Peter Beck on Relentless, full transcript with timestamps

Transcript

Ti Morse [00:43] Over the past, like, five years, you've gone from basically doing, like, six launches to, I think, last year you did 21.

Peter Beck [00:49] Mm.

Ti Morse [00:49] Uh, and it's same thing with SpaceX. I think SpaceX was at, like, 31 launches in 2021, now they're at, like, 160.

Peter Beck [00:55] Yep.

Ti Morse [00:55] Something like that. Things are scaling really fast. What is the biggest, like, limiting factor to increasing launch cadence and mass to orbit?

Peter Beck [01:03] Uh, well, for Electron, uh, quite often it's customer readiness. So, you know, the factory out there is, is capable of, uh, sort of, you know, one, one a week, um, uh, as it, as it stands. Um, so, you know, over 50 launches a year. But, uh, you know, it comes down to customer readiness and, you know, the, the market for dedicated small launch, uh, continuing to grow.

Ti Morse [01:25] I've seen so many startups pop up in the last two or three years-

Peter Beck [01:28] Mm-hmm

Ti Morse [01:28] ... just expecting Starship scale-up. Is this something that's also gonna be basically, like, really benefiting you guys?

Peter Beck [01:34] Well, it's been like that for, for as long as I've been in this industry, right? Um, so there's always, uh, you know, always been a tremendous growth. And it, and, and in fairness, it sort of goes in fits and cycles a little bit or waves, where, uh, you know, there's a tremendous amount of venture capital went into, into s- you know, space startups, and then it sort of backed off a little bit. Then there was, uh, you know, the rise of the SPAC, where a whole bunch of those ven- venture capitalists, you know, made their funds back again and thought, "Hey, this space thing's good." So there's another big wave of, of kind of investment into, uh, venture capital investment into space. Uh, and the one thing I would say is, is, is consistent is, um, you know, there was always the promise of the democratization of space.

Peter Beck [02:17] So, you know, for the longest time I can remember everybody saying, "Well, you know, space is about to democratize," meaning that, you know, it always used to be the governments who built the rockets and the governments who built the satellites. And, you know, I'd say in the last decade, um, we've actually truly witnessed that, um, that complete democratization of space. So, you know, there's a few launch vehicle companies now that are launching regularly. In fact, way more than governments. Um, you know, Rocket Lab itself launches more than governments, apart from I think the Chinese. Uh, so, um, and, and the same, same deal in, in spacecraft. I mean, we send a s- a, you know, a spacecraft to the moon. Two of our spacecraft are on their way to Mars right now. You know, these are typically, you know, government-dominated domains, historically at least.

Peter Beck [03:02] So, you know, in the last dec- decade a lot has moved.

Ti Morse [03:05] What do you think is the big reason that governments have been, like, less effective at building, like, space programs and making it so you can basically build a lot of rockets?

Peter Beck [03:15] Yeah, I think, I think it's a couple of things. It's like anything where it's incredibly difficult, uh, it requires a nation worth of, you know, talent and energy, and there's m- you can't make any money at it, those are the things that governments are really good at. The moment that a few of those things aren't true, like you can, you can make some money at it, uh, and it doesn't require a nation of energy to achieve it, then that naturally democratizes into commercial entities. And, um, you know, that, that's, that's exactly what's happened with space. Like, it no longer takes a nation to build a satellite. Um, you know, a few college kids in a dorm can go and build a little satellite.

Ti Morse [03:53] I think on another podcast that I was listening to, you basically said New Zealand has, like, this culture of not really wanting successful people or something, something to that effect. Is it-

Peter Beck [04:02] Oh

Ti Morse [04:02] ... is there, like, a big tall poppy syndrome situation happening?

Peter Beck [04:05] Yeah, I mean, there is, there is a, a, a, you know, kind of that tall poppy syndrome in New Zealand. But I would say, you know, o- over time I've realized that it's, it's really just a construct of the New Zealand media. Um, actual mom and dad at home wants everybody s- to succeed. And I think that's true in most countries where, uh, you know, suc- if successful, you know, entities or people, you know, uh, they get sort of beaten down. It's, it's generally, you know, moms and dads at home are just super stoked to see someone win. I think it's, like I say, it's, it feels like, you know, to me a, a, largely a construct of the media.

Ti Morse [04:38] Elon started SpaceX with, it must've been like $100 million. Um, you did not have that same- ... amount of, you know, cash just sitting in your, in your bank account.

Peter Beck [04:46] Hun- $100? Yeah.

Ti Morse [04:47] $100?

Peter Beck [04:48] Yeah.

Ti Morse [04:48] Yeah, yeah.

Peter Beck [04:49] Yeah.

Ti Morse [04:49] Um, even on the wall back there it says that you were, like, a billion-dollar company in 2017.

Peter Beck [04:53] Yeah.

Ti Morse [04:53] You almost got to, I think, orbit before reaching a billion-dollar valuation-

Peter Beck [04:56] Yeah, yeah

Ti Morse [04:56] ... which is fucking nuts. How did you build the company differently because you didn't have that massive pile of cash?

Peter Beck [05:01] Yeah, well, I mean, uh, and that, that is what has created some of the magic in the company even today, is, um, we, we knew that we could never outspend our competitors. Um, that was just never, ever gonna be a thing. And, you know, the reason why the, the Rutherford engine is named Rutherford in, in the Electron rocket, it's not after... Well, it's after Ernest Rutherford, but not for the many reasons people think. Um, it's named after Ernest Rutherford because he had a very famous saying and, and that was, "We have no money, so we have to think."

Ti Morse [05:33] I definitely align with that philosophy.

Peter Beck [05:34] Yeah, yeah, yeah.

Ti Morse [05:35] Yeah.

Peter Beck [05:35] That's right. So, um, you know, I can remember at the start of Rocket Lab, I would go to, to wrecking or junkyards to machi- and, and crawl over old machines and unscrew all of the Swagelok fittings. Um, and, you know, 'cause we couldn't afford to buy the Swagelok fittings. We could buy the ferrules, which were $3, think $3.20 each, but a fitting was, like, 50 bucks. So, you know, the first, the first few, um, you know, vehicles and, and bits of infrastructure all used secondhand fittings 'cause we just couldn't afford new fittings. And the, the, that kind of, I guess, hardship, um, you know, really cements, you know, part of the key cultures in this company.

Peter Beck [06:13] Like, and if you, if you look across the s- the space industry, especially amongst, you know, companies that went public- Um, most of them are toast. And, you know, the, the, you know, that core kind of, you know, um, responsibility for, you know, good steward of capital and, uh, value is, you know, exists here today. Um, you know, every dollar, every second of the hour is, is valuable here. Whereas other companies, uh, you know, if, um, if they've got heaps of resources, then, you know, it's less valuable. And, and if you look at it, it's like if, if money could solve the space problems, then there would be a lot of success. Like, money does not solve this problem.

Peter Beck [06:56] When I was trying to raise money for, for, um, Rocket Lab, you know, to do the Electron project, there was, you know, Richard Branson out there with his Virgin Orbit. And, you know, Richard had $1.2 billion to do what we did with $80 million. Um, and you know, it doesn't matter at this, you know, how much, how much money that was ultimately spent then. You know, that was a commercial and technical failure, whereas, you know, Electron with far less resources, um, was the opposite.

Ti Morse [07:24] How do you think about deciding where to take and spend your energy and time and resources, like on scaling Electron versus building Neutron and kind of try to build a full reusable vehicle?

Peter Beck [07:35] Yeah, well, I mean, so, so firstly, um, the launch part of the house only represents one-third of the company. Two-thirds is actually the space systems, um, side of the house. So with regard to being spread everywhere, it is, it's like, you know, launch, launch by default only, you know, gets a, a, a, you know, a section of my time. Um, but you know, we've got an amazing team and, um, you know, the Electron team are just, you know, they're just animals. So they're just, just banging those vehicles out and, and launching them, and, and like they're just... So there's quite frankly, there's very little involvement I have with the Electron team. Like-

Ti Morse [08:10] Really?

Peter Beck [08:10] They're-- Oh, yeah. They're just, just like I say, they're animals. They're just banging them away.

Ti Morse [08:14] Were you like highly involved right at the start of the production of the Electron, or...?

