# Building a Company in Stealth | Travis Kalanick with a16z

Markdown copy of https://realalpha.app/v/z6gH_v0buUc/ on Real Alpha, the best minutes from long interviews with the people building AI. Cite and link the page, not this copy.

Travis Kalanick argues that industrial AI can digitize the physical world by joining software, manufacturing, real estate and transport.

- Show: a16z Podcast
- Hosts: [Erik Torenberg](https://realalpha.app/people/erik-torenberg/)
- Guest: [Travis Kalanick](https://realalpha.app/builders/travis-kalanick/) · CEO, Atoms
- Guest: [Ben Horowitz](https://realalpha.app/people/ben-horowitz/) · Co-founder & General Partner, Andreessen Horowitz
- Published: Jul 22, 2026
- Length: 1 h 32 m

## The best minutes

- [27:33](https://realalpha.app/v/z6gH_v0buUc/?t=1653) [Food delivery can approach grocery-store economics](https://realalpha.app/s/food-delivery-can-approach-grocery-store-economics/) (5 min)

## Also worth watching

- [32:00](https://realalpha.app/v/z6gH_v0buUc/?t=1920) [Stealth eventually makes a company harder for media to cover](https://realalpha.app/s/stealth-eventually-makes-a-company-harder-for-media-to-cover/) (3 min)

Skip the opening reunion banter, the extended atoms-computing framework, and the second-industrial-revolution history.

## Summary

Travis Kalanick founded Uber and later acquired the delivery-only kitchen business that became Cloud Kitchens. He says he spent nearly eight years building quietly before bringing Atoms into public view, and describes it as a company applying automation to physical industries. Ben Horowitz is a venture investor who recalls a16z's near-investment in Uber's 2011 Series B and discusses founder-led company building.

Kalanick says Atoms applies software and automation to physical industries, treating manufacturing, real estate and transport as computing infrastructure. He traces the idea from Uber and Cloud Kitchens into food robotics, autonomy and mining, and says stealth let his team build without pressure from the press. Horowitz and Kalanick revisit a16z's missed Uber Series B and argue that founder judgment and management capacity shape what a company can expand into. They also discuss resistance to industrial change and the senior leaders Kalanick wants to hire.

### Minute by minute

- [27:02](https://realalpha.app/v/z6gH_v0buUc/?t=1622) **Automation could lower meal costs.** Kalanick says the aim is to make high-quality meal preparation and delivery approach the cost of grocery shopping. His model combines real estate, food manufacturing, logistics, food robots and autonomous couriers. He says Cloud Kitchens has hundreds of facilities in 30 countries and expects robotic couriers to reduce delivery costs from $12 per meal drop.
- [31:47](https://realalpha.app/v/z6gH_v0buUc/?t=1907) **Stealth buffered Atoms from publicity.** Kalanick says he kept the company quiet for nearly eight years because, after Uber, he wanted the team to build without the daily negative press he described. Stealth made recruiting and customer acquisition harder, but he says the long gap in the company’s public story eventually made it difficult for media to cover.
- [34:45](https://realalpha.app/v/z6gH_v0buUc/?t=2085) **Atoms treats physical systems as computers.** Kalanick says the idea of digitizing the physical world began at Uber. He maps computing functions onto physical systems: manufacturing manipulates atoms, real estate stores them, and transport moves them. He compares a 30-kitchen facility to a 30-core processor and says software-routing concepts can also manage physical operations.
- [1:27:54](https://realalpha.app/v/z6gH_v0buUc/?t=5274) **Atoms needs experienced operators.** Kalanick says Atoms has expanded the number of industries it is pursuing by three and sees each as a multi-trillion-dollar opportunity. He is looking for a mining CEO, technical leaders in autonomy and robotics, a general counsel and a corporate-development leader. He argues that talent is central to execution.

## Transcript

a16z Podcast, hosted by Erik Torenberg, with Travis Kalanick and Ben Horowitz.

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

[0:44](https://realalpha.app/v/z6gH_v0buUc/?t=44) We know what Uber's 2017 was like. Travis Kalanick has stepped down from his role as chief executive. That wouldn't have gone that way if Ben or Mark was on the board. You're in this hell, you're dealing with the lawsuits. Are you worried about the lawsuit? And you say, hey, let's build again. It's not as much about where you start, it's about why you start. He's one of the very rare guys who made as much money as he did and wanted to keep money. Also remember, I did it stealth. I know some of the techniques I used. Very aggressive. But that name, you can't use that name. And I remember David Drummond from Google was on our board.

