Speaker 1: Pushkin, the first airline ever, the first airline in the
Speaker 1: history of the world, started in nineteen fourteen. It flew
Speaker 1: passengers just a short hop across the Bay from Saint
Speaker 1: Petersburg to Tampa, and its maximum speed was about sixty
Speaker 1: miles an hour. By the nineteen sixties, just fifty years later,
Speaker 1: passenger jets were flying ten times as fast as that,
Speaker 1: and that increase in speed transformed the meaning of travel.
Speaker 1: But then after the sixties, air travel just stopped getting faster.
Speaker 1: A flight today takes about as long as a flight
Speaker 1: took sixty years ago. We've gone from a ten x
Speaker 1: improvement to no improvement at all. What happened? I'm Jacob
Speaker 1: Bolgstein and this is What's Your Problem? The show where
Speaker 1: I talk to people who are trying to make technological progress.
Speaker 1: My guest today is Blake Shoal, the founder and CEO
Speaker 1: of Boom Supersonic. Blake's problem is this, can you build
Speaker 1: a commercial airplane that flies faster than the speed of
Speaker 1: sound and that can turn a profit. Blake started the
Speaker 1: company in twenty fourteen. Since then, he's secured pre orders
Speaker 1: from japan Airlines, United and American Airlines, and he and
Speaker 1: his team built a test plane that flew faster than
Speaker 1: the speed of sound. Now they're working on a full
Speaker 1: size commercial jet that Blake hopes will fly at mock
Speaker 1: one point seven one point seven times the speed of sound,
Speaker 1: or roughly twice as fast as commercial jets fly today.
Speaker 1: To start, I asked Blake about the Concord. The Concord,
Speaker 1: of course, is the only supersonic commercial passenger jet ever built,
Speaker 1: ever flown with passengers on it. But the Concord stopped
Speaker 1: flying more than twenty years ago, and today it's widely
Speaker 1: viewed as a fail.
Speaker 2: I think Concord killed supersonic flight and Apollo killed space exploration.
Speaker 2: And yet at nineteen sixty nine, we had that first
Speaker 2: moon landing and we had that first flight of Concord,
Speaker 2: and at the time it looked like both of these
Speaker 2: were harbingers of huge technological progress for humanity. And I
Speaker 2: think if you stop somebody in the street nineteen sixty
Speaker 2: nine and said, in twenty twenty five, what do you
Speaker 2: think space exploration will be like? What do you think
Speaker 2: flight will be like? No one would have predicted that
Speaker 2: supersonic would be gone and moon landings will be gone.
Speaker 1: Right, But that was the peak, it wasn't going to
Speaker 1: get any better, and in fact, in terms of commercial
Speaker 1: air air travel, it was going to get worse.
Speaker 2: Yeah, everything got worse. Everything got worse. And I think
Speaker 2: that Concord and Apollo are actually brethren. Both were technologically
Speaker 2: extremely impressive, like what we did in the nineteen sixties
Speaker 2: with rockets and airplanes, with slide rolls, drafting paper wind
Speaker 2: tunnels is extremely totonal, logically impressive. Yet that the motivation
Speaker 2: as what was killer and both Concored and Apollo were
Speaker 2: Cold War era glory projects led by governments who are
Speaker 2: competing for prestige.
Speaker 1: Basically to show up the Soviet Union right, to show
Speaker 1: the superiority of Western capitalism over Soviet communism.
Speaker 2: Yes, except the deep irony is we did at the
Speaker 2: communist way, right.
Speaker 1: They were command and control projects that made no economic sense.
Speaker 2: They were command and control projects with no economic sense.
Speaker 2: And it turns out when the West copied effectively the
Speaker 2: communist approach for a little while we had technological superiority
Speaker 2: because of the momentum that we had, but then we
Speaker 2: destroyed ourselves. And so you know, Apollo didn't even pretend
Speaker 2: to have anything commercial right, like it was operating on
Speaker 2: it like a percentage of GDP, right, which is to say,
Speaker 2: an incredibly large amount of money relative to the overall
Speaker 2: economy went into getting.
Speaker 1: A very small number of people to the moon a
Speaker 1: few times.
Speaker 2: That's that's right, yeah, And you know, and and the
Speaker 2: knock on effect of that, you know, for the entire
Speaker 2: airspace supply chain, it was basically, you know, land on
Speaker 2: the mood at all costs, are at any cost, And
Speaker 2: the result was the entire space side of the supply
Speaker 2: chain got drunk on these incredibly lucrative contracts were costs
Speaker 2: was no object, right, And then after the Cold War
Speaker 2: it only got worse and we put all of the
Speaker 2: like defense industrial base on corporate welfare and they got
Speaker 2: fat and dumb. And then and then on the concord side,
Speaker 2: it at least looked better because on paper, this was
Speaker 2: a commercial airplane where people could buy tickets and airlines
Speaker 2: would buy the airplanes, and you know, the airlines would
Speaker 2: make money. But in reality it wasn't that. Here here's
Speaker 2: a hundred seat airplane, by the way, one hundred like
Speaker 2: actually pretty uncomfortable seats, and what you know, ejected for
Speaker 2: inflation was a twenty thousand dollars ticket, and you just
Speaker 2: can't find one hundred people that want to pay twenty
Speaker 2: grand to go somewhere really fast. I mean this, this
Speaker 2: is for royalty and rock stars, and especially with like
Speaker 2: eighties and nineties kind of travel demand. The thing flew
Speaker 2: half empty on the best route in the world, which
Speaker 2: is New York to London. You know, if you want
Speaker 2: to find people who want to pay a lot of
Speaker 2: money to go fast, New York London, it's the best
Speaker 2: city pair you could pick.
Speaker 1: Uh.