Peter Beck [08:17] Yeah, yeah, yeah. Yeah. I mean, and I came from a, a production background as well, so you know, knew what good production looks like. But, um, but no, I'd say the team down there now is just, you know, they're, they're just amazing. So, so that's, that's a very, very light touch product for me personally, um, because the team's just so good. Uh, whereas Electron, you know, we're, we're deep in, in development, so you know, that's a very high touch area from an engineering perspective I'm, I'm involved with. And then, um, you know, across, across the whole rest of the space systems and organizations, I mean, uh, you know, we've got a bunch of kind of business units that supply, you know, the vast majority of components for-- that are, that are in satellites. And, um, and you know, those guys are killing it as well.

Peter Beck [08:57] I mean, we've, we've developed, I would say, a, its c- you know, Rocket Lab operating system where, you know, the, the production team is really good at, at, you know, getting into these like hideously complex components and, uh, and figuring ways out to make, you know, figuring out ways to make them, you know, highly producible and, and highly reliable.

Ti Morse [09:17] What about your, like, culture enables you to be able to tackle these like massively difficult problems and do it in an efficient way?

Peter Beck [09:23] That's a great question. We often, we often kinda ruminate on that, and, and it comes down to the Rocket Lab hustle. And, uh, it's kind of hard to describe the Rocket Lab hustle in like one word, but, um, it's more-- you can easily, more easily describe it in like behaviors. Um, so a couple of years ago, we had this, um, this satellite, and it had this, uh, super thin wall titanium precious- pressure vessel, and there's like two companies in the United States that produce these, you know, electron beam welded thin wall titanium pressure vessels. And, you know, the supplier, um, just absolutely like-

Ti Morse [09:58] Shit the bed?

Peter Beck [09:59] A hundred percent. Like yeah, it would, it, it would, it would be... You know, if you've got kids, you've got a number one, and then your number twos, and then there's like the number threes.

Ti Morse [10:07] And then that, that was the supplier?

Peter Beck [10:09] Yeah. Like-

Ti Morse [10:10] Nice

Peter Beck [10:10] ... the supplier's like number threes everywhere. So, um, so that was just total disaster, and I think most companies would, would have stopped. Um, whereas we just developed a technique to 3D print this titanium, you know, pressure vessel and, uh, and, you know, developed a whole bunch of welding processes ourselves. And, um, you know, we produced the tanks, uh, you know, in time to, to meet the, the date for the launch vehicle and, you know, qualified them and acceptance tested them and everything. So now there's three suppliers in the United States who can build, you know, thin wall titanium tanks. And what's more is because we 3D printed them rather than, you know, traditional forming them, we can make whatever shape or anything anybody wants any time.

Peter Beck [10:52] So, um, so I mean, it's, it's those kind of things where I think, you know, historically you hit a barrier and people going, "Oh, I don't know what we're gonna do. We're gonna stop," is where, you know, w- we'll just overwhelm the barrier, or we'll dig under it, or we'll fly over it. Like it's just, it's just like that's just not acceptable to stop.

Ti Morse [11:10] Is there almost like a culture of just, "Fuck it, let's do it"?

Peter Beck [11:13] Yeah, 100%, yeah. And like scary things, um, you know, they're scary, but, um, but you know, we'll still go after them anyway. Like there's a good reason there's only two, well, was only two manufacturers of these things, is because they're super scary and super difficult to make. And like I say, I think most people would go, "Well, you know, we're not gonna get into the thin wall titanium pressure vessel manufacturing game." Um, but for us it's like, yep, like you say, "Fuck it, let's go, and let's, um, let's make it happen."

Ti Morse [11:40] And when you're kind of running into one of those problems where hypothetically if there was a bunch of suppliers that could just fulfill, you know-

Peter Beck [11:46] Yeah

Ti Morse [11:46] ... basically reduce all your cognitive load and difficulty of making the thing-

Peter Beck [11:50] Yeah

Ti Morse [11:50] ... that would be great, but obviously there really isn't.

Peter Beck [11:52] No, that'd be great. Oh man, I'd wake up in, in the morning, just that would be a dream, is like suppliers that deliver on time, to budget, um, at a reasonable price. Um, that would be amazing. Um, but unfortunately, that is, is a very rare, it's very rare.

Ti Morse [12:07] What's the worst supplier experience you've ever had?

Peter Beck [12:10] I mean, it's, it's just we, we have, we have people just like there's a whole team that just sits and suppliers, uh, you know, buildings-

Ti Morse [12:18] Mm-hmm

Peter Beck [12:18] ... just trying to juggle things along. Um, I think it would be unfair for me to call out the worst supplier in the world. And, and to be fair, a lot of it is, um, the industry. So, you know, the industry is... If you look at most sort of suppliers, you would-- they're all extremely low volume, extremely bespoke, difficult things. It's not like, you know, they're banging out clothes pegs. Like, these are really difficult kind of things. So in that environment, y- it sort of leads itself to having, um, you know, suppliers that take longer and, and, uh, you know, don't deliver as, as good as you would expect.

Peter Beck [12:55] It's, it's easy, easier for Rocket Lab where we have a certain amount of scale to just go and do something and, you know, if it requires some cryogenic experts, we've got those over here. If it requires some electromagnetic experts, we've got that over here. So we're able to pull all those in. Whereas if you're a little shop, uh, and you don't have all those expertise, then it, it does, you know, it, it becomes a lot more difficult.

Ti Morse [13:18] You can't just do the same thing.

Peter Beck [13:19] Yeah.

Ti Morse [13:19] It's impossible.

Peter Beck [13:20] Yeah. But that's kind of the, also, you know, the, the magic of the company is, is we have now such a diversified group of folks that, you know, there's, there's an expert for everything in the company.

Ti Morse [13:31] I know that you're very focused on trying to make as many parts of the rocket yourself, uh, as you can. How do you think about, like, at what stage it makes sense to just vertically integrate versus trying to use something off the shelf if there is some supplier, even if you-

Peter Beck [13:43] Oh, man, we would, we would buy stuff off the shelf straight away versus doing it ourselves. Like, it's not a religion to be vertically integrated. It's just a, a necessity to achieve and deliver.

Ti Morse [13:54] You've been at this for now, like, 26 years. What's the best example of Rocket Lab hustle?

Peter Beck [14:00] Well, I gave you that tank one there a moment ago, but I mean, uh, it, it's, it's, it's defined by a s- you know, a set, a set of behaviors. Um, I would say that, you know, the team is just totally relentless. Um, and they're just, just relentless against execution. So, um, you know, there's nobody here, um, or nobody survives here if they just wanna come here and work 8:00 to 5:00 and cruise and then go home. Um, that, that's just, just not the culture. We, we take on really difficult, meaty, important things, um, that people care about. So, um, you know, I, I would, I would just say it's, it's, it's ex- engineering excellence and just, like, sheer dogged determination to execute.

Peter Beck [14:40] And, you know, when a lot of companies where it comes 5:00 and the problem's not solved, a lot of people go home. Uh, not here. Like, you know, you, you, you can come to here at this facility, and you can drive past it any time of the night or the morning, and there's lights on.

Ti Morse [14:55] Is there any really good story that you have of having to basically, like, sleep here unfucking some bottleneck that you had over the past couple years?

Peter Beck [15:03] Oh my God, there's, there's, there's so many. I mean, like, in the customer room, there's, there's beds and pillows, so I mean, like, you know, for anybody to use. So I mean, that, that happens all the time. The one thing I can think of, and it was many years ago, is that we had developed this, this rocket engine, and it was a very unique rocket engine. And, uh, we had, um, a bunch of, uh, really important people coming over, um, from the propulsion industry to look at this engine. And we were doing the last test on a Friday afternoon. And, um, we thought, "Oh, we'll just do this one last test before we put the engine to bed," uh, because these guys would turn up on Monday. So we did this test, and, um, a hydraulic line, uh, was fatiguing.

Peter Beck [15:44] We didn't realize, and it failed, and the hydraulic line failed, caused basically, um, the valving sequence to be wrong, and the whole engine exploded. And not only did it... It was so good. It was such a good... I mean, it's only a, sort of a, you know, uh, a 500-pound engine, so it's not a big engine. But it exploded so good that it just tore everything out of the, the test cell as well. Like, there was... We just stood, walked back in there after it all been sorted out, and there was just shit hanging off the walls, and it was just total mess. And meanwhile, these guys had just taken off from the States, and they were on their way, um, you know, to land, um-

Ti Morse [16:17] They're gonna land whether or not the, the engine is there.

Peter Beck [16:19] There's nothing left, no.

Ti Morse [16:20] Right.