[1:22](https://realalpha.app/v/z6gH_v0buUc/?t=82) And he's like, you know, Travis, that's not a thing, dude. You've got to change it. The meaningful thing about Adam's Food is, can you make the preparation and delivery of a quality meal so efficient that it approaches the cost of going to the grocery store? If it does, you do to the kitchen what Uber did to the car. A lot of people just had that idea. To build a company, a great company, it's always a great entrepreneur. Today I'm joined by Travis Kalanick and Ben Horowitz for a conversation years in the making. We look back at the investment that almost happened, the lessons Travis took from building Uber, and why he believes the next great technology revolution won't be in software, but in the physical world.

[2:06](https://realalpha.app/v/z6gH_v0buUc/?t=126) We discuss the origins of atoms, why Travis spent years building in stealth, the rise of industrial AI, robotics, autonomy, and what it takes to build companies that transform entire industries. Travis, this is the I'm Back podcast. This is the Return of the King episode. Return of the Mac. I'm all about, we can return. I don't know what the right thing is, but we got to come up with a walk-on song for sure. Return of the Mac, return of the Mac. And it's not just the return of Travis, but it's also a return of this partnership or what could have been this relationship with Travis and Ben. So I want to read a quote, Travis, from your launch post.

[2:46](https://realalpha.app/v/z6gH_v0buUc/?t=166) I've known Mark and Ben for a long time and we got oh so close to partnering up at Uber in 2011. I, Travis, blame Mark, Ben blamed himself, but let's just say it was all on us, it was on all of us. And in 2017, Uber suffered the consequences of not having Mark on the board. If you know, you know. Travis, tell the story. Okay, so this will be interesting because I think Ben and I have maybe discussed this once or twice. Yeah, it's very painful. And I think that there could— Mostly for me. I'm not sure if there's a difference of opinion on what happened, but I'll tell you what I thought happened.

[3:16](https://realalpha.app/v/z6gH_v0buUc/?t=196) So I'm in fundraising mode. This is our Series B. This is 2011. Uber started 2010, June 2010. I'm raising our Series B. Earlier that year, I did Series A with VCL Remain Nameless. and i'm hardcore it's usually i went through such tough times as an entrepreneur pre-uber that once i'm in uber and things are working i'm still acting like i'm not going to eat tomorrow so i would do everything right up to the line be perfect and so i have this whole fundraising process that i would do just to perfection and that means i'd run an auction so met with a16z guys met with lots of folks and it was a what i would call winner takes all auction meaning there's one major lead they're going to set the price and then everybody else will fall in so i'd go to the one guy i'd tell him what the story was and they're like oh we're interested he's leaning forward they're like so how much you raising what's the price And I would do this thing where I would say, this is going to be one of the hottest deals in Silicon Valley this year.

[4:32](https://realalpha.app/v/z6gH_v0buUc/?t=272) We don't know where the price is going to be, where it's going to go to, but it's at least blank. And I call this the uncapped anchor, meaning I'm never in a place where I'm negotiating with somebody, where I'm here. And they're here, and we meet in the middle. I'm always saying it's at least this, and it can go up. But I start low so that everybody's pumped, leaning forward. He's like, okay, you can see body language. You can read. It's good. The next guy literally comes to your office an hour later. Same thing happens. He's fired up. I'm showing all the analytics. It's great. Okay, so we're interested. What are you thinking about price, whatever?

[5:13](https://realalpha.app/v/z6gH_v0buUc/?t=313) I'm like, if the last one was at least 2x our previous round, it just became 3x. I'll say, we don't know. One of the best deals in Silicon, it's going to be one of the top deals in Silicon Valley this year, but it will be at least 3x our last round. And he's like, okay. You then go call the guy before and you're like, hey, just, hey, look, dude, this went from 2x to 3x, you know, we'll see where it goes. I don't know. They start getting nervous. Anyways, you get all the way to the top and then you go going once, going twice. and it's kind of funny in this particular case Yuri was almost coming over the top so we got to 375 375 million pre with A16Z Yuri almost came in at 400 but he was like no I can't do it and so I'm like okay going once going twice sold and it's funny because that's a high momentum deal and that's how you do it and at the time you almost should feel a little shy about doing something like that and it's a little bit crass, let's just say, but that's how I was wired back in the day.

