elon musk & jeff bezos
episode 21
Broadcast date: 28 February 2018
The Moonshots Podcast returns to the worlds of Elon Musk and Jeff Bezos. The leaders of Tesla and Amazon have been so prolific that we need to refresh on their adventures in innovation. Join us on a journey that includes brand new ways of shopping and launching rockets into space.
SHOW OUTLINE
JEFF BEZOS & AMAZON
CONSUMER
Alexa Superbowl Commercial
Amazon Delivery
Amazon Go Shopping
Amazon Groceries Use Case
CORPORATE
Amazon SNL 20 Cities Skit
Amazon Earnings And Alexa
Amazon In Healthcare
Bezos - Job is to Encourage People to be Bold
ELON MUSK & TESLA/SPACEX
South Australia Battery
Boring Flamethrower
Falcon Heavy Starman
Elon Salary
Tesla trouble
BOOK RECOMMENDATION
The 10X Rule: The Only Difference Between Success and Failure by Grant Cardone
Musk & bezos transcript
TRANSCRIPT
Hello and welcome to the moonshots podcast. It's episode 21. It's going to be a massive, a huge and a very special episode. I'm Mike Parsons and I'm joined once again with the man with a plan, the one and only Chad Owen. Hey Mike. We have got a first on the show today. We are revisiting some of our, uh, first subjects and, um, I think we've got a really cool show comparing and contrasting a bit the achievements.
Recent achievements of Elon Musk with those of Jeff Bezos. Yeah. I mean, come on, man. These are the two heavyweight champions of innovation. I honestly think in putting this show together, I am firmly convinced that they are. Heads and tails, uh, beyond any other innovators and entrepreneurs at this given moment, their feats are breathtaking.
I think we both felt we had to like do another show on these two. I mean, it was only six months ago that we did their shows, but my gosh, these two have been prolific in the last six months. Yeah. And I'm looking here at like almost 20 clips that we want to try and get to on the show today. So yeah, we're going to, we're going to switch the format up a little bit and just get all of you listeners caught up with what's been going on with these two innovators and, um, we also got some exciting announcements on the live front and kind of some new technologies that we're going to try and deploy to get.
Moonshots out to you, the masses. Yeah, I, I, we've got some really cool announcements, uh, later in the show, which is very exciting for us, uh, as moonshots, uh, takes things to another level, but let's bring our minds to bear on the world of Elon and Jeff Bezos to just prolific productive. Very busy gentlemen that's for sure.
And, um, I, I think we are witnessing right now, two amazing guys who have their hands in so many different companies. I mean, just think about Ilan has space X. He has Tesla. Uh, they reacquired solar city into Tesla. You have the Hyperloop, the boring company. Uh, it goes on and on, and then you've got Jeff Bezos, which is ridiculous.
Just whole foods recently purchased the Washington post. Oh. And by the way, happens to be running Amazon. And it is, I think we are so lucky to have the chance to dig into the world. When you were pulling the show together, Chad. Did you have any expectations or did anything surprise you as you kind of pulled together all these learnings and these new news items and these new features, like what happened when you pulled this together?
Because so much has been happening. Did it challenge any of your expectations? Yeah, I was just surprised at how much has happened in the last six months with both Elon and Jeff, like you said, they've got their hands in so many different companies that are seemingly doing very different things, but I think you and I, and listeners know if you've listened to our previous shows that.
There is some method behind their, their badness, or at least we hope there's some method behind their madness. And so hopefully in taking a look at what's happened in the last six months with these two guys, we can, we can figure out a little bit more about what they're thinking, how they, how they work and you know, what we can learn from them as we try and apply, uh, their wisdom into what we're doing.
And we thought we'd start out with Jeff and Amazon, uh, because it just seems like they've been on a tear in the last six months. And, um, just to give you a little sense, here's just kind of an intro clip, kind of from a, I think this was like from MSNBC or another network like that, really just talking about how strong of a performance Amazon has turned in the last few months.
That was the exact word I had is unstoppable. Uh, put it into perspective, steward 35% revenue growth in the September 17, quarter 35% revenue growth in December that they just ported last night. And the mid point of their guidance was. 35% for March. And they usually come at the high end to that. So they may even see an acceleration of growth.
This is higher than what Amazon was growing a year ago, which was in the mid 20%, which is just a that's where unstoppable comes. Those that's the right language around this because they have a large company like this accelerate growth and maintain it is, uh, something to be, uh, uh, just, uh, uh, appreciate it.
So stoner is the most exciting company in the world. That's my opinion. Yeah. What was so amazing is those numbers are so huge. Amazon is, is just playing in so many spaces right now. But I think Chad, the craziest thing is they're like, Oh, and there's more growth. To come, it could get even more accelerated.
And my first, uh, takeout from this is this has to be living proof of the flywheel effect that, uh, based off ambient so much in Amazon. Mm. Yeah. I think if, if Amazon were focused just on one. Product or service, they wouldn't be able to see $20 billion or $30 billion a year in growth, which is what those numbers are, are talking about because they're already a, you know, I can't remember the exact market cap of Amazon, but you know, 20, 30% growth you're looking at 20 or $30 billion.
Of growth. Yes. Yes. And, and this growth is sort of the, the phase that we've entered with Amazon now, where for many years, even decade, people were very critical of Jeff Bezos and his decision to invest every single dollar of profit back into the company. Never paid dividends, always reinvested. In fact, Cut his margins, uh, in order to acquire market share.
But now you see the fruits of that coming to bear. And I think any company that is growing and is confident, I think they need to put their message in the world. I think they need to wave the flag a little bit. And this next clip is just a little smile and a little nod. To the recent super Superbowl ad that Amazon ran and it's all around the world of Alexa in Austin.
It's 60 degrees with a chamber. Amazon's Alexa lost her voice this morning causing Alexa lost her boy. How's that even possible? We have the replacements ready to just say the word and you're sure this is going to work.
Yeah. Alexa, show me a recipe for a grilled cheese sandwich. Thetic CUPE 32 years of age, or you don't have to make a crew cheese sandwich. Name is the recipe
now settings and age, you're in the Bush and you're just dirty. And so sweating. Cause it's hard in that Bush, Bush reboot. Oh
country music.
Well, that's the call. Brandon. I'm afraid. Brandon is a little tied up. Do let me know if there's anything I can help you with Jessica.
Thanks guys. But I'll take it from here. I loved watching that commercial during the super bowl. And what's interesting to me is I think up until this point, I've seen Alexa and Amazon's echo technology as kind of a nice to have, or, or fringe piece of technology. But I think they made a huge statement with this super bowl commercial in that it's everywhere.
Yeah. It's their, it's their physical manifestation. It's, Amazon's physical manifestation in the homes of their consumers, which I think is a pretty significant move for them. It, it is. And it demonstrates to me their ability to go beyond being an e-commerce retailer beyond a book provider and Kindle.
Designer to have successfully innovated in the home with Alexa is actually a, a huge value foundation of their thinking and their style of innovation, because I'll remind you that they have actually outperformed both Google and Apple in this space. And what you sort of get a sense of in that Superbowl ad is what you, you focused on, which was.
It's sort of Alexa could be anywhere and everywhere. And as it is a voice interface, it's very interesting as it is artificial intelligence. It's very interesting. I don't see where, where this can possibly end. So, you know, what you see is that. It's not only with Alexa and the Superbowl, these are not the only places that Amazon is innovating.