Peter Beck [16:20] There's not even a test cell. Um, so, you know, we're all standing around, and, and, like, there wasn't one person that said, "Oh, no," or not one person said, "Well, that's us screwed." It, uh, people just said, "Okay, well, there's some titanium back in the shop. I'll get back there now, and I'll start machining." And then, you know, the, the electricians are like, "Yep, okay, I've got some CAT5 cable. We'll start rewiring this, and we'll do this." And, and everybody just got to work. And the next day, um, we got, I got a call from the, from the guys that were coming to visit us, and they said, "Well, actually, we landed here, uh, on Saturday," Saturday morning, "so we're all feeling good. So why don't we just come down to the test cell, cell, and we'll start work right now?" And we're like, "Oh, no, you'll be jet lagged. You don't wanna do that."

Ti Morse [17:04] Yeah.

Peter Beck [17:04] Like, um, you know, "Wait until Monday." "Just wait until Monday, um, because you'll feel much better. Trust me, this jet lag to New Zealand really hits you." So, um-

Ti Morse [17:12] Don't want you to be sleep deprived when you come.

Peter Beck [17:15] Oh, yeah, yeah, yeah. No, exactly right. So we just, you know, everybody, it was just, nobody slept at all. And we just worked and worked and worked. And, you know, we were, we were rebuilding this engine, and we knew there was a couple of things in the engine that were like, eh, you know, we, we would've liked to fix in, at some point in time. But they were risky. Like, if we, you know, we made some changes to an injector and, and, you know, it might not have worked. But we're like, "Oh, well, at this point, like, let's just go for it." So we made a whole bunch of changes to the engine. Um, and we changed, you know, what we thought, you know, some of the injectors and some of the parts of the engine we thought would improve its performance. And then, you know, we got this whole engine back together and, uh, got it on the test cell, uh, in Monday m- at Monday morning. And, uh, our very important friends turned up, and they're like, "Hey, guys.

Peter Beck [17:59] How you going?" We go, "Good, good." "Right, ready for an engine test?" "Yep." And, you know, we hot fired that engine, and that was the first time that engine had been hot fired since a rebuilt engine, you know, rebuilt test cell and a brand-new engine with all these modifications. And, and I think most companies would've played it safe and just said, "Let's rebuild it exactly as it was." Um, but, you know, it, we built this new engine, and that new engine performed 13% better than the previous one, which in rocket engines perspective is a huge number.

Ti Morse [18:26] Over the course of a weekend?

Peter Beck [18:27] Yeah. And, and completely rebuilt the engine and, and that engine ran, uh, ran, ran for the next nearly a month, um, just day after day doing hot fire after hot fire and tweaking things and doing different experiments that everybody wanted to do, and all the rest of it. So, you know, that's a Rocket Lab hustle. I mean, it's, it's j- you know, I think a lot of people would go, "Well," you know- Yeah, pretty much

Ti Morse [18:52] What happens after that sort of event, like internally? How do people kind of react to being able to overcome something that feels insurmountable or impossible?

Peter Beck [19:02] That's a great question. Um, generally, there's the next big thing, so you're just onto the next big thing. Um, and, you know, there's been a couple of, uh, a couple of these kind of really big things, like the Capstone mission was a really big one. That was, that was a totally impossible project, and I still to this day don't know how we pulled it off, but that was a totally impossible project.

Ti Morse [19:20] Do you wanna just walk through what that was? Why it was so impossible?

Peter Beck [19:22] That was our mission to the Moon.

Ti Morse [19:23] Yeah.

Peter Beck [19:24] Um, so, you know, we, we, we had signed the Capstone mission, and we had to deliver the spacecraft to the Moon. And, um, you know, it's off an electron rocket, so, you know, going to the Moon off a tiny little rocket is-

Ti Morse [19:36] It's like seven to nine million bucks?

Peter Beck [19:38] Yeah. Yeah, it was $10 million. Yeah. Uh, but it, it, like, on paper it closed, but, um, in practice it was the most ridiculously hard thing, uh, to... You know, we were measuring grams in that rocket. And, you know, there was like a three-hour debate whether or not we could afford the mass of the NASA stickers down the side of the rocket- ... because the mass of those stickers would, you know, put us over the edge. So there was... It was the most ridiculously difficult en- um, engineering project. And, um, you know, we delivered that, that, that, um, that spacecraft to the Moon with such perfect accuracy. Um, it was, it was incredible. But there were so many firsts there.

Peter Beck [20:17] Um, there was a, you know, the rocket engine that was on the little spacecraft that took it to the Moon, uh, was the highest performing engine that we have ever built. And, um, you know, we had to, we had a, a separate tank of ele- of 11 herbs and spices that we would inject into the engine to just make it run super hot. So, you know, it was the most, it was the craziest, craziest project. Um, and, you know, even today you can ask people around the, the company what, what their best moment was at Rocket Lab, and anybody working on Capstone, or just about anybody, will say Capstone, even though it was the most punishing and cruelest mission that we ever did.

Ti Morse [20:55] What's your kind of philosophy on chewing glass and enjoying taking on extremely difficult challenges with uncertainty on whether or not they can even be successful?

Peter Beck [21:06] Yeah, well, I mean, I think, I think that, that is the definition of a, a good startup. Um, uh, but I would temper that with, um, yeah, okay, you're chewing glass, but also you can't just do that and not know the outcome or, you know, sometimes you have to force the outcome to be good. Um, that's a fact. But, but also, um, I would say everything that we, we take on, we honestly believe we can do. Now, sometimes our belief is unfounded, but generally we, you know, we won't take on something that we just won't, will not have a clue about how we can, how we're going to achieve.

Peter Beck [21:42] Um, so, so yeah, I think, I think, I think that's, it's a fair statement, but I think I'd temper that with like, don't be reckless with that because, um-

Ti Morse [21:51] It's like, uh, you build trust with the people that you're working with, and so if you fuck up, then that trust is broken.

Peter Beck [21:56] Yeah. Yeah. I mean, I would hope that if you went out to the industry and said, "What is Rocket Lab known for or stand for?" It's like, our hardware is beautiful, and it always works. And, um, that might sound just like, yeah, of course, but, um, that is not the norm, uh, in this industry. So, um, you know, when we take on stuff, um, we, we absolutely commit to delivering it. I mean, the Capstone project was, you know, NASA paid us $10 million, and we were three times over budget. Um, now I think other companies would've just pulled out, and it's like, to hell with that. We've, we've made this commitment. We are going to deliver that, and it is going to be successful. And it was. It was flawless.

Ti Morse [22:33] And did that kind of basically give you a whole bunch of credibility for future missions?

Peter Beck [22:38] Yeah. I mean, I mean, with respect to interplanetary and even, even launch, I mean, NASA knows when they come to us, uh, it will be done, and it will work. I mean, just like the Escapade missions, um, you know, those Escapade spacecraft, um, deeply complex spacecraft, two spacecraft going to Mars, not just one, and delivered on time, on budget, uh, to NASA.

Ti Morse [22:57] I know Elon mostly spends his time trying to basically figure out whatever the biggest bottleneck in one of his companies is.

Peter Beck [23:03] Mm-hmm.

Ti Morse [23:03] And then he goes to that bottleneck, and he doesn't leave until it's sorted, and then he just goes to whatever the next fire is.

Peter Beck [23:09] Yep.

Ti Morse [23:09] And he says basically, like, "If things are going well, then you probably won't even hear from me."

Peter Beck [23:13] Yeah.

Ti Morse [23:13] How do you think the, the differences between, or maybe similarities between your and Elon's philosophy and management style and how you operate?

Peter Beck [23:21] Yeah, I mean, I, I think that's, that's probably similar. Like, I'm not adding value to anything that's running great. Like, you know, it might feel good, but I'm not adding any value to that whatsoever.

Ti Morse [23:29] Show up, you just give the thumbs up and leave.

Peter Beck [23:31] Yeah, great. Like, what a total waste of time. Um, no, uh, you know, it's... Certainly, I think, um, you know, focus goes in areas where, uh, that aren't, that aren't, you know, aren't going well, or areas where, um, you know, it needs some, some decisions made or, um... And I think quite often, you know, the role of a CEO is just to make the decisions that nobody else wants to make. And, you know, I, I, I made sure that I was there for the first hot fire of Archimedes because I, you know, I knew that, um, there was going to need to be just some risk decisions that were going to be made. Because you can analyze and analyze to a certain point, but at some point you actually just have to press the button.

Peter Beck [24:11] And, you know, I just felt it was super unfair to put all those, those guys in the, in the position to, you know, make the decision to, to press the button.

