If there was a correlation with HR and improved outcomes it would be rational for leaders to invest more

Tuesday, December 31st, 2024

Pamela Dow explains how human resources captured the nation of Great Britain:

Until I started working in the Cabinet Office in 2020 I hadn’t paid much attention to human resources (HR). I had rolled my eyes at more time wasted circumventing another rigid recruitment policy, which, although introduced to make things better, was in fact making them worse. I assumed HR was unavoidable in large organisations, and mostly there to help.

My role was to restore relevance and rigour to civil service training, from entry to leadership. It brought me close to the gatekeepers of employee relations.

[…]

Why were recruitment processes taking so long? To ensure fairness. Who decides what’s fair? The Public Sector Equality Duty, in precedents set by courts and interpreted or pre-empted by employment lawyers and HR advisers.

Why were so many employee grievances settled at such great expense, before and after employment tribunals? Because there were so many transgressions of HR policy, often by the very people who had codified the rules.

Why did every internal meeting start with a lengthy “emotional check-in”? For psychological safety. Where are people learning about that, and similarly subjective concepts? In acquiring vocational credentials from the Chartered Institute of Personnel and Development (CIPD) and other HR representative bodies, and attending their courses. In September, Sam Bowman, Ben Southwood and Samuel Hughes published their “Foundations” essay, which attracted significant attention in the national policy debate. It details how Britain is an outlier, lagging behind comparable G7 nations since the financial crisis, and struggling with growth, productivity, and weak state capacity.

The authors explain why, with clarity and precision: private investment is over-regulated and distorted by complex tax codes; infrastructure projects are stymied by lobbyists and lawyers; and the 1947 Town and Country Planning Act removed the incentive for local councils to permit building infrastructure.

The essay does not mention that Britain is also an international outlier in its dominant and expanding HR sector. We have one of the largest in the world, second only to the Netherlands. HR jobs have been growing steadily in most Western countries but the UK is top of the league* (turn over to see tables evidencing this). The British Labour Force Survey (LFS) shows a steady, 83 per cent increase, from just under 300,000 workers in 2011 to more than 500,000 in 2023. Might this also be an explanation for our national sluggishness?

[…]

Alongside good pay and job security, in many organisations HR allows influence on high-status topics, incommensurate with position: global social justice and identity campaigns.

[…]

In Britain the share of HR directors on boards has increased sharply, from 47 per cent in 2005 to 85 per cent in 2017. More than 70 per cent of FTSE 100 companies have a chief HR or people officer on their executive committee.

The UK legal and policy framework has also been fertile ground for HR growth over the past 20 years. The Equality Act assigns rights that have been interpreted well beyond their intent of fair opportunity, and definitions of “protected characteristics” are increasingly unhelpful. For example, graduates checking “disability” on their application to the Civil Service Fast Stream rose from 11 per cent in 2014 to 23 per cent in 2020. At the time, this allowed candidates to skip an assessment stage, perhaps an incentive to disclose an anxiety disorder. The civil service now is less certain how many people are blind, bipolar, using a wheelchair, or with self-diagnosed ADHD. It’s not a great leap to appreciate both the work this creates for HR, as well as the impact it has on productivity.

If we could track trends towards higher retention, happier workers, fewer grievances, this growth would be welcome. If there was a correlation with HR and improved outcomes it would be rational for leaders to invest more. There is evidence for the opposite. As HR roles have increased so too have the number of tribunals and days lost to work-related illness, while productivity has flatlined. HR expansion is not coinciding with desirable things and appears to be coinciding with undesirable ones.

Posted in Business, Economics, Policy | 4 Comments »

Joe Rogan interviews Marc Andreessen

Wednesday, November 27th, 2024

I’ve been watching fascinating snippets of this interview with Marc Andreessen, and he makes some alarming points:

Posted in Business, Economics, Policy, Technology | 1 Comment »

Even SpaceX looks like small potatoes next to an industry like global logistics

Saturday, October 19th, 2024

Cargo airships could be big, Eli Dourado notes, because the performance of an airship gets better as it gets bigger:

If your airship performance isn’t good enough, just double it in size. The lift will increase by a factor of 8, the drag will increase by a factor of 4, and the lift-to-drag ratio will therefore double. Still not good enough? Do it again.

To do cargo airships right, we need to make the biggest flying objects ever created. A modern cargo airship would make the Hindenburg puny by comparison.

[…]

According to the Bureau of Transportation Statistics, average revenue per domestic ton-km is about 83¢ for air freight, 11¢ for trucks, and 2¢ for water transportation (in spite of the Jones Act).

[…]

What we observe under these conditions is that, domestically, most of both the tonnage and value of cargo is transported via truck. Trucks are neither the fastest nor the cheapest mode of transport, but they provide a great value proposition—you get your stuff in a few days for much cheaper than air freight.

[…]

Let’s say airships captured half of the 13 trillion ton-km currently served by container ships at a price of 10¢ per ton-km. That would equal $650 billion in annual revenue for cargo airships, notably much bigger than the $106 billion Boeing reports for the entire global air freight market. If one company owned the cargo airship market, taking only half of only the container market, it would be the biggest company in the world by revenue.

[…]

If each airship can carry 500 tons, cruises at 90 km/h, and is utilized two-thirds of the time, that adds up to around 260 million ton-km per year per airship. To produce 6.5 trillion ton-km per year would require 25,000 such airships. This is about the number of airliners in the world today.

[…]

When I initially started thinking about cargo airships, I thought it would make sense to take a cue from Hindenburg, which cruised at 125 km/h. As I will discuss below, maybe that is still the right choice, but even at that speed, you are on the wrong side of some unpleasant math.

The power needed to drive an airship is proportional to velocity cubed. Because the mission takes less time when the ship is moving faster, the total mission fuel required is proportional only to velocity squared. The net effect is that transport efficiency decreases quadratically with cruise speed.

[…]

Cargo airships would probably be among the easiest vehicles to make unmanned. The sky is big and empty, but it’s especially empty over the ocean at the lowish altitudes, below airliners’ Class A airspace, where airships would fly.