Speaker 2: And it doesn't work at all economically beyond that, and
Speaker 2: so and then the world drew all the wrong conclusions,
Speaker 2: you know, they concluded like supersonic flight had to be expensive,
Speaker 2: it had to be cramped and uncomfortable, it had to
Speaker 2: be noisy, it had to be uneconomic. And it's like, imagine,
Speaker 2: imagine if we built like the Univac, you know, like
Speaker 2: one of the first mainframe computers it which is like
Speaker 2: the size of the room, and you have to be
Speaker 2: like a bank to afford it. And then we stopped.
Speaker 2: And then and then fifty years later people would swear
Speaker 2: up and down that you could never possibly have a
Speaker 2: pocket computer that every day people could have could afford
Speaker 2: but yet you know, Concord is like the UNIVAC.
Speaker 1: Uh huh, it's a design from the nineteen sixties.
Speaker 2: Basically, that's right, that's right. And I say this with
Speaker 2: like deep admiration for the incredible technical work that went
Speaker 2: into it. A lot of people worked really hard. They
Speaker 2: did amazing things. Now that we are you know now
Speaker 2: that at Boom we have like built and flown a
Speaker 2: supersonic jet, what we can see is they did really
Speaker 2: really well given the tech was available in the nineteen sixties.
Speaker 2: It's extremely impressive. You know, in Britain and France, people
Speaker 2: are incredibly proud of Concord, and from a technological level,
Speaker 2: like they deserve to be.
Speaker 1: So. So, okay, you were you were a software developer, right,
Speaker 1: You weren't a plane guy. You weren't an aerospace engineer.
Speaker 1: But like whatever, twelve years ago or something, you got
Speaker 1: interested in this idea of supersonic air travel. Why aren't
Speaker 1: there supersonic jets? So you have this question in your mind.
Speaker 1: You go try and figure it out. What do you find?
Speaker 2: The internet was full of all this conventional wisdom about
Speaker 2: why flights aren't faster. You can still find some of
Speaker 2: these YouTube videos and they say, is like supersonic flight
Speaker 2: is inherently more expensive. Passengers always buy the cheapest ticket,
Speaker 2: so supersonic flight will never be commercially viable. And hang on, Well,
Speaker 2: first off, that's a qualitative claim about a quantitative question,
Speaker 2: and it doesn't even really completely make sense, right, Like,
Speaker 2: the whole reason we have jet flights is because people
Speaker 2: wanted to go faster than not propeller flights. The reason
Speaker 2: people pay more for direct flights than connecting is they
Speaker 2: want to save time and hassle. Time is the one
Speaker 2: resource it's not ever renewable, So the idea that people
Speaker 2: wouldn't pay for time savings didn't completely make sense.
Speaker 1: Sure, plainly, at some margins, some people will pay some
Speaker 1: amount more to go some amount faster. Right, exactly what
Speaker 1: are all the margins?
Speaker 2: Yeah, exactly, You're totally right. It's a quantitative question, not
Speaker 2: a qualitative one. And I think one of the lessons
Speaker 2: of I think the Boom story is never accept a
Speaker 2: qualitative answer to a quantitative question. Go run the math. Okay,
Speaker 2: what is the actual cost of supersonic flight and what
Speaker 2: is people's actual willingness to pay to go faster? So
Speaker 2: it turned out it took two weeks to find the
Speaker 2: key idea, which is I mean, today there is a
Speaker 2: huge market for international business class. It's roughly twenty percent
Speaker 2: of passengers and eighty percent of international airline profits on
Speaker 2: business class, which is flying beds for people who so
Speaker 2: hate that flights are along that they want to try
Speaker 2: and sleep through them on the airplane. And so that
Speaker 2: the original boom idea was, well, what if we could
Speaker 2: make a supersonic seat with the economics of a flying
Speaker 2: bed and business class, but on an airplane sufficiently fast
Speaker 2: that you wouldn't need to sleep on it. You could
Speaker 2: sleep at home instead. And so the first question I
Speaker 2: asked is, well, how much would you have to beat
Speaker 2: Concord by on just basic airplane efficiency in order to
Speaker 2: create a seat with the economics of a flying bed.
Speaker 2: And the answer was less than ten percent.
Speaker 1: Uh huh, So like Concord was almost there by your reckoning.
Speaker 2: Yeah, that's right. If you could improve on the gas
Speaker 2: dileage basically of Concord by less than ten percent, that
Speaker 2: you would tip over to this happy point where you
Speaker 2: could have a supersonic seat with the economics of a
Speaker 2: flatbed and business class and instead of being this like
Speaker 2: stratospheric airplane that like flies mostly empty, a whole bunch
Speaker 2: of modern demand would be there, the seats would fill
Speaker 2: at a high rate, and the market would be gigantic.
Speaker 2: And so that that took two weeks, and I was
Speaker 2: like that, well, I don't know anything about airplanes, Like
Speaker 2: all I had at that point was my pilot's license.
Speaker 2: But ten percent versus nineteen sixties technology didn't seem crazy.
Speaker 2: So at that point I was like, Okay, if I'm
Speaker 2: going to go do this, I need to know a
Speaker 2: heck of a lot more. And it sort of kicked
Speaker 2: off what was really a twelve month journey for me
Speaker 2: getting educated in aerospace.
Speaker 1: So when you're when you say ten percent, I mean,
Speaker 1: is that sort of a marginal cost calculation like that?
Speaker 1: That is that basically setting aside the fixed cost of
Speaker 1: building the first plane and then build well of building
Speaker 1: the first plane like that seems like the big unknown
Speaker 1: in the math there is how much is it going
Speaker 1: to cost to make plane number one? Yeah?
Speaker 2: I mean, so there are a few things that matter, right.
Speaker 2: The first thing is if we could manage to produce
Speaker 2: the airplane, would it be affordable for passengers, improfitable for airlines.
Speaker 1: Yeah, that's kind of the first principles version is like,
Speaker 1: let's just look at the physics and like thinks, right,
Speaker 1: what we know, is it theoretically possible to build an
Speaker 1: airplane that can fly enough people from New York to
Speaker 1: London if they pay business class but sit upright at
Speaker 1: supersonic speeds? Does the first principles math pencil up? That's
Speaker 1: the math you're doing there, that's.
