Yuk Chi Chan — On Rockets, Dog Years & Robotic Space-Snakes (EP.238)
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Hi, I'm Jim O'Shaughnessy and welcome to Infinite Loops.

Sometimes we get caught up in what feel like infinite loops when trying to figure things out. Markets go up and down, research is presented and then refuted, and we find ourselves right back where we started. The goal of this podcast is to learn how we can reset our thinking on issues that hopefully leaves us with a better understanding as to why we think the way we think and how we might be able to change that

to avoid going in infinite loops of thought. We hope to offer our listeners a fresh perspective on a variety of issues and look at them through a multifaceted lens, including history, philosophy, art, science,

linguistics, and yes, also through quantitative analysis. And through these discussions help you not only become a better investor, but also become a more nuanced thinker. With each episode, we hope to bring you along with us as we learn together.

Thanks for joining us. Now, please enjoy this episode of Infinite Loops. Well, hello, everyone. It's Jim O'Shaughnessy with yet another Infinite Loops. Today's guest...

I love your name, man. And I've seen it done the other way. You're going to have to educate me on that. But you literally could either be a superhero or in a superhero movie or like as I'm going through your stuff, you'd make a great character in a science fiction novel. I know that you have an affinity for that and have written science fiction.

But you are the founder of the Techstars-backed Charter Space, a space company building the operating system to simplify space programming, which...

is amazing to me given the fact that most of the big guys are still using Excel, duct tape, a variety of ancient software. You're a published space lawyer. You're a former Singapore Army officer. I want to hear about that. Science fiction author, military combative practitioner, and yet a high school dropout

And I love this thing that you wrote because I kind of think the same way. I write, read, I don't fight. Fight and think. Not necessarily in that order. Welcome. Thank you, Jim. I appreciate the invitation. I appreciate the very kind words. Yeah, I've had a bit of a weird journey. I don't know if I necessarily characterize myself as a character. Life just takes us in funny directions, right?

It does indeed. One of the first things that I noticed was you named your software package Ubik. And I'm taking it that that is a nod to one of my favorite science fiction authors, Philip K. Dick.

It absolutely is. I've read almost every single thing that Philip K. Dick has ever written. Ubik, you know, I mean, Ubik doesn't get, I think, the attention that it deserves because it's never been adapted into a major feature film like everything else. The other highly underrated novel, I think, is Flow My Tears, The Policeman Said, which I love as well. But yeah, Ubik,

It was such an influential novel on me growing up. I always loved the concept of the core behind the Ubik thing, because it really is a thing in the novel, right? There is no corporeal form to it. It's such a profound concept that cannot really be encapsulated in anything other than something as simple as a spray can. And that's ultimately what I wanted our software to be, something that is profound, that's life-changing, that's world-changing, that is...

close to God and close to that sort of ubiquitous power and grace, but wrapped up in something extremely simple, like an easy-to-navigate user interface. Absolutely. I, too, think it's actually one of his best books ever. The fact that it hasn't been made into a movie. We also have a film division, so we might try to get after that.

That'd be incredible. You know, the thing that I love about the story and the fact that you named it, your package that, is that really...

The story, reality deteriorates, right? And Joe Dirt, or Joe Chip, rather, who is the protagonist, is like, hmm, this is weird. And then Ubik, of course, is the spray that congeals and stabilizes shifting realities. Tell me a little bit about your experience with founding the company. What was the mission?

And I know from the backstory and reading your stuff that you share my idea that much space technology is from when maybe I was 15 years old in 1975.

Yeah. And, you know, I think that we are making tremendous strides in terms of the hardware. So actually, I'm in Utah today because we just wrapped up a major space conference here, which, by the way, takes place in Logan, Utah, which is the last place you would think a big space conference would take place. But, you know, while those weird oddities of history. But yeah.

We've made tremendous strides, and ultimately we are currently being held back, I think, by the interface layers between humans and other humans, humans and the hardware, and between organizations. There is that essentially what you might call the ether, the stuff that

exists between us that could either act as a medium for us to convey information and data to each other or obstruct that conveyance. And so I used to be a program manager at a small company in the UK where I was responsible for getting our spacecraft built, organizing and orchestrating all that, but also communicating a lot of the data that we were generating to external stakeholders. Because

You know, space is the most regulated industry on the planet. A lot of people would debate me on that one, but I think that space is at least up there. There's a lot of rules. They're not very well defined, sometimes on purpose in order to allow for flexibility. But that also leads to a lack of certainty as to what you're actually supposed to tell a regulator when you want to fly. And so...

Communicating that to external stakeholders like regulators, but also other parties with financial interests, potentially insurers, has never been an easy task for a manufacturer, especially of these extremely complex systems designed for regulators.

the most challenging environments ever known to humankind. There is no margin for error. There is no such thing as corrective maintenance. You can't just send up a repairman as soon as a satellite stops working. Once it's up, it's up. And so these things have to be tested rigorously. And that generates a lot of historical data, a lot of historical artifacts that have to be version controlled and managed and cited in their correct context and place. And so

Communicating all that was immensely challenging for me as a program manager because all I really had at my disposal were generic tools like Excel. Now, Excel is fantastic. I like Excel as much as the next guy. And given your finance background, Jim, I think you have a keen appreciation for the limits to which one can push Excel the most. But Excel is both a broad tool as well as a deep tool, but it can't be both at the same time. And so...

It does struggle in conveying a lot of contextual data. It does struggle in conveying a lot of complex data when it gets down to it. And

And when I say conveying, I mean in terms of I generate an Excel sheet. I'd like to send it to somebody else so that they understand what's going on in my mind. And it takes me a 30 to 60-minute call to actually explain the entire legend of this Excel sheet. And every single time that happens, you lose at least two hours, one hour on each side of that call. And that's just a huge, tremendous source of inefficiency.

In fact, the Rand Corporation actually estimated that for most aerospace programs, between 12% to 28%, depending on the specific thing that's being built, but between 12% to 28% of all program costs or overall program budget is spent purely on program management and systems engineering. If you contextualize that within, say, NASA's SRS program, which hasn't really flown,

So far, it's been somewhere on the order of, I think, $26 billion overall, which means that about $6 billion, call it a happy median, hasn't spent just on communicating with Excel, which is an oversimplification of the problem. But I hope it illustrates how insane all of this is. And so that's really where Trotter came from. I saw this and I thought...

God, we're launching these incredible machines to the farthest reaches of space. Voyager 1 relatively recently crossed the threshold of our solar system and it's now in extrasolar space. We're doing all of this and it's fantastic. It's inspiring. We should have better tools. We deserve better tools. The engineers in the industry deserve better tools so that they can go out and dare mighty things.

And so that's really what Schroeder exists for. It exists to build the tools to enable the best and brightest amongst us to stop putzing around with Excel and to get back to building our collective ambitions as species. I think it's really great because that environment is very viscous, right? You've got legacy thinking, legacy systems, legacy technologies.

And much of that was improvised, right? Like Apollo 13, where they said, you've got to improvise with just these tools. And they solved the problem. But like, where's the manual? Where is the ease of use? And the idea that there's so much complexity and the risk and complexity of space travel, space launches, etc.,

I think is one of the things that we really, really need to have a bunch of companies and brilliant minds working on. And the thing that intrigued me about you is you're basically outsider status coming in, able to, in my opinion, use very effectively your military training because I love people who've

been trained by the military because they really understand life and death and no room for error and all of those things, but also communication, right? Like if your communication is fucked up, your team dies. And so talk a bit about how that has been both beneficial to you, but also like, have you faced any that you're not a member of our club?

So you're absolutely right. The military is all about life or death stakes. And especially so in, so as you know, Singapore enjoys a relatively peaceful existence, you know, in our little corner of Southeast Asia, but we are always vigilant, you know,

A big part of my childhood growing up was reckoning with the legacy, call it, of World War II. So my family was impacted deeply by the war. My great-grandfather was murdered during the Japanese occupation. Essentially what happened was the occupying forces of the Empire of Japan at the time after the surrender of Singapore routed up a lot of military-aged educated males for re-education, and then they machine gunned them on the beaches.