Ti Morse [24:19] It's like if this, if this blows up, like I'm the guy that pressed the button.

Peter Beck [24:22] Yeah, yeah. Yeah. I mean, so I mean, I didn't need to say anything. I just sat there. Um, but everybody knew that if, if, if there was a risk call that needed to be made, is, is, are we okay to go? Um, you know, I'd, I'd give them the thumbs up. So, um, so it's, it's, it's things like that where I think, you know, you, you, you just, that's where you, you have to be there, right? Um, there, even if you're, you're, you're not Not even useful. You still, you still have to be there. So, um, so yeah, I would, I would say that, that, that, that is, that is, that is true. Um, things that are going wrong and, and things that require, you know, big decisions with no information, and, um, and then of course, um, you know, just, just pushing the company in the right direction.

Ti Morse [25:05] In the past, people have kinda joked about Elon time being maybe even years late on some projects.

Peter Beck [25:10] Yeah.

Ti Morse [25:11] Um, and over time he's kinda like course-corrected to trying to get down to roughly 50% of the time, whatever the timeline is-

Peter Beck [25:17] Yeah

Ti Morse [25:17] ... that, that he gives is going to be right.

Peter Beck [25:19] Yeah.

Ti Morse [25:19] And that means by definition half the time it's gonna be off, but that because he's basically pulling in timelines like that, more things are able to happen. If you're doing, you know, this, this mission where you're sending something to Mars or sending something to the moon-

Peter Beck [25:33] Yeah

Ti Morse [25:33] ... how do you decide how to structure that, that timeline so that you know that you're actually going to be able to ship?

Peter Beck [25:40] So I, I guess, um, you know, you have to be 50% entrepreneurial and 50% engineer, and as a public company, uh, you can't just stand up there and wave your arms around, um, because-

Ti Morse [25:51] Some people do do that.

Peter Beck [25:52] Yeah, but you get in trouble with it.

Ti Morse [25:53] Doesn't work.

Peter Beck [25:54] Yeah, no. That, that's... I mean, that you, you have to be respectful to your shareholders, uh, and your investors that, um, they're making decisions off, off your, your timelines. Um, you know, and sometimes you get it wrong, um, and that's, that's unfortunate. Um, but generally, you know, the, the thing, the, the dates and things that we try and put out there, um, we try and, and be right. Um, now we always, we do run green light schedules, meaning that, you know, when we put a schedule together, there's not some big fat in there that says that, you know, if this doesn't work, it might, you know, we build a bit extra time in here and build a bit extra time in here. Because engineers will take as long as you have allocated them to do a job. If you allocate all the fat in there, then you just, that is, that is your default best schedule.

Peter Beck [26:37] Whereas, um, we've always run green light schedules from day one, uh, where you put the schedule down in place that you think is, um, if everything goes right. And, you know, if everything goes right, then that is the best time that you're going, you're going to achieve. And of course, not everything always goes right. But you can guarantee where you build fat in, it'll be the wrong place anyway. So, you know, that, that, that, that's has been, you know, very effective for, for Rocket Lab, and yep, okay, sometimes we're late on some stuff, but, uh, it's not horrifically late. Um, and, um, and, you know, it's still faster than if you had, you know, done a more traditional approach.

Ti Morse [27:13] If you do have a situation where things do go late, what do you do to basically make sure that whatever the new timeline is happens or it happens as quickly as possible?

Peter Beck [27:23] Well, I mean, there's, there's nobody at, at Rocket Lab that doesn't feel the anxiety of something is, is not going well. Um, like everybody here is super high performers, and they want, you know, it's, it's very important for their own ego to d- you know, to deliver beautiful stuff on time. So, so, you know, it's, it's self-policing in, in that respect. And look, the stuff we do is freaking hard. So, and some of it's never been done before, so inevitably, um, you know, you, you, you, you have issues. Uh, and then, and I'd say one of the great things about the company is like, it's not a culture where if somebody has a bad day, everybody runs away and points at them and going, "Oh, no, glad that's not me." Um, it's, it's the opposite, right? Everybody runs towards the problem and, and offers their help and assistance.

Peter Beck [28:07] Um, so, you know, as far as the culture goes, it's, it's, you know, some cultures it's, you know, everybody's standing on each other's throat to try and get ahead. Not, not here. You know, everybody, everybody runs to the, runs to the, the thing that's on fire to try and put it out.

Ti Morse [28:22] How do you actually foster that type of culture?

Peter Beck [28:25] Well, I mean, I, I wish I could, I wish I could say that there's, there's like a, you know, a statement or anything. I mean, it's just the way the company is. It's just the way the company always been. You know, right back to that example I gave you of that engine blowing up. You know, nobody's, you know, nobody's jumping and around and screaming. Everybody just gets to work.

Ti Morse [28:45] I remember you said, "We make the Ferrari of rockets," and you really care about design, and you really care about beauty. You really care about like function-

Peter Beck [28:52] Yeah

Ti Morse [28:52] ... all this stuff. What's your philosophy around building beautiful, amazing products that work? And then why does it matter to create things that are great?

Peter Beck [29:01] Well, uh, it, it comes, it comes down to my belief that, uh, if you build something beautifully, then you've taken pride in what you've done. If you've taken pride in what you've done, then chances are you've, you've looked a little bit deeper than your own work. Um, and if everybody is building beautiful things, if somebody doesn't build a beautiful thing, then it becomes really, really obvious. And, um, you know, generally, uh, if you build beautiful things, they work. It's very rare that you build something that is just beautifully executed and beautifully thought about that's just a piece of crap. It doesn't happen that often. Whereas I'd say if you build a piece of crap, it's like it's a po- it's a miracle or it's a win if it works.

Peter Beck [29:41] Um, so, and I, I honestly believe it takes no longer to build something beautiful and nice than it does to build, you know, throw something together that's a piece of crap, especially by the time you spend all the time, you know, you know, going back and rebuilding bits because clearances went right or, you know, you know, code wasn't right or whatever. So, um, so I don't th- I don't think it takes, it takes any longer. But, um, we used to have a saying on the wall that, that make everything you do a work of art, um, because, you know, if it doesn't work and looks like crap, you've got nothing. But if it doesn't work and looks beautiful, at least it looks beautiful. So, um, so y- you know, this, the, it's, it's a, it's an ingrained culture. And, and it doesn't, it does- doesn't apply to hardware.

Peter Beck [30:25] It's like code, it's software, uh, it's the facilities you're in. It's like, you know, we're, we're, we're here to build beautiful things. We're not here to, you know, make crap.

Ti Morse [30:34] Who are the people or, or things that have like inspired you on, on that kind of philosophy and trying to create beautiful products?

Peter Beck [30:43] I don't know. It's, it's probably, probably just, uh, my upbringing. Like, you know, as, as a, as a child, we- that's what we were always expected to do. You know, we were, you know, very practical kids. We were building go-karts and, and building these kinds of things. And, uh, whether it was be my father or my brother or anything, like, you would know if you built something that was rough. Like, the, the whole family would go-

Ti Morse [31:07] "That's a piece of shit"

Peter Beck [31:08] ..."That's a piece of shit. Why'd you build it like that?" So there was like a, you know, an expectation and a pride that everything that came out of the Beck's garage was beautiful.

Ti Morse [31:20] How do you marry those two philosophies of you both are going to junkyards to find some little piece of, you know, something that you can kinda salvage-

Peter Beck [31:28] Yep

Ti Morse [31:28] ... for a few hundred bucks, while also, like, creating the initial prototypes, while also understanding that the finished version is going to be, like, this gorgeous thing?

Peter Beck [31:37] Yeah, well, I mean, uh, if you clean a fitting, it looks exactly like a brand-new fitting, so you're not compromising anything- ... um, in that respect. And, um, so and then you're putting a new ferrule on it, so that's the bit that's doing the work. So, so I think, I think, you know, they're, they're not, they're not separate, they're not separate things. And, um, you know, uh, a, a piece of art that's, that's done by a, an artist that sells for $500 versus something that sells for 5 million, I mean, they're still beautiful. So you don't need to equate, like, a price tag to beauty and, and quality of engineering.

Ti Morse [32:13] I remember you mentioned that the most stressful part of your life is launch day.

Peter Beck [32:19] Yeah, I hate launch day.

Ti Morse [32:20] I'm, I'm not even sure if you, like, enjoy launch day.

Peter Beck [32:22] No, I do-

Ti Morse [32:23] Like, you-

Peter Beck [32:23] I, I completely do not enjoy launch day.

