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Shotwell Desch Interview

Gwynne Shotwell / Matt Desch interview

2018-11

Host: Okay. So I am honored now to introduce our moderator for this morning's session. Mr. Matt Desch, CEO of Iridium Communications. Matt has more than 35 years of experience in the telecom industry, and as a member of the US president's National Security Telecommunications Advisory Committee. Some of you might be wondering why we have a telecommunications leader at an aviation conference. There's actually several really good reasons. First and foremost, Matt is a very active and accomplished pilot and member of AOPA's board of trustees. Second, his company, Iridium Communications, is the world's largest commercial low Earth orbit satellite operator, providing mobile communications for the maritime, aviation, defense, and emergency response industries, and more. So we think Matt is a perfect guy to have talk about space. Please help me welcome Matt Desch. [applause]

Matt Desch: Good morning everyone. I'm not the speaker this morning, but I am really excited to be the moderator for the real speaker this morning. But I have to say I am excited and pleased to be part of this. As a longtime trustee, I'm very proud of Katie and Cindy and the team, and Mark, on pulling together this curriculum, this activity. I think the trustees were a little, probably a couple of years ago, when it was brought forward that we were going to have this curriculum for high school students, we thought wow, that's really expensive, it's really challenging to do, does this organization really know how to do that. And looking around this room, you can only be energized by just how far this has come and how this has grown. So we're very proud to be part of this, and I'm very proud to be part of it too.

So I am a CEO of a very big satellite company, but we took a chance, 11 years ago, 12 years ago, when my team came forward and said you can't afford to buy a rocket from anybody else but SpaceX. We had planned to launch 75 satellites into space, which is more than anyone else, at least at that time, had planned to do. And it needed a lot of rockets to do that. A three billion dollar program, is now what we are within a month of completing. In fact our eighth launch is on December 30th, at 8:38 in the morning on the west coast. And we've had seven fantastic launches and I'm sure the eighth will be just as well. And one of the reasons why it's been so successful is our speaker Gwynne Shotwell. So Gwynne hates introductions, I know. She's not a formal person. She can glam it up with the best of them, but she'd rather put on a pair of jeans and be on the farm.

But I do have to at least tell you she is the president of SpaceX. President and COO. Everything that operates at SpaceX happens because of Gwynne. She's a Midwesterner, like me. She's from the Chicago area, just north of Chicago at Evanston. Grew up there, went to Northwestern for a degree in Mechanical Engineering and a Masters in Applied Mathematics. So she's very smart. Which is very important, too, in the sense that this is a company that she's part of. She's the 11th employee of SpaceX. Been there since 2002, so 16 years. Has really seen this company grow, and really is a big reason for its success. So I'll let her talk a little bit more about that, but if you could join in welcoming Gwynne Shotwell to the stage. [applause]

Gwynne Shotwell: So I think you have to sit there, because of the microphones.

Matt Desch: We didn't coordinate this, as you can tell. Highly. But I should also say, and we got a chance to connect last night, Gwynne has really become a friend, too. When you pay somebody $450 million dollars... [laughter]

Gwynne Shotwell: Thank you, by the way.

Matt Desch: ...you get a friendship out of it too.

Gwynne Shotwell: And a dinner! I paid last night.

Matt Desch: Yeah, she paid for dinner last night. I will say too, if you buy rockets from SpaceX, they throw a hell of a party, too. [laughter] And I really got to tell you, I highly recommend you spend $65 million on a rocket. Or it's probably more now, isn't it?

Gwynne Shotwell: It depends.

Matt Desch: We'll get you a deal, if you want one. So. You know, SpaceX isn't really as simple to explain as a lot of people think. Everybody's seen the rockets go up, and land, and that sort of thing, but maybe you could give a little bit of the origin story for everybody and talk about how you became the 11th employee perhaps, too.

Gwynne Shotwell: Sure. It's always easier to tell the story after you guys have seen either some pictures or some videos, so if you don't mind, I'm going to roll a video, it's an overview video of the company, get you thinking along the lines so that when I talk a little bit more about it, you'll see it. [spacex overview video plays]

Matt Desch: It never gets old, does it?

Gwynne Shotwell: It doesn't, no. [applause]

Matt Desch: Okay. How many people want to work at SpaceX now? It's got to be cool. I mean, when you think back to 2002 -- we'll talk about Elon in a minute -- but when you were pitched the idea and you had this concept, you had been working at a rocket company a little bit before that. I mean Microcosm, I think, was sort of involved in that. Did you expect it would be like this, sixteen years later?

Gwynne Shotwell: You know, I hoped that SpaceX would work, and that we would achieve the goals that Elon had laid out in 2002. I wasn't sure that we would be able to, though. There was no private rocket company that had made it. Lots of attempts, but generally rockets and spaceships are owned by governments and developed by governments, not by private companies and private individuals. So I was very hopeful. In fact, I did say that this would be my last job in this industry, and that if SpaceX didn't work out, I would be very happy to go be a barista at a Starbucks or sell real estate. But I was at the point, I had been in the industry for 15 years at that point and I thought that if SpaceX wasn't going to make it, I'm not particularly interested in this industry. Because it had gotten stodgy and overly bureaucratic, and it really kind of needed a punch in the arm. And so I wasn't sure, but I was hopeful.

Matt Desch: Those were your three options, career options? Barista, real estate--

Gwynne Shotwell: Barista, real estate, or SpaceX. [Matt Desch laughs]

Matt Desch: Well, maybe go back to those early days that got you into space. I mean there must have been something that attracted you to it originally. Why don't you talk a little bit about your origin story?