So we have no idea what happened to my great-grandfather. All we know is that he left one day and never came back.

And so that was a terrible, terrible tragedy. And Singapore's entire defensive posture is heavily informed by that lived experience of, we've been there before, we never want to go back. And so despite the fact that we enjoy a relatively peaceful existence and good cooperation with our immediate neighbors, we never forgot that lesson. And so we maintain a fighting force that is effective, that's well-trained, that's professional and extremely well-equipped. And so

Because of that, as you can imagine, a lot of sophisticated equipment requires sophisticated maintenance. That was my job. I was a logistics officer. I was the deputy S4 for the 1st Army Maintenance Base. We primarily worked on maintenance and recovery operations for all tracked and armored vehicles across the entirety of Singapore Armed Forces. So pretty much everything between bulldozers to main battle tanks is what I call it. And so...

Because we have assets and troops deployed, you know, far afield as well as at home. And, you know, maintenance has to follow the combatants. We exist to ensure that they are ready for the fight and that any deficiencies in that are quickly rectified. And so...

A lot of my troops were deployed far away from me. There was a lot of logistics and coordination at a distance, a lot of orchestration with lag time and latency. And so we had to build resilient processes internally that could accommodate for that, right? And it is always a fine balance. You never want to be too prescriptive. You want to assign enough autonomy that your troops at the front line can exercise their own better judgment, their own discretion to achieve commander's intent and end state.

But at the same time, you don't want to give them free reign because that's when you introduce risks, when you introduce uncertainties, and that's when things go off. That's when things go off the rails. And so you're absolutely right. Logistics is one of those things that is not...

Right. Nobody writes about the logistician. Logisticians aren't, you know, rappelling out of helicopters or, you know, doing cool things like kicking in the doors. And we, it is a very thankless job. The only time anybody ever pays attention to logistics is when something goes wrong and somebody, and they need somebody to yell at.

But it is a fantastic role because it is always operational. It is always live. And there is no such thing as a notional exercise because you're right. If we don't do our job, somebody dies or somebody is left starving or somebody is left in a deeply dangerous position. And so no margin for error. That's how we did it. And we did it right. And so bringing that into space, I think, has been an interesting experience. Now, obviously,

A lot of space is still heavily colored by the military. It is still very much a, you know, not necessarily a hundred percent, you know, defense and national security domain, but certainly it is very tightly coupled. A lot of the commercial industry does still interface directly with government. You won't find a space company out there that doesn't have a federal practice. And so that has been helpful somewhat. But yes, coming in as an outsider has been interesting. I

I think that the thing that is most refreshing and actually has contributed a lot to our ability to break in has been the fact that we look at the problem fundamentally differently from, I think, how most others might. Where other people might see an engineering problem because, you know, this primarily affects engineers. It looks like an engineer. It talks like an engineer. And therefore, you know, it's very easy to fall into that cognitive trap of thinking this must be an engineering problem and therefore I must solve it as such.

I fundamentally view it as a logistics problem because it's orchestration, data management. Data is an asset like any other, right? Be it fuel, be it data, be it information, be it knowledge transferring between different generations within the same organization. All these are assets and it comes down to good management, good practices to ensure that nothing is lost, everything is accounted for and that everything is serviceable for whatever you need it for.

And so because I think we view it fundamentally as a logistics problem, that has allowed us to target the root causes of what is actually holding up our industry a lot more effectively than if we had approached this from the same viewpoint that everybody else has tried and failed to tackle it from. Northrop Grumman, Lockheed, they've all tried to build internal tools for decades to varying degrees of success. I think...

We are the first company to actually come along and say, you know, let's just take a second and let's calm down. Maybe this isn't a logistics, maybe this isn't an engineering problem. Let's start thinking about it in a different way. I love that because I think that it's something that I try to do often, which is maybe if I looked at this problem from a completely different viewpoint, I would see much better solutions.

And that was what attracted me to your work as well. Talk a little bit about, again, we're relying on your Army experiences because you've also applied it to picking co-founders.

And like one of the first things you list is trust. It doesn't, again, in like, there are three groups of people who probably are closer to reality in quotes than most humans. And the first are special forces and those that support them. Again, life and death, data integrity, knowledge, all of that, and communication. Absolutely vital. Emergency room doctors.

Same thing. They have to make life and death decisions very, very quickly. And they're going to make them wrong if they have bad information or if things aren't working out or if the cart isn't right there. And then the other one is from my world, freighters.

Traders, basically, it's not a life and death in reality, but it kind of is because if you fuck up a billion dollar trade, you're going to die as a trader for that particular company. And so trust, I make this case a lot when I talk about Wall Street.

because people laugh when they hear me. And like, I'd say the, you don't understand that underneath everything on wall street, the first layer is trust.

Because literally the system would not work without trust. And so it gets policed very diligently. And, you know, you literally do not give some you do not say to a counterparty, I will do this and then not do it. Because if you if they DK, you don't know. Oh, I didn't do that trade. You're out.

You're literally, the black ball gets put in and you're not going to be making those decisions anymore. Another thing that you've mentioned is no lone wolves, because as you make the case, I think quite eloquently, people have to be taught how to cooperate. And the idea that you've got some guy over here just off doing his or her own thing is not going to fly in something as complacent

complex as space travel and then real professionalism. I love that. It's the way I hire people as well. I don't really care what pieces of paper they have behind their name. I want to look at their proof of work. I want to look at their history and what they've been able to create and can they move from one field to another. Any more tips for, because a lot of our listeners are starting companies and are looking for co-founders.

Any additional insights from you or listeners and viewers on that topic? Well, Jim, I...

People do ask me this sometimes. I have to confess, I am in a very privileged position. My co-founder, I've known him for well over 10 years. I was best man at his wedding. We served together in basic training. And so call it kismet, right? It was extremely fortunate that he also happened to be one of the most talented software engineers I've ever met in my life. And so, you know, I've seen this man in the absolute truest

absolute worst of circumstances. I've always known him as somebody that I could count on. And so I think...

potentially piece of advice that you can extract from that is you never really know somebody until you see them at their lowest point. And you never know yourself until you see yourself at your lowest point. And, you know, that interaction of, you know, we have nothing left. What do we do here? That is probably the most real human moment that you could ever have with another person. And you will never really know who they are until you have that. And so I

I guess that acts as a great filtering mechanism. If you don't happen to know somebody like that, manufacture scenario. Yo, go camping and forget the food and see what happens. I love that one. Another one, because our industry is a little less precise, if you will, and involves a lot more communication with people not in the industry, right? That I use is I take them to lunch and I watch how they treat the waitstaff.

And if they treat them poorly, no matter how many degrees they have, no matter how good they look on paper, I won't hire them. Because literally, I've found that to be a tell for a personality that kisses up and kicks down. And that is a horrible combination.

You're absolutely right. The other thing that I love about you is you share with me the enthusiasm for this momentum, momentous and almost miraculous timeline we are living in. The odds against, right? The odds against are like so ridiculously huge. You would never place a bet on this, right? Like I'm going to end up in this timeline. And you talk about your great-grandmother.

who saw dirt roads and oxygen-driven carts and then watched Apollo land on the moon and then watched the landing on Mars. And I had a similar experience. I'm much older than you. So my grandfather was born in 1885. And I literally took a large language model and said, what innovations occurred between 1885 and 1973 when he died?

Holy shit. Like the world, basically the world that you and I live in was created. And so I think that the question I'm going to ask you is, do you find that even younger people are hampered in any way?

by like the how quickly and and how really new a lot of what we're doing is and by that i mean like radio radio wasn't around when my grandfather was born neither were cars neither were planes right and he too watched the landing of apollo 11 on the moon and and

Do you think there's any kind of underlying cultural lag that still affects younger people? I think that it definitely affects a lot of older people, but I'm asking about younger people. Do you think that that exists?

