- Duration: 32 min
- Platform: meet
- Source: Read.ai 01JBJ2HCV3ZXD2HW4KSR0QW3GD (https://app.read.ai/analytics/meetings/01JBJ2HCV3ZXD2HW4KSR0QW3GD)
Transcript
[Michael Houck]: Yeah, it’s good. Busy week, pretty hectic week actually, but all good things. So I can’t complain. [Rama Afullo]: How about you? Yeah, awesome. Same. I mean, there’s tech lines disrupt this week. So a lot going on. So I’ve had maybe four weeks of back-to-back tech weeks while also building a product, while also raising money, while also, also, also. So it’s been a funny and an interesting journey so far, but it was cool. Like I met, Vinod Khosla this week, which is really cool. Some of the CTOs of NASA, that was interesting also. So it’s a bit of a back-to-back week, but some really, really interesting folks at the same time as well. [Michael Houck]: Were you meeting with them and with Vinod, or did you just run into them? [Rama Afullo]: I mean, he was at Techrise Disrupt, and then I was like walking back from talking to some folks in NASA, and there he was. I just had a conversation with him about a few things, and he’s like, yeah, like, you know, a very interesting guy. He brought me an email, so I’ll probably chase him when I get to the seed side of things, you know? [Michael Houck]: He’s a legend, man. [Rama Afullo]: Yeah. [UNKNOWN_SPEAKER]: Yeah. Well, cool. [Michael Houck]: Look, I’m excited to learn more about you and also about the product. I think you I would have never even thought this was a market, but now that you said it is a market, I’m like, that makes a ton of sense. Uh, so I’m excited to actually hear about it. And also just how you came across this in the first place. [Rama Afullo]: Obviously you would face it for a bit, but yeah, I want to hear the backstory. Yeah, sure. And, and just by the way, I believe I actually was subscribed to your newsletter, um, for a while. Uh, I think I did a newsletter cleansing, uh, and now, now I’ve just started subscribing to all of the I was like, come on, do more, do more. It was useful. I remember reading a bit about it every now and then. Maybe I can just tell you a bit about me and then jump into how I sort of came to the ideation of this product. It’s a bit sci-fi, right? So interesting, interesting stuff. Yeah. So I’m Kenyan born. I’ve lived in Kenya, Botswana, South Africa, the Netherlands, Ireland, and the US. So six countries so far, 10 or so cities. So I’ve always been a nomad. You live in Cape Town at all? Yeah, yeah. Cape Town’s the city I actually spent the most time of my life in. [Michael Houck]: My wife and I go down there for the winter every year. It’s just so beautiful. [Rama Afullo]: Oh, wow. Cape Town’s amazing. I’ll be there in, for the final week of December, and then for a couple of weeks in Jan. [Michael Houck]: Oh, we might overlap a bit. [Rama Afullo]: We tend to go down right before New Year’s, so maybe I’ll see you there. Most definitely, I think. [Michael Houck]: That’s one of the most beautiful cities in the world, in my opinion. Right? Yeah, yeah. I’ve spent way too much time in Stalbosch in France, having a… [Rama Afullo]: You’re asking lunch bombs. Okay, I see you, Michael. I see you. Yeah, yeah, yeah. I’ve done that red bus tour to a city like hopping from wine farm to wine farm, like Constantia and all of that. And I’ve never made it to the third wine farm, like ever. Oh, I’m out for the count by the second one. I’m like struggling to find an Uber, you know, every single time, every single time. I’ve gone in with that intention. I swear I’ve never seen what the third wine farm looks like, But yeah, my background in Mechanical Engineering, Space Systems Engineering, and Business Management. Worked for Tesla, Google, SpaceX, across telecoms, cloud engineering, cloud computing, and as a part of my Starlink. So I can’t go into detail on any of those, but I think overall I just did a bunch of really big deals. Like at Google, I also put together the first ever landmark deal between Google and Y Combinator. Right, directly with Gary Tan and Diana Hu, literally in Gary’s living room, put that together, closed that deal, or yeah, did Tesla’s first ever telco deal ever, right, from sort of the ground up, right, and built that vertical for Tesla from the ground up as well, and sold the first of the deals in that regard. So our point has been sort of, in the interface between engineering and business in terms of my overall approach and even in my background. But when I was at SpaceX, I asked them a lot of really annoying questions about what they were doing there. So I figured out that it was sort of counterintuitive for SpaceX, like they’re a vertically integrated closed ecosystem. And to become a horizontally integrated open ecosystem would be like the exact antithesis of what they’re trying to do especially since they own so much of the market, right? So I opted to leave SpaceX quite quickly. I’d already done my time three years at Tesla before my five years at Google, so I sort of knew what I would be getting myself into, right? Figured it was after a bit, I realized it was more or less the same, right, as what I’d left at Tesla, so I wasn’t really gonna gain that much value, at least in terms of where I wanted to take my career. Also, I think time is the only luxury, right? Yeah, I’ve got to do the thing before I get married or anything. So we’ll see. I’m married to