Gwynne Shotwell: Sure. So I'm one of three girls. Middle child. And I was the one that mowed the lawn, that helped my dad do stuff around the house. And we lived kind of far out of town, and so we were always in the car. And we were driving, and I asked my mom, like, how does a car work? I was in third grade. She had no idea, she's a potter, she was a potter. And so she bought me a book, I actually still have the book, on how a car works. And so I read the book, as a third grader, and was just really interested. I didn't pursue technical projects as much as maybe some other kids, but I was always very interested in it. And then when I was a teenager, my mom took me to a Society of Women Engineers event on a Saturday afternoon at Illinois Institute of Technology. And it was that day that I decided to be an engineer. And I have to tell this story, because especially for educators, I think this is kind of an important thing to understand, and it took me 30 years to realize it, but -- so I'm a 15 year old, 15 or 16 years old, I don't remember exactly, because it was a long time ago, and there was a panel of women engineers, and I was really attracted to the mechanical engineer who was sitting on that panel. And I loved what she said. She owned her own business, she was working green materials, and this was probably in the late 70s. She was working on construction materials, green construction materials, and I was really, just engaged with what she had to say. And I loved her suit. [laughter] I loved her suit, right? What was a 15 year old girl going to be attracted to? Like, nice shoes and a great suit. And the fact that she was particularly interesting. So I went up and chatted with her after the panel, and that day, I said I'm going to be a mechanical engineer. And so, I did. I became a mechanical engineer. [laughter]

Matt Desch: Do you think that is productizable as a strategy [laughter] for other people as a strategy for other people at this point?

Gwynne Shotwell: What I think it points out is that children need roll models. Something that they feel a connection to in order to go into a field that my seemingly be a little bit scary. You know, in the late 70s, 15 year old girl, I didn't know what an engineer was. I mean I thought an engineer was like, a train driver. Like, [makes a train horn noise]. That's what an engineer is. And yet there were these women on stage who were poised and had great clothes and had careers. And that was my only exposure. My father was a brain surgeon, my mom was an artist.

Matt Desch: What about space though? I mean, because you could have gone to Ford and been a mechanical engineer.

Gwynne Shotwell: Well in fact, I went to Chrysler.

Matt Desch: There you go. [laughter] You could have gotten stuck at Chrysler, right?

Gwynne Shotwell: After I finished my bachelor degree, I moved to Detroit and worked for Chrysler Motors. And left the auto industry because what I realized was that all the really interesting, deeply technical projects were being hired out. At least in that period of time. This was in '86. They were going overseas, to Japan. And I thought, well, I want to work on those, deeply technical, really cool projects. I don't want to be a project manager. I mean, I don't know anything. And so I went back to school, to get a PhD, and couldn't stand it, so I dropped out with a Masters in Applied Math. And I just ran into an undergrad professor--

Matt Desch: You're a total failure.

Gwynne Shotwell: A total failure. [laughter] A total failure. I did not finish my PhD. [laughs] I bumped into a college professor, an undergrad professor, and he said hey, come out to Aerospace Corporation, move out to LA. And it was winter in Evanston, Illinois, it was probably 20 below, and I thought you know, that sounds really great. Lets move to Los Angeles.

Matt Desch: [laughs] There's another strategy. It's about weather maybe, at this point, too. We're going to pick up on all the ones here. Well, lets move into a little bit more on SpaceX. You know, this Falcon Heavy program, earlier this year. We ended with Starman there, which captured all our attentions. I watched that, I appreciate you inviting me to the launch, but I had to watch it in the Lincoln Tunnel in New York on my iPhone as we were watching those boosters. Maybe you can talk a little bit about the whole buildup to that. How that project came about and what it meant to the company.

Gwynne Shotwell: Sure. So back to the beginning, 2002, Elon founded this company to change the whole perspective on space launch. And his goal was to get people to other planets. Primarily Mars to start, just cause it's the closest sort-of-habitable place. And so we started with a little rocket, Falcon 1. We moved to a bigger rocket, Falcon 9. We actually made a good business out of Falcon 9. [turns to Desch] Thank you for your business.

Matt Desch: Thank you. [laughter] Thank you for doing that, too.

Gwynne Shotwell: And then the next project, the bigger one, was Falcon Heavy, which is three Falcon 9s glued together. You'd think that would be super simple, but ehhhh. Three and a half million pounds of thrust on the deck. And it was a hard project. We were quite late on that. And we didn't want a customer for the first launch. Because, well, first of all, because we were so late. And second of all, we really wanted to own that, and we really wanted to do something that would get people really engaged in space again. And so Elon said, "Let's fly my Tesla Roadster, it's kind of old now anyhow." And so we integrated it on the top of the rocket. And underneath it, the pedestal, every SpaceX employee's name, engraved. And so we sent Starman, within the Roadster, just as far as we could, basically, with that Falcon Heavy flight. It was a great demonstration. We basically built this giant rocket, pushed a car with a fake astronaut as far as we could possibly push it. Multiple burns. It was a great success. We were criticized actually, for throwing that [hand quotes] piece of space junk. Which is really unfortunate that people looked at it that way. We had millions of people, tens of millions of people watching that, and more continue to watch that video. So people I think are beginning to get excited again about space. And I do want to show this video, for those of you who haven't seen it. It's a, I mean, I still get tingles on it. And by the way, the song is David Bowie's song, Life on Mars. [Falcon Heavy video plays]

Matt Desch: So that's so cool. Where is Starman now?

Gwynne Shotwell: Starman is beyond the distance of Mars. It's in a heliocentric orbit.

Matt Desch: It eventually comes back around, doesn't it?

Gwynne Shotwell: Like a hundred million years from now.

Matt Desch: Oh. [laughter] Do you have a date?