I think to an extent. So I once had a theory that it's difficult to, as difficult as it is to learn things, it is much more difficult to unlearn things. And, you know, as soon as you learn something, it constrains the probability space in your mind. And so, you know, if you are told for the longest time that, oh, there are only three states of matter, the fourth state of matter coming along is just...

it conflicts fundamentally with your world model and it becomes much more difficult to imagine what happens next. But, you know, for a state of matter, plasma is a major component for a lot of satellite propulsion units. Your pulse plasma thrusters are very well known and it is a mainstay sort of technology in space. But if you

You grew up and you operate and you form a worldview that is constrained by plasma does not exist. You will never think to start building something that relies on something that to your mind is non-existent, right? And so unlearning things is a big deal and it is a challenge for anyone because what do you unlearn? What do you dump? What are you replacing it with? I think that there is just...

We have the sum total of the world's knowledge at our fingertips at any given moment, right? If you don't have a phone or you don't have a signal, the person next to you probably does, right? And so we are only ever an arm's length away from everything that humanity has ever

ever learned in its collective history, both real and fictional. And so I think that does lead to a little bit of, not necessarily choice, but information paralysis, call it. There's way too much stuff. There's so much stuff to learn. Where do you go? And so I do think that coupled with the fact that I think

There was a cultural moment, you know, over the last couple of decades where pessimism and cynicism became the most fashionable thing around. It became cool to downplay incredible things that were being achieved. You know, people stopped wanting to work at NASA. People stopped wanting to work to be astronauts because, oh, that's not realistic. That's not, you know, that's not tenable. Oh, go be this or go be that. Don't try and be, you know, the great things that...

Don't try to aspire towards being one of our greatest. That's not tenable. And I think the

The fact that there is just so much information out there, and some of it necessarily connoting less than positive feelings, they're all negatively coded. And the fact that it becomes culturally cool to be pessimistic or cynical, I think there is a little bit of a miasma. But I do think we're breaking out of it because culture is cyclical. All things are cyclical. And

It is coming back to the point where it is now cool to build. It is now cool to manufacture. It is cool to look at something and go, you know what? I am going to do that. Like, fuck it. That is a good idea. That's cool. I'm going to get it done. And that is, it's coming back. And I think that's,

I think the great thing about the human soul and the human spirit is that we naturally yearn for that, right? Learned helplessness is a thing. We have taught ourselves over the last two, three decades that, you know what, we don't have to aspire. We don't have to reach. We don't have to dream of bigger things. And it's tiring. That naturally conflicts with what the human spirit wants to do. The human spirit wants to reach, to yearn, to climb, to run, fly, and go even ever further.

And I think that...

That natural tendency, that natural inclination is starting to break out. It's starting to crack the shell and we are now achieving ever greater things. I have a very concrete example for you. So last year, we spent most of 2023 piloting with a very particular special team at the NASA Jet Propulsion Lab. They are building under the Robotics and Autonomy Group. It's mostly staffed by a bunch of folks who previously worked on Mars 2012 and Mars 2020.

And they are designing, I know that your listeners won't be able to see this, but you will. Let me show you a photo of what they were building because it is the most incredible fucking thing that you have ever seen. And I do not make that assertion lightly. Hang on, let me pull up this photo. Okay, so if you can see that, that is a robotic space snake. I love it. It is one day going to go to Saturn's second largest moon, Enceladus,

to look for life. Now, a little bit

A little bit of a background. Enceladus is an ocean world with a thick ice crust. Now, a few decades ago, when the Cassini probe flew past, it detected clouds of water vapor emanating from the surface. And the determination that was made after several flybys was that there must be thermal vents at the bottom of the ocean that are shooting up these jets of superheated gas that are causing fissures in the ice. And that's what's causing, essentially, geysers to spew out into space. And so,

There is another ocean world in our solar system, Europa. JPL just pushed CLIPA, which is a fairly large satellite that's meant to go orbit Europa and actually look for biological compounds. It will be joined by the European Space Agency's JUICE mission, which is also meant to go look at Europa in a few years. But Enceladus is a much more interesting concept because...

in my opinion, because Europa doesn't have evidence of thermal events. And so anything that tries to land on Europa will have to drill down through about 10 miles of ice before it can actually reach the ocean. And some of this has that natural pathway for us. So this robot space snake, which is part of a project called EELS, very, very well named. It actually stands for something. It stands for Extant Exobiology Life Surveyor. EELS is meant to launch, to land,

The snake is going to slither out of its lander, find one of these fissures, go through the fissure, reach the ocean underneath, swim to the bottom of the ocean, find one of these thermal vents, and look for life. And this is a very complex mission, as you can tell, right? And NASA funding cycles being what they are, they do vary based on the will of Congress. But the target is hopefully, hopefully, one day in somewhere around 2050, in the 2050s,

This thing will land and it will find life. And yeah, I'll be in my 60s at that point. But I will hopefully get the ability to say to my grandkids and grandkids that, hey, you know what? 30 years ago, I helped. I helped in this grand quest for us to know ourselves better. Carl Sagan had a fantastic quote, we are the universe understanding itself. And I will get to say that I helped the universe understand itself just a little bit better.

Oh, I love that. And like, that's why I'm so excited about where we are right now, where we can potentially go. Pessimism, you know, you don't really have to be terribly smart to be a pessimist. You can just be against, against, against. You can naysay everything. Well, optimists are busy building the future.

And I completely agree with your comment about the cyclicality of culture, you know, to and fro the pendulum throws. Right. And I definitely, as one who's been around for a while, maybe a little bit.

A couple of years ago, I started realizing that there was a group specifically of younger people who were like, you know what? Fuck this. I'm not a pessimist. I'm not buying into your, oh, Lord, helplessness. Oh, poor me. And oh, I'm such a victim. I just loved it.

And it's actually one of the reasons why we started Oshada Sea Ventures. We're going to try to do everything we can from investment, from films, from stories, from movies to get people excited again. Because what a time to be alive. What a time to be young.

I just like it's so insanely cool to me. And as far as Europa, of course, you're a science fiction fan. Didn't we get warned by our monolith friends? Attempt no landing on Europa. Yeah.

Oh, yes. Oh, yes. Well, you know, the good news is that we are not currently planning a land out on Europa. That was actually tabled as a concept. But you know what? We'll do a couple of flybys for us, make sure there's no monoliths hanging out waiting to surprise us. And, you know, science fiction is another thing. We have a publisher called Infinite Books.

And we're coming out, we're publishing, hopefully by the end of this year, if not early 2025, two science fiction books that are literally optimistic about the future. One's called White Mirror. The other is called A Box Full of Stars.

And love that the authors are great. And I think that you speaking of logistics, right? You've got to figure out how you can make as big of an impact as you can using everything at your disposal, right? Getting back to you, though, and what you are passionate about and what you're doing. You're also a lawyer and you hate the legal industry, but love the law.

What do you think might emerge over the next couple of decades in terms of space law? So this is going to be a little bit of a boring segue. I think there's going to be a lot more regulation around insurance. So space insurance being a very, very weird sort of thing is, well, it's held captive by a few economic interests that are, you know, you can't

They're blameless. That's just how it shakes out. But essentially, the way that insurance currently works in the industry, you've got, broadly speaking, three types. You've got, and this is going to be hopefully an education because space insurance is an esoteric thing within the space industry, which just goes to show what I pay attention to.

But there's pre-launch insurance, which is, you know, you build your satellite in Virginia, goes down to Florida, you cover UPS man's journey all the way down. Launch insurance, which governs the moment your spacecraft, you know, the rocket on which your spacecraft is integrated into, the moment it lifts off to the moment it successfully spits it out in space. And, you know, the cutoff point does vary, but broadly speaking, that's the coverage period. And then there's in-orbit asset insurance. And asset insurance being for a variety of different things, right? It could be for

It could be for revenue. It could be for asset value. It could be for third-party liability. It could be for the risk of war. Somebody, a party, there's a couple of geopolitical bad actors that come to mind, might launch a missile at you just to see what happens.