[6:15](https://realalpha.app/v/z6gH_v0buUc/?t=375) Like just go all the freaking way, all the way. Score the touchdown even when you're going to, you know, it's a little much. So we're starting to work. You're going to get a term sheet going, the whole thing. And I get an email from Mark and it was like, hey Travis, let's go to dinner. And he was like tomorrow night or something like that. Let's go to dinner. And I said, send me the term sheet and then yeah, we can go to dinner. And he responded, he said, let's go to dinner. and i'm like oh i didn't like that so came down south this neck of the woods because i was in san francisco and this little sushi place i don't remember the name of it and he said look i know we talked about 375 but went to the partnership they don't agree or they just didn't think it was the right number the best we're going to be able to do is 210 see that so that i'm just telling you how it went down for me yeah wow well and so then i'm like it was definitely different on the other side so but i want it'd be interesting to hear it i've got more than the hour we have scheduled here if we want to take time but anyways i had a high momentum deal it went all the way to top i auctioned it cleared the market and the bottom came out from it and so i had to go back

[7:31](https://realalpha.app/v/z6gH_v0buUc/?t=451) to everybody else and say 210 is the new number like hey guys the guy who won backed out I'm now back at 210 we're starting the auction over it was super awkward and weird because people use lose credibility in that moment and I built it back up and basically it ended up being Menlo Park this is how Shervin got involved in Uber and at some point I told Shervin to stop negotiating against himself because he just kept driving it up without anybody else. I'm like, dude, you won, dude. It's fine. I didn't want the same thing to happen again. You know what I'm saying? So I'm very clear about the 375 and the 210 and the experience I had, but there may be another side of that story. Yeah. Well, okay. Let me just tell you what I actually remember and then what I kind of remember. So I remember you came in for the pitch and I think it was just you, which is, by the way, unusual.

[8:29](https://realalpha.app/v/z6gH_v0buUc/?t=509) So normally, people, particularly in those days, very rare that an entrepreneur would come in with no team members on a deal that size. That was a big deal, by the way. That was a high price deal. Now it's like a fucking $1.75. Yeah, you'd be like, dude, it's a pre-steer. Pre-seed. Pre-pre. Right? Yeah, the pitch was super impressive. And then the other thing I recall pretty closely was Travis had definitely read some of my blogs. I felt like, oh, we can win this. This is a deal. And we had the discussion, and it was clear, like, no, we want to do the deal. And at the time, I was like, I should really do this one, but I wasn't the consumer guy.

[9:11](https://realalpha.app/v/z6gH_v0buUc/?t=551) And then I had a lot of board seats and a lot going on. I think it was like 16 board seats. It was something crazy. It was just this. I was like, ah. And so I gave it to Mark and John O'Farrell to do. And then all I remember, so I remember something different at this point. But I got it all from them, so I wasn't there. There was something about the employee option pool or some shit. It was one of these things where it's like, okay, okay. But, like, I just assumed we were doing the deal. And then the next thing I knew, Shervin had the deal. And I was like, geez. And I regret it. I can't tell you how long.

[9:50](https://realalpha.app/v/z6gH_v0buUc/?t=590) So that was the beginning of my torture on this thing. So I was like, fuck, I know we should do that deal. We lost the deal. And then meanwhile, Scott Weisson did a deal for the other company in the space, Lyft. And by the way, that kind of got off to a very, very difficult start, largely because of Uber. And, you know, in order to Dave and Catch, I ended up having to go on the board. Like, I took over that board seat to kind of help them through that. And just so you understand my experience on the Lyft thing, it happened, I believe, a year later, almost to the day, something like this. And the deal on Lyft was $2.10.

[10:29](https://realalpha.app/v/z6gH_v0buUc/?t=629) Was it really? I know. I'm just saying this is what the entrepreneur is going to remember. You know what I'm saying? Holy cow. But anyways, because if a company is in a lot of trouble, that's generally when I get called, given my history with that. Oh, man, I was working so hard on that. And so. I was working hard on that trouble. Oh, my God. It was a lot of trouble. It was a lot of trouble. But anyway, so I'm living with that. And then, by the way, and then I would see Travis, you know, now and again. Like, I had him over to my house, see a barbecue, like all kinds of shit, right? Like, just because, like, I knew who he was.

[11:02](https://realalpha.app/v/z6gH_v0buUc/?t=662) Yeah, we were kind of friends. Yeah, yeah, yeah. And it was always, like, a lot of, like, there was a respect there because we knew who each other were. um but like he was winning and it was just like he wasn't gonna let me fucking not hear it and it was just horrible you know i had to listen i was like god damn it there's all the time like for for a decade there was also this other thing would happen so this is like 2000 i think this really started 2014 15 etc is emile and i would meet up with mark and ben at this super undercover restaurant. Ah, yes, yes. Right next to our office, which was in the same building at the time as Twitter, or sorry, same building as Square, right?