Yeah. And what's interesting to me building on this flywheel effect, Mike is, you know, Amazon's already making money off of the Alexa platform. There's a lots of third-party companies that are using. The, the voice capabilities and the AI capabilities of, of that platform to, to great effect in my research for this show, it was kind of funny coming across all these clips, you know, asking when, when Amazon is going to buy ups or when Amazon's going to buy FedEx.
And, um, I think they've got some ideas of their own. So let's hear about Amazon's plans for future delivery. We actually don't think this is a terribly important step for Amazon. We think if anything, they're just sort of experimenting what's you have to understand about FedEx and ups, um, is that these are companies that have been around for a really long time and have built out massive networks, which would be very, very hard.
Uh, to replicate, um, our transportation analyst, Rick Patterson refers us as to the 30, 30 rule. In other words, it would take Amazon about 30 years and have to spend about $30 billion to have the scale that a ups or FedEx does. You know, to put that in perspective, you know, FedEx has 659 aircraft. They have 160,000 vehicles.
They have over 400,000 employees and they're the small or of the two. So we're not reading into this. Quite frankly, as much as we like Amazon, we don't think that this is a big major news, negative news for ups and FedEx. It's a really good point, Amazon, any headlines associated with healthcare and all of a sudden the healthcare sector is down.
Any headlines associated with delivery and all of a sudden stocks like ups and FedEx, a down is Amazon having an outward effect on other sectors. Do you think it's sort of overemphasized by some people. I think with Amazon, you have to look at everything on a case by case space. And so if you recall, I was actually on the show last week, talking about what they were doing with healthcare and saying that's a very bad thing for health insurers.
Um, but that's very different than, um, then, you know, then, then the delivery business. Um, I think that Amazon, particularly the partners that they have in healthcare can build scale and do things that are very, very innovative. I don't necessarily think that's true. Uh, when you're talking about, um, you know, the package delivery companies, quite frankly, you know, uh, Rick and I were to report in November of last year saying that if Amazon really wants to solve their last mile delivery problem, they should buy FedEx.
And that would be highly accreted, uh, to Amazon's earnings per share at significant premiums to FedEx, current stock price. Hmm. It's really interesting because we we've done a show not only on Jeff basis, but also on Fred Smith, the CEO and founder of FedEx, and both of them have these clear points of view about why they won't, uh, be directly competing.
And I think that what we keep seeing though, is Jeff and the team at Amazon. Uh, trying to use their own fleet of prime airlines of big jumbos zipping around the U S as a way to augment into, to improve their delivery services. And I think this is particularly important because they're now moving to a two hour delivery service on.
Not only prime goods, but prime groceries, which shows you whole foods starting to integrate into the Amazon infrastructure. I mean, so to me, this is both exciting, but also we have to remember how hard it would be for, for Amazon to get into the exact same businesses, FedEx. But did your mind, Chad go a little bit crazy when you then thought, well, maybe Amazon just purchases.
FedEx, could you see that happening? I think that would be most telling is how Amazon goes about solving. They're their last mile delivery problem. Um, I think Amazon more and more and Jeff basis is really relying on convenience as a selling point for Amazon. I mean, we even saw this in kind of the commercials that have been running in, in the Olympics from Walmart talking about, Hey, you can order online and pick it up in the store, you know, by the time you drive there.
And so that that's, what's Amazon, Amazon's competing against. And, but what I'm more interested in is if Jeff gives a mandate to his team to solve this within Amazon, or if he steps back and says, you know what, I'm a relatively savvy investor. I've got savvy investor friends. Maybe I could purchase FedEx outright and at a, at either a discount or premium.
I don't, I don't know what that would be. And then just fold it into Amazon and solve his last mile delivery problem. That way I don't know which he would choose, but I think it would be very telling to us about how he goes about solving those problems. I think where, where your mind boggles with possibility is that.
You know, we can see that Amazon is in your home with Alexa. They are mesmerizing the world with it and changing the game, uh, by setting new standards of speed and convenience in delivery. Um, and what's crazy is what we're going to hear in this next clip is they're redefining the way we go into physical stores.
And this just builds beautifully on the way in which they acquired whole foods. And they're putting this whole stack together, which as we mentioned earlier, creates this flywheel effect, this sort of compound interest, there's huge momentum that spins between their different businesses. So let's have a listen now to what it's like to go and have an Amazon go shopping experience.
Amazon go is the latest effort by Amazon just to make shopping incredibly easy. When I was there, I got an early glimpse. Their vision for this is you walk in, you grab something, you walk out, you have this app called Amazon go. It has a sort of QR code that you use to scan in when you get there. The Gates open.
You go in, you grab whatever you want from a shelf, and then you literally just walk out and the way the system works is it tracks what it is that you actually take with you. Amazon, didn't go into a lot of detail how they do this, but it's basically through using sensors that are in the shelves. They also have hundreds of cameras hanging on the ceiling.
It basically just like tracks you in the store and you're linked to that account. I didn't have to interact with anybody. I didn't have to wait at all. There were no lines. It literally was just as fast as I wanted to shop. And then I was out of there. It's set up through your Amazon accounts in the Amazon go app.
So you can go in there after you've left the store and see your receipt. So the whole point of this is to make it very fast and convenient for you. Okay. Amazon goes in, in beta for the past year with employees able to visit as of January 22nd, the public can go in.
I love how Amazon now has a physical manifestation of the hyper convenience of ordering online. Uh, Hmm. I'm a little surprised that they didn't try this sooner. I mean, you, you see the concept and you're like, of course that makes complete sense. True. Um, I mean, I, I, of course, of course it's harder than it looks, but yeah, in a way, like why don't they allow people to go to the warehouses and the robots just to deliver the things to them.
Uh, you know, I mean, I think this opens up a world of possibilities for Amazon making it more convenient and more indisposable and irreplaceable for their, for their consumers. Again, building onto that flywheel of how can I deliver more value to my customers and increase the lifetime value of that customer over time?
I don't know about you, Mike, but I've been a customer of Amazons since 1998. Whew. I can't between my personal and business spending on Amazon. It's got to be like in the thousands and thousands and thousands of dollars. Yes, it's so true. This, one of the things that I noticed when moving from the U S uh, to Australia is we noticed that Amazon only just launched here.
And we noticed how we were like, Oh my gosh, it's so weird. Not having Amazon, like we really missed it. And the other thing that struck me is reflecting on going to whole foods in San Francisco. It was always so busy. And I think what's really important for our listeners to understand here is removing the queue at the checkout is actually a big problem because I think it's not unrealistic to say.
That in any major city, you're probably spending 10 to 15 minutes trying to check out, uh, from the grocery store. And we know that if you can make time for your customers, this is of enormous value for a modern lifestyle. 15 minutes is actually a big deal. And so you can kind of see that the way they're thinking about shopping is changing everything.
But also, I mean, You just wonder like the Walmart execs must be sitting there and just freaking out because it's the delivery. It's the redefining the way we shop. I mean, these guys, Amazon is on a tear to redefine shopping and groceries, and I just don't know how the guys at Walmart even get any sleep.
Yeah, well, one of the last things on Jeff Bezos's list to increase the share of the consumers spend that Amazon is able to capture his groceries. It's a very large percentage of what the average consumer spends. I think it's, you know, somewhere between like 18 and 25%, somewhere in that range. And, you know, for a long time, Amazon was not in that market.