Speaker 2: Right, with technology that's available, is it possible to build
Speaker 2: an airplane that is affordable for passengers improfitable for airlines?
Speaker 2: And it turned out the answer was yes.
Speaker 1: Uh huh, And what is business class New York London?
Speaker 1: What is that five grand? Something like?
Speaker 2: Yeah, yeah about that? I mean, actually people routinely pay
Speaker 2: more than five grand. The economics of our airplane. It
Speaker 2: turns out thirty five hundred is break even. So at
Speaker 2: five grand it's very profitable for airlines. And people pay
Speaker 2: five grand by the way round trip routinely.
Speaker 1: Yeah. Okay, so you've got the kind of first principles
Speaker 1: back of the envelope math that looks promising. So you
Speaker 1: started the company, yes, and and that was what about
Speaker 1: ten years ago, right?
Speaker 2: That was Yeah, it was about eleven years ago now
Speaker 2: that I was making that spreadsheet, and you know, we'll turn.
Speaker 2: We'll turn eleven on paper in September, because that was
Speaker 2: when I got to the point where, Okay, I'm actually
Speaker 2: really committed, it's time to go.
Speaker 1: I love that you called it boom leaning in like
Speaker 1: embracing the haters in some in some fashion. Tell me
Speaker 1: about the boom. Let's talk about supersonic booms.
Speaker 2: Yeah, so my belief from day one was that the
Speaker 2: boom would not be the blocker, and that that spreadsheet
Speaker 2: basically said there is a gigantic market for supersonic flight
Speaker 2: even if the boom is entirely unsolved, and you have
Speaker 2: to fly subsnic over land and supersonic over water and
Speaker 2: focus initially on on routes that were primarily transoceanic.
Speaker 1: Just to be clear, in the US right now, commercial
Speaker 1: flights are not allowed to fly supersonic, even if there
Speaker 1: were a plane that could do it by regulation, right
Speaker 1: because of the boom. Is that the starting point?
Speaker 2: Yeah, So that that's where we started, because the premise was, hey,
Speaker 2: it's pretty ambitious to start a brand new company from
Speaker 2: scratch where your goals to build a supersonic airliners. So
Speaker 2: let's not let's not push anything too far. Let's operate
Speaker 2: only with existing technology and only with existing regulations, and
Speaker 2: that would that would have some hope of making it
Speaker 2: tractable for a startup to go do.
Speaker 1: So I want to talk a little bit about the
Speaker 1: last ten years and building XB one, your test plane,
Speaker 1: And I'm curious in particular sort of unsurprisingly it has
Speaker 1: taken longer than you thought, which it would be shocking
Speaker 1: if it didn't, rightly given the nature of the project.
Speaker 1: But I'm curious, like, what were some of the things
Speaker 1: you thought at the jump that turned out to be wrong,
Speaker 1: you know, things where you went down the wrong path
Speaker 1: and had to do something different.
Speaker 2: Yeah, So when we started out with XB one, we
Speaker 2: gave it some really really aggressive goals. So we wanted
Speaker 2: to go ten percent faster than Concord, We wanted to
Speaker 2: do it with a passenger on board. We wanted to
Speaker 2: not need an after burner. Like. We gave it all
Speaker 2: these you know, fairly aggressive goals that were actually well
Speaker 2: beyond what was really necessary. But we thought we didn't
Speaker 2: appreciate all of the challenges that would would come with that,
Speaker 2: and so we actually made the job a lot harder
Speaker 2: than it needed to be. And the biggest thing that
Speaker 2: we learned on XB one in this context is is pragmatism, like,
Speaker 2: it doesn't need to go mock two point two. At
Speaker 2: mock one point seven. Is it totally fine, minimum viable
Speaker 2: supersonic chat and it's dramatically easier. So part of what
Speaker 2: we learned from XP one is how to make the
Speaker 2: overture airliner a lot easier to do, and it was
Speaker 2: things like, if you want to go mock two point two,
Speaker 2: the wings have to be really skinny, and if the
Speaker 2: wings are really skinny, it's very hard to fly takeoff
Speaker 2: and landing. And so we ended up spending two years
Speaker 2: on low speed aerodynamics for takeoff and landing with a
Speaker 2: wing that was really designed to go super super fast,
Speaker 2: and then with a long, skinny airplane to go mock
Speaker 2: two point two. It's really hard to fit the landing
Speaker 2: gear in. And so we ended up I remember in
Speaker 2: like twenty nineteen when we're like finishing the design of
Speaker 2: this thing and kind of in the process of building it,
Speaker 2: and so wait a minute, how did we end up
Speaker 2: in a corner of the universe where we have to
Speaker 2: design the most efficient shock absorber ever made like that
Speaker 2: was a bizarre like and we literally we had to
Speaker 2: design the most efficient shock absorber ever made for a
Speaker 2: landing gear. Why, well, we given ourselves this like unnecessarily
Speaker 2: challenging top speed goal, which it made the airplane log
Speaker 2: and skinny, which made the landing gear need to fit
Speaker 2: in a very tight space, which meant the shock absorbers
Speaker 2: had to be really really good.
Speaker 1: Uh huh, Well, why had you? I mean, it's easy
Speaker 1: from this point of view to say, like why it
Speaker 1: was foolish to try and go so fast? Which is
Speaker 1: sort of what you're saying. But presumably when you picked
Speaker 1: that speed, you picked it for a reason. Why did
Speaker 1: you pick that speed?
Speaker 2: Yeah, well we there was sort of a scientific reason,
Speaker 2: and then there was probably an emotional reason. And the
Speaker 2: scientific reason was we thought we were on the happy
Speaker 2: side of a lot of market opportunity and on the
Speaker 2: happy side of the step changes in technological challenge. Based
Speaker 2: on what we knew from textbooks.