[11:51](https://realalpha.app/v/z6gH_v0buUc/?t=711) By the way, Emil, also like a remarkably amazing motherfucker and currently the CTO of the Department of War, but super talented. Yeah, 100%. The best. Yeah. We would do these sessions. We'd just, we'd have dinner, break some bread talk shop and we're like yeah and me and I always walk out going damn it would be so great to have these guys involved of course it didn't because they were at Lyft yeah and sometimes even we might even talk about hey is there a thing that comes together but like I was just so the way I was there's no way to cross a deal with him other than if he gave him the company yeah and he could just fire everybody and something so as you know but it was like that is it was it was there was mute there was mutual respect with this really kind of cool tension at the same time that made it, that kind of just was the extra texture on the Uber experience, at least for me.

[12:57](https://realalpha.app/v/z6gH_v0buUc/?t=777) Yeah, it was kind of like, it felt like, well, you're a basketball guy. It felt like the old Larry Bird, like, fucking Magic Johnson. We're like, okay, we'll meet each other. We hate you, but like, ugh. I wish you were on our team. It sucks. That was good. So it's the one that got away. But fast forward, and now there's a new chance. Well, what I would say is there's one middle piece to this. Sure. Which is those who are obviously in the tech industry, like we know what Uber's 2017 was like. Yeah. That wouldn't have gone that way if Ben or Mark was on the board. Nope. So when Ben and I talk about this, we're like, it was our fault.

[13:48](https://realalpha.app/v/z6gH_v0buUc/?t=828) Yeah. We screwed it up. Yeah. Yeah. I mean, it would have been. By the way, Uber would be, I'll just say, considerably larger and more important and more central company today. There's no question. I mean, first of all, it would have won food. No question. Uber was dominating food. Yeah. Dominating food at the time. And it would have also been for sure a leader in autonomous. DoorDash was 5% market share when I left. Yeah. And if we lost a tenth of a percent in a week, we're not going home this weekend. And by the way, Tony, God bless him, had a hell of a time getting his round done at the time.

[14:39](https://realalpha.app/v/z6gH_v0buUc/?t=879) Like right at that period, he was doing a round at DoorDash. And he had to really struggle to get it done. And, you know, congratulations to him for building, you know, what he built. And he's done it. Yeah. You got it. You got it. You know what? It's really easy to do the what ifs and the this and the that. The thing that matters most is tail of the tape. Yeah. And he got some stuff done. He did. He did. He did. You know, respect. No, amazing. He survived it. Which is, by the way, you know, in entrepreneurship, surviving is a big part of it. Yeah. Yeah. It's not that easy. Our timing program was like second to Waymo, but catching up at the time.

[15:18](https://realalpha.app/v/z6gH_v0buUc/?t=918) And you had the network. We had the network too. We had the ferocity, sort of the fierceness that it takes to catch up. Yeah. In a certain technology space while building all these other things that we were doing. I mean, it was a lot. It was good times. It was a lot of fun. Yeah. Yeah. Yeah. I mean, even though 17 was super tough for me, and maybe you could say even for the company at large, certainly for the company at large, you know, I loved every minute. And honestly, even when you come out of it and you're like, yeah, got a little weird at the end. It was tough. I still, I still, I still, it was still great. It was fun.

[16:02](https://realalpha.app/v/z6gH_v0buUc/?t=962) Some of that you love in retrospect. Yeah, no, I get you. Trust me. Trust me. You don't have to remind me of that. I'm just saying like. There's that feeling that's so fucking horrible at the time, you know. Yeah, there was a love affair there. And that's almost the way I would put it. And a lot of people talk about, well, you know, are you mad about this or that? You're upset that that happened. And I'm like, when you fall in love again, you don't think about the ex very much. Yeah. That's it. So then you can just be like, it was a good time. Yeah. She got a little crazy at the end. That's true.

[16:39](https://realalpha.app/v/z6gH_v0buUc/?t=999) That's true. Like, yeah, the crazy, crazy ex. Yeah. So. there we go yeah and um how did you fall in love again or did it take you how did you handle this the interim period between sort of the well yeah i mean you had a really interesting situation i think headlines and the negative the negativity in the headlines from that period of time and And you could really say the extreme wokeness that was sort of coming in on Uber and trying to constrain it, if that makes sense. There's this interim period. It was like seven, eight months between when I left and when I started what's now called Adams. and I had to sort of fight for my life because there are just a number of lawsuits, a number of investigations, all these things where it was just like, I continue to stand by every decision I made at Uber.

[17:45](https://realalpha.app/v/z6gH_v0buUc/?t=1065) But, you know, there are a lot of times where you could just make the argument, I just got way too close to the line. And then, yeah, I could show that there's no chalk on the shoe. I could show, but you would need an electromagnetic scanning microscope to see that there was no chalk on the shoe. You reverse angle, slow-mo, and it's just like that's – the problem is the edge of being a – what's the word? A hard-scrabble, small startup kid brought to something that's working and going super big you don't realize that when you get big there actually are different rules and they're not just the rules there's the there's the vibes of the rules when the pirate becomes the navy we talk about this at the permalot when you're the upstart and you're battling the man you can go hard in ways that if you do it when you're the big the big dog it's not okay yeah very that you're viewed entirely differently.