[…]

The USGS estimates the private sector price of helium to be $7.57/m³, while hydrogen is sometimes available for $0.11/m³. It would cost almost $8 million to fill our 500-ton airship with helium, and just over $100k to fill it with hydrogen. Lifting gas doesn’t get used up the same way as fuel does, but through leaks and venting, it wouldn’t be just a one-time charge. Hydrogen is cheap enough that you can design to vent it to help keep the ship trim.

[…]

The USGS estimates that the entire planet has helium reserves of around 40 billion m³. Global helium production is only around 160 million m³ per year, enough for about 141 airships.

[…]

Ideally, airship fuel would be neutrally buoyant, the same density as the surrounding air. This would ensure that as the fuel burned off throughout the journey, there would be no need to vent lifting gas. You could do this by using as fuel a mixture of the slightly heavier-than-air propane (C?H?) and the slightly lighter-than-air ethane (C?H?).

[…]

With real-time wind data, it should be possible to plan a route that uses winds to minimize fuel burn and increase overall performance. It would be bringing a form of sailing back, only using tons of atmospheric data and autonomous route planning to do it in modern style.

[…]

We’ve been assuming a cargo airship can do 260 million ton-km/year at 10¢/ton-km for annual revenue of $26 million/airship. The fuel cost of doing 260 million ton-km would be around $4 million, leaving $22 million/year for other costs including insurance, capex amortization, ground support, maintenance, and profit. This depends on a lot of assumptions, but if you can build the airship at rate production at a cost around $100 million, the math is getting close to working.

[…]

In my experience, once you start thinking about giant cargo airships, it’s hard to stop.

Indeed, he kept thinking about airships:

You can cross the Pacific in a plane in less than a day. You can pay for parcel service that will get you your package in 2 to 3 days. But for air freight service, end-to-end delivery takes a week or more, involving multiple parties: in addition to the air carrier and freight forwarder, at both the origin and destination, there is a trucking company, a warehouse, a customs broker, and an airport. Each touchpoint adds cost, delay, and the risk of theft or breakage.

Once you account for all these delays and costs, the 4 to 5 days it takes to cross the Pacific on an airship starts to look pretty good. If you can pick up goods directly from a customer on one side and deliver them directly to a customer on the other, you can actually beat today’s air freight service on delivery time.

This changes everything. Since airships are, after all, competitive with 747s on delivery time, you can earn the full revenue associated with air freight, not just the lower trucking rates I had assumed. Cargo airship margins, therefore, can be much higher than I had realized.

Today’s 747 freighters have almost no margin. They operate in an almost perfectly competitive market and are highly sensitive to fuel costs. They simply won’t be able to compete with transpacific airships that are faster end to end, less subject to volatile fuel prices, and operating with cushy margins. A cargo airship designed to compete head to head in the air freight market could take the lion’s share of the revenue in the air cargo market while being highly profitable.

[…]

Many software investors eschew hard tech startups because of their capital intensity, but it’s hard to deny that huge returns are possible in hard tech: just consider SpaceX. Bring me another SpaceX! the reluctant investors might say.

But even SpaceX looks like small potatoes next to an industry like global logistics. For a Falcon 9-sized investment, instead of revolutionizing a $2 billion/year (10 years ago) commercial launch market, you could transform a market that is at least 30 times bigger, with similar unit economics to SpaceX

Posted in Business, Technology | 14 Comments »

Those numbers sound big — but they were insufficient to keep up with demand

Tuesday, October 1st, 2024

As recently as 2010, a small town in central Michigan was the world’s biggest producer of solar polysilicon, but now more than 90% comes from China:

Washington blames China’s dominance of the solar industry on what are routinely dubbed “unfair trade practices.” But that’s just a comforting myth. China’s edge doesn’t come from a conspiratorial plot hatched by an authoritarian government. It hasn’t been driven by state-owned manufacturers, subsidized loans to factories, tariffs on imported modules or theft of foreign technological expertise. Instead, it’s come from private businesses convinced of a bright future, investing aggressively and luring global talent to a booming industry — exactly the entrepreneurial mix that made the US an industrial powerhouse.

[…]

Hemlock Semiconductor Corp. produces about one-third of the world’s chip-grade polysilicon, which finds its way into almost every electronic device on the planet. Solar polysilicon is simply the poor cousin of the stuff computer chips are made from: While impurities of one part in 100 million are considered acceptable for solar panels, microprocessors need to be pure to as much as one part in 10 trillion.

[…]

Dow had established itself in the 1890s in nearby Midland to take advantage of rich underground deposits of brine that could be refined into useful chemicals. The trains rattling back and forth there upset the delicate polysilicon purification process, so a new plant was established on isolated farmland in Hemlock, 14 miles (22.5 kilometers) to the south.

[…]

Things started to change around the year 2000, as rising concerns about climate change coincided with a surge in oil prices and the prospect of subsidies for renewables. Solar panels were traditionally so costly they were only used for highly specialized applications such as space probes, as well as watches and pocket calculators that only sip power. Suddenly in the early 2000s, solar started to look like a competitive way of producing energy.

As a result, PV-grade polysilicon — made until then from material rejected by chipmakers — seemed like it might become a valuable commodity in its own right. Almost overnight, it went from a backwater to a boom industry. The growth has yet to stop. Since 2005, annual installations of solar panels have increased at an average annual rate of about 44%. This year, the capacity of new modules installed globally every three days is roughly equivalent to what existed in the entire world at the end of 2005.

Hemlock initially surfed this wave. In 2005, it announced a $400 million to $500 million plan to increase production at the plant by half. Eighteen months later, it promised $1 billion more to add a further 90%. One more billion was announced amid the 2008 financial crisis, along with yet another $1.2 billion for a separate plant in Clarksville, Tennessee.

Those numbers sound big — but they were insufficient to keep up with demand.