And so you've got all these types of in-orbit asset insurance, but you don't really have the data to build quantitative models that really speak to the risk of being in space with any degree of certainty. I think a lot of people are generally quite shocked to realize that our space tracking abilities are not really all that accurate. We're getting better.

But as you can imagine, it's tough, you know, because you have a lot of ground-based sensors. These things are going past extremely quickly. The average orbit time for a satellite in low-Earth orbit is about 90 minutes to make a full round trip around the Earth. And so if you imagine, you know, you've got a handful of ground-based sensors scattered around the world, and you've got a lot, a lot of things in space. There's well over 10,000 active spacecraft plus a whole lot of debris up there. Tracking all that is a gargantuan effort.

And so it becomes very, very difficult. You can build large probabilistic models of the overall picture in space. It's difficult to form a picture of any one particular object, especially if it's just been launched. And so extrapolating that

from, you know, pre-launch, it was your building a satellite, you know, what is the risk of this thing getting slashed into or what is the risk of it failing is an extremely difficult endeavor. Now, that's not to say that in-space insurance doesn't already exist. It does, but only for a certain type of satellite. Generally, only for geosynchronous satellites because those are the big ticket, those are the big money makers. Those cost, you know, upwards of $200 million in terms of some assured. And so,

As I'm sure you know, right, as the premium is a percentage of that, the brokerage and underwriting fee is a percentage of that. And so for most underwriters in space, it is just plainly uneconomical to underwrite anything that is not a giant geo satellite because it takes way too much effort. It's from the manufacturing side as well as from the underwriting side for way too small of a fee. And so

What we've ended up with is the vast majority of satellites in space, which are all primarily concentrated in low-Earth orbit, they're all primarily small satellites that are nowhere near $200 million in value, are uninsured. There is a crisis, for lack of a better term, in terms of space asset insurability.

And that is a very dangerous and tenuous position to be in. And so I think one of the big things is going to... One of the big developments in the next decade or so will have to be some sort of insurance mandate for assets in space. Because...

depending on the space law, the way that liability is actually handled in space is done purely at the international level. So if a Russian company launches a Russian satellite and then SpaceX launches a satellite and the two collide, the matter is not educated between SpaceX and the Russian company. It's done between the U.S. and Russian governments. And then, you know, they handle everything internally. And so that effectively means that all governments, the U.S. government included, is on the hook for anything that happens.

Now, the U.S. government already forces launch operators to indemnify them against losses every time they fly. And that's because it's relatively easier to insure rockets because, you know, we send them up often enough that you can build a proper probabilistic model. And, you know, it's a discreet, like it's a fairly isolated event. When a rocket goes up, everybody pays attention.

But each rocket spits out, you know, 40, 50, 60 satellites. Each of them has to be tracked and managed individually. Kind of challenging. And so I think that the next big move is going to be that insurance will become regulated and mandated in space. The question is, how do you actually make that economical for the underwriters? And I think there is something just beautifully poetic about that because I compare it to, you know, I think about the history of commercial shipping and global trade, right? Prior to the 1680s,

was really able to underwrite sea voyages and expeditions? Three groups. The church, kings and queens, or just really, really rich people. And, you know, you have a similar enough situation in space right now where, you know, who are the people actually able to go to space? There's a handful of select chosen few. But then in 1688, a bunch of, you know, salt field ship captains and merchants gather around a little coffee shop in London, and they started, you know, bedding pools. Oh,

Jim, yeah, that guy's going to come back. That guy's not going to come back. And so that then coalesced into insurance as we understand it. The very first mutual funds were founded or were created just by a bunch of guys betting on who's going to screw up and who's not. And then that enabled more voyages to be undertaken with distributed risk that weren't solely reliant on the goodwill and deep pockets of particular individuals and patrons. And, you know,

Fast forward a couple of centuries, we have global trade. We have global shipping. We have the world as we understand it today, all enabled by insurance because insurance lets the common folk, the average individual, the person who is climbing up from the gutter to get in on a booming economy and actually go out and

I love it. But I'm very impressed by your knowledge of what created the industry. Yeah.

I've met very, very few people who know that. It's kind of like something I love economic history and so know a lot about that. And insurance, by the way, has always been one of the things that I check as a kind of an early indicator. If insurance companies all of a sudden stop underwriting something, watch out because they have much better models than I do.

And so it tends to be, if you're paying close attention, it tends to be a leading rather than a lagging indicator. I'm delighted to hear that you are working on solving that problem because as you were talking, I was thinking, wow, now that sounds like a great company that could be a startup right there alone. What do you think about the whole notion of

ownership, right? Like I use a lot of memes and GIFs on Twitter, for example, to joke around. And well, one of them is this GIF of a United States astronaut landing on the moon, planting the flag and saying, it's ours. And then there's one landing on Mars, planting the American flag and saying, it's ours. How do you think that that's going to play out?

Well, there's two schools of thought here. And really, the fundamental difference between these two schools of thought are where you stand on the existence of international law. Is international law real? Now,

I am going to probably annoy a few of my professors or past professors when I say this. I don't think international law is real. I think it is entirely based on the threat of force, the monopoly on violence. And that comes from my military background, right? I look at things from a purely realistic standpoint. What is actually able to, what has embodiment in the real world? Guns do, bullets do, missiles do, soldiers do.

The concept of international law, you know, I mean, there's a couple of courthouses, you know, in Europe, but I'm not really sure that their influence extends much further. Yeah, definitely pissed off a lot of my former professors now. But...

Ultimately, based on that perspective, so in terms of actual space law, there is a very firm rule. And this is one of the few, call it non-vague rules in space, that there is a principle of non-appropriation. No country is allowed to lay claim to anything outside of Earth's atmosphere. And by the way, the way that space law characterizes what is space is unbiased.

honestly hilarious because it characterizes everything that is not earth as space and therefore under the realm of space law, which is,

If there is a galactic community out there, I think it's very funny that we basically just laid claim to all of space and we said, this is all under our legal system now. This is our jurisdiction, which, you know, but that's how it is. But yes, so the principle of non-appropriation requires that no country be allowed to actually appropriate, lay claim, or exercise any sort of ownership over any part of space. Now,

ownership is completely separate from control, right? And, you know, again, this goes to another school of thought, which is, you know, possession that is nine-tenths of the law. So can you really possess and control something without effectively owning it? This is a big live issue in space. But because there is no such thing as national appropriation in space, there's a general principle in law that it's not just base law, it's all law. And

It really comes down, I'm going to butcher this because I suck at Latin, but the principle is, which basically means, simply put, you can't give ownership to something that you don't own yourself, right? And so, ultimately, all property rights flow from the government, and therefore, if the government isn't allowed to lay claim to anything, it cannot give the right for any individual private citizen to claim stuff.

So that's one school of thought, that there is no such thing as appropriation. Planting the flag is purely symbolic.

Or you can think about it in terms of international law is not real. And, you know, whoever has the biggest stick can do whatever the hell they want. In which, you know, the United States passed an act in 2015 called the Space Act, which effectively gave folks who mine resources to extract resources, sold jurisdiction to do whatever the hell they wanted with it. So if I flew a satellite to go mine an asteroid, I brought back a ton of beryllium. That is mine to do with as I see fit. I could sell it for whatever I want. And, you know, I get...

keep the proceeds of that and I don't have to pay anybody taxes because there is no tax regime in space. Obviously, if you arrive back on Earth, then you probably have to pay the IRS a hefty sum. But, you know, maybe. The IRS has no jurisdiction in space. So sell it on a woman is the point. But yeah, so I think ultimately that's the direction they were going to go down. There is...

This is a recurring joke that we will never have another space treaty because we are... So the space treaties were all negotiated, broadly speaking, between 1962 and 1976. Sorry, they weren't negotiated at that time. But that's when all the instruments were actually adopted, produced, and assigned and ratified. And so at that time...