Gwynne Shotwell: [laughs]

Matt Desch: So I was captured by the original Apollo, Saturn V. How does it compare, technology-wise, to some of the, I mean, maybe you can go back to show some engineering respect to even the previous time when something that big was really put up there. Because I don't think we can even appreciate the technology differences between the two.

Gwynne Shotwell: What is extraordinary about the lunar program was what they accomplished in such a short amount of time, with the state of technology at the time. In the 60s. A rocket as large as Saturn V has not flown since. We certainly hope to be able to do so in the future, but it has not flown in 50-odd years or so. Yeah. We're able to do what we are at SpaceX because of the lessons learned and the extraordinary achievements of the people who have come before us.

Matt Desch: But we couldn't do that again, today, right? To do that today, it's really at a place like SpaceX, not at a government agency like it was before. It was extraordinary back then.

Gwynne Shotwell: It would be very expensive to recreate that program in a purely traditional government way of running a program. I think it will be achieved by public-private partnerships, where you leverage the best of the government and the best of entrepreneurial firms to yield a great outcome. We did that with NASA in fact, for the COTS program. The Commercial Orbital Transportation Services program. 2006, we were awarded a Space Act Agreement with NASA. It's a $278 million dollar job, which was huge to us at the time. We'd only been in business for four years and we hadn't gotten to orbit yet, even with Falcon 1. But with NASA's support and some technical help, and certainly process help, we were able to leverage the smarts that our team had, and we got Falcon 9 to orbit under that program, as well as the Dragon capsule to the International Space Station. And right now we're working with NASA regularly to bring cargo up to Space Station. But soon we'll be taking crew to Space Station. In fact, the first flight, the first demonstration flight of that crew vehicle, should be standing vertical on the pad by the end of this year. And then we'll launch as soon as NASA's ready for us to go.

Matt Desch: Which will be a return in many ways to the level of quality that we had to get to in those days. So 16 years, nothing has ever happened wrong. [Gwynne laughs] It's just gone smoothly, exactly the way you programmed it. I mean, maybe you could talk about, maybe from more of an entrepreneurial kind of view, how do people look at these things?

Gwynne Shotwell: Sure. So the first three launches that we had of Falcon 1. That was the little rocket, it was our technology demonstrator. We did not get to orbit. We had a failure on every flight. It's funny, 16 years later, I look back at those, and those weren't failures, those were learning opportunities. And we, our 4th flight of Falcon 1 was a success. Previous rocket programs had struggled, you know, up to 13 failures before a particular rocket worked, so--

Matt Desch: Thank you for not learning with any of our launches, anyway. Here, we didn't learn anything.

Gwynne Shotwell: [laughs] Although you were a return to flight after our second failure with Falcon 9. So after the first three failures of Falcon 1, we had a great string of successes. Even as we were spinning the technology on this vehicle. The rocket at that time was never the same. Every rocket was kind of a new rocket. But we did have a flight failure while we were carrying a Dragon capsule to the International Space Station. In June, June 28th 2015. I know the date, because that's Elon's birthday. So now we don't fly on his birthday. Yeah, that was our first flight failure. We got back to launch. In fact, the next launch, so that was the end of June, our next flight was in December of 2015. Brand new rocket, return to flight, and that was the first time we landed a booster on land. That was the first time. So that was kind of a great recovery. And then the second failure we had, other than development failures. These were flight failures, where people paid for flights, or we had satellites on top, and it represented a huge impact to both our customers' business as well as ours. We blew up a rocket on the pad, on September 1st 2016. We had a helium pressure bottle basically explode and blow out the side of a second stage tank. You know, there's one thing about failures with rockets. They are spectacular, they make spectacular videos. Heart and soul crushing, but spectacular videos nonetheless. That was a hard one. I think I was still a good leader, a competent leader after our first failure. Kept people on track, kept them moving. That second failure, I probably didn't do as good as a job. I was much more anxious. Probably a little crankier than normal with folks. Instead of just keeping people motivated to get to the root cause of the issue and get back to flight. So that was good lesson for me.

Matt Desch: That wasn't the way they described you, actually, at the time.

Gwynne Shotwell: [laughs]

Matt Desch: Did you learn something? I mean, if something happened again, I mean, God forbid. It will, someday.

Gwynne Shotwell: It will. It's hard.

Matt Desch: Do you feel like you are a different person as a result of all that?

Gwynne Shotwell: Absolutely. Yep. Yeah. As the leader of an organization. I mean, there's 7,000 of us now at SpaceX. As leader of an organization, you need to make sure people are doing great work. And running around looking anxious, and worried, probably, not yelling, I don't really yell, but not being particularly supportive of people, is a bad way to get people to doing the right thing.

Matt Desch: But people don't appreciate just how, you know, you make it look easy sometimes. I mean, landing two rocket boosters simultaneously. How cool is that? So Jetson-like. I mean, it's just what we envision.

Gwynne Shotwell: Yeah. But there are failures along the way.

Matt Desch: That could have been spectacular as well, couldn't it have been?

Gwynne Shotwell: Yes. And in fact, I have a spectacular video. I don't show launch failure videos, because it's too depressing and it's not respectful to our customers. But when you're failing on development projects. And landing was a development project for SpaceX. And actually, I kind of skipped this part: why are we landing rockets? You guys are educators in the aircraft arena, I certainly want to get in to the aviation arena, if you're going to take people to other planets, you can't throw the ship out after that first flight. It's got to be recoverable and reusable, like aircraft now. You can imagine if you threw that aircraft out, we probably wouldn't be here in Louisville, Kentucky. Right? It would have taken us longer to drive. Anyhow. So the vehicles need to be reusable, like aircraft, in order to take people to other planets. But it was a long road, and I'm going to show you a fun video of our lessons learned, in landing a rocket. ["How not to land a rocket booster" plays]

Matt Desch: That is awesome.