the business. So in terms of the ideation, I actually have had the domain for Satellite for eight years. So I think at the time I had the .com, the .net, and the .space. And I got the .ai like three years ago or so. And I just thought it was cool. I knew I’d do something with it. Of it as space and technology analytics, right? But in the end, two years ago, two and a half years ago or so, I started thinking about what I possibly could do like when I get my green card. And some of the ideas were like, you know, like, you know, there probably should be a cloud computing solution for space or like, why aren’t satellites interconnected? Like, what is stopping that from happening? And this is when I was uh, when I just become a cloud architect. Right. Um, so at that time I just, like, you know, it was really like in the back of my mind that this could be something useful. And I think over time, if you, so like connect a lot of the dots of the things I did, the telco stuff at Tesla, the cloud stuff at Google, and then finally the styling stuff, like you can see, like, I was like, you know, the idea was just being fermented and cemented. Right. In my mind So eventually I Like I just come I’d come up with this idea. I got my green card at the end of last year I thought you know what if someone’s gonna beat me to this it’s probably gonna be spacex. So let’s go if they’re doing it I’ll follow suit. All right And I’ll just help them build it Right and turns out that they had disbanded the team that was trying to do this the month before This might be surprising to anyone who hasn’t worked at an Elon company. But I was not surprised at all. It’s a thing that happens all the time. I guess you got to kill some innovation to make other innovation happen. [Michael Houck]: It literally happened to me too. It was like that at Uber too, when I was there. Same type of situation. This was back in 2016. [Rama Afullo]: So Travis was the same as Elon for sure. Kalanick, yeah. Another famous wildcard. [Michael Houck]: Let’s call them that. [Rama Afullo]: Yeah, we’ll play it safe for the sake of the Read.AI meeting notes. Yeah, so I think for me, yeah, I think that was really the ideation and really what the idea ended up being is satellites, other than those that are within their own constellation, and even then, tend not to have a standardized communications protocol and tend not to be networked, right? Which means that there are a number of things that can go wrong, right? For example, for avoiding collisions, it becomes so much worse if you’re not interconnecting, you don’t see what’s going on. You’ve got to rely on the satellites communicating to the ground and back up. Now, if you’ve got cloud cover, that is also very difficult for you to be able to communicate with the ground whenever there’s cloud cover or electromagnetic radiation or solar flares or, you know, the list can go on. Everything goes wrong in space, right? It just does. But beyond that, you have really, really high latency as a result of not being networked. So instead of, oh, I’ve got cloud cover blocking my view. Let me send my data to the neighboring satellite as a conduit down to the ground. I’ve got to wait for this cloud cover to finish, at which point my contact time with the ground station will have been severely impacted, and then I’ve got to take another revolution. But during that next orbital revolution, I have collected more data and overwritten the last data, right? It’s just like a comedy of errors, actually comical sometimes when you look at how the space industry operates. It’s kind of funny, right, if it wasn’t so potentially catastrophic. So that’s what we’re building. It’s a software-first solution. We’re not putting out a constellation of satellites to go and solve for constellations of satellites, which some of our competitors are attempting to do. More power to them, because they shall be nodes in our ecosystem. But let them go ahead and do that. But we’re uplinking software directly to these satellites and we’re getting them to be able to intercommunicate with each other and be interoperable. This would mean that we essentially create an internet or a cloud service and it’s a shared revenue model. So it’s like akin to Airbnb for space compute. So maybe I should stop because I’m about to dive really deep. Maybe like, I don’t know if you’ve got any questions, like I can go on and on. I live this on a daily basis. [Michael Houck]: One question that came to mind when I was looking through the deck was, do you think you’ll be able to get enough, is there enough density of a market to get, is there a large enough market to get with SpaceX being so dominant? Can you get into this space and be large enough or are they just gonna be able to come in and acquire you guys at some point and take the market? [Rama Afullo]: Yeah, I mean, I wouldn’t be, opposed to acquisition if it’s in the right hands. I think I’ve got a very principled approach to how I’m trying to build this. SpaceX is technically right now not our competition, right? They are networking their own satellites only, right? They have a very different philosophical approach. I’ve seen the plans. Read.AI might read too much into what I have to say at this point, but they are focused on a consumer product, right? Beaming down satellite internet down from space, broadband internet. And they’ve, of course, got