01:35:25 · Ty Morse
[01:35:25] S0: Let's say you're at some, you know, tens of millions of revenue run rate on, you know, whatever contracts you have, and you're basically designing the company for a future where you're going to scale 10 to 15 times in the next year and then 10 to 15 times bigger or some over the period of the next few years, how do you figure out what structure to create inside the organization so that you can actually successfully make that transition to prototyping and showing to, like, design... Like, actually at scale manufacturing some product?
01:35:55 · Ethan Thornton
[01:35:55] S1: I think you want unscalable systems that are constantly in the process of becoming more scalable, but deeply scalable people. So changing people throughout that process is crushing. That said, if at the front end of that process, you build the way you do business, you build your org chart, You build your ERP. You build your design releases. For that two stages down the business, you're gonna move so slow. And you're you're also gonna build it wrong because you don't know yet. And so you wanna accelerate as much as you can on people and find deeply scalable people that you're insanely confident this person will be the person leading this function in ten years. Basically, execs can can kill or make a business. And I think most people hire execs too soon. And I I tried to and I failed many times. My fault and the the the fault of the execs I'd hired. But a year ago, we finally, like, hit the sweet spot where it made sense for us to start hiring execs as a business. So I spent the last year building what what I consider to be a phenomenal, phenomenal executive team. And then I've really spent the last six months building out their lieutenants, and I'm super proud to say a 100% on the exec side now, probably 80% on the lieutenant side, that these are the people who will be running the company with me in a decade. And that 20% is not lieutenants who are here who are doing a bad job. That is not a single person. It's... We don't have these functions today, and I'm still standing up these functions. And you... I love top down hiring, and you need to execute that as early in the process as you can, And you only want to do that once as a company. You wanna do that process of top down hiring, and then you wanna get excellent at developing talent. I think a metric of an excellent company in year five is what percent of your newly promoted leadership is hired outside versus interned at the company, worked as an IC at the company, and worked their way up the company. And so you wanna start with this top down push. Ideally, you do that once. I think I had to try probably two or three times. But you wanna do that, and you wanna get it right. It was one of the most painful things I've ever done, but we got it right. And then you wanna start developing. On the process side, it's completely different.
01:38:02 · Ethan Thornton
If your processes don't always feel a bit broken, you're overbuilding your processes preemptively. Now I think most companies underbuild process, but I think most excellent companies actually overbuild process. And so you wanna always be building the processes, the specific reporting lines, the specific systems, the specific workflows that need to exist to the company in, like, three to six months. It's so hard as a company, especially a company in a market is lumpy as defense to project out past past six months. I I think you end up being very, very good at predicting, like, three months, pretty good at predicting six months, atrocious at predicting two years, and hopefully excellent at predicting twenty years. But if you push your systems out past six months, you're gonna build the wrong systems, and you need to focus on the thing you're doing today. Like, there's an optimal system to to be at this stage of company. That system looks so much different than the system that we needed two years ago, and I really, really hope looks so much different than the system we need in a year.
01:39:03 · Ty Morse
[01:39:03] S0: So one of the things that you talked about earlier was basically, like, this leadership failing, which I kind of think is not necessarily leadership failing in the sense that any organization as it scales and any leader as they scale is just gonna go through challenges, and it's just how you basically take those challenges and, like, work with them. What have been the biggest things outside of that that you think are basically the biggest blunders that you've made over the course of the company?
01:39:27 · Ethan Thornton
[01:39:27] S1: I think most of it has been leadership. So I think I think there's a common theme of me just not having enough reps on leadership early in the process. I think it's rarely the company grow... It's basically you've got the rate of company scale versus rate of your scale. And, ideally, your scale is faster and higher. And when those things intersect, it gets very painful. And we went from, like, dorm room to, like, this factory, and I guess, like, fifteen months or something. And those intersected hard. And there was a lot of different things that happened there. I think that's one. I think two, I I don't see myself as inherently excellent. Actually, let me rephrase that. I see myself quite bad, trending to be less bad, but still quite bad at detailed technical program management. I think I'm good at architectural decisions, but when it's like the day to day decision making on a product, I'm actually quite a cute little bat. I think part of that is just naturally the way I am. I think another part of that is reps. Like, that is where senior leaders and an engineering org come into play. Like, I see it as the horsepower in most of the org comes actually from typically younger ICs. And then when people get more reps, they get good at seeing around those boulders. And usually those boulders, if you're developing right, are actually every couple of days, and I'm very bad at that. I'm better about the long term boulders than I am the short term boulders, but I I think there have been a number of blunders there. Like, we had the first Viper rev. This is called RevA. It was such a blunder that we literally had to move off of doing revs and switch to blocks because I didn't wanna call anything rev b.
01:41:13 · Ty Morse
[01:41:13] S0: And what is a rev?