There are a few reasons for that. First, Hemlock was owned by a joint venture between two American and two Japanese chemical companies, which between them produce everything from fiber optic cables to smartphone glass, plastics to insecticides, pill casings to machine tools and gold bullion. Such setups are notorious for complexity, which can undermine their ability to adapt quickly to changing conditions. Any fresh spending needed to get signed off by four corporate boards, none of whom saw solar poly as a priority.

Making matters worse was the fact that, when solar power started to take off in the late 1990s, Hemlock’s main shareholder Dow Corning was in the middle of a decade of bankruptcy protection — the result of lawsuits from women who claimed to have been harmed by its silicone breast implants.

Another factor was energy. As much of 40% of the cost of producing polysilicon is power, and the Hemlock factory is the biggest single-site consumer of electricity in Michigan — a remarkable statistic, when you consider the state also includes the immense General Motors Co. and Ford Motor Co. factories in Detroit.

Local electricity costs are relatively high. The 2008 expansion in Hemlock only went ahead after the state’s governor Jennifer Granholm — now President Biden’s secretary of energy — signed a bill giving the facility tax credits to protect it from electricity price hikes.

Posted in Business, Policy, Technology | 3 Comments »

Livvy has earned a total of $9.5 million during her time at LSU

Wednesday, September 11th, 2024

Student-athletes gained the right to profit off their Name, Image, and Likeness (NIL) a few years ago, which was a boon for female gymnast Livvy Dunne:

Livvy has amassed more than 8.1 million followers on TikTok and 5.3 million on Instagram at the time of this writing.

With her massive following, Livvy has earned a total of $9.5 million during her time at LSU. According to On3.com, she earns $3.9 million per year, up from a $3.3 million evaluation before LSU won the national championship.

Prime Video’s The Money Game apparently goes into this.

Posted in Business, Fitness | 2 Comments »

The legacy employees at Twitter didn’t know how to handle him

Tuesday, September 10th, 2024

Elon Musk by Walter IsaacsonOn December 22, 2022, Musk met with two of Twitter’s infrastructure managers, Walter Isaacson explains (in his biography of Elon), who tried to explain their problem:

The data-services company that housed one of Twitter’s server farms, located in Sacramento, had agreed to allow them some short-term extensions on their lease so they could begin to move out during 2023 in an orderly fashion. “But this morning,” the nervous manager told Musk, “they came back to us and said that plan was no longer on the table because, and these are their words, they don’t think that we will be financially viable.”

The facility was costing Twitter more than $100 million a year. Musk wanted to save that money by moving the servers to one of Twitter’s other facilities, in Portland, Oregon. Another manager at the meeting said that couldn’t be done right away. “We can’t get out safely before six to nine months,” she said in a matter-of-fact tone. “Sacramento still needs to be around to serve traffic.”

[…]

He paused in silence for a few moments, then announced, “You have ninety days to do it. If you can’t make that work, your resignation is accepted.”

[…]

“I’ve built server centers myself, and I can tell if you could put more servers there or not. That’s why I asked if you had actually visited these facilities. If you’ve not been there, you’re just talking bullshit.”

[…]

“All you need to do is just move the fucking servers to Portland,” he said. “If it takes longer than thirty days, that would blow my mind.” He paused and recalculated. “Just get a moving company, and it will take a week to move the computers and another week to plug them in. Two weeks. That’s what should happen.” Everyone was silent. But Musk was still warming up. “If you got a goddamn U-Haul, you could probably do it by yourself.”

[…]

They were not sure how they would even get inside the data center at night, but one very surprised Twitter staffer, a guy named Alex from Uzbekistan, was still there. He merrily let them in and showed them around.

The facility, which housed rooms of servers for many other companies as well, was very secure, with a retinal scan required for entry into each of the vaults. Alex the Uzbek was able to get them into the Twitter vault, which contained about fifty-two hundred refrigerator-size racks of thirty computers each. “These things do not look that hard to move,” Elon announced. It was a reality-distorting assertion, since each rack weighed about twenty-five hundred pounds and was eight feet tall.

“You’ll have to hire a contractor to lift the floor panels,” Alex said. “They need to be lifted with suction cups.” Another set of contractors, he said, would then have to go underneath the floor panels and disconnect the electric cables and seismic rods.

Musk turned to his security guard and asked to borrow his pocket knife. Using it, he was able to lift one of the air vents in the floor, which allowed him to pry open the floor panels. He then crawled under the server floor himself, used the knife to jimmy open an electrical cabinet, pulled the server plugs, and waited to see what happened. Nothing exploded. The server was ready to be moved. “Well that doesn’t seem super hard,” he said as Alex the Uzbek and the rest of the gang stared. Musk was totally jazzed by this point. It was, he said with a loud laugh, like a remake of Mission: Impossible, Sacramento edition.

The next day — Christmas Eve — Musk called in reinforcements. Ross Nordeen drove from San Francisco. He stopped at the Apple Store in Union Square and spent $2,000 to buy out the entire stock of AirTags so the servers could be tracked on their journey, and then stopped at Home Depot, where he spent $2,500 on wrenches, bolt-cutters, headlamps, and the tools needed to unscrew the seismic bolts. Steve Davis got someone from The Boring Company to procure a semi truck and line up moving vans. Other enlistees arrived from SpaceX.

The server racks were on wheels, so the team was able to disconnect four of them and roll them to the waiting truck. This showed that all fifty-two hundred or so could probably be moved within days. “The guys are kicking ass!” Musk exulted.

Other workers at the facility watched with a mix of amazement and horror. Musk and his renegade team were rolling servers out without putting them in crates or swaddling them in protective material, then using store-bought straps to secure them in the truck. “I’ve never loaded a semi before,” James admitted. Ross called it “terrifying.” It was like cleaning out a closet, “but the stuff in it is totally critical.”

[…]

Having ruined the Christmas Eve of the NTT managers, as well as hitting them with a potential loss of more than $100 million in revenue for the coming year, Musk showed pity and said he would suspend moving the servers for two days. But they would resume, he warned, the day after Christmas.