There were only really two voices in the room that mattered, the US and Soviet Union. And so it's a lot easier to have a conversation between two people and actually come up with a set of rules. Even then, it took 14 years to actually figure everything out. We have so many voices in space now, so many emerging countries, so many emerging space-faring nations. A lot of African states have been launching satellites just for various purposes. Obviously, they could benefit immensely from having superior imaging and superior communications. But

But also it is a point of national pride because, you know, it's something that anybody can do now. You know, students launch CubeSats. And so everybody has a stake at the table, has a voice that has something to say. Have you ever tried to moderate a caucus of, you know, 300 something voices, each of whom has, you know, a ton of different opinions?

So we're likely not going to end up with another set of space treaties just because, yeah, we can't all get along. We're definitely not all going to agree on anything. And the tricky thing about treaty systems is that they generally require everybody to sign up to them. Anybody who doesn't sign up to them, they're not bound by the rules. So, you know, it's kind of nuts, right? Like if you come up with a set of laws and you can just opt out, just say, nah, it's not for me. Thanks. And then you can just leave.

So because of that, I think that ultimately the matter of space ownership is going to come down to a realistic take on what international relations actually looks like. Anybody who can defend their claim and defending their claim obviously has a ton of different connotations from purely legalistic to guns on the moon. But I do think it's going to be whoever can lay claim to something, whoever can defend it, owns it. And that

sets up a very, very dangerous set of circumstances, right? We don't want to trigger a land grab in space, which is why we still have this normative international legal order, sort of try to hem everybody in. I do hope that it persists. Against everything that I've said, against all my criticisms of international law, I do think that it has immense value as a normative system. I don't know if it'll hold. I hope it does. But this is one area where I am a little bit more pessimistic than optimistic. The

But, you know, good things can come out of that too. A land grab inspires more folks to get into space faster, much more aggressively, because you've got to beat your competition, which is going to spur space development. It's going to spur the development of additional technologies to sustain. You know, my whole thing is sustainment. And so if we want a permanent base on the moon, we want a permanent base on the Mars, you have to have a supply chain that actually keeps those people alive. And we're going to have to build all the technologies that go along with it. So, yeah.

A land grab would be tragic for the unity of the human race, but would be pretty great for the development of space technology.

What a great answer, because it also impers and implies that logistics rather than international law is going to maybe be what wins. As you were talking about it, I was thinking of the Dave Chappelle routine where he's the president and he says the United Nations is going to sanction him. And Chappelle goes, oh, OK, go ahead, sanction me. You and your army. Oh, wait a minute. You don't have a fucking army?

me guess what i got one yeah that she and i make so much that yeah i mean and like honestly international law well i certainly am in favor of there being protocols in place so that people can solve their disputes peacefully right rather than at the barrel of a gun

You look long enough at human history and, you know, it even turned into a joke at the height of cryptomania. I used to say that in addition to saying that if you want to know the original Bitcoin and I would hold up a currency, I would hold up a U.S. dollar. Right. Because you can't track it. You can. No one knows where it is.

But then when they got on the soapbox of, oh, the fiat currency, the US dollar, I'm like, yeah, the US dollar is backed by the most powerful military the world has ever seen, which takes its orders from a political class that has repeatedly demonstrated its willingness to use them.

And so maybe I'm a little cynical on that point, but I definitely agree that the gold rushes are a good analogy here. The gold rushes were responsible for the development of huge tracts of uninhabited land, both here, Canada, elsewhere.

And so, you know, I think leaning into human OS and understanding how it really works, as opposed to how it might ideally work, is going to maybe give you an edge.

Absolutely. One of the things that you say that I love is two things. Actually, I want to talk a bit about the angry man on your shoulder. And you say he's there in a variety of guises to basically shout at you. Stop being such a whiny little bitch and get to work. I love that. I love that. I use a similar technique, but I want to hear about yours.

So he's always been a little bit of a voice in the back of my head, not to sound nuts or anything, but it's always that little voice in the back of my head that pushes me just a little bit further. Now, I think a lot of people have written about this in various forms. There's one particular...

depiction of the concept that I really, really like. So there's this webcomic that I really enjoy reading. It's called Terminal Lands. It's written by this guy who was a Marine Lance Corporal at the height of Iraq and Afghanistan. And then he draws these comics about what life was like in the Marines, but also post-separation. And it's always a great read. And I think to that point, it actually speaks about the universality of the military experience that, you know, I've never met this guy. You know,

Singapore does conduct exercises with the U.S. Marines. But we lived very different lives. But somehow there was just this commonality across all of it. I actually once met this through...

an accident of life. I met this former Bulgarian Air Force officer. And so he was, he served in the time when Bulgaria was still a communist state. And so they also practiced conscription and he didn't speak a word of English. And I was just casually sort of chatting through some

somebody who was known to both of us as a mutual interpreter. And I just got on the subject of cleaning your weapon and, you know, getting stuck outside the armory for hours because you were cleaning your weapon. The armory kit just kept turning it away. And his face just lit up and he just started laughing and he just started telling me about, you know, getting stuck on this airbase and didn't

in the middle of godforsaken nowhere and just being like, yep, that is a universal experience. So that's a segue. But yes, the angry man on my shoulder. So this particular comic that Terminal Lance made years ago at this point, basically it's just a little miniature. It depicts the author or the author's analog going through college. He's just tired and then a little sprite pops up in his shoulder in Desert Camis and he just screams at him and he's like, stop being such a...

pussy, dude, you've been in way worse. You have to be the 240 gunner and on like two hours of sleep and you had to pull fire watch. It's like, what are you even doing? And he was like, oh yeah, actually that is, I can push through this. And I had a very similar experience in college myself. And so I was cramming for a late night and law school is challenging for most, right? And I remember I

I went to sleep at... So I crammed all night. I was pushing out this essay. I also wasn't particularly diligent in law school. Unfortunately, I was just trying to have a great time after separating from the army. And so, you know, I left at the last minute as I usually did. And so the deadline was noon.

the following day. So I crammed from, I think maybe about 10 in the evening to about five in the morning. And I managed to push this thing out, wrote a fairly decent essay. I actually did quite well on that one. I realized that there's an inverse correlation between how much time in advance of a deadline I spend on an assignment and how well I do. My best

My best ever scoring essays I did literally right before the deadline. So I'm laying down in my bed after a long night, you know, it's five in the morning, the sun's starting to come up. And so it's starting to get a little bit lighter. And I think to myself, you know what? This actually reminds me of a lot, a lot of this other thing that I once did. So I think one year prior, I was still in the service and I had the worst night of my life. I was so sad.

Singapore, we have a skill test, an infantry skills test that is actually very closely modeled on the US Army's expert infantryman badge course. And what it involves is a 32-click march with about 70 pounds of gear. It's a timed fast march, so you have to clock all 32 clicks under seven hours. So not a breezy stroll by any stretch of the imagination, but it's

Part of that test also requires you to perform several skills at arms tests. So, you know, it can range between your weapons handling to grenade throwing, you know, stuff that you should be able to do as an infantryman. And then finally, there is a water crossing. So normally, this water crossing is conducted at the 29-click mark so that you don't have to haul 70 pounds of Geo now weighed down with a ton of water. But when I did this test as a young officer cadet,

some genius decided to shift, well, they redid the route and now the water crossing was at 19 clicks. Worse still, the water crossing was done not over a river as it normally is, but through a swamp.

And this swamp, unbeknownst to us at the time, was actually being used as a latrine point by a different training company. And we only found this out much, much later. And so, you know, we... So it's at night, right? Because, you know, Singapore being as hot as it is, it's basically suicide to try and do any of this stuff at the daytime. So it's at night.

We're marching. It's not a breezy pace at all. We're basically running with 70 pounds of gear on our backs, and we're just trying to get through this thing. So we get to the water crossing, which is a swamp, and it smells like the entrance to hell, because I imagine that the entrance to hell smells like sulfur.

