you get into that curve you're, you know, 10, 20, 50, 100 million dollar plus in.","offset":2936,"duration":27},{"text":"Host: We spoke about like what did you not do and you said like offensive cyber and the cyber that we discussed earlier. What did you do that you shouldn't have done, and what do you learn from that?","offset":2963,"duration":8},{"text":"Matthew Steckman: That's a good question. Um, way early, I mean we, we got into some tech that we weren't ready for, um, we got into some markets that we weren't ready for. We tried to early on build a pretty sophisticated aerial system, we didn't have the core building blocks, we didn't have the core team. Um, I think we were 20 million or 40 million in before we kind of realized that it was, it was a scrap. We didn't have the sophistication with the customer, we didn't know how the customer was going to buy a, a vehicle of that sophistication. The kind of crazy part about all of this is like, well okay, given all of that and given that that was not a good business decision like clearly by most metrics, do we even get to build the autonomous jet fighter if we had never made that mistake? And so like it's hard to replay history sort of perfectly, right, and it's like I don't think so. I think part of that failure was a stepping stone to getting to success. Um, yeah we probably spent too much money on it and could have gotten out quicker, but like I think we had to learn that lesson in order to then re-approach the aviation market in a new way, which obviously has, has been quite successful for us, um, you know in recent history. And so if you, if you look at a lot of these failed things that we've done, it's hard to separate that from what came after it.","offset":2971,"duration":81},{"text":"Host: Final one before we do a quick fire. I always think to this question of, like, the biggest challenges in life are not like— it sounds so corny— but like, not iron or gold but unmade decisions. I never made the decision to move to Silicon Valley and everyone always reminds me that it will be the decision that haunts my career. Is there an unmade decision that ever haunts you?","offset":3052,"duration":22},{"text":"Matthew Steckman: No, but I'm kind of weird that way. I have trouble separating indecision and failed decisions from the current success that we're actually seeing as a company. I, I just do. And so people talk a lot about, um, I think like these overblown, uh, sort of ideas around like, \"Oh you have to learn from failure and fail fast,\" like yes, all of that's true. Most people suck at actually doing that. And, you know, so for me it's I deeply learn from indecision and from bad decisions, um, but it doesn't like haunt me and it doesn't, like, I'm not going to like kill myself over it, right? I'm going to, I'm going to move on and I'm going to make the next best decision.","offset":3074,"duration":42},{"text":"Host: Dude, I want to do a quick fire with you. So I say a short statement, you give me your immediate thoughts. Does that sound okay?","offset":3116,"duration":3},{"text":"Matthew Steckman: Sure.","offset":3119,"duration":2},{"text":"Host: What's one belief you have about modern warfare that most people think is insane?","offset":3121,"duration":5},{"text":"Matthew Steckman: I think a lot of my beliefs and our beliefs, uh, that we started the company on are now becoming a bit more commonplace. You know, when we started the company maybe we were a bit out of on a limb of like, \"Could I replace every single mission that the current set of technology provides us with an autonomous system?\" I believe that that is true in the long run. I also believe that we're not even close to where a lot of people think we are on it. I think we're still in the early days on, on tons of this tech. Um, but as time goes to infinity, like absolutely every single mission can be replaced, uh, with this new way of thinking. In 2017 when we started the company not only was that not widely held, you know, that, that was a headwind for us. I think that's changed pretty dramatically.","offset":3126,"duration":53},{"text":"Host: What do VCs fund in defense that you think will most go to shit? What are you like, \"Oh—\"","offset":3179,"duration":8},{"text":"Matthew Steckman: It's really companies that there is only one large program to capture. That's like fundamentally what it is. Um, in defense you have to be wide by the very nature of how acquisitions occur. Um, and so I think anything is a risk where it's like, \"Nope, there's kind of one program and if you don't win it, you're not a good company.