Gwynne Shotwell: That's fun. [applause]

Matt Desch: You really got the music just perfect on that one, too. I hadn't really seen that one in public yet, here. But obviously failure is a part of this.

Gwynne Shotwell: It's how you learn. You learn so much more from failure than you do from success.

Matt Desch: When did you hear that you were going to be landing boosters? I mean was that in 2002, that was the original vision, right off the bat? Because I've heard a couple of your team members sort of express almost a little skepticism when they first learned that that would be happening. Because it's inbred that you can't do that, right? There's no way you can do that.

Gwynne Shotwell: Right. No one does that. We started working on recovering boosters pretty early in the program. Maybe 2005, 2006? But we were using parachutes. You deploy a parachute at those speeds, they just go ripping, like, we were kind of idiots about it actually. It would never have worked, and we demonstrated that it could never work with parachutes. So you had to get the retro-propulsion working. And we learned a lot from Dragon reentering the atmosphere and what happens to the thrusters while you're firing while doing that. So the Dragon program actually helped us recover Falcon 9s.

Matt Desch: Yeah. It's a, you certainly have proven so many things not true, anyway, here. I love this quote, I think, is this Elon's quote?

Gwynne Shotwell: Elon's quote, yeah.

Matt Desch: We'll talk about him a little bit. But maybe you can just read this. It's like special forces: "We do missions that others think are impossible. We have goals that are absurdly ambitious by any reasonable standard, but we're going to make them happen. We have the potential here at SpaceX to have an incredible impact on the future of humanity and life itself." You know, maybe this is a good time to bring Elon into the mix here.

Gwynne Shotwell: Sure.

Matt Desch: I'm sure there's a lot of people who are interested in, sort of, your relationship with Elon and the culture that he's created at SpaceX.

Gwynne Shotwell: So I've worked for Elon for 16 years. I think the longest-running direct report that he's ever had. I love working for Elon. Don't believe what you read in the media, actually. Half love him. Half rabidly hate him. He's somewhere in between, right? He's a great man. He wants to do great things. He's dedicated his life to actually making life better. Whether it's through renewable energy, better payment systems like PayPal that made life a lot easier. You can buy a lot of different stuff now and don't always have to leverage banks, use PayPal. Then he took on the energy community. Then he took on the aerospace community with SpaceX.

Matt Desch: Took on the flamethrower community.

Gwynne Shotwell: The flamethrower community. [laughs]

Matt Desch: The not-a-flamethrower community.

Gwynne Shotwell: I bought one of those, by the way, for my husband for Valentine's Day. [laughs] Cause we have a ranch. And I figured we could light our burn piles with the flamethrower.

Matt Desch: What a thoughtful gift for you to think of. [laughter] I can't imagine what it'd be like.

Gwynne Shotwell: Yep. Elon is a great man. I love working for him. He's funny. He's incredibly intelligent. And he works really hard. So everybody around him works really hard, too.

Matt Desch: And he's sane. I mean I don't think people appreciate that, they're seeing a couple little video clips of him, but he really is a really good businessman.

Gwynne Shotwell: Oh, extraordinary. He doesn't, there's nothing that's, I don't want to say sacred because that's not quite right, but there's nothing that can't at least be tried. And the worst day you can have is to go into him and say, "You just can't do that. It's never been done before." Because then you have a new job. With another company.

Matt Desch: We both own Teslas.

Gwynne Shotwell: Yes. I love my Tesla.

Matt Desch: And yours has more personality than mine does, because mine's a newer one I think.

Gwynne Shotwell: Yes.

Matt Desch: Have you thought about going back over and fixing Tesla, too? And making that work? And--

Gwynne Shotwell: I like SpaceX. I like SpaceX.

Matt Desch: Okay. You're not going back to cars.

Gwynne Shotwell: I'm not going to Tesla.

Matt Desch: Maybe this would be the time to talk a little bit about, you know, aerospace. Bringing people into aerospace. We talked about this a little last night. Especially girls, into aerospace. What's your view on why there aren't as many girls coming into our industry, and in the aviation industry, I was mentioning, you know, it's six percent pilots or something, that are girls?

Gwynne Shotwell: Seven percent. Seven now. [points into the audience]

Matt Desch: [looks at who she's pointing at] Did you just join? Oh. [laughter] Just got your pilot license, great! So we're up! [laughter] [turns back to Gwynne] Why is that?

Gwynne Shotwell: So, you know, we're actually doing research in SpaceX to figure out why women are not as attracted into this kind of technology. I mean women, obviously, computer science and software, there's better percentages, higher percentages of females in that. But why aren't women interested in big machines? We haven't cracked the code, but when we do, I'll certainly let everyone know, because I think it'll be an important discovery. But what you can do is be role models. I have my female engineers out in public talking, trying to bring more women into the field. And by the way, who cares? Why have women? Why not have women? By the way, because a diverse workforce is incredibly important. You can't solve hard problems with everyone in the room thinking the same way. And so diversity is just a simple thing that should make sense. In order to solve hard problems you need lots of opinions. Lots of different ways of thinking. Lots of approaches. And so diversity is critical to us. We have not cracked the code, but we're trying. So I think we need to serve as more role models, get out into the community. And by the way, make space cool and fun. And that was part of what we did with that Falcon Heavy launch, and put the Tesla into space. I think the only mistake we made there, by the way, it was Starman, the astronaut, but I think it should have been Star-ma'am, and she should have had a ponytail coming out her helmet. That would have helped, I think.

Matt Desch: I agree. I agree. Can we talk a little bit about another big disruption? The BFR.

Gwynne Shotwell: The Big Falcon Rocket.