And so I am the second man to cross. My battle buddy, he's the first guy to go over and he just, you know, there's floodlights, but they only really extend so far into the swamp. And then beyond a certain point, you know, the darkness takes over, right? And so I watch him walk out slowly. And so then, you know, my turn. So I start wading into the water, right? I've got my rifle overhead, I've got my pack dragging behind me and I'm just walking and walking. And then, you know, the light

starts to fade and everything starts to go dark around me. And, you know, there's a rope that I'm tethered to. So I'm just continuing to walk along the rope. And then I slip and

And I sink into the swamp all the way up to my wrist. So literally the only thing that's still above water is my rifle. And I slip. I think to myself, you know, I get a face full of swamp muck. And I think to myself, okay, don't panic. Let's just keep walking. Sooner or later, it has to come back up. So I keep going. I go for maybe about 30 seconds before my feet find purchase on the mud bank. I stopped climbing up and I emerge like the

the thing right i i'm just covered head to toe with crap and i as i clear you know all my airways and then i hear one of my instructors yelling me hey are you all right i'm like yes sir he's like then hurry the fuck up you're holding the rest you're holding up the company okay great so i keep marching right

And I get to the other side and now I'm covered in God knows what. I can't even smell anymore because it's just like, you know, smell is the weakest of all of our senses, right? Mine has just been completely overrun. And so I get to the other side, you know, I get my stuff. I'm now soaking wet. I am, you know, covered in everything. Everything is way heavier now. And I lie down by the side of this road and I look at my watch and I see it is 5 a.m. And I think to myself,

Yeah, okay. That makes sense. And I fall asleep and I have this, as I'm waiting for the rest of the company to pass, I lay down, my pack's on my back and I lean against my pack and I have the best 30 minutes of sleep I have to date ever had in my life.

And so, you know, the rest of that test went relatively smoothly. You know, we finished the remaining 13 clicks. We did a shoot at the end. Most of us passed. And then afterwards I caught a nasty viral infection from that swamp, which basically made me, rendered me incapable of eating for like two weeks because my mouth was just covered in ulcers. It was horrendous. I had a, I had like a fever of like 104 for like two weeks, but yeah,

Anyway, fast forward a year. I'm laying down in my bed in college. I am just lying there. I look at the clock and I see it's 5 a.m. I think, you know what? Things could be so much fucking worse. I have a soft bed. It's nice. It's cozy. You know what? It ain't so bad. What a fantastic story.

And because it illustrates so many things that I also hold dear, right? Like a lot of younger people would often come to me for advice on investing and things like that. And the one thing that I would tell them that they really didn't like, but when I would hear back from them, those that had succeeded in the career, they were like, oh man, you were so fucking right. And that was...

You will never be able to achieve what your goals are until the market repeatedly kicks and punches you in the face to the point where you are literally just like, all right, I get it. Right. And that is such a filter.

The people who, there's a great saying, there are old traders and bold traders, but there are no old bold traders, right? If you haven't accepted that the market is right and you are wrong,

And you keep insisting, yeah, no, no, right? Like I'm going to just continue getting punched in the face. I'm going to learn nothing. You don't have anything to compare about it. And so like had that experience, luckily I'd been in the world for a long time when the financial crisis happened and my head of research and other portfolio responsibilities, uh,

used to come into my office every morning during the financial crisis. And I didn't think anything of it, right? Like he would come in and say, good morning. And I'd say, good morning, Chris. I'm like, what's that, right? And much later, we were out at dinner and he goes, hey, do you remember how I always came into your office during the financial crisis? And I'm like, yeah, I guess. And he goes, I wasn't coming in to say good morning. And I'm like, what do you mean? He goes, I was coming in

to see that you were calm. And he goes, I was so fucking freaked out by what was going on. But I always knew like if I would go into your office and you were calm that it was going to be okay. And then we basically started talking about it much like your thing. I'm like, Hey, I was around for the crash too. Yeah.

And when you have that ability to compare, like you were lying comfortably in your college bed, and then you have that reference point in the past, it just makes it so much easier. And I love, love, love that story. Another thing that you do that I really like is you think of years and dog years.

And so, of course, I'm like, okay, isn't the standard measure of dog years seven to one? And so I log on to our large language model. We have an internal AI stack at OSV. And I don't know if you know this. I didn't know this until this morning. But the actual way to calculate dog years is not multiplying however old you are by seven.

The actual way is the first dog year equals 15 human years. The second dog year equals nine human years. And then you have four to five years for every year thereafter. By that calculation, by the way, I am 334 years old in dog years. But explain why that's a helpful thing to do.

Absolutely. By the way, Jim, you look fantastic for somebody who's over 300. So congratulations. Thank you. But you're absolutely right. It is a linear correlation. And actually, dog years differ from breed to breed as well. So smaller dogs, it's all relativistic is the point. So I have, well, rather...

I and my parents have three dogs. We used to have a fourth, but she passed very tragically from cancer a couple of years ago. She's a hell of a fighter. She held on for well over a year. She's a fantastic dog. But so,

I have spent the better part of the last 10 years, actually a large part of the last 10 years, away from my home, away from my family, and away from my dogs. And yeah, I raised two of them from puppies. Now, all my dogs are rescues, and they've come to us from a variety of different means. But they're all rescues on the street. They would never...

Except for one. One did see a little bit of time inside a kennel because he was rescued first and then we picked him up from there. But two, we picked up directly from the street, essentially because one was going to be put down and another didn't have a place to go. And so both my parents are civil servants. They both work in various roles. And my dad is essentially...

Well, he was. I don't really know if there is an equivalent in the United States, but essentially he worked for the city or he worked for... Yeah, he worked for the city as an operations and facilities manager. And so basically one of his sanitation teams had picked up this dog that they'd found in a gutter in the middle of a rainstorm. And they were like,

So you should definitely take this one because he is a great dog. They didn't have the ability to look after him. So that's where my dog Zeus came from. And he's been my lifelong best friend. He's the greatest companion I could have ever asked for. And so it kills me that I spend so much time away from him because he's not getting younger, obviously. He is 15 years old in human years this year. And he actually just crossed 15 about a month ago. And so...

When I think about time is the one thing that we cannot make more of. And all time has to be contextualized within the people that we spend it with, right? Time spent in isolation is not the same as time spent with family. And so when I think about whenever I engage in an endeavor, whenever I commit my mind to something, whenever I invest time into something, I think of it as time that I'm not spending with my dog, with my family, with my friends, you know,

Quality time is, I guess, the simplest way to put it. And as the clock continues to run forward, each additional second, each additional second or each marginal second is much more valuable than the last.

because there is so much less of it. I once read about this thing. Basically, if you want to really start treasuring time with loved ones more, think about it in terms of how many times you'll see them again before you won't get to see them ever again.

And if you really count it out, if you really sound it out and you really get very specific, it's not as much time as we think. It never is as much time as we think. We never have as much time as we hope we have. And so whenever I think about what do I do next, I always think about in terms of, am I willing to invest years, the remaining years or whatever time my dog has left, am I willing to invest that on this? Because that is the real cost.

For me, it's whatever. I'm an easygoing guy. I'm a simple dude. I'm happy to give my time to people who ask for it.

But I am extremely judicious with the time of others, especially the time that I am depriving them that they would otherwise want to spend with me. Now, if I say that about a human being, I sound like an egotistical maniac because, oh, look at me. I am this great person that everybody should love being around. No, I, so I don't ever really, I think it's a little bit presumptuous to assume that about another human being's view of me.

But with my dog, I have full confidence that I am the only thing in his world. And I can never communicate to him why I'm doing the things that I'm doing. I can never help him understand. All he really knows is that I'm not there and I should be there. And so it is, I think, the purest measure of time, of effort, of value to think about it in terms of somebody or something that loves you utterly

What are you willing to spend time away from them for? What is the thing that is truly worth that? And so I can say with absolute certainty that if I did not believe in what I'm doing now, with every ounce of my being, every fiber in my soul, I would not because I have much better things to do if for nothing other than to go spend time with my dog.