[…]

The moving contractors that NTT wanted them to use charged $200 an hour. So James went on Yelp and found a company named Extra Care Movers that would do the work at one-tenth the cost.

[…]

The servers had user data on them, and James did not initially realize that, for privacy reasons, they were supposed to be wiped clean before being moved. “By the time we learned this, the servers had already been unplugged and rolled out, so there was no way we would roll them back, plug them in, and then wipe them,” he says. Plus, the wiping software wasn’t working. “Fuck, what do we do?” he asked. Elon recommended that they lock the trucks and track them. So James sent someone to Home Depot to buy big padlocks, and they sent the combination codes on a spreadsheet to Portland so the trucks could be opened there. “I can’t believe it worked,” James says. “They all made it to Portland safely.”

By the end of the week they had used all of the available trucks in Sacramento. Despite the area being pummeled by rain, they moved more than seven hundred of the racks in three days. The previous record at that facility had been moving thirty in a month. That still left a lot of servers in the facility, but the musketeers had proven that they could be moved quickly. The rest were handled by the Twitter infrastructure team in January.

Elon had promised James a big bonus, up to $1 million, if he got the servers moved by the end of the year. Nothing was put in writing, but James trusted his cousin. After the move, he heard from Jared Birchall that the deal applied only to the number of servers that got up and running in Portland. Because they needed new electrical connections, that was zero. James texted Elon, who came back with the proposal that he would get $1,000 for every server that arrived safely in Portland, whether or not it was plugged in. That amounted to just over $700,000. Elon also offered him a stock option package to join Twitter. James accepted both.

[…]

“In retrospect, the whole Sacramento shutdown was a mistake,” Musk would admit in March 2023. “I was told we had redundancy across our data centers. What I wasn’t told was that we had seventy thousand hard-coded references to Sacramento. And there’s still shit that’s broken because of it.”

His most valuable lieutenants at Tesla and SpaceX had learned ways to deflect his bad ideas and drip-feed him unwelcome information, but the legacy employees at Twitter didn’t know how to handle him.

Posted in Business, Technology | 1 Comment »

It was so people can watch Netflix and chill and get online for school and do good peaceful things

Tuesday, September 3rd, 2024

Elon Musk by Walter Isaacson An hour before Russia launched its invasion of Ukraine on February 24, 2022, Walter Isaacson explains (in his biography of Elon), it disabled the routers of the American satellite company Viasat with a massive malware attack, which disabled the Ukrainian military’s command and control:

Top Ukrainian officials frantically appealed to Musk for help, and the vice prime minister, Mykhailo Fedorov, used Twitter to urge him to provide connectivity. “We ask you to provide Ukraine with Starlink stations,” he pleaded. Musk agreed. Two days later, five hundred terminals arrived in Ukraine.

[…]

The next day SpaceX sent two thousand more terminals via Poland. But Dreyer said that the electricity was off in some areas, so many of them wouldn’t work. “Let’s offer to ship some field solar+battery kits,” Musk replied. “They can have some Tesla Powerwalls or Megapacks too.” The batteries and solar panels were soon on their way.

[…]

Unlike every other company and even parts of the U.S. military, they were able to find ways to defeat Russian jamming. By Sunday, the company was providing voice connections for a Ukrainian special operations brigade. Starlink kits were also used to connect the Ukrainian military to the U.S. Joint Special Operations Command and to get Ukrainian television broadcasts back up. Within days, six thousand more terminals and dishes were shipped, and by July there were fifteen thousand Starlink terminals operating in Ukraine.

[…]

Starlink contributed about half of the cost of the dishes and services it provided. “How many have we donated so far?” Musk wrote Dreyer on March 12. She replied, “2000 free Starlinks and monthly service. Also, 300 heavily discounted to Lviv IT association and we waived the monthly service for ~5500.” The company soon donated sixteen hundred additional terminals, and Musk estimated its total contribution to be around $80 million.

[…]

Although he had readily supported Ukraine, his foreign policy instincts were those of a realist and student of European military history. He believed that it was reckless for Ukraine to launch an attack on Crimea, which Russia had annexed in 2014. The Russian ambassador had warned him, in a conversation a few weeks earlier, that attacking Crimea would be a red line and could lead to a nuclear response.

[…]

Allowing the use of Starlink for the attack, he concluded, could be a disaster for the world. So he reaffirmed a secret policy that he had implemented, which the Ukrainians did not know about, to disable coverage within a hundred kilometers of the Crimean coast. As a result, when the Ukrainian drone subs got near the Russian fleet in Sevastopol, they lost connectivity and washed ashore harmlessly.

[…]

Musk replied that the design of the drones was impressive, but he refused to turn the coverage for Crimea back on, arguing that Ukraine “is now going too far and inviting strategic defeat.” He discussed the situation with Biden’s national security advisor, Jake Sullivan, and chairman of the joint chiefs, General Mark Milley, explaining to them that SpaceX did not wish Starlink to be used for offensive military purposes. He also called the Russian ambassador to assure him that Starlink was being used for defensive purposes only. “I think if the Ukrainian attacks had succeeded in sinking the Russian fleet, it would have been like a mini Pearl Harbor and led to a major escalation,” Musk says. “We did not want to be a part of that.”

[…]

He took it upon himself to help find an end to the Ukrainian war, proposing a peace plan that included new referenda in the Donbas and other Russian-controlled regions, accepting that Crimea was a part of Russia, and assuring that Ukraine remained a “neutral” nation rather than becoming part of NATO. It provoked an uproar. “Fuck off is my very diplomatic reply to you,” tweeted Ukraine’s ambassador to Germany. President Zelenskyy was a bit more cautious. He posted a poll on Twitter asking, “Which Elon Musk do you like more?: One who supports Ukraine, or One who supports Russia.”

[…]

“SpaceX’s out of pocket cost to enable and support Starlink in Ukraine is ~$80M so far,” he wrote in response to Zelenskyy’s question. “Our support for Russia is $0. Obviously, we are pro Ukraine.” But then he added, “Trying to retake Crimea will cause massive death, probably fail and risk nuclear war. This would be terrible for Ukraine and Earth.”