Speaker 1: The market opportunity means the faster you go, the bigger
Speaker 1: the market.
Speaker 2: I mean, that's right, Like, you know, if you speed
Speaker 2: a flight up. I'll pick an extreme example. Let's let's
Speaker 2: say you speed up New York London by like half
Speaker 2: an hour. You actually make the flight worse. It's still
Speaker 2: going to be scheduled as a red eye, right, but
Speaker 2: you don't get as much sleep, that's right, So it's
Speaker 2: actually it's actually worse.
Speaker 1: And then presumably if you can go fast enough, you
Speaker 1: can like fly the same crew to London and back
Speaker 1: without having to change the crew, and your economics get
Speaker 1: better or something bingo.
Speaker 2: That's one of the ways the economics in this work
Speaker 2: when you go faster. Lots of things actually get cheaper.
Speaker 2: You need less crews, you don't you don't spend money
Speaker 2: putting people up in Marriotts like that. We call that
Speaker 2: the speed dividend. There's a lot of cost that comes
Speaker 2: down with speed.
Speaker 1: Basically, the cost the benefits of going two point two
Speaker 1: are the same, but the cost of the marginal cost
Speaker 1: of going that much faster was higher than you thought.
Speaker 2: That's that's right. Like and fuel burn. You know, once
Speaker 2: we committed to meeting the same most stringent noise rules
Speaker 2: that apply to subsonic airplanes that actually puts a big
Speaker 2: penalty on high speed, and we found that it mocked
Speaker 2: two point two. We'll be burning forty percent more fuel
Speaker 2: than at one point seven, and yet and what that
Speaker 2: meant in flight times was actually just a fifteen minute difference.
Speaker 1: Huh.
Speaker 2: So it made no sense, and we got more pragmatic.
Speaker 2: And the other thing that, you know, it was the
Speaker 2: kind of the emotional piece of this was, you know,
Speaker 2: I sort of booted up, you know, pounding my fist
Speaker 2: on the table and saying, fifty years later, we should
Speaker 2: do better than concords, that we should be faster, and
Speaker 2: d da DA and all these other things. Yeah, And
Speaker 2: the reality was that wasn't actually necessary. What we needed
Speaker 2: was a pragmatic starting point that we could then continue
Speaker 2: to iterate and innovate, you know. And overture is not
Speaker 2: the be all end all of supersonic airplanes. It's the
Speaker 2: version one. And we can do a version one point one,
Speaker 2: and we can do a version two. And the thing
Speaker 2: that matters is ensure ensuring that version one is sufficiently
Speaker 2: pragmatic that we can we can birth it. Yeah. So,
Speaker 2: how fast did concord go? Two point zero? Actually two
Speaker 2: point oh two actually is the precise number.
Speaker 1: And you've you've made your piece with building a first
Speaker 1: plane that goes slower than the Concord.
Speaker 2: I don't know. I guess officially we've made our piece
Speaker 2: with it not in your heart on the spread, not
Speaker 2: in my heart like because you know, mock one point
Speaker 2: seven just doesn't roll off the tongue like mock two.
Speaker 1: No two, Mock two sounds way cooler.
Speaker 2: Mock two sounds way cooler, you know, And for a while,
Speaker 2: by license, TAG said mock two point two, and I
Speaker 2: learned that I should really never put a technical design
Speaker 2: parameter on a vanity plate. That was a That was
Speaker 2: a That was a bad decision because it made it hard.
Speaker 2: It made it harder for me to admit the difficult
Speaker 2: truth when every.
Speaker 1: Day when you went out and thought your car, you
Speaker 1: were getting mocked by your failure in relatively.
Speaker 2: Yeah, m A h E D yes, oh very good,
Speaker 2: very good.
Speaker 1: That should be your new vanity plate to keep you humble.
Speaker 2: No, now it just says supersonic because so long as
Speaker 2: I bust mock one, I'm good.
Speaker 1: Still to come on the show. How much more time
Speaker 1: and money will it take to build a supersonic plane
Speaker 1: that can carry paying passengers? Also, what might go wrong?
Speaker 1: So you're building the airliner, you're also sort of building
Speaker 1: the jets, right, I know, you were working with Rolls
Speaker 1: Royce and then which makes a lot of jets for
Speaker 1: airplanes now, and then you stopped working with Rolls Royce.
Speaker 1: Tell me, tell me about what you've got to do,
Speaker 1: Like what's the next big step in terms of the
Speaker 1: airplane the jets, Like what do you got to do next?
Speaker 1: And when do you?
Speaker 2: Yeah, so step one, scalop those jet engines. Step two,
Speaker 2: scalop the airplanes. Step three, put it all together, prove
Speaker 2: to ourselves and to our regulator in the public that
Speaker 2: it's safe, and then go carry passengers. And so you
Speaker 2: mentioned you mentioned the whole jet engine thing. Yeah, we
Speaker 2: actually when I started, our plan was to go build
Speaker 2: our own jet engines, just the same way SpaceX builds
Speaker 2: their own engines. And then we got, uh distracted. I
Speaker 2: let us get distracted by this sort of sexy notion
Speaker 2: that would be able to take Rolls Race engine and
Speaker 2: just modify it working with Rolls Royce, and that turned
Speaker 2: out to be just a terrible idea.
Speaker 1: Huh. Most companies that build airplanes don't build their own jets. Right,
Speaker 1: It's not a crazy idea to say we're going to
Speaker 1: build airplanes and we're going to let people who are
Speaker 1: really good at building jets, build the jets.
Speaker 2: Yeah. So if you look back far enough in time,
Speaker 2: it turned out Boeing, United Airlines, and Pratt and Whitney
Speaker 2: the jet engine company, were actually all the same company.
Speaker 2: H they were all they were vertically integrated from the
Speaker 2: airline through to the jet engine or I guess back
Speaker 2: that it wasn't jet engines, it was Piston engines. But
Speaker 2: I think that was actually the national state of the industry.