some commercial and government integrations as a result of that. But generally speaking, it’s for that same broadband internet. That’s what they use Starlink for. Starlink is actually just a mechanism to make Starship work. That is literally what it is. It is the cash cow for Starship. To go ahead and explore Mars, right? So we see this as very different. So if SpaceX is the iPhone, we are Android, right? In my head, that’s how I was thinking about it. [Michael Houck]: And so I just don’t know how big the market is. So it sounds like it would be big. [Rama Afullo]: It’s a sizable market. So just for some sense of framing here, there are 10,000 satellites in orbit or 13,000, whatever. Satellites in orbit right now, right? Two thirds of those satellites are SpaceX Starlink satellites, right? Right now, 10 years ago, there were less than 1000 satellites ever launched, like ever, right? So things things have shifted significantly, right? The size of satellites used to be, they used to be massive, right? In the next 1010 years or so, we’re going to go to between 100 and 500,000 satellites in orbit. So Things are changing significantly. And of those, only 20% to 30% of them will be SpaceX Starlink satellites, because they’ll have reached their capacity for what they are trying to achieve, which is to be able to provide broadband internet to every corner of the Earth at any given point in time. And they’ll need to cover the ground with their ground stations, which is actually part of the flaw of the entire SpaceX ecosystem. In order for them to lower latency, they need to have the presence of physical ground stations in that locale, right? Which is exactly what I’m trying to solve against. So I’m trying to kill off ground stations, right? [Michael Houck]: By my very nature, right? [Rama Afullo]: So there’s a future world where they’re actually a customer of you guys? Possibly, right? You’d have to un-elonize them. Them, right, a little bit, you know, in order, in order for them to make that sort of pivot, because they do have the capability to add edge nodes and to try and do this, right, but they just don’t have the motivation to do this, right? It doesn’t, it doesn’t make any sense for them in terms of what they would have to do to their satellites in order to achieve this, right, for them, for their thing. It’s like, it’s like telling, telling, Apple to install Android right now, right? Like, it’s just not gonna happen. They can do it, but it’s not gonna happen. [Michael Houck]: Logically, it checks out. I buy it. Well, yeah, let’s go deeper. I wanna hear more. Let’s go deeper. Sure. [Rama Afullo]: Okay, so look, if we look at the overall market, right, of those satellites in orbit, if we think about the different things that we can do with this tech, just in general. Before there were cloud service providers, people were putting together their racks of data, their data racks, and like on-site, on-premise, right? And they would handle basically every interaction, every transaction, anything that happened like on their own data centers, right? Now, people are offloading that and doing all sorts of things that even the cloud service providers never thought that they were going to do, right? Like transferring things between one region and another instantaneously, right? Or being able to use a lot of these as redundancy and backup and doing some data warehousing that folks didn’t think would be as useful as it is, or even building their apps directly from the cloud service providers, right? That’s very different from what the initial point was, hey, come store your stuff on our data centers, right? That literally was the was the entire pitch that AWS is putting out there, right? Now, it’s a whole different market. So that’s exactly what we want to build here, right? This becomes the sort of the backbone of the internet for space, right? Like where we have the TCP protocols, where we have the standardization micro mechanisms to be able to tell people, like, use these communications for protocols, right? Rather than whatever you’re using, which tends to be people are just like taking whatever available spectrum there is and coming up with their own comms protocols for every mission, which just is, it’s so silly. It’s really difficult to put this into words how silly this all operates at the moment. It’s like if every five cars had their own special road, right? It’s like, it’s mind boggling. It’s like numb. It like numbs the mind, right? Like all of you, this is my road and this shall be my road whether I’m using it or not. That is literally how the space ecosystem works. It’s, yeah, it’s really dumb. So we could, for example, with this inter-satellite network, this interconnected network, we could oh, a fire is coming from this specific point at this instantaneous time because one of the satellites in this node detected a spark right here. Everyone you know, like immediately, right? Right now, do you know how they detect this? Like the satellites is like, oh, it is possible that there’s a fire coming. I shall tell you at the end of my next revolution in 90 minutes. Okay, now I’m connected to a ground station. I’ve got a 10 minute window. To tell you that the fire is coming. Okay, it is being downlinked to you. Oh, there’s cloud cover Okay. Well, I guess you won’t know the fire is coming. Let me go around again Okay, the fire has