[…]

Providing humanitarian help was fine, but private companies should not be financing a foreign country’s war. That should be left to the government, which is why the U.S. has a Foreign Military Sales program that puts a layer of protection between private companies and foreign governments. Other companies, including big and profitable defense contractors, were charging billions to supply weapons to Ukraine, so it seemed unfair that Starlink, which was not yet profitable, should do it for free. “We initially gave the Ukrainians free service for humanitarian and defense purposes, such as keeping up their hospitals and banking systems,” she says. “But then they started putting them on fucking drones trying to blow up Russian ships. I’m happy to donate services for ambulances and hospitals and mothers. That’s what companies and people should do. But it’s wrong to pay for military drone strikes.”

[…]

An agreement was struck that the Pentagon would pay SpaceX $145 million to cover the service.

But then the story leaked, igniting a backlash against Musk in the press and Twitterverse. He decided to withdraw his request for funding. SpaceX would provide free service indefinitely for the terminals that were already in Ukraine. “The hell with it,” he tweeted. “Even though Starlink is still losing money & other companies are getting billions of taxpayer $, we’ll just keep funding Ukraine govt for free.”

Shotwell thought that was ridiculous. “The Pentagon had a $145 million check ready to hand to me, literally. Then Elon succumbed to the bullshit on Twitter and to the haters at the Pentagon who leaked the story.”

[…]

“Starlink was not meant to be involved in wars. It was so people can watch Netflix and chill and get online for school and do good peaceful things, not drone strikes.”

[…]

More than 100,000 new dishes were sent to Ukraine at the beginning of 2023. In addition, Starlink launched a companion service called Starshield, which was specifically designed for military use. SpaceX sold or licensed Starshield satellites and services to the U.S. military and other agencies, allowing the government to determine how they could and should be used in Ukraine and elsewhere.

Posted in Business, Policy, Technology, War | No Comments »

Play life like a game

Monday, August 26th, 2024

Elon Musk by Walter IsaacsonIn 2021, Walter Isaacson explains (in his biography of Elon), Musk became obsessed with a new multiplayer strategy game on his iPhone, Polytopia:

In it, players choose to be one of sixteen characters, known as tribes, and compete to develop technologies, corner resources, and wage battles in order to build an empire. He became so good he was able to beat the game’s Swedish developer, Felix Ekenstam. What did his passion for the game say about him? “I am just wired for war, basically,” he answers.

[…]

“He said it would teach me how to be a CEO like he was,” Kimbal says. “We called them Polytopia Life Lessons.”

Musk’s Polytopia Life Lessons:

Empathy is not an asset. “He knows that I have an empathy gene, unlike him, and it has hurt me in business,” Kimbal says. “Polytopia taught me how he thinks when you remove empathy. When you’re playing a video game, there is no empathy, right?”

Play life like a game. “I have this feeling,” Zilis once told Musk, “that as a kid you were playing one of these strategy games and your mom unplugged it, and you just didn’t notice, and you kept playing life as if it were that game.”

Do not fear losing. “You will lose,” Musk says. “It will hurt the first fifty times. When you get used to losing, you will play each game with less emotion.” You will be more fearless, take more risks.

Be proactive. “I’m a little bit Canadian pacifist and reactive,” Zilis says. “My gameplay was a hundred percent reactive to what everyone else was doing, as opposed to thinking through my best strategy.” She realized that, like many women, this mirrored the way she behaved at work. Both Musk and Mark Juncosa told her that she could never win unless she took charge of setting the strategy.

Optimize every turn. In Polytopia, you get only thirty turns, so you need to optimize each one. “Like in Polytopia, you only get a set number of turns in life,” Musk says. “If we let a few of them slide, we will never get to Mars.”

Double down. “Elon plays the game by always pushing the edge of what’s possible,” Zilis says. “And he’s always doubling down and putting everything back in the game to grow and grow. And it’s just like he’s just done his whole life.”

Pick your battles. In Polytopia, you might find yourself surrounded by six or more tribes, all taking swipes at you. If you swipe back at all of them, you’re going to lose. Musk never fully mastered that lesson, and Zilis found herself coaching him on it. “Dude, like, everyone’s swiping at you right now, but if you swipe back at too many, you’ll run out of resources,” she told him. She called that approach “front minimization.” It was a lesson she also tried and failed to teach him about his behavior on Twitter.

Unplug at times. “I had to stop playing because it was destroying my marriage,” Kimbal says. Shivon Zilis also deleted Polytopia from her phone. So did Grimes. And, for a while, Musk did so as well. “I had to take Polytopia off my phone because it was taking up too many brain cycles,” he says. “I started dreaming about Polytopia.” But the lesson about unplugging was another one that Musk never mastered. After a few months, he put the game back onto his phone and was playing again.

Posted in Business, Games | 3 Comments »

That day Musk became the richest person in the world

Monday, August 19th, 2024

Elon Musk by Walter IsaacsonTesla’s stock price dropped to $25 per share in early 2020, Walter Isaacson explains (in his biography of Elon), and then bounced up to ten times that:

On January 7 it hit $260. That day Musk became the richest person in the world, with $190 billion, vaulting him past Jeff Bezos.

Under the extraordinary compensation bet he had made with his Tesla board in February 2018, amid Tesla’s worst production problems, he got no guaranteed salary. Instead, his compensation would depend on hitting very aggressive revenue, profit, and market value targets, which included Tesla’s market valuation increasing ten-fold to $650 billion. News articles at the time predicted that most targets would be impossible to achieve. But in October 2021, Tesla became the sixth company in U.S. history to be worth more than $1 trillion. Its market value was greater than its five biggest rivals — Toyota, Volkswagen, Daimler, Ford, and GM — combined. And in April 2022, it reported a profit of $5 billion on revenue of $19 billion, an 81 percent increase from the year before. The result was that Musk’s payout from the 2018 compensation deal was around $56 billion and his net worth at the start of 2022 increased to $304 billion.