Matt Desch: Yeah, right. [laughter]

Gwynne Shotwell: I testified before Congress. It's the Big Falcon Rocket.

Matt Desch: It's Big Frickin Rocket, is what it is. We know what that stands for. [laughter] But maybe tell everyone a bit about the Big Falcon Rocket and what it is. Because it's pretty awesome.

Gwynne Shotwell: Sure, sure, yeah. So we started the company with little Falcon 1. Moved to Falcon 9. Glued three Falcon 9s together, made a Falcon Heavy. But we really needed a much bigger ship in order to take large cargo to either the moon, or to another planet, namely Mars. And so the Big Falcon Rocket program was born. Probably, I guess we started talking about this six years ago or so. Five or six years ago. But we've made some great progress since. We're going to a completely different kind of propulsion. Right now we're using LOX/Kerosene, and it's a gas generator system. Now we're moving to a staged combustion, LOX/Methane. The reason why we picked methane is because you can generate methane on the surface of Mars, from the constituents in the soil. By the way, that engine program is called Raptor. The engines on Falcon 9 and Falcon Heavy are called Merlins. But all are types of Falcons. So that's the naming convention there. So anyhow, I think I've got a video here of BFR, not necessarily taking people to other planets, but leveraging the technology here on Earth. And I thought it might be relevant for this particular group. [BFR point-to-point video plays]

Matt Desch: So as a pilot I've made a few people throw up before, but [laughter] what exactly is that ride going to be like? Can you tell me?

Gwynne Shotwell: Well, you know, there's enough power there to creep up on the Gs. I think it'll be an exciting ride, but I don't think people will throw up.

Matt Desch: No, it won't. You won't have enough time. [laughter] I mean, by the time you pull out the airsick bag. Do you get time to float around? You know, the drinks service will be tough, probably. Right?

Gwynne Shotwell: Yeah, no drinks. I think maybe pouches in the seat in front of you.

Matt Desch: But I mean, you think about the challenges, it's not just the aerospace challenges here, right? There's a lot of other, I'm sure, regulatory, there's just business challenges, there's distribution and sales... I mean, I've got to believe, because we're thinking about educating kids to these kinds of jobs, this is going to take a lot of skill yet to come. This is not just solving a couple math problems.

Gwynne Shotwell: That's absolutely right. In fact, so the rocket business right now, it's relatively simple. I'm not saying it's easy. But it's relatively simple. When you expand the business like this, where you're reaching out directly to consumers, huge regulatory, well, there's a lot of regulatory in rockets, too, by the way, because they're missiles. But yeah. So the opportunities for growth and careers with the expansions of our business into something like this is extraordinary. You need more sales people. You need more customer reps. Need a marine, basically fleet, because you're going to have to launch and land these things offshore. So I'm actually very excited about that. I do so much travel, I would love to be able to go overseas during the day and then come back home, sleep in my own bed, make dinner. I think that would be great. I'm not going to Mars. I don't like to camp. [laughter] And that would be extreme camping. But I'll fly on a BFR to go see my customers.

Matt Desch: If Matt Damon was going with me or something, maybe. But I just think about it, and I think when you said you were going to do reusable rockets, I can tell you, being in the industry and knowing a lot of your competitors, there was a lot of "Yeah, right."

Gwynne Shotwell: Right.

Matt Desch: "We don't need to do anything about this because it'll never happen." And now of course they're all struggling with their own reusable programs and trying to catch up. What do the airlines think of this, do you think? Do you think they're at the same point, saying, "Seriously? I mean, this isn't going to be competition to me."

Gwynne Shotwell: You know, I don't think the airlines think, as they shouldn't, I don't think the airline industry should be particularly worried about this. This'll be pretty complementary. And these tickets will be pretty expensive. This is not an economy-class fare, but super-economy, light business-class fare?

Matt Desch: You won't be commuting to Shanghai, then.

Gwynne Shotwell: You won't commute to Shanghai everyday. No no no, it'll be thousands of dollars for a ticket. But yeah, I think it'll, again, I think every time you bring people from far away closer together, we learn, hopefully we become better people. I think it will cause us to think harder about the planet because you'll see more of it. You'll be able to see it more easily. So I'm actually very excited about that program. I'm also excited, of course, to be able to take people to Mars. I just don't want to go with them. [laughs]

Matt Desch: Well let's talk a little bit about Mars. You called it a fixer-upper planet I think, in the past. [laughter]

Gwynne Shotwell: Yeah. Yep.

Matt Desch: And I kind of agree with you. It doesn't, The Martian wasn't a travelogue for it or anything here, when it got done. But maybe talk a little bit about the vision for Mars, when it's going to happen and what it means.

Gwynne Shotwell: Sure. So I think, I think it's important to explore. That's what separates humans from the animal kingdom, actually. And I think it's time to explore beyond Earth. Robotically, you know, we've landed probes on planets, and we've certainly landed rovers on Mars, but I think it's time to go there, to continue our destiny as humans and to explore our world. And I just think our world is getting bigger, hopefully, not smaller, as some might prefer. So there's that. I think it's just kind of a normal progress of the human race is to find new areas to explore, so planets are certainly one of them. And the other is, it's a risk management tool for the human race. You know, we're not catastrophe people, "the world is going away", but I think it's important for the human race to be able to survive in more than one location. And Mars is just the next closer, although candidly what excites me about space travel is not going to Mars and having extreme camping until we can "fix up" the planet, which I think will probably take decades to maybe a century or so, but I'm really looking forward to building ships that will take people to other solar systems, other star systems, and meet other people. That is what makes me really excited about working at SpaceX.

Matt Desch: You're really young, but that's a little ways away.