Speaker 2: And they got broken apart, not because they wanted to.
Speaker 2: But there was an airmail scandal in the early nineteen thirties,
Speaker 2: the outcome of which was the government split them up. Oh.
Speaker 1: Interesting, an airmail scandal. You don't hear about so many
Speaker 1: airmail scandals there.
Speaker 2: There was the airmail scandal of nineteen thirty two, where
Speaker 2: what was going on was basically the US government was
Speaker 2: subsidizing airmail because they wanted to get off the ground.
Speaker 1: So to speak.
Speaker 2: Yeah, and uh, it's it's so the the retail price
Speaker 2: of airmail was less than the airlines were getting paid. Yeah. Uh,
Speaker 2: And so the airlines found they could make more money
Speaker 2: by going to the post office and mailing bricks. Oh.
Speaker 2: I love that that's and so the you know, and
Speaker 2: that the Postmaster General was corrupt, like everybody was on
Speaker 2: the take. It was nasty. And then and then the
Speaker 2: the industry, everybody was kind of at fault here, and
Speaker 2: the industry took the blame.
Speaker 1: Yeah, in yours telling is why jets companies that make
Speaker 1: jets are different than the companies that make the airplanes
Speaker 1: they go on. It's a bull claim. Yeah, well, yeah,
Speaker 1: and I think there is.
Speaker 2: You know, industries tend to go through cycles where vertical
Speaker 2: integration is either a good strategy or a bad strategy.
Speaker 2: And there's a there's a great book on this called
Speaker 2: The Innovators Solution, But they talk about under what circumstances
Speaker 2: vertical integration is smart versus working with suppliers.
Speaker 1: What was it Jim Barksdale line in the nineties, there's
Speaker 1: two businesses, bundling and unbundling. It's like that.
Speaker 2: I hadn't heard that, but I think it's kind of true,
Speaker 2: and it's it's contextual. Yeah, And the long story short,
Speaker 2: when when the current state of the art technology is
Speaker 2: good enough for the in purpose, uh you, unbundling and
Speaker 2: not vertical integration tends to make sense when the when
Speaker 2: the components need to advance and the integration and the
Speaker 2: final product is important, then vertical integration really matters. And
Speaker 2: so I think they're kind of two threads of the story.
Speaker 2: One is, it's probably not a good idea for a
Speaker 2: brand new startup to put all of its eggs in
Speaker 2: the basket of a like one hundred year old company
Speaker 2: that like is a risk averse, doesn't want to make changes,
Speaker 2: isn't fast moving, maybe you know, it isn't sure what
Speaker 2: it really wants to be, right, so.
Speaker 1: You're putting all of your eggs in your own basket,
Speaker 1: which is strong, certainly. So uh so, what like what's
Speaker 1: the next mile post you got to hit? Like, what's
Speaker 1: the big, big next hurdle.
Speaker 2: We'll find we'll find out around the end of this
Speaker 2: year whether our jet engine's working. We're building the first
Speaker 2: one right now, and we'll see if it works. And
Speaker 2: so this this will be a very very large jet
Speaker 2: engine core. You know, like it'll be roughly four feet
Speaker 2: in diameter. This is not a small piece of hardware.
Speaker 2: You weigh well over ten thousand pounds. This is a
Speaker 2: very complex piece of turbomachinery. And we'll we'll we'll fire
Speaker 2: it up and we'll we'll see what's we'll see what's working,
Speaker 2: and then next next year. So that's the core of
Speaker 2: the engine, and a year later our goal is to
Speaker 2: have a you know, a full up engine, not just
Speaker 2: the core, but the fan and the what's called the
Speaker 2: low pressure system as well. Okay, but the core, the
Speaker 2: core is actually the really hard part. So we're starting.
Speaker 2: We're starting with the hardest part, and.
Speaker 1: Then in parallel you're building the plane or designing the plane.
Speaker 2: Yeah, we're actually done designing the plane. Okay, So we
Speaker 2: we froze, froze the design of the overture I think
Speaker 2: a week after XB one's final flight. Okay, And so
Speaker 2: that means, you know, I proverbally broke the engineer's pencils.
Speaker 1: So just now, just in the last several weeks, you
Speaker 1: froze the design of the plane. You said, this is it,
Speaker 1: this is the plane we're going to build. This is
Speaker 1: this is it?
Speaker 2: Right? You know, like it's it's very easy for ambitious
Speaker 2: engineers to want to optimize forever. Sure, and we said
Speaker 2: this is good enough for version one. It's time to
Speaker 2: it's time to stop tweaking the design and start doing
Speaker 2: the detailed engineering so we can start building this thing,
Speaker 2: tell me about what it's going to look like. So, Uh,
Speaker 2: supersonic jets fit in some ways sculpted by physics. They're
Speaker 2: going to be long and skinny, They're going to have
Speaker 2: a triangular kind of delta wing. So in a certain sense,
Speaker 2: overture is going to need to look concord like because
Speaker 2: physics says it needs to look concord like.
Speaker 1: Uh.
Speaker 2: But the details are the details that come so far forward. Uh.
Speaker 2: One of the one of the big aerodynamic advances versus
Speaker 2: concord is something called area ruling, which basically said the
Speaker 2: fuselage needs to be big in the front and small
Speaker 2: in the back. And uh. And so overture looks it
Speaker 2: looks a little bit like a concord in a seven
Speaker 2: forty seven had a love child. Okay, so it's it's
Speaker 2: not literally double deck in the front, but it's bigger
Speaker 2: in the front and it's skinnier in the back. And
Speaker 2: this leads for a very interesting canvas. And I can't
Speaker 2: tell you yet what exactly it's like at the front
Speaker 2: of the airplane, because we've got we've got something we
Speaker 2: invented that I'm incredibly excited about. That we haven't revealed yet,
Speaker 2: but I think it's gonna be. I think it's gonna
Speaker 2: be a big wow factor. People look at them, say,
Speaker 2: wait a minute, you got that to fit in a
Speaker 2: skinny supersonic chat an elephant?