And then they started their own grocery delivery, delivery service. And, you know, with the recent purchase of whole foods, I think, you know, bit by bit Jeff and the Amazon team are putting together all of the pieces for, you know, a grocery delivery service that's, you know, could potentially put much in the amount of, out of business.
In today, it will be, uh, easier and more convenient for you to get your fresh organic food delivered right to your door. Whole foods now owned by Amazon is offering free grocery delivery through prime. Now they're joining a growing list of retailers offering grocery pickup and delivery. None of your sounds, Allie Cramer broke down, which has the best bargains.
We all live busy lives and the grocery store, usually isn't at the top of your list, but you still want those fresh fruits and veggies. And, uh, you would get the points at home. If you at least try to get your kids to eat their broccoli. But if you're going to have to have that battle at home, you don't want to have to battle the grocery store as well.
Launching today in four cities, including Cincinnati prime pantry will now offer a wide selection of items from whole foods, and it comes with the prime two hour delivery, but the concept isn't new. We compared your grocery pickup and delivery options, both whole foods and Meyer now offer home delivery.
Whole foods requires a $99. Amazon prime subscription Meyer also charges a $99 fee. So it's the same cost, right? Not exactly. The Amazon prime subscription gives you access to millions of items outside of the grocery sphere. Things like streaming, TV, and video with Meyer. You're only getting groceries and there's a 10% surcharge to cover the cost of the personal shopper who picks your items.
You're also weighing the price of the groceries, but it's more about convenience than saving money, Kroger and Walmart don't deliver, but you can order online and swing by to pick up groceries. It's the same thing though. Kroger charges $5 to do the shopping for you while Walmart is free to Mecca. So there you have it.
Kroger, Walmart, Maya, trying to do a little bit of an Amazon can't even match them on price. Oh. And then by the way, you get all these free videos and films and TV shows as part of the prime package. I mean, right there, what we just heard is a customer facing proposition of Amazon. And it's so obvious that it is absolutely.
Crushing the competition with this obsession on delivery, ease of use and using the flywheel to very good effect. Yeah. Well, not only all of the things that you mentioned, Mike, but next NFL season prime subscribers will also get, I think like a dozen or so football games. So, I mean, What started as this way for Amazon to figure out how to make shipping a frictionless thing for, for customers.
You know, I don't know if you remember, but you know, way back in the early days of the internet, you know, shipping costs or, you know, it could be kind of prohibitive when you're, when you were shopping for things. And you'd usually hit for shipping, you know, costs for every item or every order. They turned that simple thing into what is now this gargantuan service of prime that can get your groceries delivered, TV shows and music, and now NFL football games.
For complex hustle. I'm Katie Mar, if you are an Amazon prime member, you can finally go ahead and say bye Felicia to your expensive cable relationship because Amazon has won the rice to live stream games for the upcoming football season, beating Google, Facebook and Twitter. Under the new deal. Amazon is paying around $50 million for 10 games.
Yeah, no big deal. In comparison, both CBS and NBC pay $225 million each per year to broadcast only five Thursday night games. A season last year, the NFL experimented with live streaming by partnering up with Twitter for a much lower price of 10 million. So there you go. They beat Google, Facebook and Twitter.
And what's really interesting is you don't hear CBS. You don't hear all the traditional broadcasters, which is a bit of a clue to how the future might, might play out. You know, when I look at everything we've heard about what. Jeff Bezos and Amazon are doing with consumers. I think we've made the case.
They're in the home, they're in the grocery store, they're delivering and they're doing so at the most competitive rates with enormous benefits to end users, which is to be quite Frank. That's like right there. You've got most of your formula that you require for. Innovation and massive, uh, sort of disruption.
I mean, I'm very excited about what they're doing because there are real benefits for us as consumers. And I think that, you know, we, in the show we did on Jeff, we really focused on the flywheel effect. And what we can see here is that when you're great in so many different businesses, how strong your position becomes.
And we heard that Kroger and Meyer and Walmart. They just can't compete. I'm curious, Mike, with all of these recent acquisitions by Amazon, where do you think they're going to continue to reinvest and double down into the future? For, for me, I think it's in the creative content that they are producing.
Whole cloth, you know, within Amazon studios. I think that could be certainly film and TV content, maybe even a music label. And then I, I'm very curious in this last mile transportation to see where they're going to invest huge. I just don't know where that would be, but I think it will be very telling how they invest that, that money.
Yeah. I, I, I agree on those. I think some other things too, to add to your list of, um, Competing CEO, headaches. I think it has to be healthcare. And we're going to talk about that a little bit later in the show. The other thing that seems undeniable to me, which would be very easy for them to deliver is financial services.
So I'm just thinking about whether you're a retailer. Uh, and you need a credit based on your sales, whether you're a consumer who needs insurance, I would imagine a pure digital banking and insurance product with their brand, I think could be kind of killer. What do you think. It would certainly be convenient if all of my information is already in the Amazon system and I'm spending half of my paycheck there because I get all of my entertainment, my groceries, my school supplies, my.
Close my books, you know, everything. And they just have all my information there. Yeah. Right. And they can offer you enormous savings because of that, because they know you so well. What an exciting future from a consumer point of view, Chad, let me ask you this. What's got you excited about how they're, how they're doing business and how we kind of see the internal machinations of Amazon.
What are you, what are you seeing there? That's got you excited. Well, I don't know if this is exciting or disappointing. I'm sure everyone by now has heard about this competition for Amazon's HQ to where essentially every city and municipality in North America, like bent over backwards to try and offer as many incentives and tax breaks to Amazon as possible to get them to locate their second headquarters.
There. And part of me thinks that Jeff Bezos has already decided where he wants to put that headquarters, even before he put this out to bid. And he's really just trying to get the best deal. I think he's doing that because he knows he has so much power. You know, like in this, in the same way that Amazon is going into the grocery business, and now all the groceries are trying to figure out how to compete with it.
Or Amazon says that there may be thinking of going into last mile transportation. And then all of a sudden the transportation stocks, you know, take a dive because, Oh, you know, Amazon's going into that business. So they're going to crush their competition. But here's the, here's a funny take on, uh, this, this competition that Jeff Bezos had set up from, uh, from SNL.
Alexa, are we ready for the presentations? Yes, sir. We are down to 20 cities for our new Amazon headquarters. Great. The winning city would get 50,000 new jobs and billions of dollars. Alexa, isn't this exciting? Yes, it is exciting. And just to make sure Alexa, who is the richest man in the world? The richest man in the world is Jeff Bay.
Zeus. Close enough.
But, but it, it is, um, pretty remarkable what those cities in America are doing and offering in order to attract Amazon from their point of view. Chad, why do you think they're going out of their way to try and entice Amazon? What's the real reason a municipality and a city would go to such effort to attract them.
I think it's because they think it will have a boom on their economy. I don't know if that's true or not. I mean, certainly it would bring lots of jobs and some notoriety to the city, as you know, the second headquarters of Amazon, I think it just remains to be seen a company like Amazon has, I think too much power to hold over these municipalities and, you know, A corporation is a profit driven entity.
And so how altruistic it could be. I mean, it remains to be seen. And I know I might be sounding a little pessimistic, but I do think that this is really Jeff, Jeff Bezos, trying to get the best deal that he can. Yeah. And, and the, the interesting thing is that these large, highly scalable technology companies, Facebook, Google, Amazon, et cetera, all of these companies producing growth and profit at unprecedented levels.