Gwynne Shotwell: And we need breakthroughs in propulsion, and, probably not in energy, but we do need a breakthrough in propulsion to be able to achieve that. Like, one of my favorite shows is Firefly, I don't know, any Firefly fans? [some cheers] Yeah? Why did they cancel it, I don't get it. It's a great show. Anyhow, I want to meet other people, from other planets. And I know it probably won't happen in my lifetime, but I hope to see some progress towards that.

Matt Desch: Again, huge challenges that have to be solved, right? Radiation--

Gwynne Shotwell: Lots of engineering.

Matt Desch: --and distance, and figure out how to get back, because you really don't want a one-way ticket if you can help it.

Gwynne Shotwell: No one-way ticket, yep. No one-way tickets.

Matt Desch: Can you talk a little bit about this Japanese artist, or actually, billionaire, who happens to like art.

Gwynne Shotwell: Yes.

Matt Desch: You're going to fly him around the moon?

Gwynne Shotwell: Maezawa-san. Yes. He bought a ticket on the first BFR. Around the moon.

Matt Desch: He bought a big ticket, right?

Gwynne Shotwell: It was a big ticket. It was a big ticket.

Matt Desch: He bought for some of his friends, too, right?

Gwynne Shotwell: Right. So his plan. And by the way, he's doing this not, well, I think he's kind of an adventurer but, I think he wanted to do this kind of why Elon is doing things in space, to get people thinking about space. And so he bought the first trip around the moon. And he's going to bring artists on board. Eight to ten. And the payback for that trip, that historic trip, is that they need to create works based on their experience and share it with the world. So he's an interesting, really interesting man. And I'm pleased, obviously, that he bought the ticket, and the price of the ticket will be meaningful in completing the development of BFR.

Matt Desch: Maybe tie that together though, with crew, with the update on the crew.

Gwynne Shotwell: Sure.

Matt Desch: Because you're flying people. And that's a whole new risk paradigm.

Gwynne Shotwell: Yes.

Matt Desch: You can't have blooper reels for that.

Gwynne Shotwell: No blooper reels on that. In fact, we're flying dads. I'd love to say we're flying moms, too, but our first two flights are males. We will, as I mentioned early on, we'll have the first demonstration of that crew version of the Dragon capsule vertical on the pad at the end of this year. That will not have crew in it. Roughly five or six months later, once we get the data back from that flight and make sure we're doing the right thing, and have done all the right things, we will put two US crew members on board and fly them to the International Space Station. Dads. Two dads. And then that should be the beginning of regular travel for American astronauts again. You know, we haven't flown our own astronauts since Atlantis flew her last flight in 2011. We've been relying on our international partners. Russia. And geopolitically things are strained, for sure. And regardless, I think it's important for the US to own its own human space program. And so both Boeing and SpaceX are in the middle of that. And by 2019 you should see both of us flying people.

Matt Desch: She won't say that SpaceX is doing a better job, cheaper and faster than the government. But who's surprised? How many people here, by the way, if Gwynne offered a free trip for a dad or a mom to go next year, would you take it? [laughter] [looks at raised hands] I think that says something about the audience, and I'm encouraged by that because a lot of you are teaching our young people here, so you're going to want to push the boundaries. Can we ask a few questions from the audience? I mean, do you have this app, or something that you can do that with? What's that? They'll ask from the back? Okay, go ahead.

Question: I was wondering if you wanted to show the Mars video?

Gwynne Shotwell: That's four minutes. I figured we'd run out of time if we showed the Mars video. All my videos are on YouTube, by the way. So you can watch 'em. So, can we redo that survey? Who would go to Mars? When it was still a fixer-upper planet? Wow. Good for you guys.

Matt Desch: How many want to come back from Mars? [laughter] Okay, good. Just checking.

Question: So, SpaceX has been around for a decade, but you seem to keep a startup mentality, how have you done that, what's the secret?

Gwynne Shotwell: So the secret there is never applaud your successes. You move on to the next gigantic challenge. In fact, that's a great way to drive a business. Not to not thank people for doing great work, by the way. That's terrible. And we do fall into that trap. But to set absurdly ambitious goals. If you're always scrambling for that next achievement, people stay pretty energized and pretty motivated. As long as that next achievement is a fun thing. Yeah.

Matt Desch: But I mean, there is, especially when the quality control has to be so high, there is a level of bureaucracy that you have to kind of see set in at times. When people start checking the checkers who check the checkers. And that is like a disease, potentially, right? How do you get past that disease in some way?

Gwynne Shotwell: So, there is a requirement for some bureaucracy, but it has to be level-set against what you're trying to achieve. And the more bureaucracy, the harder to achieve. But there is a minimal set, for sure. Quality control being key. Just, there's a couple of ways we do it. First of all, I have a very mouthy employee base. You know when we've done a stupid thing. Like when we've put a new rule in place, we hear about it right away. I have a suggestion box. Sometimes people will email me directly, but sometimes they're cheaters and they go to my autonomous suggestion box. Man, you know right away that you've made a dumb mistake, because you get feedback. Like, a lot of it. And you have to read it all. So, I have a mouthy employee base, which prevents us from doing too many stupid things. And the other thing is, we try to set up tools to implement processes as opposed to establishing rules. So it just feels like a helping aid in getting your job done, as opposed to, "Oh yeah, I've got to go read the checklist, do that thing." So tools, not rules. And I think you need to keep your employees mouthy, so that you know when you've made a mistake.

Matt Desch: And it's a demanding place to work, too.

Gwynne Shotwell: Very demanding.

Matt Desch: I mean, it's not the kind of place that you're going to get by, fall under the radar a little bit.

Gwynne Shotwell: It's hard to skate. I mean, even though we have 7,000 people, I need every one of them to be doing great work every minute of the day. And so that's taxing and tolling, but that's why we have good parties.