Speaker 1: What is it?
Speaker 2: Uh? It is some It is something that will be
Speaker 2: delightful for passengers.
Speaker 1: A waterfall. I'll stop guessing, but I'm curious.
Speaker 2: So it's I'll tell you right now. It's not a
Speaker 2: hot tub.
Speaker 1: Okay, cold plunge. Cold plunge is the new hot tub.
Speaker 2: That's right. There's a cold plunge in the front of
Speaker 2: the air airplane and the hot tub of the back
Speaker 2: of the airplane. You can actually have both.
Speaker 1: So what what do you got to do to get
Speaker 1: through the very non trivial regulatory hurdles to get from
Speaker 1: drawing up a plane into a plane that the FAA
Speaker 1: and analogous regulators say yes, this can fly with commercial passengers.
Speaker 2: Well, we just have to prove it safe.
Speaker 1: I mean, there's a lot in that.
Speaker 2: Just there is a lot of there's a lot of
Speaker 2: that just I mean that this will be one of
Speaker 2: the most complex safety critical machines ever built. But all
Speaker 2: of the rules are published, so we know exactly what
Speaker 2: we have to go do, and the certification is just
Speaker 2: proving that we did it. And so that that will
Speaker 2: involve about five thousand hours of flight testing and many
Speaker 2: more hours of ground testing. And so just to give
Speaker 2: you a concrete sense of what this is like on
Speaker 2: the ground, you know, we will we will build a
Speaker 2: a kind of a flightless bird, you know, a copy
Speaker 2: of the airplane that will never fly, and will load
Speaker 2: up the wings with hydraulic presses and we'll bend them
Speaker 2: until they break. It will make sure that they don't
Speaker 2: break before they're supposed to. Basically, you have to prove
Speaker 2: that they can take one point five times the load
Speaker 2: they will ever see under the most extreme case before failing.
Speaker 2: You know, that's one example. You do in the ground,
Speaker 2: and you and then the air you fly it through
Speaker 2: all the most extreme flight conditions. You make sure it
Speaker 2: can handle bad weather. You can make sure that it
Speaker 2: flies through, you know, a snowstorm, the deicne can keep
Speaker 2: up with the icing. You shoot a chicken at the
Speaker 2: jet engines and make sure that when you know, if
Speaker 2: you get a bird strike, that either the engine doesn't
Speaker 2: fail or it fails in a non catastrophic way. That's
Speaker 2: actually one of the most difficult tests.
Speaker 1: Uh. So okay, so you got to do all these things.
Speaker 1: What is your current target date for when I can
Speaker 1: buy a ticket?
Speaker 2: About four years, So our goal is to be ready
Speaker 2: for passengers by the end of twenty twenty nine, so
Speaker 2: about four four and a half to five years from
Speaker 2: where we are today.
Speaker 1: Like, playing XP one took longer than you thought, but
Speaker 1: you're still assuming overture is not going to take longer
Speaker 1: than you thought setting them in parallel.
Speaker 2: I mean it's it's mean, it's totally possible overture will
Speaker 2: be late. Yeah, I mean, the way these things go,
Speaker 2: it seems likely. Again, this is from ignorance, just looking
Speaker 2: at the nature of projects in many different companies, in
Speaker 2: many different settings. Like, plainly, what you're trying to do
Speaker 2: is very hard, and plainly you're only doing it because
Speaker 2: you have some amount of optimism which is required to
Speaker 2: do the job right. And so just from from that
Speaker 2: very small amount of data and for like, yeah, I mean,
Speaker 2: you're probably not gonna overestimate that long it will take it. Yeah, yes, yeah, yeah,
Speaker 2: it is. It is highly unlikely we will get done
Speaker 2: sooner than we're charge. You're not gonna be done early, right, yes,
Speaker 2: you know. But the one of one of the lessons
Speaker 2: I've learned along the way is is kind of how
Speaker 2: to think about schedules. And uh, I think schedules are
Speaker 2: actually misnamed because because nothing ever goes according to plan,
Speaker 2: and and what what, it's not a schedule, it's actually
Speaker 2: a work plan. And the point of the work plan
Speaker 2: is to allow the team to respond intelligently the moment
Speaker 2: something doesn't go according to plan, which is basically every day.
Speaker 2: And so what we do is we build what's called
Speaker 2: a success based schedule, meaning we don't pad it to
Speaker 2: assume that there's going to be failures. Uh, we kind
Speaker 2: of we kind of assume, ever, everything is going to
Speaker 2: go well, and we assume that we'll be able to
Speaker 2: do things, you know, slightly more efficiently than you know
Speaker 2: than like a Boeing Wood And so there's some optimism
Speaker 2: built into it, and and and many times we realize
Speaker 2: that optimism and and and and when we find oops,
Speaker 2: there's something we didn't know about or this was harder
Speaker 2: than we expected, then we react to it in the
Speaker 2: most efficient way possible. And uh, and that that's what
Speaker 2: actually results in the fastest possible deliver uh, because nothing,
Speaker 2: nothing ever gets done faster than the amount of time
Speaker 2: you give it. Right, But we'll just take all the
Speaker 2: time there, that's right, because they want to be the
Speaker 2: best job possible, exactly, And the kind of people who
Speaker 2: come join a supertonic jet startup are incredibly ambitious and
Speaker 2: have very very high standards. So you know, you know,
Speaker 2: if if I didn't say, the design is frozen and that's.
Speaker 1: It's a hard trade off, right, It's a hard trade
Speaker 1: off because like there's a million hard optimization problems that
Speaker 1: people are working on, and there's the kind of meta
Speaker 1: optimization problem of how long do you spend on each.
Speaker 2: Thing that's that's right? That's right, And there's like you know,
Speaker 2: when when do you declare good enough?
Speaker 1: Yeah?