begun. Okay, let me down. Okay. I got I finally there’s no cloud cover this time Okay. Now, you know that a fire was coming like two hours ago Literally so bad just like that fire example, uh the fire example, there’s a pun in there but like It’s so bad that Google has now elected to set up its own satellites just for fire detection, like last month. It’s that stupid. And what people are saying, OK, well, let’s solve this by adding more ground stations. It’s literally the equivalent of saying, well, you know how I’m going to solve the fact that my car has its own spectrum? I’m gonna add more fuel on the road. Like, on the road! Like, it’s so silly. [Michael Houck]: Okay, so other people are trying to solve this in this flawed way of putting these craft stations out there. My question is, why are they doing that as opposed to seeing this apparently obvious opportunity here to do what you guys are doing and connect these in space? [Rama Afullo]: Oh, they see the opportunity. I was at the Silicon Valley Space week, last week. The CEO of Viasat, CEO of OneWeb, UtahSat, CEO of Maxar, CEO of like the biggest space companies that don’t start with SpaceX, right? We’re all there, right? They were all talking about interoperability, a shared communications protocol. I asked them point blank, right? Like literally they had a Q&A, point blank. You’re all talking about this thing, right? We’re all, computer history museum where they’re talking about all the different things we’ve done for interoperability of the internet, right? Why don’t you all decide right now to start working on a shared communications protocol? Have you watched The Matrix? [Michael Houck]: Yeah, of course. [UNKNOWN_SPEAKER]: Favorite. [Rama Afullo]: Remember Neo dodging bullets? These are the scenes that were seen on that day, Michael. It was kind of hilarious. The CEO of Viya that was asked directly about letting Globalstar, one of his arch nemeses, dive into some of his comms protocols. And he leaned into the mic and he said, no. There’s a lot of egos. It’s a very old ecosystem. A lot of folks in the vertical are like CEOs in this vertical are 60, 70 plus years old. They have They have an old school way of thinking. They have an old school way of ideating of what a satellite is. It’s the very reason that our 20-year-old company has just come in and appended 70, 80, 90-year-old companies that have every government advantage known to man. Boeing is basically a government wing. How is SpaceX beating them? It’s shameful. So the way I see it is all of them talk about this thing. None of them want to do something about it. Are nervous also. They’ve even gotten nervous to say anything against SpaceX because SpaceX doesn’t subscribe to standardization either, right? So they’re treating SpaceX like they treat the government because SpaceX is also actually basically a government way. [Michael Houck]: Okay, so then that all makes sense that they wouldn’t do it themselves because they wouldn’t trust each other with that. Why would they trust the third party? What have you seen in terms of sales when you’ve been talking to these people? What What did they push back on all that? [Rama Afullo]: So one of the primary reasons why they don’t trust each other is because they’re each other’s competition. We’re not building satellites, right? We’re not building rockets, right? Our very aim right here is this interoperability that is very different from other folks like who, for example, they say, well, uh, the, the space development agency, right? Uh, are the folks who are trying to create a standardized market, but they also fund a lot of the different competitors, right? Like it’s, it’s, it’s diametrically opposed views in the same room, right? It makes no sense. Whereas our main goal is to say, well, we’ve got a product that is essentially Airbnb for space compute. We can optimize your satellites, right? We can, you can rent a rent out your excess compute. Our people and people can rent that from you and you get the lion’s share of those profits, right? And our entire incentive is to make sure that we’re all into connected because it helps us as satellite, right? It’s a very different proposition, and it’s part of why we’ve opted to not go the hardware route, right? Because as soon as you do that, you are a satellite manufacturer. Yeah, you’re a competitor at that point. Exactly. Because you will for sure start thinking, I could also do Earth observation. I could also do asset tracking. You start thinking about other things you want to do with your satellite. There’s no way you won’t, right? And as soon as you do that, you competitor and these people do not like competitors. [Michael Houck]: So you guys have raised $500. It looks like relatively quickly too. How much more are you taking on? What's the status of that? [Rama Afullo]: All that kind of stuff. So we've raised $600. So $500 directly from Antler. $100 from Angels. We’ve gotten a bunch of term sheets that we didn’t agree with at all. Because there’s always some clauses, discounts later on, et cetera, right, that we don’t necessarily agree with. We’re looking to raise another 400 or 500, right? Yeah, so that’s where we are right now. Ideally, we’d like to raise it yesterday because we want to spend November really, before people disappear and go on Christmas break and you can’t reach anyone, right, like after Thanksgiving, we