Ti Morse [32:25] What was it like 2009 when you guys launched your first rocket or test, and then also, you know, 2017 when you tried to make the first orbital attempt?

Peter Beck [32:35] The fi- first flights are a little bit different. Um, I mean, you want everything to go well, and you're willing everything to go well, and you've done everything you can to make everything go well. But it's, it's a, it's a logical kind of understanding that it may not go well. Um, so-

Ti Morse [32:50] It probably won't go well.

Peter Beck [32:51] Yeah. So yeah, yeah. So, so flight one's, that's not, it's not so bad. Um, that's, that's, that's not so bad 'cause that's, that's, that's a test. Um, it's worse later on, and the more you do, the worse it gets, um, because, uh, you know, it's still a extremely complicated vehicle and system and, and stuff. You know, even for the best of us, stuff goes wrong, right? Um, you know, whole countries' vehicles-

Ti Morse [33:16] Are counting on you.

Peter Beck [33:17] Yeah. Well, well, whole countries' vehicles also, also fail now and again, so it does happen. But, um, I don't know. It's just, I feel an immense sense of responsibility to our customers, uh, to our shareholders. Um, you know, people buy a rocket to, for to deliver their payload to orbit. They don't buy a rocket to deliver their payload to the ocean. So, you know, I just feel a, a tremendous sense of responsibility to, you know, to make sure that their experience and their, their mission is delivered exactly right. And I think, you know, that's part of the Rocket Lab culture is every single person in this company takes the delivery of their thing or the end solution incredibly seriously.

Peter Beck [33:59] So, um, you know, whether it's a reaction wheel to a customer or an entire spacecraft or an entire mission, you know, the c- we really care here. Like, when we deploy a satellite into orbit, um, you know, I think most people would think that our job is done, yes, and we all just go home. But everybody's hanging on, hanging off, waiting for the customer to c- tell us we've had a successful contact of our spacecraft. You know, it's not our part of the mission, but we just want that mission to, to be successful so badly that, you know, I don't think anybody in mission control, you know, has a sigh of relief until our customer comes back to us and said, "Yep, we have made, made contact with our spacecraft," and the whole thing is successful for everybody.

Peter Beck [34:39] Um, it really sucks when a customer forgets to tell us because there's, there's like 100 people sitting back here going, "Oh, was, did the customer make contact or not?" Even though our mission is over.

Ti Morse [34:49] What was the most stressful day of the last 20 years?

Peter Beck [34:54] Oh, man. You know, it's, it, for me, it's, it's like, yeah, when, when something has gone wrong. I mean, like, a launch anomaly is, is just, is j- like, this place is a morgue. Like, it is, you, it is... You know, if you're, if you're, like, a psychologist, you come in here, you'd make a killing because, you know, after a launch failure, it's just, it is, it is just really tough. Really, really tough. Because everybody is, is so invested in, in, in all of that.

Ti Morse [35:21] There's this wonderful line which is like, entrepreneurship in its best form is basically going from failure to failure without a loss of enthusiasm. And I feel like every company that succeeds over time is, becomes very good at basically experiencing failure-

Peter Beck [35:36] Yeah

Ti Morse [35:36] ... learning from it quickly, and then moving on and just focusing on the next thing.

Peter Beck [35:40] Yeah, no, I'd say, I'd say that's absolutely true. Yeah. Um, uh, and, and, you know, failure happens in all forms and, like, there's, there's big, big public failures, and then there's, there's, like, you know, someone's been working on this piece of hardware for the last three months, and it goes to the vibe table and falls to bits. Like, you know, they're still gotta go home, and they're like, "Oh, that didn't work." If it wasn't, if it wasn't for the prize of the space industry, I doubt anybody would do it because it's just... And when I say the prize, I mean the prize is, like, if you work on a launch vehicle, seeing a rocket fly. Like, you know, um, people will just absolutely work their ass off, and then a rocket will fly, and they're like, "Yeah, yeah, yeah, let's go do it again."

Peter Beck [36:20] Like, it's, it's just like this, this adrenaline hit that you get that, that, um, keeps everybody going. If there wasn't that kind of, you know, almost climax of, of event, then whether it be a rocket or a spacecraft being launched or whatever, I'm not sure everybody would do this job because, um, it is, it, you know, it is, it is just, it's just constantly tough.

Ti Morse [36:40] For the first, like, 12 years of the company, you're basically an R&D organization, where you just needed to design something that actually worked and ma- you know, show that it worked. And then in like 2018, you make the first orbital success, uh, launch, and suddenly that shifts. And I remember you mentioning that basically once you have a product that works, now the job is to go and sell it and like actually get customers and actually start scaling that up.

Peter Beck [37:06] Mm.

Ti Morse [37:06] What was it like transitioning from a company culture of just designing, developing, iterating to something that's actually scaling up rocket production and shipping?

Peter Beck [37:16] Yeah, that, that, that's a good, that is a good question. Um, you know, in a previous life, uh, among other things, I was a production design engineer, so I know what good production really looks like. Um, and, uh, I would say it's taking a product from, you know, an R&D standpoint and in-into full volume production is, is a whole different set of skills and a whole different set of pain. Um, and you know, there was times during the Electron scale-up that it was just incredibly, incredibly painful because, you know, it was difficult to, you know, get, get all that DNA built within the company. Um, but you know, I look back now and it's like, it's just such a core strength across the whole organization.

Peter Beck [37:58] Um, you know, and I think any-- every startup goes from that, right? To developing their, their first widget or thing and then scaling it. I mean, those scaling challenges are real.

Ti Morse [38:07] This, like, idea of production hell, um, and you know, you finally have the thing that works, and then suddenly the biggest fire is no longer making the thing work.

Peter Beck [38:15] Yeah.

Ti Morse [38:15] It's just scaling the production-

Peter Beck [38:16] Yeah

Ti Morse [38:16] ... of the thing that works. What was it like kind of going through production hell, like, for rockets?

Peter Beck [38:21] Yeah, it was just like that. Like, you can ask anybody there. It was just like that. It's production hell. But, um, but I would say that, um, it's not as, as hellish as it could've been because we designed that vehicle from day one to be produced. So it's not like a bunch of engineers got together and said, "Let's just see if we can make a rocket." It's like, "Let's see if we can make a rocket that will be producible." So, um, you know, Electron, as far as a launch cadence, scaled faster than the Falcon 9. So from first flight to 50 flights, um, you know, we were faster than a Falcon 9. And from 50 flights to 100 flights, as long as we keep doing what we're doing, we'll be faster as well. So it w- it was designed very intently to be producible. Um, and then you can say that for just about, you know, certainly Neutron, it's even better.

Peter Beck [39:06] Um, but, uh, but for all of our other satellites and products as well.

Ti Morse [39:10] How do you kind of think about designing something initially that is gonna be like expendable, and then when do you decide to make the call on like, "Let's work on this massive new project-"

Peter Beck [39:20] Mm.

Ti Morse [39:20] "... in order to make reusable rocket"? And like how do you actually, again, shift the company culture back or not necessarily shift the company culture, but shift back into the gear of just building the first iteration of that thing?

Peter Beck [39:29] Yeah, I mean, it's not, it's not that, not that hard really, um, you know, 'cause we, we do a lot of new stuff all the time. Um, and, uh, you know, we, we spent quite a lot of time with Electron and Electron's reusability program, learning so much. So, um, so I'd say, you know, the muscle memory was there pretty strongly already. Um, but no doubt, you know, we, we, we took a lot of learnings from Electron and then, you know, and a lot of the team from Electron and ported them directly over to Neutron. So, um, so yeah. I mean, Electron is a great product, but if we look at like, you know, how we've gone about Neutron, um, it's just, it's, it's just so much better from a production standpoint.

Ti Morse [40:10] What about it is better?

Peter Beck [40:11] Well, it's just firstly, it's, it's less mass sensitive than Electron. Like Electron, every gram counts. So, um, you know, you have to do a whole bunch of things where-- that are from a production standpoint that are suboptimal, but from a mass perspective are critical. Whereas Neutron, we don't have that same constraint. And, um, you know, it's just, just really nice stuff like all of the fluids, fluid systems are just built completely off the rocket and then just assemble in as, as, you know, boom, boom, boom, boom systems. Whereas, you know, on Electron you're literally, you know, having to bend tubes, you know, to, you know, to, to pipe stuff out, pipe stuff in. And then same with the electrical systems. Um, you know, the whole electrical system, the complete electrical system is built off the rocket, and then just one day it gets installed in the entire rocket.