Speaker 2: Right? And that was I mean there are so many
Speaker 2: stories of you know, really, I think part of my
Speaker 2: role is helped the team decide when's good enough and
Speaker 2: you know, and what things have to be in one
Speaker 2: point zero versus what things we can save for one
Speaker 2: point one, and having good judgment about that makes it
Speaker 2: much easier to actually ship one point h Right.
Speaker 1: You don't need to build the most perfect supersonic jet ever.
Speaker 1: You just need to build on that is safe and reliable.
Speaker 2: That's that's right.
Speaker 1: So let's talk about money. How much have you raised
Speaker 1: and how much do you need to get the first
Speaker 1: one point zero overture flying with ye.
Speaker 2: So, a thing I've come to believe is that one
Speaker 2: of the most important things in pulling this off is
Speaker 2: being incredibly efficient with capital. We've raised about six hundred
Speaker 2: million dollars, We've spent less than five hundred million dollars,
Speaker 2: and with that we built and flew a supersonic jet
Speaker 2: with a human on board. We designed an airliner, we
Speaker 2: designed an engine, and we did all the other things
Speaker 2: that started a pass to do over a decade. So
Speaker 2: what does that mean going forward? We need less than
Speaker 2: a billion dollars of investor funding from where we are
Speaker 2: now to finish.
Speaker 1: When you say investor funding, like, are you assuming more
Speaker 1: pre orders or you think for less than a billion
Speaker 1: dollars you can actually or less a billion dollars more
Speaker 1: you can actually build a build a plane that's gonna
Speaker 1: take passengers across the ocean.
Speaker 2: Yeah. Part of it is being very smart with capital leverage.
Speaker 2: You know, you know, so for example, uh, you know,
Speaker 2: we will be able to go use debt to buy
Speaker 2: capital equipment, right, So, like a lot of production equipment
Speaker 2: will be financed without requiring you know, equity investment from investors, huh.
Speaker 2: And we've we've already been able to do some of that.
Speaker 2: So there's a lot smart financial engineering as part of
Speaker 2: the solution. The other part of the solution is being
Speaker 2: incredibly efficient in execution. You know. I still tell that
Speaker 2: by the way that this is in some ways the
Speaker 2: most difficult thing.
Speaker 1: Spending the money intelligently basically.
Speaker 2: Yeah, Well, the way I frame it for our team internally,
Speaker 2: and we're just very open about this. I say, our
Speaker 2: single biggest risk as a company is we don't get
Speaker 2: done for an obtainable amount of money.
Speaker 1: Yeah, well, because the physics. We've known the physics for
Speaker 1: whatever fifty years or more. Right, Like, plainly one can
Speaker 1: build a supersonic jet. But building it cheaply enough in
Speaker 1: your case to survive, right and then in the long
Speaker 1: run to have it be commercially viable is the hard part, right.
Speaker 2: Yeah, So one half of this is how do we
Speaker 2: execute really efficiently. How do we have a small team
Speaker 2: of world class engineers with incredibly good software tools, and
Speaker 2: we're using a lot of software, and we're using some
Speaker 2: ai uh such that one engineer can do the work
Speaker 2: of ten, and that allows us to be really efficient
Speaker 2: with our money. And we are just absolutely miserly about
Speaker 2: money on one hand. On the other hand, we need
Speaker 2: to have a capital structure that's very good for investors
Speaker 2: and that leverages non diluted financing sources, be it customer
Speaker 2: prepayments or plant and equipment debt, or public support to
Speaker 2: kind of lever up those investor dollars to make the
Speaker 2: whole thing economically viable.
Speaker 1: What's public support mean?
Speaker 2: So we're we had a fantastic package that we got
Speaker 2: from the state of North Carolina that funded the superfactory
Speaker 2: and Greensboro, where the state of North Carolina so wanted
Speaker 2: Boom to come and build the airplane there that just
Speaker 2: as they welcomed the Right Brothers one hundred years ago,
Speaker 2: they welcomed us, and and that that basically paid for
Speaker 2: the entire site prep and build out of the superfactory.
Speaker 2: So that way, and we were incredibly grateful for that,
Speaker 2: and I, you know, I want to make sure we
Speaker 2: pay it forward in North Carolina.
Speaker 1: I've heard you say on an interview you did in
Speaker 1: the last year or so that you underestimated how hard
Speaker 1: it was going to be to build the company to
Speaker 1: build a supersonic jet. And I'm curious, if you look
Speaker 1: forward now to going from here to you know, having
Speaker 1: passengers on a jet, do you think you're underestimating how
Speaker 1: hard that's going to be.
Speaker 2: I am sure there are problems that we will have
Speaker 2: that I don't know about today.
Speaker 1: Yeah, that's a different I mean, it's a weird question
Speaker 1: because if you're underestimating it, then you would revise your estimation.
Speaker 1: It's like why is the stock market wrong?
Speaker 2: But like, yeah, I don't know.
Speaker 1: I mean maybe you have to underestimate it, Like I
Speaker 1: don't know. You know, people always sy if I knew
Speaker 1: how hard it was going to be, I wouldn't have
Speaker 1: done it.
Speaker 2: And I don't know if they really mean that, but
Speaker 2: I think some people mean it and it's really and
Speaker 2: I find that really sad, and I don't I don't
Speaker 2: mean that in a sarcastic way. I mean like, actually,
Speaker 2: like boy, like this startup stuff is so hard. It
Speaker 2: just kills me that someone will put in all of
Speaker 2: the effort required to birth a new company and a
Speaker 2: new product from scratch, and it is really hard. It's
Speaker 2: like chewing on glass, and then to do it for
Speaker 2: something they're like, wow, I wish I hadn't, Like that
Speaker 2: is really sad. And by the way, I have my
Speaker 2: chewing on glass days for sure, and I'm sure I'll
Speaker 2: have more. And the worst of it, the worst of
Speaker 2: it is when I look in the mirror and I'm
Speaker 2: not sure whether I'm up for the job. Yeah, I mean,
Speaker 2: I think, like boys, someone better than me could have
Speaker 2: done this, But I don't know if I can, you know,
Speaker 2: Or I look at a problem we have and it's
Speaker 2: not you know, and it's it's very much my responsibility
Speaker 2: and my error. Like those are the hardest days, and
Speaker 2: and yet I care so darn much about this that
Speaker 2: that it's worth that personal hell to give it everything
Speaker 2: I've got, and I don't. I don't regret it, even
Speaker 2: the days where I'm like, boy, I don't know whether
Speaker 2: we're going to get through this. And We've had a
Speaker 2: bunch of those days, and I think I'd be foolish
Speaker 2: to think that we won't have them again.