And what we're seeing already is a distinction within that select group. Um, and I think what's really interesting in this next clip is we hear about. Not only the, the growth and performance of the company, but the role that Alexa has to play in that. So now let's have a listen to the story of Amazon's earnings and the role that Alexa has to play break down, Amazon earnings for us.
What do you think the highlights are? Look, we just spent 10 minutes talking about how Apple is trying to make the iPhone 10 work better, how they're lowering guidance. So they sold fewer phones in the quarter. How the phone might be too expensive. And now we're talking about Amazon where the biggest store success story and these results is what happened with Alexa and how Alexa is become this giant platform with over 30,000 skills available.
How, as you mentioned, Jeff Bezos said in the press release, they're going to double down. And th that we're this really important inflection point where the most important device in the world in the iPhone. Uh, well, I just talked to Scott Galloway and Bloomberg radio and he says, this is the moment. This is exactly right now today.
The most important moment of technology we've seen in a decade where the leader in technology is no longer Apple. And now it's the Amazon Alexa. And that this inflection point is so important because computing is moving. From the phone to voice and Amazon owns it, an Apple blew it, and you can see it in the results that both companies announced today.
And, and, uh, you know, the open platform, the ambulance, the Apple like platform with open to all to multiple developers and also from multiple hardware developers, look at what Sonos is doing. With the Alexa, for example, uh, that Amazon is weeping. The benefits of this Amazon is getting services revenue already in the way, you know, two thirds of American households are Amazon prime members.
Uh, Amazon Alexa is part of that ecosystem. They're already in the place where it, as it wants to be. I think the openness of the Alexa platform is really what Amazon has. Over Apple and, uh, the commentator that they mentioned, Scott Galloway, I think he's actually got some really great insights. If you just Google him on YouTube, he has really fascinating insights into, especially like the big three for technology companies.
I've always, I've always been hesitant to wholeheartedly recommend Apple and the Apple ecosystem because it is quite. Close minded. And I think these, you know, financial minded, um, investors are pointing that out as to why Amazon's earnings, you know, beat apples. And it's maybe because it's opening up its platform to many more.
Yeah. I think what this clip really pointed out was a critical topic, which is did Apple who have missed the TV revolution. Okay. So they missed that. Have they also missed the in-home technologies, smart home space as well? And has the main reason for that being that Steve has gone. And two that they are too closed and that Amazon has achieved this massive success, not only with prime, but also with Alexa, largely due to a more open style of innovation.
So what do you, what do you, what do you think, do you feel like. The iPhone is, is in transition to losing its pole position. Do you think Alexa and an echo, these Amazon products are going to take over? The smart home has, has Apple missed one too many things. I mean the home pod just came out, you know, at the beginning of 2018, I don't remember exactly when the Alexa first launched, but they've been in.
You know, probably millions of people's homes for several years now that in technology years and you know, that's, that's almost a lifetime, even just a two to three year headstart. Yeah, I, I w I really think there's something emerging here. Did you hear how they would diss the distinction that they were making between Apple and Amazon?
And it really felt to me kind of almost crushing towards Apple. Yes. They're very large, but they're still enjoying the fruits of the iPhone. But imagine a world after the iPhone, what do they have and the reviews of the HomePod that you mentioned? Uh, it's great to listen to terrible, to talk to, um, the, the, that the Siri technology is just not there and it makes me, makes me.
Like, I think Scott Galloway might have a point. We might be witnessing an inflection point, a transition where Apple hands over the crown to, to, to Amazon. And if you think that Amazon have again, a rest easy now they've won the home. They've won the world of shopping, uh, because they have signaled their intent to get into one of the single biggest industries in the universe.
The biggest, and that is. Yes. I think only, I think, uh, military and defense spending is, is like the only contender to healthcare. So let's jump in and listen to what Amazon has planned for the world of healthcare. Uh, on the one hand, um, I'm not at all surprised to see Amazon go after the healthcare industry.
This is a very large, uh, growing profitable industry. Those are typically the type of sectors that Amazon wants to be involved in. Um, the other thing too is. You know, as they're saying that they're not really interested in profitability, uh, and I'm sort of reminded of one of Jeff Bezos's favorite saying, which is your margin is my opportunity.
Now, one thing that's interesting is the, is the partners here, right? Berkshire Hathaway, JP Morgan, you might've expected them to partner with some type of health care company, but at the end of the day, you know, look, Amazon brings a technological expertise. Uh, Berkshire Hathaway brings the operational.
Experience right. They have over 60 companies in their portfolio. And JP Morgan brings deep pockets though. Quite frankly, all three of them have deep pockets. So, you know, I would not want to be a, uh, a shareholder of an inch, uh, healthcare insured, uh, today. So you think it's pretty safe assumption that kind of like Amazon web services, something that started as an internal operation or the logistics, sorry, something that started as an internal operation, that, that was then opened out.
That assuming this gains traction within these companies, that would only be a matter of time before this new company is trying to, uh, serve employee employers beyond just these three. That's correct. And if you look at the press release, um, there is a quote from Jamie diamond in which he basically hints at that strongly hints at that.
So we would expect that if this a successful for Amazon, for Berkshire Hathaway for JP Morgan employees, eventually they will expand it to outside employees. Yeah, let's get to that. So basically what you were just talking about, the quote from Jamie diamond, he says the three of our companies have extraordinary resources.
And our goal is to create solutions that benefit our us employees, their families, and potentially all Americans. Hm. I can only imagine the kind of learnings and innovations that could come out of a partnership between Berkshire Hathaway, Amazon and JP Morgan. The. The most interesting thing for me in relation to our previous show on Jeff was how this is a platform play for Amazon and not just a product play.
And Amazon wants to be where you go for everything now. And healthcare is just one of those things that they want to be able to offer to their consumers. Yeah. And, and the, the interesting thing to build on that is that they chose some fascinating partners to do this with, and it shows you if you can attract Warren buffet and Jamie diamond to the table.
It speaks to the kind of shift from old to new power and frankly, having been part of the healthcare program and infrastructure of the U S where America spends as much money yet is not able to deliver the highest level of health care. I feel like. This is a welcomed intervention from Amazon Berkshire and JP Morgan.
We got to do something different in the world of healthcare, in the U S yes. Yeah. And I think banding together, their pool of, of employees. I don't know how many it is, but it's gotta be several hundred thousand. If not. Over a million, you know, total between all three companies, because Berkshire Hathaway's, you know, dozens and dozens of companies.
Um, yes, I think they're hoping that with that number of consumers, they can put the pressure on healthcare providers and healthcare companies to improve outcomes, lower costs and improve care for everyone. And then hopefully the other consumers can benefit from that. Yeah, I agree. And what's so fascinating about this is just to demonstrate the sort of macro impact that Amazon has.
What's important to remember is they announced that they actually didn't announce anything that they are doing. They, they only mentioned that they plant plan to do something with JP Morgan and Berkshire, and it would be internal. So think about that for a second, they haven't announced a date. Like it will be effective, you know, uh, February one, they didn't do that.
And they have certainly not announced that they plan to do it to consumers. But as soon as you hear this, it opens that you're warmed up. To all the possibilities of when a company like Amazon, whether it's focused on the customer scale efficiency, convenience, I mean, health care could be a lot cheaper and a lot more convenient.