Peter Beck [40:54] Whereas you're not, you know, you know, not pulling cables up and down the rocket, um, like you are in an Electron. So there's just, there's just a whole bunch of stuff that we could do with Neutron that's just way better.

Ti Morse [41:03] I think you asked Ashley, uh, that you wanted to like meet Elon or have dinner with him, and then I think in like 2017 you actually did have dinner with him. What was that dinner like? Uh, and I remember you said in an interview with him that it may not have been useful for Elon to know that you guys were like as serious as you were.

Peter Beck [41:21] Well, you'd have to ask Elon, but, um, but yeah, no. I mean, uh, we'd, we'd kind of at that point we'd launched a, uh, a few and, and, um, the, the thing I took a- took away from that is like these companies are the same. Like same problems, same everything. Uh, his rocket's big, mine's small. Same, same. Like it's... It was, it was very, very, very similar. Um, but I mean, uh, yes, for sure sometimes it's better to just remain off the radar than on the radar.

Ti Morse [41:51] If you could go back and not do that dinner, would you?

Peter Beck [41:54] No. I mean, we, we, we would've w- we would, we scaled anyway and, um, so we would always be on the radar.

Ti Morse [42:01] When you look out today and you think about the biggest bottlenecks in your mind, what are they?

Peter Beck [42:06] We always have a challenge of feeding talent to the machine. Um, uh, you know, the bar to get into Rocket Lab is extraordinarily high, and I think, you know, everybody says, every CEO says, "Oh, we've got the best team in the world," and all the rest of it. I mean, there is a lot of people that are from a lot of other space companies that, um, that you would respect that just don't make the grade at Rocket Lab. So, um, so the bar is extraordinarily high, and we make no apologies for that. And then even when you're in, you know, through the bar or under the bar or over the bar or whatever, um, no, the bar no longer involved. Um- Like the expectations are super high. They're super high. And this place is, is not for everybody, that is for sure.

Peter Beck [42:50] Um, so you know, we're just growing so fast, like keeping great talent fed to the organization is, I'd say, one of the biggest throttles.

Ti Morse [42:59] How do you actually, like, maintain that bar? Like, I know Jeff Bezos has this idea of he wants to constantly improve the bar over time so that any new hire is basically like the best hire that they've made-

Peter Beck [43:08] Mm

Ti Morse [43:09] ... uh, in the history of the company. And then over time, it just becomes like this impossibly high standard of quality of human.

Peter Beck [43:15] Yep.

Ti Morse [43:15] How do you kind of maintain that?

Peter Beck [43:17] Yeah, well, it-- that's a great question because, you know, sometimes, um, you know, a manager will just be so overwhelmed with how much they've got to do, they just want a pulse. Just give me a pulse. And, um, and you know, uh, the, the recruiting process just is, it's, it's pretty rigid about, you know, that. And also, I would say that generally, you know, enough managers have made enough bad, um, hires where, you know, they, you know, this person's not exactly what I need, and they-they're not, they're not quite bought into the mission and the, the culture. But, you know, hey, they'll be fine. And then, you know, they're, they're, they're not, they're not putting in the hours or they're working from home all of a sudden, and then they get self-selected.

Peter Beck [44:00] I mean, uh, so it, you know, it, it's ultimately not successful.

Ti Morse [44:05] If you had to think about the perfect day for Peter Beck, what does that actually involve? Like, what do you do during that twenty-four-hour period?

Peter Beck [44:13] Perfect day? I don't think there is such a thing. I mean, the, the reality is, the reality is that as, uh, I'm, like I'm the chief engineer, I'm the CEO, my job is to fix shit. That's, that's pretty much it, right? Um, and, and, and also, you know, think forward and grow the company and all those kinds of stuff. So the perfect day would just be to successfully, you know, solve a whole bunch of problems. That's, that's when I go home at the end of the day the happiest. It's like, "Yeah, we finally nailed that," or, "This is a great idea. Let's go after that." Um, those are the, those are the best days. It's when, when you like, you know, you, you, you grind on a problem, and you just still don't find a resolution, those are the, those are the tough times.

Ti Morse [44:56] What have been the favorite days for you so far?

Peter Beck [44:59] I don't know. I'd-- To be honest with you, I'm not a very re-retrospective person. It's just like, what is the next day gonna throw at me? Um, so I mean, look, I mean, there's, there's always great days when we have a, you know, a, a really successful launch. I mean, I think one of the, one of the more impactful launches for me was our first NASA launch because, you know, as a kid growing up, my dream was to go and work for NASA. And I had, like, this little space shuttle that used to sit on my desk, uh, at home, you know, and then it used-- it sat on my top of my computer when I was, you know, started my career at w- at work, and that space shuttle still sits on my desk today here at Rocket Lab. And, um, that was, that was, that was kind of the thing I would look at, like, "I'm gonna do that, I'm gonna do that."

Peter Beck [45:41] And, um, you know, when we actually, you know, got to launch, launch a NASA mission, and there's a whole bunch of people in mission control wearing NASA T-shirts and high-fiving us and, and doing it successfully, that w- that was, that, that meant a lot. It's like that, that was a big tick.

Ti Morse [45:55] I think the first time that you came to America, you, like, went and talked with a bunch of VCs.

Peter Beck [45:59] Yeah.

Ti Morse [46:00] And there was this day where you came out of a very successful meeting with, I don't know if it was Vinod Khosla-

Peter Beck [46:05] Yep

Ti Morse [46:05] ... or yeah. And you just, like, went home and, like, bought an American flag.

Peter Beck [46:10] I did.

Ti Morse [46:10] Um-

Peter Beck [46:11] Yeah

Ti Morse [46:11] ... you know, you were just-

Peter Beck [46:12] I went to Whole Foods and yeah, they had-- Yeah. It was the nearest supermarket I could find, yeah.

Ti Morse [46:17] What did it feel like coming to America? What was different about that, like Silicon Valley?

Peter Beck [46:21] Just, just so invigorating and exciting, um, because the great thing about America is anything is possible. Like, if you've got a dream and, uh, and, and you, you've got the energy to go and do it, you can do it, and that is, that is the magic of America. Um, and, uh, you know, how crazy was it that a guy from the arse end of a little country can turn up to America and raise a bunch of money to go and build a rocket? Like, it's nuts. And, and that is, that is, that is the amazing thing about America, um, and also Silicon Valley and venture capital and, and like y- there's, I don't-- there's nowhere else in the world you can do that.

Peter Beck [46:59] Like, I mean, if you look at Europe and, you know, why, why is Europe not as entrepreneurial as, as America? And it's, it's because you don't-- it's, it's not that culture of belief and the culture of we can give it a go, and we can make it successful, and rah, rah. You know, it's, it's a very much a subdued culture. It's like, well, don't screw that up, and that might fail, and all that rest of it. And I think, you know, if you look at the historical developments and why they always come from America, it's because people can just have a crack. And even if it turns to custard, the crazy thing is you can go back to exactly the same person and have a crack on something totally different again, and they'll back you. Um, and that, that is, that is the magic of America.

Ti Morse [47:40] When you were on the flight over, what were you thinking?

Peter Beck [47:42] Well, I knew nothing about how any of this worked. I knew nothing. I mean, so I gave myself three weeks to come home with a check or be run out of town, and that was my, that was my philosophy. And coming from New Zealand, everybody told me it's like, "Oh, Silicon Valley, venture capital, that's like a shark tank, and that-- then you're just gonna get eaten up and spit out and ripped off." And it's like, "Nah, not at all."

Ti Morse [48:03] That wasn't your experience?

Peter Beck [48:04] No, no. I mean, um, quite the opposite. And, you know, I spent the first week just figuring out how the game is played 'cause I knew absolutely zero. So this is where I went round a bunch of, you know, startups and tried to figure out how the game is played. And, um, you know, and the second week was figuring out who I wanted to talk to, and the third week was I only pitched to three VCs in the end. There was only three VCs that, that, that, you know, I felt I wanted to work with, and I felt that would get it, and we came home with a check.

Ti Morse [48:35] What did Vinod say to you in that meeting?

Peter Beck [48:37] Well, um, Vinod had, uh, invested in Skybox, which, uh, was a, an imaging company that was ultimately bought by Google for half a billion dollars. And, um, Vinod had felt, and that whole team had felt the, the, the pain of launch. Like, they were launching off Russian ICBMs. Um, so, you know, when I turned up and said, "I'm gonna build a rocket," there was zero question about whether there was a market or not. Absolutely zero question. Like, we 100% understand there's a massive market here. Yep. The only question, I guess, was, you know, could I pull it off? Um, and I didn't come there with, uh, with a dream and, and only that. I came there with, you know, a successful flight, a sounding rocket to, to space, and, and a whole bunch of stuff.