[…]

In November 2021, he conducted a Twitter poll to see if he should sell some Tesla stock in order to realize some of the capital gains and pay tax on it. There were 3.5 million votes, with 58 percent voting yes. As he already was planning to do, he exercised options that he had been granted in 2012 and were due to expire, which caused him to pay the largest single tax bill in history: $11 billion, enough to fund the entire budget of his antagonists at the Securities and Exchange Commission for five years.

“Let’s change the rigged tax code so the Person of the Year will actually pay taxes and stop freeloading off everyone else,” Senator Elizabeth Warren tweeted at the end of 2021. Musk shot back, “If you opened your eyes for 2 seconds, you would realize I will pay more taxes than any American in history this year. Don’t spend it all at once… oh wait you did already.”

Posted in Business | 1 Comment »

Only to reemerge from his defrocking by Big Tech as a vengeance-seeking icon of counterelite Americana

Wednesday, August 14th, 2024

Palmer Luckey sounds like a fictional character:

Luckey is the owner of the world’s largest video game collection, which he keeps buried 200 feet underground in a decommissioned U.S. Air Force nuclear missile base — which is the kind of thing a man can afford to buy when he single-handedly turns virtual reality from the laughingstock of the technology industry into a multi-billion-dollar enterprise by inventing the Oculus Rift in a camper trailer parked in the driveway of his parents’ duplex in Long Beach, California, where at 19 years old he lived alone and survived on frozen burritos and Mucho Mango AriZona tea.

[…]

After selling Oculus to Facebook for $2.7 billion and then getting fired by Mark Zuckerberg for making a $10,000 donation to a pro-Trump troll group dedicated to “shitposting in real life,” Luckey tried his hand at building a nonprofit private prison chain that only gets paid when ex-prisoners stay out of prison. After he decided that would require too much lobbying work, he attempted to solve the obesity epidemic by making food out of petroleum products centrifuged out of the sewer system — a perfectly delicious and low-calorie idea, he maintains, which he only ditched because of the “marketing nightmare” of persuading people to eat remanufactured sewage. In the end, he decided instead to found Anduril Industries, a defense technology startup that makes lethal autonomous weapons systems. It is now valued at $14 billion.

[…]

In his spare time, when he is not providing U.S. Customs and Border Patrol with AI-powered long-range sensors, or Volodymyr Zelenskyy with drones to attack high-value Russian targets, or winning first place in the Texas Renaissance Festival’s costume contest with historically meticulous renderings of Henry VIII and Anne Boleyn sewn and stitched by his wife, Nicole—who’s been at his side for 16 of his 31 years on earth — Luckey recently built a bypass for his peripheral nervous system to experiment with giving himself superhuman reflexes; vestibular implants to pipe sounds into his skull so that instead of having to call him and wait for him to pick up, Anduril employees could just pick up a designated Palmer Phone and talk straight into his head; and a virtual reality headset that — by tying three explosive charges to a narrow-band photosensor that can detect when the screen flashes red at a specific frequency (i.e., GAME OVER) — kills you in real life when you die in a video game.

[…]

Before the recent preference cascade enabling high-profile tech moguls to violate the taboo against supporting Donald Trump, there was first the lonely figure of Palmer Luckey, the homeschooled, Jules Verne-obsessed, amateur scientist with no money, whose faith in the power of technology was so strong that he worked jobs sweeping ship yards, scrubbing decks, fixing engines, repairing phones, and training to sing as a gondolier for tourists, all in order to spend his nights in a gutted 19-foot camper trailer trying to manufacture dream worlds out of breadboards and lens equipment and accelerometers and magnetometers and a soldering iron — which he did, bringing virtual reality to the masses, burning a hole in his retina with a laser, and losing it all to Zuckerberg over a meme, only to reemerge from his defrocking by Big Tech as a vengeance-seeking icon of counterelite Americana, the aspiring rebuilder of the arsenal of democracy, the black mullet-, chin beard-, Hawaiian shirt-, cargo short-, sandal-clad possible savior of America.

Posted in Business, Technology, War, Weapons | 3 Comments »

Two of the installers succumbed to the heat

Monday, August 12th, 2024

Elon Musk by Walter IsaacsonWhen Musk turned his attention to SolarCity, Walter Isaacson explains (in his biography of Elon), there were consequences:

He fired his cousins, who had focused on door-to-door sales schemes rather than making a good product. “I fucking hate my cousins,” he told Kunal Girotra, one of the four chiefs of Tesla Energy he hired and fired over the subsequent five years. “I don’t think I ever will ever speak to them again.”

He cycled through leaders by demanding miraculous growth in roof installations, giving them insane deadlines for delivering, and firing them when they didn’t.

[…]

There were too many fasteners, he said. Each had to be nailed down, adding time to the installation process. Half should be deleted, he insisted. “Instead of two nails for each foot, try it with only one,” he ordered. “If the house has a hurricane, the whole neighborhood is fucked up, so who cares? One nail is going to be fine.” Someone protested that could lead to leaks. “Don’t worry about making it as waterproof as a submarine,” he said. “My house in California used to leak. Somewhere between sieve and submarine should be okay.”

[…]

The tiles and railings were shipped to the sites packed in cardboard. That was wasteful. It took time to pack things and then unpack them. Get rid of the cardboard, he said, even at the warehouses.

[…]

“We need to get the engineers who designed this system to come out here and see how hard it is to install,” he said angrily. Then he erupted. “I want to see the engineers out here installing it themselves. Not just doing it for five minutes. Up on roofs for days, for fucking days!”

[…]

Why, he asked, did it take eight times longer to install a roof of solar tiles than one with regular tiles? One of the engineers, named Tony, began showing him all the wires and electronic parts. Musk already knew the workings of each component, and Tony made the mistake of sounding both assured and condescending. “How many roofs have you done?” Musk asked him.

“I’ve got twenty years of experience in the roof business,” Tony answered.