Right? Right. I think some people may be scratching their heads and like why in the world is Amazon going after healthcare, but you have to go back to how Jeff sees the consumer and he's looking at for every dollar that. A North American consumer spends how much is across each of these categories and how can we as Amazon try to capture as much of that or provide as much value or capture as much value in that.
And so, you know, what started with books then grew to other forms of entertainment, then grew to all kinds of retail products then grew to. Groceries, you know, and now healthcare is just kind of another one of those categories that they're hoping to capture and add value to the consumer because it's, it's a very large spend for most, for most people.
And full of friction. So whether it's fixing the queue at, at the grocery store or fixing the queue at the hospital, he's open to doing that. And what lies at the center of that is one of his core tenants about being courageous and relentless and having these. Epic visions and it's, he doesn't want to be the only guy with that.
So let's have a listen now to him talking about how he wants not to be the only person in the room with a bold idea, but he wants everyone to be bold. One of my jobs as the leader of Amazon is to encourage people to be bold and people love to focus on things that aren't yet working. Um, and that's good.
It's human nature that kind of divine discontent can be very helpful, but, uh, you really, you know, it's incredibly hard to get people to take bold bets and you need to encourage that. And if you're going to take bold bets, They're going to be experiments. And if they're experiments, you don't know ahead of time, whether they're going to work experiments are by their very nature, uh, prone to failure, big successes, a few big successes compensate.
So, you know, bold bets, AWS Kindle, Amazon prime, our third-party seller business. All of those things are examples of. Bull bets that, uh, that did work and they pay for a lot of experiments. I've made billions of dollars of failures@amazon.com, literally billions of dollars of failures. What really matters is companies that don't continue to experiment companies that don't embrace failure.
They eventually get in a desperate position where they only thing they can do is make a kind of hail Mary bet at the very end of their corporate existence. Hmm. Um, I would add Alexa to the bold bet. That's now paying off for Amazon too. It's um, yeah, I thought this quote from Jeff really just summed up the, for those of us had been scratching our heads.
Why in the world, Amazon is doing all of these various things. I think he says it best. If we want to be a great company, we have to take big bets and spend billions of dollars on things that probably might not work. And I think that's what makes him and Amazon just such an interesting company to follow and learn from.
And, uh, I hope that the clips that Mike and I have shared with, with all of you listeners has helped to impart some of those learnings. Yeah, absolutely. I think that the big takeaway for me is tackling big customer problems, having the boldness, the courage to go and do it in any different, uh, sphere that relates to their business.
And then they generate the flywheel effect. I mean, you can just, literally, as we talk about it, you get a sense of their momentum. Don't you. Yeah. And, um, I don't want you listeners to forget, but we're also going to get updates on what Mr. Elan Musk has been doing the past six months as well. We just had a lot of updates from Amazon to get through, to get to Ilan.
It's crazy. It was really ridiculous. And actually we skipped and cut out a few because we just. Didn't have the time to cover them. But I think, um, what I would encourage our listeners to do is if any of these ideas, you want to learn more about them. If you want to unpack them more, decode them, just go to our website@moonshots.io, and you can find a complete list of show notes, links to different interviews, and two books about Elan, about Jeff Bezos about Tesla.
And Amazon there's tons of content there. Lots of ideas, lots of inspiration for you to use. Every single day when you're trying to create something that really is 10 X. Now talking about 10 X, where do we start with Elan? Because he's been very busy too. Chad. Well, um, I kind of want to start with the flame thrower.
It's uh, I don't know if you've heard about this, but it kind of started as a joke. When Elan started the boring company, people were kind of scratching their head. What does that name mean? It sounds kind of boring. Pardon the pun. Um, what are they doing? So he went on to Twitter to sell the quote, unquote, most boring hat ever.
And he sold tens of thousands of these hats. And his joke was, well, you know, next time we'll sell the boring company, flame throwers, and it turns out he actually built one and, uh, is now selling it. The new hot product from Elon Musk is a flame thrower and this hot seller can be yours too. For $500 plus tax.
This is a product from the boring company. It is a tunnel construction company that Musk founded in 2016. Now on Saturday, Musk announced the product on social media and opened up advanced orders with a limited number of 20,000. This stunt really lit up the internet. Musk has been tweaked sales updates with early Monday morning saying.
7,000 were sold. That's three and a half million dollars worth of flame throwers. And his company is also selling a $30 fire extinguisher. Naturally the CEO of space X and Tesla also runs the boring company to make tunnels for the underground Hyperloop transportation system. It's called boring because it bores a tunnel.
Boring. Yeah, he's a funny billionaire. So what sparked this crazy product back in December must promise that after his boring company sold 50,000 promotional baseball caps, they would start selling the boring company, flame thrower. And then on Christmas Eve, he tweeted that the flame throwers were, I mean, soon.
So it seems interested in his joke. Didn't burn out and he kept true to his promise. The website says the flame throwers will ship in the spring. Maybe that's April, maybe that's April 1st. Oh. And for those of you with the burning question, yes. Flame throwers are. Legal the United States Bureau of alcohol, tobacco firearms, and explosives allows flame throwers just as long as the flame is shorter than 10 feet.
I'm Bridger Kerry, and be sure to leave your hot take on this sizzling marketing moment in the comments and be sure to head, to see net for all the latest on eccentric tech billionaires with flame throwers. As long as it doesn't extend a flame 10 feet. It's okay. I mean, come on. It is ridiculous. He sold thousands and thousands of flame throwers and caps, and it shows you just the role that he plays in the zeitgeists in popular imagination.
I think people love the daring somewhat cheeky way. He approaches everything and. It's kind of just hilarious in both the case of Jeff Bezos and Elon Musk, it doesn't matter how crazy or offbeat or how disconnected things might appear. They seem to be able to use their, their fans, their brand, to, to achieve great entrepreneurial success.
I think the interesting contrast to me, and this might be a slight generational thing because Elon Musk is younger than Jeff Bezos. Elan seems to connect more directly with his consumers and be able to move the consumers to do crazy things like buy flame throwers. And I think Jeff is more interested in, I don't want to say intimidate or manipulate, that might be a little wrong, but just influencing the corporate arena.
You know, if he just says, if he just intimates, Oh, you know, I'm interested in transportation, transportation, stocks, dive. And so I think that's, so Jeff's kind of playing in that corporate field and is able to really have an influence in that arena. And Ilan is kind of connected directly with the consumer, you know, through social media.
Yeah, I see, I see where you're going. I would put it in, perhaps in this view that Ilan is more genuinely a geek and nerd who likes to have fun. He's a little bit more the mad scientist. Whereas Jeff, he is the sort of modern day industrious, right? He's the Carnegie, he's the, he has such a huge. Uh, view of industry, whereas I think Ilan is more about science, gadgetry, cool stuff, uh, physics, that kind of stuff.
Do you think that's fair? Yeah. Yeah, I do, but, but I, but I think what's interesting though, for all of somewhat questionable time-span on flame throws and hats and so forth. I think Ilan is also doing some. Major stuff. And in particular, I think he's doing great stuff here in my home country of Australia, uh, where he actually took, took up the challenge.
And as always got a lot of PR for it to create what is safely the largest, uh, uh, working battery on the planet. And, um, it was a very, very interesting project. So let's have a listen to what Elon Musk did. With the battery that he constructed in record time here in South Australia, this seemingly innocuous rural area in South Australia has suddenly become home to one of the biggest sources of renewable energy in the world built in 60 days.