Matt Desch: I'd say, I mean, one of the cultural items I noticed, I was out there visiting the factory and going through, and I got to commune with the booster. It was a previously flown booster, and they decided not to paint them. Why paint them? You're going to turn them around in a day. So it's all sooty and everything, and I'm getting, the person who runs that part of it is telling me, is kind of like, "Do you want to write on the rocket?" [laughs] Really, I can do that? "It's dirty for a reason, go ahead and write whatever you want to, and we'll take a picture." And you know, that's the sort of attitude you really want to have, right? I mean, it's not breaking the rules. It's smart. Another question in the back. From the back.

Question: Sure. This is along employee lines. What do you look for in hiring new people? Who's a good fit. They all need brains, how do you look for a good fit?

Gwynne Shotwell: So, two key characteristics for any great SpaceXer. Super smart and highly motivated. So there's a strong sense of energy when you come in the factory, actually. It's what people comment about most frequently, especially our government visitors. Because there are other organizations that don't have the same kind of buzz that we do. So smart and energetic are the two characteristics. And then the third thing that we look for is demonstrated success. If you've had success -- because SpaceX is a hard place to work, it's very demanding -- but if you've had success in another area, hopefully you can bring that success to SpaceX. Kind of recreate it.

Question: What has been the hardest unforeseen obstacle to date?

Gwynne Shotwell: Do launch failures count as unforeseen? I mean, you know they're going to happen, it's pretty inevitable, even the longest, the Soyuz in fact, had a failure. They've launched thousands of times. They had a failure last week or the week before, I'm losing a little bit of track with time. Yeah, launch failures are terrible. It's hard on the company, the financials are in the toilet the year you have a failure. It's roughly half a billion dollars we lose or delay in revenue, every failure. And it's so disappointing for our customers. It's kind of hard to pick up the phone and call them, tell them we just blew up your satellite. Sorry.

Question: Next question, what do you think commercial aviation will look like after the advent of BFR, do you think it will hinder aviation or be a complement?

Gwynne Shotwell: I think it's a complement, and I think it will actually help the industry. I think more people will be flying. A lot of times people are afraid to do something, but then you do the next level. So maybe people are afraid to fly, but then they see people who regularly get on a rocket and fly, maybe that will provide courage to get on an aircraft. Maybe even on the rocket.

Matt Desch: Do you have any personal opinions about AI? I mean, I know Elon's very public about his concerns. But maybe personally, about autonomous vehicles. The Falcon is really a completely autonomous vehicle from, you know, minutes before launch, nobody's really pushing buttons or anything, making it happen, that thing is doing everything on its own.

Gwynne Shotwell: It is. And there's some difference between artificial intelligence and autonomy. Autonomy is kind of pre-programmed intelligence. Artificial intelligence, frankly, I wish we had a little bit more AI at SpaceX. We have a lot of people who are reviewing a lot of data, and I would love for a machine to learn how to review data and assess whether an engine is ready for flight or whether a stage is ready for flight. But it would have to be a learning algorithm, because you always see variations in data, you know, when you have a million and a half pounds of thrust on a Falcon 9, or a million eight, I guess, now. So I actually would love to see more of it at SpaceX, but yeah, I guess, if you're really great at building an AI capability, then that capability could overtake human system.

Matt Desch: I bring it up because there's a lot of science teachers here, you know. And this is not taking over for us, we need these students to be prepared with the skills to be able to program those kind of vehicles, because that is coming, these neural nets are really there. Another question back there.

Question: Does SpaceX have an education community? Do you have a group that works on activities, resources for teachers, and sort of re-energizing teachers around space?

Gwynne Shotwell: So we do have a very tiny outreach team. And we bring in students for tours and stuff. But we're leveraging the approach of "Do cool thing, make them very public and obvious," and hopefully that will cause people to kind of push their boundaries a little bit and think about careers that they may not have otherwise thought about. That's more the approach. We're great engineers, I don't think we're great teachers. But we'd be happy to work with teachers to figure out what kind of curriculum we could leverage.

Matt Desch: If I could, I have a little different view on that previous one. You know, Gwynne's team has to really be super smart. Because they're really breaking new ground all the time. I would say, just to counter, Iridium's team, we're not as large, but we also hire young people and everything, and I would say, I have sort of more of a culture where we really need people who communicate extremely well, who demonstrate respect for their teammates, who operate in team environments extremely well. They have to be smart, capable, and everything else, but they have to work as a group. Because the workforce these days is not hierarchical anymore. There's no, Gwynne and I aren't telling people what to do very often. I mean, we get to make the final calls, a lot of times. You're picking the drapes out for the BFR, I know we talked about that. I get to pick how long the antenna gets on my satellite. But beyond that, we really need people to work together and make these decisions quickly and holistically. Right? The interpersonal skills have got to be something that you are looking for as well.

Gwynne Shotwell: Yeah, but when I said smart, I didn't mean only like, brain-smart, but not get along with other people. In fact, smart is, there's multiple facets of it. It's technically smart, but a logical thinker, critical thinker, and obviously you have to get along with your teammates. We do have a policy at SpaceX. I won't use foul language, but you'll figure it out. We have a no "A-hmm" policy. And when you are nasty, and you can't get along with people on your team, you've obviously brought down the team. And so we invite you to work at another company. Even if you're great. Like great individual contributor, but if you're bringing down the dynamics of the team, then you can't work there. Because I need 7,000 people to do great work, every minute.

Matt Desch: We call it "Life is too short for this person."

Gwynne Shotwell: That's better. You don't need the foul language.

Matt Desch: No. It helps, though.

Question: One more question. This is about cybersecurity. Are any of you concerned about the hacking or jamming of your missions?