“But how many solar roofs have you installed?”

Tony explained he was an engineer and had not actually been on a roof doing the installation. “Then you don’t fucking know what you’re fucking talking about,” Musk responded. “This is why your roofs are shit and take so long to install.”

[…]

At high noon the next day, it reached 97 degrees in the shade, of which there was none. Dow and his installers were on top of the house next door to the one they had done the previous day. Two of the installers succumbed to the heat and started vomiting, so Dow sent them home. Some of the rest attached battery fans to their safety vests. Per Musk’s instructions, they were using only one nail to hold down each foot of the tiles, but it wasn’t working well. The tiles were popping up and rotating. So the team began using two nails again.

[…]

When Musk arrived at 9 p.m., they showed him why they needed a second nail, and he nodded. It was part of the algorithm: if you don’t end up having to restore 10 percent of the parts you deleted, then you didn’t delete enough.

[…]

“Nice work, guys,” he said. “You should stopwatch each step. That will make it more fun, like a game.”

I asked him about his anger the previous evening. “It’s not my favorite way to fix things, but it worked,” he says. “The improvement from yesterday to today was gigantic. The big difference is that today the engineers were actually on the roof installing instead of at a keyboard.”

[…]

The business of installing solar roofs is labor-intensive and doesn’t scale.

[…]

Musk did not have the patience for such businesses.

[…]

“You’ve got to cut costs,” he said. “You’ve got to show me a plan by next week to cut costs in half.” As before, Dow showed his enthusiasm. “Okay, let’s do it,” he said. “We’ll kick ass and cut costs.”

He spent all weekend working on a cost-cutting plan to present to Musk that Monday. But as soon as the meeting began, Musk changed the subject and grilled Dow about how many installations had been completed in the past week and details about personnel redeployments. Dow did not know some of the answers, and he protested that he had been working since his birthday on cost-cutting plans and not the details Musk was now asking about. “Thank you for trying,” Musk finally said. “But this isn’t cutting it.”

It took Dow a while to realize that Musk was firing him. “It was just the most bizarre, weird firing you could imagine,” Dow later says. “I had so much history with him, and deep down Elon knows that I have something special. He knows that I can kick ass, because we’d done it together in the past, in the Nevada battery factory. But he thought I was losing my edge, even though I had missed my birthday with my family to be up on that roof with him.”

Posted in Business, Technology | 1 Comment »

Physics does not care about hurt feelings

Monday, August 5th, 2024

Elon Musk by Walter IsaacsonA few weeks after the surge, Walter Isaacson explains (in his biography of Elon), Musk turned his attention to Raptor, the engine that would power Starship:

Fueled by supercooled liquid methane and liquid oxygen, it had more than twice the thrust of the Falcon 9’s Merlin engine. This meant that Starship would have more thrust than any other rocket in history.

[…]

Raptor was too complex to be mass-manufactured. It looked like a spaghetti bush. So in August 2021, Musk fired the person in charge of its design and personally took on the title of vice president for propulsion. His goal was to get the cost of each engine to around $200,000, a tenth of what it then cost.

[…]

Musk began with his lecture on collegiality. “I want to be super clear,” he began. “You are not the friend of the engineers. You are the judge. If you’re popular among the engineers, this is bad. If you don’t step on toes, I will fire you. Is that clear?” Hughes stuttered a bit as he assented.

Ever since he flew back from Russia and calculated the costs of building his own rockets, Musk had deployed what he called the “idiot index.” That was the ratio of the total cost of a component to the cost of its raw materials. Something with a high idiot index — say, a component that cost $1,000 when the aluminum that composed it cost only $100 — was likely to have a design that was too complex or a manufacturing process that was too inefficient. As Musk put it, “If the ratio is high, you’re an idiot.”

“What are the best parts in Raptor as judged by the idiot index?” Musk asked.

“I’m not sure,” Hughes responded. “I will find out.” This was not good. Musk’s face hardened, and Shotwell shot me a worried glance.

“You better be fucking sure in the future you know these things off the top of your head,” Musk said. “If you ever come into a meeting and do not know what are the idiot parts, then your resignation will be accepted immediately.” He spoke in a monotone and showed no emotion. “How can you fucking not know what the best and worst parts are?”

“I know the cost chart down to the smallest part,” Hughes said quietly. “I just don’t know the cost of the raw materials of those parts.”

“What are the worst five parts?” Musk demanded. Hughes looked at his computer to see if he could calculate an answer. “NO! Don’t look at your screen,” Musk said.

“Just name one. You should know the problematic parts.”

“There’s the half nozzle jacket,” Hughes offered tentatively.

“I think it costs thirteen thousand dollars.”

“It’s made of a single piece of steel,” Musk said, now quizzing him. “How much does that material cost?”

“I think a few thousand dollars?” replied Hughes.

Musk knew the answer. “No. It’s just steel. It’s about two hundred bucks. You have very badly failed. If you don’t improve, your resignation will be accepted. This meeting is over. Done.”

[…]

“We should ask each of them to see if they can get the cost of their part down by eighty percent,” Musk suggested, “and if they can’t, we should consider asking them to step aside if someone else might be able to do so.”

By the end of the meeting, they had a roadmap to get the cost of each engine down from $2 million to $200,000 in twelve months.

[…]

“I give people hardcore feedback, mostly accurate, and I try not to do it in a way that’s ad hominem,” he says. “I try to criticize the action, not the person. We all make mistakes. What matters is whether a person has a good feedback loop, can seek criticism from others, and can improve. Physics does not care about hurt feelings. It cares about whether you got the rocket right.”

[…]

He thinks that when people want to prioritize their comfort and leisure they should leave.

That’s what Hughes did in May 2022. “Working for Elon is one of the most exciting things you can do, but it doesn’t allow time for a lot else in your life,” he says. “Sometimes that’s a great trade. If Raptor becomes the most affordable engine ever created and gets us to Mars, then it may be worth the collateral damage. That’s what I believed for more than eight years. But now, especially after the death of our baby, it’s time for me to focus on other things in life.”