The U S technology company, Tesla has built the largest ever lithium ion battery, which is plugged into the power grid in the state of South Australia. The state's premier unveiled the giant battery, which is powered by nearby wind farm. This is an example of South Australia leading the world, the world's largest lithium ion battery.
It's right here in Jamestown, in South Australia. And it's already supplying power to the national electricity market. Australia is a major export of coal. The state of South Australia is demolishing is coal fired power stations and switch into renewable energy. That's imperative after freak storm last year caused a statewide blackout highlighting the unreliable supply of electricity.
The billionaire business tycoon Elon Musk offered to build the back. Most salient point here is that the system will be three, three times more powerful than any system in the on earth. This is a, this is not like a sort of a short, like a minor foray into the frontier. It's just like, You're not going three times further than anyone's gone before.
Musk also promised that if it wasn't completed on time, it would be free. Lucky for him. The $40 million project was switched on ahead of schedule. I don't know if the listeners caught this, but Elan said it was three times more powerful. Again, going back to his mental model of. Multiple step changes, you know, powers of 10 sort of thinking where incremental change is just simply not something that Elan.
Yeah, he, he, he is very basis in him, a very similar in the boldness of their thinking of the. Uh, their mental models, as you said, and they look to create dramatic impact. And remember this it's three X more powerful than the next nearest lithium battery, but it's also was built in record time. Um, and he's always looking for those increments or.
Improvements or jumps. And did you hear him, Chad, as he described it? It was almost like a, like he almost described it like a space mission, venturing, you know, beyond the furthest point. I thought that was kind of interesting. Uh, well, you're getting to kind of the biggest update we've got from Elan really just a week prior to this.
Recording space X had their biggest launch yet of the current largest rocket, the Falcon heavy. And here is a short clip talking about a little of what inspired him to go so big with the Falcon heavy. I'm very excited about this launch because I think this is, uh, it's going to really show that we can do giant rockets game, most space, uh, organizations, government, or, or commercial have set their sights too low.
They've really gotten built relatively small rockets, um, and fucking heavy is the first time that there's something that's arguably even in the super heavy class or somewhere between heavy and super heavy and showing that you can launch a giant rocket and have it be commercially viable, carry satellite.
It's potentially carry people. Fucking heavy is capable of actually taking a dragon mission, taking people around the moon. Yeah. The, if, if the, the battery was, um, uh, three X more powerful, I believe this is the most powerful rocket ever created. So it's like gazillion times more powerful than the space shuttle.
And they have this thing called the payload to low earth orbit ratio. And. Once again, it's about three times better than the, than the space shuttle. I, I just think that the audacity of what he does, that he just loves to take a, like a sort of a paradigm and a smash, it smash it to pieces so much science so much.
Engineering, but I think the other thing that is really interesting about how he operates is he has this newsworthiness that we've touched on. Um, he just grabs the headlines like nobody else. I mean, I can't think of any other business person that can grab headlines. Like Elon Musk. Can you chat? No. And I'm, I'm sorry about the, uh, the teenage Chad obsessed with space has to correct you.
The Saturn five still is the most powerful rocket ever created and launched. That's what, uh, took, uh, the Americans to the moon and back, but the, the, the Falcon heavy is still the largest, uh, rocket that's that's functioning today. And, um, normally in test flights like this, they just send up concrete blocks as the payload, but.
Concrete blocks was just not inspiring for Elan. Was it? No, I think he was looking for something a little bit more fun, a little bit more cheeky in the spirit of the flame thrower. So let's have a listen to a new pioneer of space. It was the star man. Three two.
now the biggest rocket in the world space. X's Falcon heavy, three rocket strapped together launched a new era of American space travel, successful separation, but this was different. The boosters separated and then flew back to earth landing together. Reusable
the center. Rocket coming back to earth, ran out of fuel and slammed into the ocean. It was lost a setback for the $90 million test flight, which needed some cargo and rather than concrete. Space X CEO, Elon Musk, who also runs the electric car company. Tesla decided the payload, the weight at the head of the rocket under the skin would be his electric car, a red Roadster.
So there was a car with a dummy venous space suit, exposed to space. Floating and sending spectacular pictures back of it. And the earth with David Bowie music playing in the background.
Musk says he thought this launch only had a 50% chance of this spectacular success. What did Falcon heavy teach you crazy things. Okay. Come true. Um, cause I, uh, he'd said like, I didn't really think this would work. Um, he was like, when I see the rocket lift off, I see like a thousand things that. That could not work.
And it's amazing when they do so for a few hours before the rocket and this Tesla were boosted toward Mars in the sun, those amazing pictures, even for Musk, he found it funny, silly, iconic, and wondering if thousands or millions of years from now aliens might discover this strange tests, cargo thinking, what the heck?
What, what were these guys doing? Did they worship with this car? Worshiping the car. I mean, I tell you one thing, if you look at his ability to get news, to sell hats and flame throwers, I think everyone's kind of worshiping Ilan right now. What do you think, Chad? Yeah, I mean, I watched the launch live again, just the kind of kid who wanted to be an astronaut couldn't resist.
And, um, I think the most amazing thing to me was one how knowledgeable Elan is about. Rocket science pretty much self-taught. I mean, you know, so not only does he know how to launch rockets into space, but he knows how to build batteries and to build cars. I mean, I think the biggest takeaway and inspiration for, for me about Elan is just how he.
Is a lifelong learner, you know, will not stop when it comes to acquiring, you know, more learnings and insights and information. And, you know, it was a success for, for him, both from a technical standpoint, the, you know, the boosters were able to land back at Cape Canaveral and the, the Tesla was successfully launched into, into space, but it was also, as you were saying, you know, a marketing success for, for him to like, How fantastic of a marketing ploy was launching your Tesla vehicle into space.
So clever and he just got so much coverage for it. And that's really Ian Addy smartest, and he's best in, good on him. You know, like if he can get the coverage, like, uh, why, why would you begrudge that? I wanted to do one thing here and just call out. It's not as hard as you may think. It's not as impossible what Elan does.
And it reminds me of a book that I actually read recently, which is the 10 X rule. Now we've talked a lot about 10 X, Chad and Mulan is, is. You know, a great proponent of that thinking, but I actually read a book that translates the idea into things that you can do today. Things that you can do to also go and make 10 X things happen.
Now, the book is called the 10 X rule and the author is grant Cardone. And I really want to encourage our listeners if they want to unlock their own inner. Elon Musk. This book, the 10 X rule is, is the perfect tool to unlock that. So we'll have a link to, to this book in the show notes@moonshots.io, but I really encourage everyone to check out this book, the 10 X rule, because it really kind of shows you how to do the Musk thing.
And I wanted to ask you, Chad. If you think about putting 10 X interaction in your work in your day, where do you start? When you think about doing things? 10 X, I think for me, It's trying to approach problems from a completely different or outside perspective and applying something that I've learned or heard about from a different industry or discipline and try and see how it can fit with what I'm doing.
These aren't real examples, but you know, it's like, how can the rigidness of accounting. Or the discipline of accounting, you know, helped me in this creative endeavor. Or if I'm sitting down to, you know, look at a proposal or something that I'm doing for a client, you know, how can I. How can I use something like poetry or, you know, theater, you know, affect how I'm connecting with that potential customer.
