00:01:39 · Molly O'Shea
[00:01:39] S1: I'm excited. I came across you guys through LinkedIn and these posts. You were doing some collaborative posts with some of the interviews that we've done. I did this amazing series with Michelle Del Buono of a sixteen z perennial, which is Mark and Ben's multifamily office. We did two episodes so far, and it's all centered on the major wealth creation event that's happening right now. We're about to have more millionaires and billionaires minted than ever before with the OpenAI, SpaceX IPO, Anthropic IPO, the Cerebrisk one that just happened, and all the secondaries and tenders that are going on also behind the surface. But right now, we're in this crazy period of time where a lot of people are gonna be making a lot of money. And so with these conversations, I've been trying to get down to, okay, what do you do once you have that wealth? How do you manage it? And one of the topics in the conversation on wealth management is private aviation. So I'm really excited for to talk about this today, and I'm just really curious. So are we seeing more private jets? What's the state of the market? Yeah. I mean, so it's like you said, it's absolutely insane what's going on right now. We're sitting here on a Sunday. SpaceX is supposed to IPO this Thursday. So some of our clients and a
00:03:00 · Israel Slodowitz, Molly O'Shea
[00:03:00] S0: lot of our investors are gonna be in New York for this iconic IPO. It's probably the largest IPO by twice as much as the last one. And this is just the first of many, right? OpenAI just announced that they're going to be going public. And we're seeing like not just insane wealth creation moment, probably the largest we've seen in the history of humankind. But we're also seeing a shift in how people spend their wealth and their priorities and also the type of wealth that they are generating. It's not the same wealth that was generated historically, where people kind of built a business over many, many years and they slowly diversified. [00:03:43] S1: New money. This is just like completely [00:03:44] S0: new money. So there's like this massive tsunami that's hitting, and we're seeing it in our business. We're seeing it in the preferences of what people are choosing, how they're accessing private aviation. And of course, the most sought after thing once you make some money is to start flying private. It's like the one thing everybody looks to do. It's truly a unique tool that nothing else replaces. [00:04:09] S1: So how is that changing who's buying jets versus who's chartering them? What is the difference?
00:04:09 · Molly O'Shea, Israel Slodowitz
[00:04:09] S1: So how is that changing who's buying jets versus who's chartering them? What is the difference? [00:04:14] S0: First of all, we're seeing people entering the market buying bigger airplanes. So this airplane, for example, this is a Challenger three fifty. It's considered a super mid. It's considered what I like to call a proper jet. It has a flat floor. Normally, people would sort of enter the market by starting to charter or they would start with getting a light jet. And people are now going straight for the super mid, straight for the heavy. They're going straight towards buying or even chartering the latest and greatest. So we're seeing this big sort of skipping of steps that we are accustomed to in our industry. The other thing that I'll say about our industry is, you know, if there's almost 8,000,000,000 people in the world, if point 0001% of them are flying private today and that doubles, which I think it's going to more than double, to point zero zero zero two, that has like a huge cataclysmic effect on our industry. Why? What do you mean? So our industry is just not really built for the manufacturers, the OEMs, the supply chain, engines, parts, the speed at which these factories are able to build airplanes, the speed at which you can train pilots. [00:05:25] S1: Are we gonna have a shortage
00:05:25 · Molly O'Shea, Israel Slodowitz
[00:05:25] S1: Are we gonna have a shortage [00:05:26] S0: of There's gonna be a huge shortage. I mean, these are obviously depreciating assets. These airplanes you know, airplanes are equipment. They don't go up in value normally, but we're seeing them go up in value for the first time almost ever, especially in the higher end of the market. So that small little change in wealth, which I think is actually huge, is something this industry is not at all ready for. And and and I think we're gonna there's gonna be a lot of adjustment and price fluctuation and uncertainty until until, like, the the new the new wave sort of takes effect. [00:05:59] S1: I guess to give more of, like, the one zero one behind all the sizes and pricings and that kind of thing, could you walk through you mentioned it before, but, like, can you walk through all the sizes and then up to, like, okay. What does, like, a Jeff Bezos have? What does Elon Musk have? Drake has a very weird plane, but that's just him, and that was a deal. But I'm curious, could you, like, walk through all the different planes and, like, when you should start at which one? And then, obviously, we can talk about the different kinds of financing options for those. But I guess first, let's start with the sizes and the prices on them.
00:06:33 · Israel Slodowitz, Molly O'Shea
[00:06:33] S0: Yeah, so typically, the entry level what was the entry level would be something like maybe a light check. So like a Phenom 100 or a Phenom 300, it seats about six. You can fly about an hour, two hour flight. Step above that, you go into the midsize category, Citation XLS or Latitude are like the popular ones. Step above that, we go into the super mid category. This is like, as I call it, the proper jet, which is what we're in today. Super mid category, you have like the Challenger three fifty like we're in today, and then there's the Praetor 600, also phenomenal airplane. Above that, we go into the heavy jet category. So think of like a Gulfstream g four fifty. People are flying these heavy jets quite frequently even on short missions. So we're seeing people who have large families that wanna travel that they're like, don't even want the light or super mid. Like, they're going straight for the heavy even on a two or three hour flight. And then, of course, if you wanna go to Europe, you would need something called an ultra long range. Something like a Global 8,000 is like the top of the line. So when you think about like the Jeff Bezos of the world and the Larry Page and Sergey Brin, they're typically G700 Global 8,000 category. That's like the top of the line. [00:08:08] S1: And you fly too? I'm a pilot as well.
00:08:08 · Molly O'Shea, Israel Slodowitz
[00:08:08] S1: And you fly too? I'm a pilot as well. [00:08:10] S0: I'm a certified pilot. I only mostly fly for fun now. Have a full company to manage and keeps me quite busy, but I am certified in this airplane actually. You're flying today? I'm not going to be flying today. Yeah, yeah, we have two great pilots on board, but I'll be flying from back here. [00:08:25] S1: So walking through all of those different options, when does it make sense to buy a plane versus charter? So the traditional logic is somewhere between one hundred and fifty hours a year to two fifty hours a