\"","offset":3187,"duration":22},{"text":"Host: When you think about your kids, what do you tell your kids or kids graduating college about the world when it comes to career advice, knowing and seeing all that you do?","offset":3209,"duration":12},{"text":"Matthew Steckman: Yeah, I mostly say, um, a couple of, of things. I think it's about the community that you surround yourself with. Uh, I, and that, that's a reflection on sort of my own personal story. I mean everything that I've done in my career, um, has been the community of people around me that, um, have helped me, have gotten me jobs, have afforded me responsibility. You know, it's not like some big machine or process, it's, it's really just the people you surround yourself with and um, I like to think I made some pretty good choices early on that helped. And then the other piece would be, I think people tend to overthink a lot of their steps and don't appreciate how much you just can learn along the way. Um, you know, I talk to a lot of, um, military folks that are transitioning out into the commercial world and I would say for the most part they, they kind of like hem and haw over what company they should go to and, you know, my main advice is I actually think you just need to start. And you're actually a really smart person. Um, if you don't like it you can leave. If you like it you got lucky. And you should talk to a lot of companies, you should pick, and you should change your mind when you need to. And I think, uh, often times there's a hesitancy to change your mind, right? And I, I don't think that's actually true. It doesn't need to be true.","offset":3221,"duration":84},{"text":"Host: Final one for you and this is the most unfair of all and that will get you in most in trouble. When you look at the founding team, in a hypothetical world in 10 years time you start another company but you can only take one of them with you as your co-founder. Um, which, which one and why?","offset":3305,"duration":22},{"text":"Matthew Steckman: I can't take them all?","offset":3327,"duration":1},{"text":"Host: No.","offset":3328,"duration":2},{"text":"Matthew Steckman: No? Huh. It's a trick question 'cause there's no way that I'm starting another company after Anduril. I don't know if you know this, but starting companies is really tiring. Um.","offset":3330,"duration":11},{"text":"Host: No, I'm a venture capitalist, we, we don't, we don't know that. We know it's tiring, so we're much wiser than you.","offset":3341,"duration":7},{"text":"Matthew Steckman: I'm just gonna— I'm just gonna retire to the countryside and live with my family and I'm gonna do that.","offset":3348,"duration":5},{"text":"Host: Dude, you've got to choose one.","offset":3353,"duration":1},{"text":"Matthew Steckman: Yeah. I'm not choosing. Don't make me choose. You know I live in Washington DC, I'm very good at not answering questions. Maybe it's Bobik just 'cause the contrast of his baldness and my hair would make us a pretty, pretty formidable duo.","offset":3354,"duration":13},{"text":"Host: Do you think Palmer's brand is helpful?","offset":3367,"duration":1},{"text":"Matthew Steckman: I do. Unequivocally. In defense anything highly regulated, right? Every single thing is a headwind. And so the main thing you do to cut through headwind is you try and establish trust relationships with people who matter. Um, I think Palmer is an N of 1 when it comes to establishing trust relationships with people who matter.","offset":3368,"duration":22},{"text":"Host: I, I've loved this. This is so not how I thought it would be, to be totally honest. It was so nice, it was so fun. I learned, I totally didn't do anything that I kind of thought I would, but thank you. This, like— it reminds me why I love doing what I do.","offset":3390,"duration":13},{"text":"Matthew Steckman: This was great. It— honestly it was great to meet you. I do listen to the pod most episodes, um, I love listening to it. Um, so thanks for having me on. It was cool.","offset":3403,"duration":15}],"logs":[{"elapsed":"0.0","message":"Downloading audio from YouTube...","detail":null},{"elapsed":"0.0","message":"Trying download with browser cookies (ad-free)...","detail":null},{"elapsed":"30.4","message":"Audio downloaded (39.6 MB) in 30.4s","detail":"File size: 39.6 MB"},{"elapsed":"30.4","message":"Video title: 99% of Drone Companies Will Die & Why Anduril’s Products Aren’t an Ethics Debate | Matthew Steckman","detail":null},{"elapsed":"30.4","message":"Audio duration: 57:03 (57.1 min)","detail":null},{"elapsed":"30.4","message":"Uploading audio to Gemini File API...","detail":null},{"elapsed":"35.4","message":"Audio uploaded in 5.0s","detail":"File ref: files/dwjw9tfnwdvn"},{"elapsed":"35.4","message":"Audio processed in 0.0s. 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