Such an inspiring way to look at things and very clarifying as well. I struggled with, I mentioned mentoring these young people. And one thing that I would always begin with is you are a time billionaire and you are, it is a wasting asset. And as you put it much more eloquently, every second costs more than the one that preceded it.

And if you start thinking that way, it really changes the way you look at what you want to do in terms of getting things done. And dogs are natural bouts, right? And we had an experience. My daughter was traveling with my wife and I in Bhutan.

And I don't know if you've ever been to Bhutan, but I know he is the happiest place on earth. That's amazing. And the people are amazing. And I highly, highly recommend going if you get a chance to. But we were being followed by a dog that was essentially in need of rescue.

And now I like dogs. My daughter loves dogs. So literally you're spending the evening at dinner with her trying to figure out the logistics of getting that dog from Bhutan back to the United States. And she lives in California. And I'm just like, Kate,

You know, I'm sure that there are a ton of dogs in California that are in need of rescue as well. But I also love the way that you frame it because you're right. If you make these statements in terms of other human beings, you sound like the biggest egotistical jerk in the world. But putting it in the framework of a dog, I love that. I think that that is kind of just brilliant.

chef's kiss because most people love dogs and they can immediately get it because dogs are with us for such a shorter period of time relatively. Shifting gears, what has surprised you the most with your enterprise? And obviously, what was like the, oh shit, I didn't think about that. And then how

How did, how do you look at solving that problem or problems? Good.

So not to rehash a point, but actually the biggest one so far has been insurance. So in speaking with folks on the underwriting side, I think from the manufacturing side, it's kind of given, right? It's a very simple cognitive exercise. You're launching a $10 million thing, which is expected to generate, call it $40, $50 million worth of revenue. Why would you not want to insure it? But I've heard differing opinions about this, right? The entire reason why satellite constellations exist is

It's as an architecture and as a concept.

is to be downside mitigation, right? You don't want to put all your eggs in one basket. That's the problem. Historically, been the problem with reliability of geostationary satellites that everything, you know, hundreds of millions of dollars are funneled into this one machine that is incredibly intricate and complex. If one thing goes wrong, that's several hundred million dollars just up in smoke immediately. Much better to defuse that risk out amongst, you know, 10, 20, 30 satellites. And, you know, and

The industry estimate for how many satellites actually fail on orbit as soon as they're deployed is actually a lot higher than you think. So, I mean, I've heard varying reports on this, but the number that I keep coming back to is somewhere between 10 to 20% of each launch. Imagine Falcon 9 deploys 60 satellites, six of them will not work just for any number of reasons. And it's almost impossible to do any sort of post-mortem because they're not exactly close by. And so-

That is, it's just nuts to me. But, you know, that's why you have constellations so that if those six go down, you still have 54 that work, right? And, you know, that is a way to maintain service and you always launch more things than you need to. But what an insane proposition that is in terms of ensuring service, right?

I'm going to launch an extra $10 million worth of stuff because I'm worried that the previous $50 million won't cut it, or some proportion of the earlier $50 million won't cut it. It's wasteful. It's silly, I think, from a pure efficiency perspective, because why wouldn't you want every single thing to work? But things don't always work, right? And that's just a fact of life. And so...

I like insurance because it does make it a lot better. But honestly, understanding the actual process of getting it insured has been fascinating to me. Because, so, I mean, in my previous role as a program manager at that small company in England, I had to tangle very briefly with insurers. Now, the long and short of it was that we were flying a particular type of propulsion system that was

slightly hazardous, call it. And because it was slightly hazardous, the government effectively said to us, yeah, we're not letting you fly this thing unless you insure it. You should probably go talk to some folks. And so we did. And we basically got told to go hit the brakes. Now, I didn't realize why at the time. I thought it was because our thing was so ludicrously hazardous that they just did not want to touch it, which could have entirely factored into the conversation. That could have been very much a factor. But

I also found out that it has to do with economics. So I kind of alluded to this earlier in terms of why underwriters don't want to touch anything that is worth less than $200 million, I'm assured. But the actual mechanics of how underwriting is done is so qualitative and manual and just loop.

that it really does confound the mind. So the way that it's normally done is the manufacturer will engage a broker, broker will gather up a bunch of underwriters using some basic information, and then they all gather together for a big presentation. And for that presentation, the manufacturer has to compile a stupidly big technical report. Now, depending on this particular satellite, depending on the flight heritage, the support can range anywhere between 500 pages to 5,000 pages of very dense information

technical information. Now, most of these underwriters are themselves technical. A lot of them have space systems engineering backgrounds. They are also balanced out on lawyers who can actually comment and opine on policy itself. But basically, all these guys who built satellites and then went into insurance will now assess this other satellite being built, and they will pull over every single line because just like healthcare, right? You agree to something means you're liable for something. And so

They will go over this entire report, which, by the way, is not even actually comprehensive because the number one reason for claims, the number one historical reason for claims getting denied in space insurance is non-declaration. So lots of things are still being left out. It's just if you try to include in everything that's

God knows what this report would end up being. And so, you know, they go over this entire, so the underwriters pour over every single detail, every single line, come up with a series of questions, send them back, manufacturer answers them, they go back and forth. And as you can kind of tell, this would probably take a good amount of time. Now, that means, logically, it behooves the manufacturer to engage with the underwriters significantly early in the process because there's lead time. But here's the catch 22 of it. The earlier you engage in the process, the

The less firm your satellite design and your actual manufacturing and assembly integration test is, the plans, and in terms of your planning, in terms of what you're actually going to do, in terms of even your requirements. And so, the higher the likelihood, the earlier you engage, the higher the likelihood of some sort of major design change. And because these systems are so intricate and so tightly coupled, there's no such thing as an isolated change. So that

one change quickly ripples throughout. And then it affects so many different things that the entire technical report now needs to be recompiled. And it now needs to be reassessed from top to bottom, thereby extending the lead time even further, behooving you to engage even more, even earlier in the process and so on and so forth. And so it becomes a very, very vicious cycle. And so you end up with some satellite companies that

having to engage the underwriters five years ahead of their launch in order for the underwriters to actually feel comfortable. And that is a real life example, by the way. I didn't just invent that. I heard about it like two weeks ago. And so-

It is just such an onerous process and it is so silly. And at the end of it, because, yeah, you're probably going to leave out a ton of stuff because you don't want to inundate the underwriters, because if you do, then that just costs everybody much more time. You still get claims getting denied for lack of declaration or misrepresentation. And

That's why all of this costs so much money. And that's why you can only really get insurance for a giant satellite because otherwise it's the underwriting fee is literally not worth the effort and why the entire system does not work.

Insurance and space is pretty broken and everybody wants to fix it. The insurance guys want to fix it. The manufacturers want to fix it. It should be fixed. Last year was a particularly bad year. But as an indicative example, last year, the industry posted $500 million in revenue against $1.8 billion in claims.