Peter Beck [49:20] And, and I came with, uh, a complete, uh, one-tenth scale set of plans for the whole rocket, blueprints, and I rolled them out all, all along the, the, um, partner's desk, um, in the boardroom. Um, this whole, like, one-tenth scale blueprint of the rocket, and I had a pump in my hand, and it's like, "Here's how we're gonna do this, guys." So, um, so yeah, I mean, it's lucky enough to convince Vinod that it's worth a go.

Ti Morse [49:47] Was there any moment in your head where you weren't sure whether or not the money was gonna be there, or this was something, like a problem that was tackleable at all?

Peter Beck [49:57] Well, at the risk of sounding arrogant, no. Because I think if, if you, if you believe that, then you wouldn't wake up in the morning. Like, I mean, I think a successful entrepreneur is, is a, an optimist to their core. Because if you're not, then, like, if everybody else is telling you it can't be done, and you believe it can't be done, then it's never gonna be done, is it? So no, I think you, you... I mean, you have to temper that with, um, the reality of, of some of the things, and I think this is, this is where, um, maybe the balance is, is good, is, is like half of my brain is completely entrepreneurial, just wanting to go for it, and the other half is, like, this conservative engineer. So, you know, you fuse those two things together, you, you know, you, you get, you get what you get.

Ti Morse [50:42] What's been the biggest, like, evolution of your own kind of internal philosophy on how you operate the business and just operate day-to-day over the past couple of years?

Peter Beck [50:51] It, it, it'd be interesting to ask somebody else that question because in my mind, it feels like exactly the same. Um, I don't, I don't feel like I've changed my management style or, uh, people, my expectations of people, or the way we run the business has changed at all. Um, you know, there's, there's, there's certain things that change because they have to. Like, you're a publicly traded company, so you have to do s- some things differently. But I would, I would... You'd have to ask somebody else, 'cause at least to me, um, it just feels like this is the way that it's always been done.

Ti Morse [51:22] SpaceX and Elon decided to go public, and for a very long time, the first more than 20 years of the company, he was like, "I don't even know if SpaceX will ever go public."

Peter Beck [51:31] Yeah.

Ti Morse [51:31] Because he didn't know that public market investors were the type of folks that would be interested in, you know, experiencing failure-

Peter Beck [51:38] Mm

Ti Morse [51:38] ... like that.

Peter Beck [51:38] Mm.

Ti Morse [51:39] Um, how'd you make the decision to go public in the first place?

Peter Beck [51:42] Well, for us, it was, it was always part of the plan, um, because, uh, f- and it's, it's for a, for a selfish reason and a non-selfish reason. Um, so, uh, you know, the, the s- the selfish reason, reason is, um, you know, the only thing my parents ever said to me is, "We don't care what you do as long as you have impact." So choose something in your life that you can have impact and, you know, contribute to the human history, basically. So, um, you know, for me, that was, that was space, and I think that, that you can have a meaningful impact. But, um, I measure impact in not just, like, a blip in history. I measure impact in, you know, a long, consistent, you know, thing over a long period of time.

Ti Morse [52:24] Like an enduring thing?

Peter Beck [52:26] Totally enduring. And one of the, the reasons why I was very, very adamant to take the company public was a public company, it's, it's, it's a f- you, like, it... If you do it right, that is a fact. Like, you know, many generations of, of, you know, rocket labor can go by, and this company can be successful for a very long time and, by default, have impact, and then I've done what I was supposed to do. So, um, so that, that, that, that's super important. And also, being a public company, uh, it, it really enforces the diligence and, um, you know, the, the rigor to, to be successful. If you're a private company, especially if you're a private company and you don't have problems raising capital, then, you know, you're just, you're just fat and happy for ages until you're not.

Peter Beck [53:11] Um, and there's no, like, extreme pressure-

Ti Morse [53:13] Like force and function?

Peter Beck [53:13] Yeah, no force and function or extreme pressure to develop a product, to get it profitable, to make the company sustainable. Um, like, you know, there is, there's a lot of checks and balances and a lot of pressure as a public company to make sure that, that, that those things become true. Um, and those, those things ultimately, you know, create longevity. And then, you know, as a, as a, as a spinoff, then they also, you know, create value. So, you know, I had a lot of investors invest in the company and, um, and, you know, want to return that value back to them. And, you know, ev- any venture capitalists that invested in the company, we've made their whole fund back, uh, which is great. And also, um, you know, the staff have, have done really well, and all, and all of our investors.

Peter Beck [53:55] So, you know, our obligation is to continue, you know, to grow the value of this company, um, which I think is, is, is important as well. So, like I say, there's... I, I kind of view it as slightly selfish that I'm trying to, I want to build this company that way, way outlives me, um, and can go on and have, you know, long, long impact.

Ti Morse [54:13] Is there any decisions that you make with that kind of understanding of this, like, multi-decade, you're in this basically until the day that you die, understanding in the back of your mind, um, that you might not make if you weren't planning on trying to create this super enduring institution almost?

Peter Beck [54:27] Um, well, I mean, if you look at, there's, there's a lot of space companies out there where if their founders and leaders die- I think you would have to question whether or not that company would continue

Ti Morse [54:38] I think Elon's one of them. I like-- I think the, like, keeper of the soul of those companies is, is Elon, and the second that he leaves-

Peter Beck [54:45] Yeah. Well, I mean, there's a, there's a, there's, there's, there's more than, more than that as well. I mean, there's others there as well, and I just didn't wanna be one of those companies. Like that-- What a word. I mean, I, I, I want this thing to go on for forever. So, um, so, you know, that, that's kind of, you know, a critical, a critical point. And, um, I'm also a realist, like, um, you know, there'll be a point in time where, um, you know, there's other people that can run this company better than I can, or I just get too old and I'm, I'm, you know, I'm like that guy trying to log into his laptop and not been able to do it 'cause it's... So, you know, y-y-you know, everybody that comes to this company knows that you have a finite period of time at Rocket Lab.

Peter Beck [55:23] And that finite period of time might be that you just get exhausted and you wanna do something else, or there's other younger, better people that are, that are better than you, and you'll be replaced. And the same goes for me. Like, there'll be a point in time where there's a better person to run this company and, and, you know, I wanna make sure that, that when that happens, this thing doesn't stop.

Ti Morse [55:41] If you have a whole bunch of cash in your bank account, it's pretty easy to graph, you know, how long do we have-

Peter Beck [55:45] Yeah

Ti Morse [55:45] ... as far as runway goes.

Peter Beck [55:46] Yeah.

Ti Morse [55:47] But when do you want to be, like, a profitable business so that you just are, like, operating off of, you know, you're able to make these big bets-

Peter Beck [55:55] Yeah

Ti Morse [55:55] ... and you're completely, like, with the understanding that your other bets that you've made have succeeded, and they're able to fund them.

Peter Beck [56:00] Yep. Well, it's a complex question, and the answer is, is as soon as possible because that ensures survival. Um, if you're making money, you will live. If you're not making money, eventually you will die. So it's survival. Um, now, um, you have to, you have to play that carefully because, okay, um, you know, Rocket Lab could be profitable instantly if we just stop developing Neutron. But Neutron unlocks an entire, you know, massive opportunity with us building our own constellation and ultimately deploying our own infrastructure in orbit. It's all about risk versus reward. So, you know, do you want to have a little company that's profitable and okay, it may survive, or do you want to have a much bigger impact and make some investments in these much bigger capabilities?

Peter Beck [56:44] Um, so we're very black and white and un- impassionate about these sorts of things, um, for us. Um, you know, we don't, we, we, we don't, we don't make decisions based on, you know, feelings and, and those kinds of things. It's, it's very much, uh, impassionate. Um, you know, we're trying to build profitable. We're trying to build value, which ultimately builds longevity. But, um, you know, we do also, you know, happy to make, uh, you know, make the decisions and take the risk to, to pay, to make big investments like Neutron, where we can see the outcome of that investment is just gonna be, like, orders of magnitude of scale of company.