[18:50](https://realalpha.app/v/z6gH_v0buUc/?t=1130) Yeah, and I hadn't consumed that information. It actually helped me because, you know, when we started the firm, we were the upstart. And I talked just fucking crazy shit about the other VCs and this and that and, you know, call them bitches. But, like, at some point, like, I could feel it turning. And I remembered what happened to him. And I was like, and we actually had a whole thing. Like, we're not the pirates anymore. Don't say that type of stuff. Like, be chill. Yeah, we had this thing where we would, against Lyft, we would recruit the drivers on Lyft to bring them over to Uber so that it was hard for Lyft to build supply.

[19:37](https://realalpha.app/v/z6gH_v0buUc/?t=1177) And we would aggressively do it, and we had a program for it internally, which we called shoplifting. Just that name, by the way? Like, forget about all the, I know some of the techniques I used, very aggressive, but that name, you can't use that name. It's just not a thing. And I remember, you know, David Drummond from Google was on our board and he's like, you know, Travis, that's not a thing, dude. You've got to change it. And then I had, of course, like antitrust training, which like at the time, again, I'm like this small startup kid. I'm like, antitrust, what the hell is that? legal people telling me whatever they're like look i'm like i can't wait to have that problem you know and uh they're like they're like look here's the thing the way you call projects it has to be appropriate for like a a 10 year old basketball team so it went from shoplift to the national they're sorry the north american championship series we call it the nacs Yes.

[20:43](https://realalpha.app/v/z6gH_v0buUc/?t=1243) . And we had a whole very heavy-duty initiative called the NACS to, like, make sure that the North American Championship Series was won by us. That is hilarious. I didn't know about the North American Championship Series. Yeah. Okay, so you go through this eight-month period. You're in this hell. You're dealing with the lawsuits. You're sort of reflecting back. You're thinking about what's next. And you say, hey, let's build again. so what happened was it's super interesting um so i had a buddy who started a thing right near the end of my uber tenure um and it was called cloud kitchens and what happened was is he he's a real estate savant yeah that's just the thing and he was looking like real estate like there's got to be an angle in tech and real estate how do we do this and he got a property up actually maybe you know what let me start even before this we got uber we got uber eats up in 2015 we saw the first dark kitchens i don't know it was like late 15 early 16 we saw pictures of commercial kitchens in melbourne that were not restaurants that were on uber eats so the first dark kitchens were emerging we're like this is crazy that's so interesting and uh a buddy of mine who is this real estate savant sort of like caught wind of like what's

[22:15](https://realalpha.app/v/z6gH_v0buUc/?t=1335) going on and he had this idea which was why don't we have a multi-tenant approach to this so 30 kitchens on a single property and uh basically lease these kitchens which are 200 square feet as delivery only locations anyways he i didn't really i mean i sort of knew what was going on but not really and then in the fall like like three months after i had left uber we meet up and he's telling me about it's like yeah you know we got a few tenants it's kind of working he's like i'm gonna do like a few more of these i think i think i'm gonna try to figure out how to do a few more i'm like you mean like a few thousand right and so then we partnered up um I acquired it.

[23:03](https://realalpha.app/v/z6gH_v0buUc/?t=1383) I think they'd just done their Series A. And so I acquired it, and then we just went to town, right? And so it's really interesting because sometimes you start a thing, and sometimes you're involved in a thing, and then you come in. I think this is an interesting story about Elon was obviously involved in Tesla from the beginning was an investor at first but then went all the way in um and it's interesting how these ideas come so i like to say that sometimes i you have ideas sometimes ideas come to you yeah but if it's an idea that's meant to be if it's your it's meant to be your soulmate you know it when you see it right and it's and you just yeah and sometimes you just it's like a love affair, you just go for it.

[24:00](https://realalpha.app/v/z6gH_v0buUc/?t=1440) Some people have these long lists. That's a very important distinction because there's a real difference between that and like what's known as the professional CEO, right? Where nobody would ever consider, nobody smart other than like a few weird political people would ever consider Elon a professional CEO. It's like, oh, that's an idea. That's... I didn't start the company, but it's mine. That's mine. Like, it is me, and I know how to do it. And these guys did a great job in starting it, but there's no way they can do it. And that's a different, a very different animal. Yeah. So, you know, you fall in love with something, and it's...