Speaker 1: Why why is supersonic flight your thing? Like, why is
Speaker 1: that what you have devoted your professional life to?
Speaker 2: One of the principles I have for myself now is
Speaker 2: I only want to work on things that might not
Speaker 2: happen if I didn't work on them. And if the
Speaker 2: world followed that, we'd have a lot less photo sharing
Speaker 2: apps and fewer AI companies. But maybe things like traffic
Speaker 2: would be solved, huh. And you know, for me specifically
Speaker 2: with supersonic flight, my kids had a grandfather who lived
Speaker 2: in Hong Kong, you know, eighteen hours from us in
Speaker 2: Denver that they got to meet maybe three or four
Speaker 2: times their entire life, and so they never got to
Speaker 2: know him. And I grew up with my grandfather ninety
Speaker 2: minutes away, and I got to spend every weekend with him,
Speaker 2: and I'm a different person because of that. And so
Speaker 2: I've had a lot of personal experiences that basically say, hey,
Speaker 2: speed's not about saving time or being really cool, although
Speaker 2: it is about saving time and being really cool. Yeah,
Speaker 2: speed is about what you choose to do or not do,
Speaker 2: And there are all kinds of things in the world
Speaker 2: that don't happen because flights are too long.
Speaker 1: We'll be back in a minute with the lightning round. Okay,
Speaker 1: let's finish with the lightning ground and then before you
Speaker 1: started the company. You made a list of things you
Speaker 1: wanted to work on, and you sort of rank ordered
Speaker 1: them and how happy it would make you to work
Speaker 1: on them. Obviously supersonic jet was one, but what was two?
Speaker 1: It fell off really quickly. It's a distant second.
Speaker 2: I had a rental car company idea. Huh, that would
Speaker 2: be like a like your rental car picks you up
Speaker 2: like an uber, then you get in and drive it
Speaker 2: like it's not I would love that product. I don't
Speaker 2: think it's a great business idea. What was the scariest
Speaker 2: part of getting your pilot's license. Oh, I remember that
Speaker 2: very first moment of takeoff and what turned out to
Speaker 2: be Larry Elson's old airplane, And there was this moment
Speaker 2: of like, holy crap, I'm scared because I got my
Speaker 2: life in my own hands.
Speaker 1: Yeah, it's like when you learn to drive a car.
Speaker 2: I remember that.
Speaker 1: When I learned to drive a car, is like I
Speaker 1: could just swerve into the oncoming lane right now, right.
Speaker 2: It felt really fragile, like I've got my life in
Speaker 2: my own hands. But then there was the other side
Speaker 2: of that same coin, which is this is really cool,
Speaker 2: I've got my life in my own hands.
Speaker 1: Uh, Huh. What was the scariest part of working with
Speaker 1: Jeff Bezos? Uh.
Speaker 2: Jeff was great to work with and I was incredibly
Speaker 2: privileged in my early twenties. I got to work on
Speaker 2: something he cared about. Uh uh. And Jeff one of
Speaker 2: one of the one of the best things about Jeff
Speaker 2: is he very fairly calls the balls and the strikes
Speaker 2: and he and he rewards honesty and accountability. So I
Speaker 2: remember at one point, this is actually my very first
Speaker 2: time presenting to him, and it's the presentations overall, going well,
Speaker 2: this is before he ban PowerPoint and I get to
Speaker 2: some slide and he says, well, why didn't you do X?
Speaker 2: And X was actually a pretty good idea, And I said, well,
Speaker 2: we didn't think of that and and and he starts
Speaker 2: laughing that like famous big Jeff Bezos laugh And he says,
Speaker 2: that's a great answer. It's true all the time, but
Speaker 2: no one will ever say it. He understands that anybody
Speaker 2: sufficiently ambitious is going to make mistakes, and what matters
Speaker 2: is to own him and learn from him. And he
Speaker 2: always rewarded that. And that's that's something I try to
Speaker 2: emulate myself as a as a leader.
Speaker 1: Okay, briefly, let's do a few overrated or underrated questions
Speaker 1: for jet travel checking luggage overrated or underrated?
Speaker 2: Underrated. The way this should work is you take your
Speaker 2: Uber to the airport, someone grabs your bag from the trunk.
Speaker 2: You go through the airport only with what you actually
Speaker 2: want with you on the airplane. When you arrive on
Speaker 2: the other side, you go to your Uber and your
Speaker 2: check bag is already in your trunk.
Speaker 1: That's a compelling dream. Rated or underrated.
Speaker 2: The window seat, I think it's highly rated and underrated.
Speaker 2: Like I am glued to that window.
Speaker 1: I love highly rated but still underrated things. So I
Speaker 1: feel about Bob Dylan neck pillows overrated or underrated.
Speaker 2: It's not for me under overrated.
Speaker 1: Same. Blake Schole is the founder and CEO of Boom Supersonic.
Speaker 1: Today's show was produced by Gabriel Hunter Cheng. It was
Speaker 1: edited by Lyddy jeen Kott and engineered by Sarah Brugeer.
Speaker 1: You can email us at problem at Pushkin dot f M.
Speaker 1: I'm Jacob Oldstein and we'll be back next week with
Speaker 1: another episode of What's Your Popula