And so, yeah, it was 1.3 billion. Now, of that 1.8 billion in claims, about a third of that came from two satellites that failed. Just two. And you got to remember that this is just the 1.8 billion is representative of satellites that were able to get insurance. And so there was a lot more outside of that.

that weren't insured, that still nonetheless failed. And so the actual loss value is probably significantly higher. So yeah, that's probably one of the most interesting things. I had briefly tangled with insurance. I've been thinking about this insurance thing for well over two years because of my previous experience, but I had no idea what the actual mechanics were like and how broken it was. It's just been one of those holy shit moments. It's like,

good God, we are on the precipice of a complete collapse. Somebody needs to fix this. It's like the workflow gets you trapped in Zeno's paradox, right? If you're familiar with Zeno's paradox. And it's really interesting to me because those are the things that trip you up, I think. I would bet that most of our listeners and viewers were not expecting that answer. And yet,

Holy shit. If you can't get that fixed, it blows and pollutes the entire enterprise, right? And so that sounds like a very thorny problem to solve. What other things come to mind that you would highlight as differences between doing space-based deep tech

versus just deep tech in general here on Jarek Burma? Well, I think deep tech is a very broad term. And it can be as wide or as narrow as you want it to be. I've heard varying definitions. I think one of the more restrictive definitions is that deep tech is anything that requires you to have a PhD in, which, yeah, I mean, you don't really need

a PhD to do like applied AI and yet applied AI is so mathematically and computationally intensive that you know arguably you require a ton of resources which was another definition it's just something deep tech is anything it requires a ton of resources to go actually make real I think probably one of the big differences with space is that

Okay, so let's take, for example, GPS, right? GPS is a very age-old technology. We have it in our cars, we have it in our phones. It is everywhere. It is ubiquitous, which, by the way, is, of course, what Ubic product is short for. It's short for ubiquitous. But-

Much like GPS, all space technology is ubiquitous. When you get Wi-Fi on the plane, that's probably satellite internet, right? As you're walking around and you're trying to get directions for stuff, it is via GPS and satellite imaging. People debate me on this. I like having the satellite imagery view on Google Maps on my phone because I like being able to look at stuff. I'm okay at interpreting maps, but I'm a lot better at interpreting satellite imagery.

because I can see that there are trees there or there aren't trees there, and therefore it is or probably is not a kirk. And so I think the thing that's most interesting about space relative to other forms of deep tech is that space is a lot more ubiquitous. It affects every part of our lives, every part of the economy. If all of our satellites went down right now,

we'd be so fucked as a civilization. It is ludicrous. And there are only a handful of other deep tech sectors that I think really have that sort of...

have that critical impact on civilization, but are still unknown. Nuclear energy being another, right? Because nuclear energy is kind of like this big, ooh, oh my God, things glow green, which by the way, they don't even glow green. That's a joke from the Simpsons, right? Cherenkov radiation is blue. It just blue doesn't look as threatening. But-

Other than nuclear energy, space affects everything and nobody understands space. Everybody still thinks of space as being, oh, it's super far out there. It doesn't impact me. A lot of the contemporary commentary around space spending and government spending in space and how it should be applied towards one social welfare program or another is wrong.

Just silly because all space exists for Earth. Space doesn't exist in a vacuum. Pardon the pun. Everything in space is an enabler for other things on Earth. And so this figure is definitely outdated by now. This was back from like 2021. But space enables $5 trillion worth of adjacent industries that are primarily based here on Earth. Absolutely.

Agriculture, weather monitoring, national security, communications. These are all industries that we rely on every single day to live life as we do.

And, you know, I think for every other deep tech industry, the impact is a lot more immediate. It's a lot closer, right? Even with applied AI now, thanks to, you know, chatbots and, you know, sort of user interfaces that are public facing, right? You can look at, you know, Grok or Claude or GPT-4 and you can play with it. You can ask the questions, you can, you know, ask it, tell you jokes, and you never really have to think about the sheer amount of computation that went into it, right?

all the GPUs that were used, all the energy that was expended, but it is a lot more immediate. And so when you think of AI, you don't think of this far off concept of, you know, oh no, I robot, something that's walking around, it's going to kill me or Skynet. You think of, oh yeah, GPT-4. But when you think of space, what is the average impression of space? Moon, Mars, SpaceX, NASA,

astronauts. But that's not the vast majority of the space industry. The vast majority of space industry exists almost exclusively to serve life on Earth. And then there's a handful of other companies out there that are looking to serve the next generation of human beings. And so there is no... A lot of people like to think of space as dalliance. They couldn't be further from the truth. And I think that disconnect is probably the thing that is most stark about space relative to all other forms of deep tech.

nowhere else with deep tech do you sort of hear about it and go, yeah, but like, what's the point of that? Like, when you think of humanoid robots, you don't think of what's the point of that. You think of, holy shit, that's cool. I could send it into a war zone. I could make it a butler. Even though, you know, what is, why would you actually want a humanoid robot? This is a completely separate topic, but I have an opinion that robotics, human beings are great. The human spirit is great. The human form is great.

yeah not super optimal if you can build a robot that does the job a lot better in a different form factor why the hell would you ever want to build a humanoid robot that just mimics all the same weaknesses that a human being has but yeah this is this completely separate topic and we are incredibly simpatico on that last bit like why on earth are we going to build them in this suboptimal format we're

We're not, right? The way that the robots that are going to actually truly function when we build them are going to look a lot different than we humans. It's just so funny. It's part of the way we anthropomorphize everything, right? And it also leads to that short-sightedness that you referred to. I could not agree with you more about the importance of space, the importance of understanding. And I love the way you do it.

First off, you explain, guys, you want real Armageddon? Wipe out all the satellites. And, you know, I think there was even a show called Black Orphan, Orphan Black. I can't remember. But it's set in the future where there's a war that knocks out all the satellites and literally people are back in the Stone Age.

Yet another reason why we're using this multi-platform approach, you've got to tell better stories. The story is the thing. If you're not telling better stories about the incredible importance of

of space, of ultimately, you've got to also have a North Star, right? So, like, we probably should think about being multi-planetary because, you know, there's a single point of failure here on this single planet.

So that's another thing that I know that you think a lot about. Well, I'm getting the hook from my nanny, also known as my executive assistant, who keeps me in line. She says that trying to govern me is trying to govern the ungovernable, but she does a very good job of it. So first, I want to thank you sincerely for taking time away from Zeus and

to chat with us. I'm honored. Very happy to do. I'm definitely honored. Can you tell people where they can find you online or offline?

Yeah, absolutely. So I'm on Twitter. I spent too much time on Twitter. I think my handle is at astral lawyer. Fantastic. Fantastic. Chocolate was unoccupied at the time. I'm on LinkedIn. I write, I sometimes try to write, I haven't written in a good long while, so I should probably get to get back to it. But, uh, uh, my sub stack is called a sorry, speak up. I have tinnitus, which is, yeah, I have, I had tinnitus. Yeah. If not, yeah. But, uh, LinkedIn and sub stack.

Terrific. I can hardly wait to see what you accomplish. I would think you're going to do great things and what you've actually done on it. If you've seen this or listened to this podcast in the past, you know that we have a final question for our guests. And that is, we are going to create you as the emperor of the world. You cannot kill anyone. You cannot put anyone in a re-education camp. But you can. We're going to hand you a magic microphone and you can say two things into it.

that is going to incept the entire population of Earth. And what the hell? Let's incept the entire sentient population of the universe. Suddenly. And because we'll have babblefish in our ears, so everyone will be able to translate it automatically. Right.

What two things are you going to do where everyone is going to wake up the next day and I'm like almost every other morning they wake up, they're going to say, I've just had two of the greatest ideas and this time around, I'm going to act up. Yeah.

So, somewhat at odds with each other. The first thing is to, I think, be grateful. Take stock. Remember that we are here for a limited amount of time and that that time has to be spent. And whatever it is spent on, we should be grateful for it. We cannot go through life discontent. Sorry, we cannot go through life discontent. Yeah. Now, the other one is to be hopeful.

and to reach ever further. So it is at odds, right? Be happy, be content, but never happy. Or sorry, be happy, but never content is probably the better way to put it, right? Be grateful, appreciate what you have, love the people around you, spend time with them, but also reach, do more, strive for more, because that is what we will put on this earth to do. The human spirit demands endeavor. The human spirit demands hope.

And we would all be better off if we listened to our spirit, our inherent spirit, the thing that drove us to where we are today, out of caves, across oceans, to the stars. We would be all better off if we listened to it. So be hopeful. I love both of those. Man's reach should exceed his grasp for what is a heaven for.

Listen, this has been so much fun for me. Thank you so much for your time. Likewise. Can't wait to watch what you do next. And thanks for coming on Infinite Loops. Thank you for having me, Jim. This was excellent. Thank you.