And it's those kinds of exercises. They don't usually lead to direct applications, but it gets me into the mindset where eventually one of the ideas that I come up with can actually move me towards that, that 10 X. So it's the kind of looking at things from different perspectives and angles and mashing up.
Uh, disciplines, I think where I've had the most effectiveness. And I don't know that I've achieved 10 X quite yet, but, you know, it's, I, I I'm striving for it. Hmm. That's so cool. Because what you're essentially doing is looking for patents beyond the problem. That you have. And, and the challenge of trying to meet and looking for inspiration around, which I think is, is great.
I think the little nudge tip I would give you that I got from the 10 X rule book was if you set. More audacious targets that really matter to you. That's the perfect compliment to your approach of here's how you do it and sort of setting the target first with more audacious goals for things that you really believe in what the author Cardone puts forward is most people don't get to 10 X because they never dream.
Of doing anything, 10 X, everything they dream of is incremental. Yeah. And I think that's why you and I have looked to the likes of Jeff Bezos and Elon Musk for that inspiration, because we're talking about companies that are doing that are making billion dollar mistakes. And it's like, well, what if I could make a billion dollar mistake?
What would that even look like? Um, and those you're right. Those are the fun. Thought experiments. They a and S. And, and it's, it's really, uh, for me, an affirmation of you sort of, you are what you think. So if you set these audacious tannex targets, you can, you know, do amazing things within your company. You can solve big customer problems, but I think what you can also do is prosper yourself.
You can create wealth and opportunity for yourself, unlike no other. And speaking of wealth and opportunity we're not done with, with Ilan just yet key. Um, He's just come out with a very interesting compensation plan for himself. You know, he recommitted himself to Tesla and, um, he's putting, he's putting himself on the line for the success of his companies.
And I'm not sure that we've seen in the other CEOs do this, certainly not in such a public fashion, but, um, here's, here's a clip about Ian's new compensation package, uh, across his companies. It is some breaking news this morning, uh, that just broke, uh, literally overnight Elon Musk. He's the subject of the Columbine telling me he's now agreed to stay on as CEO of Tesla.
For the next decade, there've been a lot of speculation that he'd be stepping down in the next two or three years. He had said that once the completion of the model S uh, or the model three rather, uh, was up and running, that he might not stay at the company, at least as the CEO, but Tesla now announcing a radical new compensation plan.
It could be perhaps the most radical compensation plan in history. Uh, comp must compensations will be tied directly to the company's performance. Uh, the executive will receive no guaranteed compensation of any time, if any cons at all. He gets a salary cash bonus equity. Uh, you only get to equity that, that vests over time, but only if he reaches, uh, these hurdle rates, which are dare I say crazy.
So right now the company is worth $59 billion. They run it $50 billion increments. So if he gets the company to a hundred, a billion dollar market capitalization, not based on revenue, not based on the number of production metrics at each step. So the first step is he has to get the company to a hundred billion dollars.
And reach these operational and adjusted EBITDA and revenue number. If he doesn't get either of them, he gets nothing. I have a weird way to break it down based on market 50 and has to hit the operational number. I mean, the market can be irrational. So if can't control that at each phase $50 billion number, he collects 1% of the company.
If somehow magically he would get the company to $650 billion, which is literally what the plan calls for. If you can believe this. Uh, he would collect the equivalent of about $55 billion in compensation. Otherwise he gets out. Absolutely. Well, if you get it to 600, a billion dollars and then it immediately collapses to $500 billion.
Is it just hitting that market capitalization milestone that matters or is it keeping it there for a certain time? Is it hitting it's even more interesting the shares vest, uh, but then he has to hold the shares for five years, eat for it at each. Break. You still get it right. If the, if even if the market capitalization is the weirdest thing I've done, it's impossible the game.
Because even if you were to get the company and the market cap to a hundred billion dollars, you then have to, by the way, hit the operational numbers on top of, on top of it, it's a war. You have to get both, and then you have to hold the shares for five years. It seemed to, uh, flummox that commentator completely, like, she was just like, this can't be true.
And then, and then it was funny cause uh, the other guy is just like, it's like the full-proof model. But I think the, the audacity of, of, of the targets, the, the complete, an art, uh, Accountability that he's taking on that model is breathtaking. And I think you, you pointed out, like, I haven't seen anyone, this transparently take responsibility, but did you catch some of the math, Chad?
I mean, those numbers are insane. Yeah, he has to grow the company's market cap by $50 billion and hit revenue numbers in $50 billion increments. That, yeah, ridiculous. Again, I think it's because he, he created this plan. No, no one else did because of course only he would be crazy enough to think, well, you know what?
I have to double. I have to double the size of the company for me to see anything. And then after that, I'll just keep, keep going. And the only other person that I can think of that did something like this was Cortez when he landed, when he landed these shifts and burn the boats so that they could return them.
Yeah. Well, I know that's why I committed here. Yeah. Yeah. I know. The Vikings also, uh, did the same, so maybe Ilana has some lost Viking blood in him that just gives him ridiculous care. What I think is interesting is it shows you the mental models. It shows you the break in how he sees the world. When even ourselves might start to think that is ridiculous.
But the thing is because of his mental models, he kind of sees the future in very inevitable ways. So to him, it seems. Inevitable, but to us, it seems crazy. And actually that's where we can understand how different he's mental model, how he's thinking is just so different. And this is actually a huge transformation that I have gone through just in the past year or two.
Uh, something similar. I mean, not quite as crazy and audacious as what Elan's done at Tesla, but, you know, I want to say this to all of the other solo, preneurs, freelancers, you know, single business operators out there that this commitment by him to Tesla is really incredible. And I think. All of our entrepreneurial minds can be very distracted and lured by, you know, the shiny new objects out there.
And I just love that he made this commitment to Tesla and it's reaffirming to me, the commitment that I made to my business, you know, that this is what I'm doing. I'm never selling the company. Everything I want to do in my business. I'm going to do in, in this business and not get distracted. Um, by other things.
And so that's, what's what I'm taking away from this compensation package that Ilan set up for himself at Tesla. Yeah. And I think, um, the only pause I would give here is like, obviously we're big fans of Musk and Bezos. Um, but I think it's important, you know, bayzos certainly has a challenge when it comes to.
Ensuring the conditions for his workforce. There's definitely some work to do on the conditions for the factory and warehouse workers. Uh, there's definitely been some suggestion of a pretty tough culture within Amazon. So he's not perfect and Ilan is not perfect either. You know, um, he talks a big game and when you talk a big game, you can sometimes get caught out.
When people hold you accountable. And this, uh, very recently tests are announced that it is burning cash faster than it ever has in history. And they've had quite a deal of challenge in actually producing enough of the model three Teslas. So I think it's important. I think it's important to really balance our view of these guys and this, this next clip cause Ilan out for some of the production challenges they had with the model three.
What happened? Elan said they were going to be in production hell, bringing the model three to market. But now as many suspected, they're not going to make it. Yeah. It sounds like hell is ongoing. We know that Elan was camping at the Gigafactory. And in the letter to shareholders released today, it sounds like they're having a lot of problems at the Gigafactory.
So it seems like they're still playing. Whack-a-mole figuring out what these production problems are. There's a delay of at least. A quarter to when they'll start hitting their production carpet, do we have any details on what the problems could be if they said that they're having challenges with their battery pack assembly, which is at the Gigafactory and that, uh, as they ramp up production, you know, things may shift.