[24:44](https://realalpha.app/v/z6gH_v0buUc/?t=1484) It's meant to be for you at that time, and you just go for it. And for me, it was like, man, complexity is interesting to me. Things that are naturally not, they're not sexy on the surface is also weirdly interesting. um and then how like especially if you can see that it's sexy but people don't understand yet that's where the the sparkle in your eye you kind of go you don't see what i see and i'm pretty sure i'm right and that's the fun part yeah but this was a very complex thing because we're buying property we're doing construction we are uh then have a sales team that's selling to restaurants a delivery-only location, so they're expanding the restaurant chain.

[25:44](https://realalpha.app/v/z6gH_v0buUc/?t=1544) This isn't like I'm just getting into a vendor flow. I'm actually, we're making a strategic sell, which is you should expand. You should expand your business and you should expand it in a new way, which is two strategic moves at the same time. Yeah. And. By the way, you like complexity. Yeah, yeah. Yeah. Which makes it. Exactly, yeah. Yeah, so then you're like, you're also, okay, so we've woven technology through this whole real estate thing. We have a software stack that, of course, will work in this facility, but will also sell it to all your brick and mortars everywhere. And shit, let's just get some robotics going at the same time because, like, labor is your biggest problem if you're a restaurateur.

[26:33](https://realalpha.app/v/z6gH_v0buUc/?t=1593) If you solve that, it's really big. I can get into the strategy of why that is the whole thing, but just the brass tacks of the complexity of the project was interesting to me. So it was more kind of emergent or iterative than, hey, I've got this master vision for what it's all going to turn into? No, I think at that time, if I don't see how it's big and meaningful, then the complexity for like complexity's sake is not a thing. There has to be, you know, maybe somebody would say a pot of gold at the end of the rainbow. It has to be something meaningful. The meaningful thing about Adam's food or what folks know as cloud kitchens is can you make the preparation and delivery of a meal, a quality meal, so efficient that it approaches the cost of going to the grocery store.

[27:35](https://realalpha.app/v/z6gH_v0buUc/?t=1655) If it does, you do to the kitchen what Uber did to the car. And you go, okay, that's kind of a big deal. But then you say, what do you need to do to get there? Okay, well, you need to do e-commerce for online food delivery, which means I need warehouses like Amazon style, except they're not just for logistics. It's not just picking, packing, sorting, and then putting in a car. You also have to have manufacturing there too. Manufacturing, also known as a restaurant. People don't think of that, but you go to the labor statistics, Bureau of Labor Statistics, restaurants are manufacturers, okay? So you have to have manufacturing and logistics infrastructure in the same place.

[28:17](https://realalpha.app/v/z6gH_v0buUc/?t=1697) That's real estate. Then you actually have to have automated production. That's the manufacturing. So robotic, food robots, essentially. Food robotics. and then you need to have robotic hurriers and you do those three things and then all of a sudden you are getting super high quality meals everything you could ever imagine we call it the internet food court and it gets to with the price of going to the grocery store so you go okay nice that's a nice story then you go well in 20 years will robotics i start with a really easy question in 20 years will people be cooking food regularly and there will be a suite of robotics that basically will make higher quality meals uh like there's just you'll be doing a better job than any of us could do and i think most people especially those in the robotics space we like of course that's obvious that that's going to happen and you're like in 20 years are we going to have i call them autonomous burritos like boxes on wheels that hold food at temperature that come to your house yes everybody will say yes absolutely we see waymos cruising around all the already we just need a very cheap much cheaper version of that so 20 years is like the easy one then you go well

[29:41](https://realalpha.app/v/z6gH_v0buUc/?t=1781) what about what about 10 what about seven what about five and so that's when you're bending you're bending reality you're you're bending it towards now so everybody would agree that this is going to happen and now it's about when and who and then you say lfg now sometimes you're a little bit early and i would say on the we were a bit early on cloud kitchens but but you build those bricks all those things i talked about we have hundreds of facilities in 30 countries many hundreds of facilities in 30 countries. Restaurants, because the online delivery market keeps growing, the restaurants are doing better and better. So, success is happening, right? Well, restaurant world has high churn. Your churn starts coming down because volume's going up. We have applications that guarantee volume into these restaurants so that we can have successful tenants, which means I'm a successful real estate guy from a business model perspective. The robotics start to work.