would really love to test out our systems in a really impactful way. But yeah, so the status of that, there’s a few others that we’re waiting for. I think one or two of them will probably send a term sheet. We’re very discerning. I think for me though, anyone Jeff sends, I definitely wanna have a conversation with, because I trust his judgment. Yeah, he’s cutthroat, but he gets to it, right? Like at least you know exactly where you’re at. Right. So I like that a lot. Um, so it’s, yeah, that’s where, that’s where we are at the moment. Um, yeah, even though the million raise is probably not absolutely necessary, which is why I can like rest to my laurels and be like, Oh, you don’t give me exactly the terms I wanted. But, but at the same time, it’s, it’s a case of, um, we, we want to like, this is this marriage essentially, right? Like we want to have the right folks on board who really believe in us, um, who, who, want us to make things happen. I mean, like Jeff and the Antler team. Before I even had a green card, right? Like, before I even breathed that I really was doing a startup, they were trying to, like, get me signed up. Oh, yeah. Oh, yeah. I mean, this is before they even knew that I was there, like, I ended up being, like, their Google contact and doing a whole bunch of stuff for them. Like, I was, when I was running the stuff with with Antler, with Techstars, et cetera, but even before that, right? So, so they, they, yeah, they have real conviction right now. Yeah. Well, cool. [Michael Houck]: I guess on our side, so, yeah, let’s see, I guess I didn’t really give too much context on me at the beginning. So I did the whole big tech thing too. I was at part of the early team at Uber Eats, helped grow that business and then jumped over to Airbnb as a product manager. Manager there for a while, helped build Airbnb Plus. Then the whole team got laid off during COVID. And so I started a company called Launch House. Ended up raising our Series A from Andreessen. And we raised a venture fund as well. Basically, we were running these co-living residencies for founders all over the world and like very nice mansions and investing in the companies that came through. It’s sort of like, if you know HF0, Dave Fontenot’s thing, like a precursor to ATF zero. And so he made a bunch of investments out of there. And then I left that company in the first half of 2023. And ever since then, I’ve just been basically building up a holding company. Recently, I started wanting to get back into the investing side of things. And so Rama’s a friend, we got, you know, reconnected, and basically, I’m helping him write some checks out of weekend fund. So I know from are with Weekend Fund, Ryan Hoover’s guy, founded Product Hunt, obviously. And so yeah, so 200 to 400k checks, sector agnostic, this is super exciting, and pretty high conviction, I would say. We’re not going to wait to see who else is investing or anything like that. It’s more so, do we like it? Do we like the opportunity? Do we think it makes sense? So yeah, that’s the So that’s kind of the TLDR background there. [UNKNOWN_SPEAKER]: Cool. [Rama Afullo]: How do I make this as quick as possible? What are the things I can do? Of course, I know Rhino, I know Product Hunt, I’ve heard of the Wicked Fund. What can I do? What are the mechanisms? I mean, it’s a pretty lightweight process. [Michael Houck]: So basically, the next steps from this, first of all, I like it. I think it’s super interesting. I think you clearly know the market. You clearly see the opportunity. And yeah, I think there’s something compelling here. So I’m gonna forward this over to him. I’ll be like, hey, you know, talk to Rama. He’s great. You should chat with him. He’ll probably reach out to Chad maybe next week. And that’s pretty much it. It’s not some heavy process. I would say we don’t need a ton of like materials or anything like that. We’ve got the deck. If you have anything else that we should look at, please send it over and I’ll include it I know to him, but yeah, I think everything, everything else is like information overload of epic proportions, right? [Rama Afullo]: Like if you guys decide you want to dive into the data room, like, let me know, but like, it’s, it’s crazy, right? Like this, but more than happy if, and please let him know as well, if he wants my head of engineering to also join, I’m happy to do that. Right. [UNKNOWN_SPEAKER]: Okay. Yeah. Cool. [Michael Houck]: Sounds good. I’ll, I’ll reach out to him tonight and we’ll probably hear back. I’ll get in touch. You next week. [Rama Afullo]: Sounds good, Michael. Enjoy the conversation. Let me jump back into your newsletter. Now that my newsletter detox is over, I was surprised like 50 at some point. [Michael Houck]: It was crazy. Yeah, I feel like it blew up earlier this year and everyone’s just subscribed to so many. [Rama Afullo]: But yeah, if we end up doing the deal, you got to make it past the third station on the wine tram. Oh man, that thing is crazy. Let me know when you’re in Cape Town, regardless of what happens here. Let me know. [Michael Houck]: I will. We’ll probably be there in, as I said, last week of December or first part of January, so I’ll let you know. [Rama Afullo]: Yeah, I’ll ping you. When you get to Cape Town, ping me and I’ll drop you my number. [Michael Houck]: Will do. All right, chat more soon. Good to meet you. See you.