[…]

“It’s like Machiavelli taught,” Krebs replied. “You have to have fear and love for the leader. Both.”

That attitude would sustain Krebs for another two years. But by Spring 2023, he would become another refugee from Musk’s hardcore all-in approach. After getting married and having a child, he decided it was time to move on and find a better work-life balance.

Posted in Business, Technology | No Comments »

Why is no one working?

Sunday, July 28th, 2024

Elon Musk by Walter Isaacson”The storm clouds building in his head burst,” Walter Isaacson explains (in his biography of Elon), when Musk and a group of his top managers went down the road to the launchpad site and didn’t see anybody working:

This might not have seemed unusual to most people on a late Friday night, but Musk erupted. His immediate target was a tall, mild-mannered civil engineer named Andy Krebs, who was in charge of building the infrastructure at Starbase. “Why is no one working?” Musk demanded.

Unfortunately for Krebs, it was the first time in three weeks he didn’t have a full night shift working on the tower and launchpad. Soft-spoken with a hint of a stutter, he was tentative in his answers, which didn’t help. “What is the fucking problem?” Musk demanded. “I want to see activity.”

That’s when he ordered the surge. Starship’s booster and second stage, he said, should be rolled out of the manufacturing bays and stacked on the launchpad within ten days. He wanted five hundred workers from around SpaceX—Cape Canaveral, Los Angeles, Seattle—to be flown immediately to Boca Chica and thrown into the breach. “This is not a volunteer organization,” he said. “We are not selling Girl Scout cookies. Get them here now.” When he called Gwynne Shotwell, who was in bed in Los Angeles, to figure out what workers and supervisors would come to Boca Chica, she protested that the engineers at the Cape still had Falcon 9 launches to prepare for. Musk ordered them delayed. The surge was his priority.

Shortly after 1 a.m., Musk sent out an email titled “Starship Surge” to all SpaceX employees. “Anyone who is not working on other obviously critical path projects at SpaceX should shift immediately to work on the first Starship orbit,” he wrote. “Please fly, drive, or get here by any means possible.”

At Cape Canaveral, Kiko Dontchev, who won his spurs when Musk ignited a similar frenzy after seeing almost no one working on Pad 39A one night, began rousing his best workers to fly to Texas. Musk’s assistant Jehn Balajadia tried to get hotel rooms in nearby Brownsville, but most were booked for a border-control convention, so she scrambled to make arrangements for workers to sleep on air mattresses. Sam Patel worked through the night figuring out the reporting and supervising structures they would put in place—and also how to get enough food to Boca Chica to feed everyone.

[…]

The surge was successful. In just over ten days, the booster and spacecraft of Starship were stacked on the launchpad. It was also a bit pointless. The rocket was not yet capable of flying, and stacking it did not force the FAA to rush its approval. But the ginned-up crisis pushed the team to remain hardcore, and it provided Musk with a bit of the drama that his headspace craves.

Posted in Business, Technology | 2 Comments »

Monopoly Go! made $3 billion in just over a year

Saturday, July 27th, 2024

I can’t say I even knew that there was a Monopoly Go! game:

On Hasbro’s second-quarter earnings call Thursday, the toymaker revealed that the mobile video game has grossed more than $3 billion in revenue since its launch on April 11, 2023. That makes Hasbro the top licenser of video games in the past year, the company says.

Hasbro works with mobile games company Scopely on Monopoly Go!—along with other licensed titles, such as Scrabble Go and Yahtzee with Buddies.

[…]

For the full year, Monopoly Go! is expected to generate roughly $105 million in licensing revenue for Hasbro—and company officials admit they could be underestimating that, as they’re still getting a sense of how players interact with the game.

“We don’t quite get the seasonality yet,” said Chris Cox, Hasbro’s CEO on the call. “However, where I do think we have some bullishness is on the mid- and long-term [prospects] for the game. When you look at games that reach this ‘hyperscale’ like Monopoly Go! has . . . 10 of the 20 best-performing games have been out for five or more years. So, this is a game that’s going to be a really strong and positive annuity for us for a long time to come.”

Posted in Business, Games | 4 Comments »

Precision is not expensive

Monday, July 22nd, 2024

Elon Musk by Walter IsaacsonMusk was playing with a toy Model S, Walter Isaacson explains (in his biography of Elon), when an idea came to him:

It looked like a miniaturized copy of the real car, and when he took it apart he saw that it even had a suspension inside. But the entire underbody of the car had been die cast as one piece of metal. At a meeting of his team that day, Musk pulled out the toy and put it on the white conference room table. “Why can’t we do that?” he asked.

One of the engineers pointed out the obvious, that an actual car underbody is much bigger. There were no casting machines to handle something that size. That answer didn’t satisfy Musk. “Go figure out how to do it,” he said. “Ask for a bigger casting machine. It’s not as if that would break the laws of physics.”

Both he and his executives called the six major casting companies, five of whom dismissed the concept. But a company called Idra Presse in Italy, which specialized in high-pressure die-casting machines, agreed to take on the challenge of building very large machines that would be able to churn out the entire rear and front underbodies for the Model Y. “We did the world’s largest casting machine,” Afshar says. “It’s a six-thousand-ton one for the Model Y, and we will also use a nine-thousand-ton one for Cybertruck.”

The machines inject bursts of molten aluminum into a cold casting mold, which can spit out in just eighty seconds an entire chassis that used to contain more than a hundred parts that had to be welded, riveted, or bonded together. The old process produced gaps, rattles, and leaks. “So it went from a horrible nightmare to something that is crazy cheap and easy and fast,” Musk says.

The process reinforced Musk’s appreciation for the toy industry. “They have to produce things very quickly and cheaply without flaws, and manufacture them all by Christmas, or there will be sad faces.”

[…]

“Precision is not expensive,” he says. “It’s mostly about caring. Do you care to make it precise? Then you can make it precise.”

Posted in Business, Technology | 5 Comments »

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