[30:51](https://realalpha.app/v/z6gH_v0buUc/?t=1851) You know, we're getting a manufacturing line for our robots up in Q4. So, like, the pieces start to come together. You're like, production is now 50% cheaper. Once we get the couriers, the robotic couriers, you go from $12 a drop for each meal to $0.50 a dollar of distribution cost per meal. And now you're taking, okay, $6 out in labor. you're taking, let's call it $10 or $11 out on the courier on the real estate because you're going to get higher volume because you're driving the prices down. You probably save a few bucks, let's call it two or three bucks on occupancy per meal. And all of a sudden you've got like a eight or $10 meal that's delivered to you all in. Plus you don't have to recruit drivers, you know and get shoplifted that's true so that's right you can't shoplift a rope a robotic career yeah yes so we should need to stop using this term so you're so wrong okay hundred facilities in 30 countries thousands of employees you know over eight year period and you're in stealth yeah dude yeah that's just super hard mode yeah and the thing is is like look coming out of 17 things were, it was 150 articles a day of negativity. And so I wanted to be able to build without bringing that negativity into the system. And I wanted the team to be able to build without

[32:35](https://realalpha.app/v/z6gH_v0buUc/?t=1955) worrying about what the New York Times was writing tomorrow. Simple as that. And it was the right thing to do. Now we had to do hard mode is we had to recruit Colt. And it was always from a recruiter who has a stealth thing in LinkedIn and on their signature yeah okay um and you had to go get customers with like stealth in LinkedIn like and you're thousands of people big this is hard mode yeah and it was interesting we didn't know how long it was going to go and you have to trust that no one's going to leak um you know what happens is here's the cool part about stealth if you go that long and I I don't recommend this for anybody like it's not very special yeah you don't really i don't you know but eventually there's this break in your narrative like there was a story arc and it was going going going and then it's discontinuous it stops and there's this whoops sorry about that guys there's this long period of time now where nothing is filling in and what happens then is the media doesn't want to cover a story

[33:50](https://realalpha.app/v/z6gH_v0buUc/?t=2030) **Travis Kalanick:** because it's so hard to discuss a thing that has a gap a few years before it.

[33:57](https://realalpha.app/v/z6gH_v0buUc/?t=2037) So it's too hard to do the story and it's too hard to cover it. So you get to this place where it becomes self-fulfilling, where it's easier to be stealth over time because even if somebody tries to leak, nobody even knows what to do with it. they're just like i don't even understand and by the way we did crazy stuff so people know it as cloud kitchens in the u.s but it's casino sequeltas in latin america and we have different names that means like magical kitchens essentially uh we have like kitchen valley in korea we have flash kitchen and three other names in china we have i mean food stars in london like go it goes you know you know i think it's uh kitchen park in middle east we were going to go with yalla kitchens like you know it's like a bunch of things like this so it was very hard to connect the dots yeah you're extra still yeah anyways and so at some point an even bigger vision for this company emerges to digitize the physical world we're category creating that you're creating a category the term industrial ai yeah talk about when this bigger vision starts to culminate so look the the vision for digitizing the physical world for me started at uber okay and treating atoms like bits

[35:05](https://realalpha.app/v/z6gH_v0buUc/?t=2105) started at uber you were it was sci-fi at one point i promise you would touch glass and a car would come to you yeah and you had satellite view you're watching this car come to you that was crazy now it's just like whatever okay but it was crazy at the time everybody's first uber experience This was a magical moment. So we, you know, digitizing the physical world was the thing. And this idea of what I would call an atoms-based computer was something I sort of was working on in terms of her framework at the end of Uber, which is CPU manipulates bits, storage stores bits, network moves bits from point A to point B.

[35:47](https://realalpha.app/v/z6gH_v0buUc/?t=2147) Okay, well, CPU manipulates bits, what manipulates atoms? That's manufacturing. Storage stores bits what stores atoms. That's real estate. Network moves bits from point A to point B what moves atoms. Well, that's transport logistics. And those now are your three core computing resources in an atoms-based computer. And you know what? Everything you learn in your computer science curriculum, everything you learn in engineering, it plays in the atoms world. Same frameworks. All the data structures. All the algorithms. It works exactly the same. routing algorithms oh totally totally in fact we use we use tcp expert we use tcp sawtooth to basically manage how much demand to send to certain kitchens based on capacity and and reliability, as an example.

[36:41](https://realalpha.app/v/z6gH_v0buUc/?t=2201) But like we look at when I go and I'm messing around, like when I'm pitching this to a tech person who wants to understand, that 10,000 square foot facility, I call a 10,000 square foot semiconductor. And it's a 30 core processor, 30 kitchens. They're computing atoms, not bits. The corridors where the food moves, that's a network bus. The processing center is like an L1 cache or something similar. He's taking this analogy very far. The cold storage where you have ice cream and juice, okay? That's pre-computed items that sit on the edge. Those are your Akamai servers. The courier who comes and picks up the food and goes on the road and brings the meal to you, that's a TCP packet.