Ti Morse [57:23] One of the things that Elon did is he just kept on working on basically this idea of launch costs up to orbit or, like, mass to orbit-

Peter Beck [57:30] Mm-hmm

Ti Morse [57:30] ... and then getting the cost down. And then eventually he basically just filled his own supply-

Peter Beck [57:34] Mm-hmm

Ti Morse [57:34] ... uh, where now, like, Starlink is the-

Peter Beck [57:36] Yep

Ti Morse [57:36] ... best business in space.

Peter Beck [57:37] Yep.

Ti Morse [57:37] Period, end of story. How do you kinda think about figuring out which business to build in space-

Peter Beck [57:42] Yeah

Ti Morse [57:42] ... when you're just absorbing all of your own supply?

Peter Beck [57:45] Yep. Well, for the longest time, I've always said it's gonna be really blurry in the future of what is a space company and what is not a space company. Especially the big ones, like the, the, the, the big space companies of the future, they're gonna be blurry. And I think if you looked at, looked at SpaceX right now, w-what is it? Is it an AI company? Is it a-

Ti Morse [58:04] Telecom

Peter Beck [58:04] ... communications company, or is it a space company? Um, but the one thing for sure as shit, if, if, if you have the ability to, to put infrastructure in orbit, and you have the ability to make that infrastructure that it is in orbit, then your ability to deliver a service or a s- a solution down on Earth is vastly superior to anybody else. That experiment has been run. That experiment, experiment to us is always super obvious. And, and I think, you know, that, that is clearly where, where we're tracking.

Peter Beck [58:33] And, um, you know, I think if we have this, another interview in 10 years' time, there's gonna be a, a select few of really large space companies that, um, provide a, a critical part of infrastructure and backbone in orbit, and 100% of them are gonna have their own ride to the-- ride, uh, with their own rocket, 100% of them.

Ti Morse [58:50] If you had to fast-forward five or 10 years out, and you said if, you know, just best guess today what the vast majority of your launches, like, what payload they're carrying, what would that be? Like, what is that business that you create?

Peter Beck [59:02] Yeah, we don't talk about that.

Ti Morse [59:03] Oh.

Peter Beck [59:04] No, look, I mean- ... we don't talk about it for a number of reasons. One, one, uh, it's just too early. Um, so, you know, there's no... I'm, I'm, I'm a very, um, methodical person, so I like to finish one thing before I start the next. And, uh, the most important thing is to get Neutron to orbit, um, and, uh, get that vehicle scaled. Uh, then we have the capability to deploy whatever infrastructure we need. Um, you know, we've been methodically, uh, building capability in our space systems division to the point now, whether you wanna go to Mars, whether you wanna go to the Moon, whether you wanna do national security, the most exquisite thereof, we can do it all, like piece of cake. There is nothing we cannot build now in, in orbit.

Peter Beck [59:47] So, um, so, you know, we've, we've put all those building blocks in place.

Ti Morse [59:50] You're basically building optionality?

Peter Beck [59:51] 100%. The only thing left we've got left to do is to get Neutron finished. Then, then we, then we can talk about what infrastructure we'll, we'll end up building in space.

Ti Morse [1:00:00] In 2012, uh, Mark Zuckerberg and Paul Graham were talking together on stage, and I think Facebook had just gone public, and their stock was down, like, 50%-

Peter Beck [1:00:08] Mm-hmm

Ti Morse [1:00:08] ... or something like this.

Peter Beck [1:00:09] Mm-hmm.

Ti Morse [1:00:10] And Paul was asking him basically the question of, "Do you like it when everything is working, or do you like to be underestimated?" And Mark basically said, "I love being underestimated, and people not really knowing what I'm capable of." What is your favorite state? Is it being underestimated?

Peter Beck [1:00:24] I like everything working, 100%. No, screw that. Yeah, no, I don't, um, uh, I don't need to be felt as the underdog or anything like that. No, I like everything humming and working, absolutely.

Ti Morse [1:00:35] What does the, uh, scale up of Neutron look like?

Peter Beck [1:00:37] Yeah. So, uh, we'll, we'll do a first launch, and we'll, we'll do a, a splashdown of that, and that'll, that'll give us a good, really good sense of, you know, where we're at with the program. And then, uh, all going well, if the program's going well, then we'll slip the barge under the next one, and we'll, we'll try and stick a landing. And then, you know, Neutron will scale, uh, a lot faster than e-even Electron scaled, um, because we've just put in place, uh, you know, uh, both from a design perspective, but also just from a, a manufacturing and infrastructure perspective. We're just so far further ahead than we were with, with the likes of Electron. I mean, you know, the design dec- design decisions that we made into carbon composite structure using AFP, uh, automated fiber, fiber placement machine, like, it's just nuts how quick we can make a tank or make structures with that, with that machine.

Peter Beck [1:01:22] Um, it's just, yeah, and how cheap we can do it. So, um, so, you know, we've, we've chosen various kind of, you know, paths that, that are just infinitely scalable.

Ti Morse [1:01:32] I remember Starship, initially it was gonna be this, like, carbon fiber basically structure, and then they swapped it to, like, a special alloy of steel.

Peter Beck [1:01:40] That's done, yeah.

Ti Morse [1:01:41] Yeah. Are you doing anything new on, like, the material side?

Peter Beck [1:01:44] Yeah, absolutely. Yeah, I mean, um, so it's a, it's a complicated, um... So a, a, a rocket is a giant engineering compromise. Um, like, if we're, if we're having a design review and all the, all the subsystems are in a room together, and one of them is happy, then something's gone wrong. Like, everybody should be equally as miserable because it is, uh, everything is a giant engineering compromise. And, um, you know, uh, carbon is, you know, its strength to weight ratio is just vastly superior to any other material. Like, it's four times better than stainless steel, for example. You know, for the same strength, it's, it's, it's one quarter of the weight. So, um, but with that comes other challenges, and, you know, we've been able to solve these challenges through a lot of this automation with AFP machines.

Peter Beck [1:02:29] So, you know, the structures of Neutron are just absurdly light, um, uh, which is, you know, which enables you to, uh, you know, take pressure off other areas like, um, rocket engines. Our rocket engines don't have to be, like, on the limit of grenades. Um, they can, they can be, they can be backed right off and just sort of, you know, a relatively unstressed engine. And that's because, you know, we've have-- our structures are so light that, you know, we can back some performance off the propulsion.

Ti Morse [1:02:56] What's been the biggest unlock over the past, like, 20 years that you wouldn't have expected, like, most unexpected thing that have happened?

Peter Beck [1:03:03] Well, um, there's lots of things. Uh, there's both from a technology standpoint, and also, I would say, um, capital because it is a big one. Because we're always in, in this position where we have vastly less resources than our competitors. And, um, you know, e-even as a public company, that, that is, that is true. But as a public company, we've been able to harness the, you know, the capital access that we have, and just look how fast this business has grown. Like, year on year, it's just crazy. Not just organically, but inorganically, we're able to acquire capabilities and, and grow those as well. So, you know, the, the, the kind of, you know, the line here is fairly vertical with respect to that.

Peter Beck [1:03:47] So, you know, going public, um, was a great capital unlocker for us to, to go and, and, you know, really, really grow. I mean, we, we went public with one product, and now we have hundreds, and we're building, you know, complete m- as a prime contractor for the US government on national security. So a lot of that was unlocked by, you know, having that, having that ability to access that capital.

Ti Morse [1:04:11] I've gotten this overwhelming sense of just relentless optimism from you and from just the team in general.

Peter Beck [1:04:18] Mm.

Ti Morse [1:04:19] What is the importance of having just extreme optimism?

Peter Beck [1:04:22] Well, I mean, I think, I think, um, yeah, I mean, it's, it's, it's, it's absolutely critical, but I think what a boring person if you're always down. I mean, like, would you wanna work with somebody who is just, like, took the negative side of the angle? I mean-

Ti Morse [1:04:36] Never.

Peter Beck [1:04:37] No.

Ti Morse [1:04:37] But the pro- but the thing is, most people aren't. It's like you just constantly have a smile on your face every time I see you.

Peter Beck [1:04:42] Yeah. Well, I mean, I'm having fun. So-

Ti Morse [1:04:44] Mm-hmm

Peter Beck [1:04:44] ... it's not, it's not, it's not, um, it's not anything other than that. But, um, no, I think, I think there's a lot to be optimistic about. Like, this is, we're doing fun stuff, and we're doing big stuff that's important. Um, so I'm not, not sure how you could be anything but an optimist, um, in this, in this industry. And I, and it, it probably, to be fair, it probably does attract optimists because, um, you know, the rocket gods are trying to crush you every, every chance they get. So you have to, you know, you have to be a little bit, little bit sunny side up.