Gwynne Shotwell: Everybody should be concerned about electronic hacking. If you don't think you've been penetrated, you have. We worry about it constantly. I am sure we have been hacked. We're always looking for little trails and little signals. Luckily, we do have our mission networks very separate, and very secure. So I don't think anyone could get to our mission network, um. Yeah, I don't think anyone could. But we're vulnerable everywhere else.

Matt Desch: SpaceX has got to be such a target for the world. You know, who wants it. We are as well. The government uses our services and everything. I was, it was a little bit of an eye-opener eight or nine years ago when the FBI came to me and told me that a keylogger was on my computer. Which meant that everything I had typed, probably for the previous year, had gone someplace. I became very aware of security at that point. And we're the same way, we have a mission network and nobody can get into that. But we are, we're investing a lot to make sure that nobody can get inside. What you just don't want is the "A-Team" to be on you. You got the "A-Team" on you. I'm just hoping that I'm below, and have got the "B-Team" and the "C-Team" working on my hacking. Is there anymore questions around here? Anybody want to throw anything else that you wanted--

Gwynne Shotwell: Someone was raising their hand over here.

Matt Desch: Yeah, go ahead.

Question: I just wondered, I'm from a high school in Florida, and my kids, I'm asking on behalf of my kids, several female future engineers, they want to know how we can tour SpaceX. They wanted me to ask that.

Gwynne Shotwell: So why don't you send me an email?

Question: Absolutely. We will do that.

Gwynne Shotwell: Where in Florida?

Question: Port Orange.

Matt Desch: Do get them out to watch a launch. They're awesome.

Gwynne Shotwell: They're fun.

Matt Desch: They're a lot of fun.

Gwynne Shotwell: Your launches in particular at sunset are pretty spectacular.

Matt Desch: Yeah, we scared all of southern California. But you got another one to do that, and that's not fair.

Gwynne Shotwell: Yeah, sorry.

Matt Desch: Don't launch them at dark again, because it's really, but it is an emotional experience when you have $350 million dollars of your stuff on top of something that explodes at the bottom-- [laughter] --to make it go up.

Gwynne Shotwell: In a controlled way. It explodes in a controlled way.

Matt Desch: In a controlled way. But the first launch, I want to say, just a quick story, and Elon came to that one, because it was a return to launch, it had been four months. We'd been told about Carbon Overwrapped Pressure Vessels. I know a lot about them now, to convince ourselves that there wasn't a problem. But it's amazing when you're standing out there, and then you see Elon, and he's very tired looking. People'd been up all night. And then you hear that the winds at night blew off one of the things and we had 18 minutes or something like that for a kid to get up in a, because if that didn't happen then there wouldn't be the startup sequence. And Gwynne is texting, there's a ship in the thing, and I'm on a sleepy bus going, "Gwynne just said there's a ship in the range." And somebody goes, "Stop telling us what's going on! It's better to be blissfully ignorant about all this stuff." Because there's a million things that can go wrong. And everything has to go perfectly. So it is really an incredible engineering feat what Gwynne and SpaceX have accomplished. I'm really excited about the future things that SpaceX is going to accomplish. I wish I could buy more rockets. I can't afford 'em anymore.

Gwynne Shotwell: Well, you don't need anymore!

Matt Desch: Everybody wants me to build a satellite network on Mars.

Gwynne Shotwell: There you go.

Matt Desch: I just said I need a few customers for it. It doesn't really have a business case until you get a few people there. [laughter] And we'll work on that then.

Gwynne Shotwell: Sounds great.

Matt Desch: Anyway, are we out of time, or do we? One more question, okay. I see someone over here.

Question: So do you have a good diversity of women in your organization?

Matt Desch: Me, personally? Um, never enough. We were talking about that last night. I was getting sort of a reference from Gwynne on somebody I'm going to bring in at a senior level that I've been, I will tell you the pool is, I wish there was a bigger pool. That's been my challenge. And I tell you, I've made several offers for direct-reports to me, and they've turned me down. For not-career reasons. And I don't deny that that's important, it's just, even those of us that want to create diversity sometimes have a challenge, because the pool is often so small, that have experience, that have demonstrated sort of their abilities and confidence to run a big organization. And so I'm excited about bringing a person back in, and I'm hoping, if I get a senior person, they'll attract other senior people. And a couple people that even know that this is a person I'm looking for are so excited, these women are so excited because they're looking for role models. Somebody who appreciates and understands what they are doing. And so I celebrate finding people who can really run organizations. People like Gwynne, we need more of that. And you've got to send us more, that are ready.

Gwynne Shotwell: So, when I graduated from college in, when did I graduate? '86, I guess. I was of nine percent, engineering. I was at Northwestern, now we're graduating like 32-33% women? And some universities are actually graduating 50-51%. So the pool is getting bigger.

Matt Desch: And I said, you know, I was a computer science major in college, and believe me, I wanted more women in computer science, okay? I had to go off and do student activities just to find them, you know? Now it's changed. There's a lot more computer scientists that are women. In fact, I think it's a lot more 50/50 now.

Gwynne Shotwell: It's closer to 50/50.

Matt Desch: And there's something that happened in a way that made women think that that was an acceptable career for them. And I've got to find a way of doing the same thing in aviation. In all kinds of STEM activities. We've got to figure out how to unlock that code.

Gwynne Shotwell: We need to make sure big machines, and manufacturing big machines, doesn't feel scary. That it feels accessible.

Matt Desch: And wear really good shoes. Because that seems to attract certain high-performance women into the field, okay? I'm going to update mine, so, if that helps.

Gwynne Shotwell: I'll help ya.

Matt Desch: Alright, well, thank you very much for having us. Take care.

Gwynne Shotwell: Thank you very much.

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