So it's, it's not the most confidence inspiring shareholder letter in terms of production. What about when it comes to cash burn, record cash burn? Not in surprising because they're ramping up this car. Uh, but you know, I mean, they're going to continue to have cash needs as they grow as a company. And then w you know, we've also been talking about layoffs.
Yeah. The fact that they'd lay in mass, there's a distinction laughs. And firing. They clearly got rid of several hundred people, but they've never given a number. And typically you wouldn't do that while you're in the middle of a big ramp. So there wasn't anything about labor in the shareholder letter, but it will probably come up on today's call, which positions are they?
It was across the, it was across the board. A lot of it was. Solar city folks to be Frank, uh, because they, you know, acquired solar city last year and they were no longer doing door to door sales. So I think it was, it was across the board. It wasn't just factory. So when it comes to the model three, you know, what kind of information are we getting as to when?
Well, we're basically just getting that they initial ramp is delayed by at least a quarter. Uh, they originally wanted to make 5,000 cars a week by the end of this year. Now they're saying that we'll be late for the first quarter of 2018. So if you ordered a model three, you are going to be waiting for it even longer.
That's dicey for Tesla because a lot of people are not going to want to wait forever. I mean, there's still tons of reservations, but you know, eventually you're going to need to drive a car. Hmm. Yeah. I, it, this combined with, uh, Elan's commitment to, Tesla's surprising, you know, so they're, they're going through some of the biggest growing pains and this is when he decides to commit to the company.
I think it's very, very interesting and you know, we'll just have to wait a little while longer to see how his commitment and step up involvement is going to pay off at Tesla. Yeah. Yeah, I agree. I think, um, despite those troubles, he doubles down, which is what he's always done. In fact, I think what we've learned from Ilan today, everything of the last six months has just been a confirmation of his tannics mental model from flying throwers to batteries, to Starman, to rockets it's old Tenix and similarly, Jeff.
He's he's pushing things. But I think what we really learned today is the power of the flywheel effect and their ability to get into any type of business, no matter what the breadth of, uh, of business, not only Jeff, but I think Ilan can get in it too. And I think that's, what's so inspiring about being students of innovation is you can apply it anywhere.
Anyhow, and for me, that was the big takeout from, from today's show. For you, Chad, what was the, what was the one thing that really resonates with you that you're going to take away with you as you go and do your, is it karate? Kickboxing? I can't remember what, what you always do after the show and kick kickboxing.
Usually you go, um, I, it's interesting going through these clips. Between the two of them in how Jeff Bezos and Amazon are going for this kind of shotgun approach, general ubiquity across a consumer's spending habits in dozens of different arenas that are close to an important, uh, to a consumer, you know, that they have convenience and, you know, low friction to access.
And Elan is like, pardon the phrase, you know, shooting for the moon here, with what he's doing. You know, he wants the Tesla to be the electric car that everyone is driving and he's, he's betting on that. One thing, you know, the Tesla battery technology is going to be in everyone's homes and to power. All of our cities.
And so it's, it's, Jeff's kind of, uh, desire to go broad in how he's been successful with that in building the flywheel. And Elan's kind of obsession with these, uh, single products and services. You know, to make them ubiquitous it very interesting and different approaches. And they're both finding some success.
They, yeah, they are. And that, that contrast is, is very interesting to me. It is. It is. I think that, um, Once again, Musk and Bezos have demonstrated, have proven just how remarkable they are. We're so lucky. Like, like they said, we're at this tipping point and we're seeing so many new things that we can, we can learn from.
And as we teased earlier in the show, it's not only Mr. Musk and Mr. Bezos that have been busy. Uh, Chad and Mike are. Very very conscientiously, uh, working hard at building out the moonshots program. And I think the first thing we should talk about Chad is our next live video broadcast. You and I will be on the European continent once again.
And this time we'll be broadcasting live from Bucharest, which is a place that you find yourself in from time to time. Yeah, I'm, I'm often in the, in the, the, the Paris of the East, as they say. Um, that's where the, uh, the headquarters is for, for quality runs. The firm that I work at. Uh, we got like 200 engineers running around their design is UX guys and girls.
So we're going to do a live broadcast on March 15th and it will be on Facebook. It will be at the offices. There will be a ton of people there. It's going to be very exciting. We're going to be discussing learning leadership, productivity, life, harmony innovation in Romania. With some great entrepreneurs and innovators.
We'll, we'll tell you more about those in the, in the next show. Um, but that's super exciting, but that's not the only video news we have. No, we're, um, we're going to be putting the moonshots episodes and shows in more places, you know, look to our YouTube channel, to see the episodes, start to appear there.
And Mike and I want to experiment with some. Live some more live broadcasting. So if you haven't already go to moonshots.io where you'll find all of our contact information across all social media platforms. And, um, I think the next thing we're going to experiment with is, you know, short five minute teasers of upcoming shows to give you a preview into.
Into what we're going to talk about. Yes, can't wait. So just go to moonshots, uh, dot IO to get all the news about all our new video products and all the new content that we're pushing out there. But before we leave, we should sign off with a quick check-in on our next episode. So to kind of, uh, put some options out there for your chat, we can go into the world of some of, uh, Silicon Valley's best founder CEOs.
Potentially Zuckerberg, Mike Benioff Hastings from Netflix, Steve jobs from Apple. Are any of those tickling, your fancy, are they a nice pivot out of Musk and Bezos? Or do you feel like you want to get into some innovation authors like Eric Reese and Simon Sinek? What's what's tickling the chatter. Oh, and fancies.
Oh, I don't know. I think, I think we have to go for another big one. Um, I think, um, I think Mark Zuckerberg could be very interesting to profile him and his time at Facebook. You know, another founder CEO that has done well and faced some challenges along the way. Yeah, I like it. And I think what's really interesting is I think that, um, Facebook has achieved a sort of scaling growth that challenges that of Amazon and me maybe, um, they are a little bit more mature in age in internet time, because I feel like there's some challenges there, there was some recent reports that.
They're really struggling with, uh, young audiences and that Snapchat is really starting to eat into market share in the 12 to 20 age groups. So it could be very interesting to see what we can learn, not only from creating great growth, but dealing with adversity and challenge. Mm. Yeah. And we've got other great ones, you know, Marc Benioff from Salesforce, Reed, Hastings of Netflix.
I can't wait to dive into some of those. Yeah, yeah. Yeah. All good. Well, Chad, this was a great doubleheader episode Musk in basis. I'm I'm totally pumped. I'm living the flywheel. I'm living the 10 X. I really. Such great reminders and great inspiration for us on, on what you've got to do to innovate. I'm pumped for the next show.
What are you going to be working on next? Now that you've got this inspiration? What's, what's the thing that you're going to bring into focus. Thanks to Musk and Bezos. I'm recommitting myself to my work and my business. I think, um, that compensation plan from Musk and his commitment to Teslas is really inspiring for me.
So I'm, I'm doubling down on, on what I'm doing and I'm just hope to be able to do more of it this year and for years to come. Nice. I like it. Well, what a great way to wrap the show with a doubling down on the things that really matter to us. So. If you want to follow up on anything we've discussed on the show today, head to moonshots.io, where you'll find all the thoughts, notes, and musings from Chad and myself.
So from us here at the moonshots podcast, we're going to say all reservoir idea and we'll see you on the next episode of the moonshots podcast. That's a wrap.