[37:23](https://realalpha.app/v/z6gH_v0buUc/?t=2243) This shit goes forever. That's excellent. Okay, so the vision started at Uber. So the point is that atoms-based computation is a thing. And honestly, it's always been a thing. And the idea that, oh, okay, Uber was network for the physical world, digitized transportation, and by the way, almost done. Why almost done? Because it's almost fully software, right? Waymos are cruising. It's almost fully software. But what about CPU for the physical world and storage for the physical world? basically digitized manufacturing and digitized real estate. There's just so much to do there. It's crazy. And so there's a huge amount of innovation there, not just with what Adams is doing, but like there's going to be lots of stuff even beyond what we're doing.

[38:21](https://realalpha.app/v/z6gH_v0buUc/?t=2301) It's a portfolio strategy, really, if you're investing. It's very interesting because you kind of got to the conclusion that we've now all learned from AI, which is you can model just about anything with computation. And you basically were ahead of that in modeling this physical world, even metaphorically in computation, and now kind of manifesting that. It's, you know, probably entirely with AI on top of your computation model. It's funny because the framework started near the end of my Uber time, really when we were getting deep, we were going into deep learning and heavy-duty ML. And I was, you know, we would go after some of the best AI.

[39:02](https://realalpha.app/v/z6gH_v0buUc/?t=2342) we had an AI lab that was probably one of the best in the world as well and I was always pitching that the physical world is more interesting for this stuff than the digital one and you know look I'm selling my book like that's what we do right but it's you have a way many more variables axes of stochastic distribution which then means you're not going to solve it with an algorithm you're going to solve it by empirically understanding how it works yeah right so let's fast forward to how the bigger vision for Adams comes together in terms of the combination of the companies I keep stopping you and I want to get to the partnership because it also yeah it's all good so okay okay, you've got to have your manufacturing logistics hub.

[40:04](https://realalpha.app/v/z6gH_v0buUc/?t=2404) That's the real estate. You've got to have your automated production and you've got to have your autonomous burritos. The minute about a year ago, I started looking into autonomous burritos and I went to China and checked out all of the autonomy guys. I was here in the US talking to a lot of the autonomy guys. Word got out. They're like, Travis is looking at autonomy again. People started going. what's going on and you know folks like you know folks like uber other partners Across different categories, we're like, we're interested. Like for one reason or another, because it's like, you could even be doing, you could be like supply chain guy on food.

[40:51](https://realalpha.app/v/z6gH_v0buUc/?t=2451) You're also saying, I need to have, for business continuity and just like peace of mind, I need to have another alternative for how these freight, how these trucks, heavy transport, are gonna move. and I need an alternative and I'd love to have a partner as an example, this kind of stuff. And so, okay. So partnered with a couple of folks, actually created a new company to do it because funding autonomy through a sort of core food company, it just wasn't going to work at first. And the reason why is because it's like, these are just different profiles. It's a real estate company. This is like heavy duty software, We're big, big money going after it.

[41:38](https://realalpha.app/v/z6gH_v0buUc/?t=2498) It's like a computer company trying to build a network company off of the side. You got to buy a networking company. So we just got – and these partners wanted a pure play. And so we created that sort of near the end of last year. But what happened is it's like you got to get – okay, well, now I need to get my team together. I need to get my guys from way back when, 2016, when we were – 2017, team where we're running hardcore at autonomy, we need to get that going. Because if you're going to be in the specialized robotics game, you have to have autonomy for yourself. You have to. Your robots are moving and acting in the physical world, and you cannot depend on only one company that has an existence proof now. Of course, Tesla's going to get there sometime soon or maybe some amount of time. We don't know exactly.

[42:33](https://realalpha.app/v/z6gH_v0buUc/?t=2553) um you gotta you you can't be dependent in that way and so okay get your team together uh eric meihofer who ran atg is already running my food robotics division um that's uber's advanced technology group uh is is working for us uh and then uh anthony levandowski who is one of my top leads uh on autonomy in back at uber was running uh pronto which was an autonomous mining company, let's call it off-road autonomy, but in a workflow or category where it's like much more than just like this thing needs to move. It's like, how does it move? What is the context for which it's moving? It's like a very specialized thing.

[43:17](https://realalpha.app/v/z6gH_v0buUc/?t=2597) I was the biggest investor in Pronto. I'm like, let's go. So acquired Pronto and now I'm in the mining business. But it's not like I didn't know about it. I was the biggest investor in it to begin with for a good reason. It's one of the most beautiful and interesting autonomy categories or use cases. And on our mining business, our mission statement is more productive mines to power Earth's industries. We can go to a gold mine CEO right now and say, would you like to get 20% more gold per year? We don't get no. Right? Now, he says, prove it, and we're like, let's go. But that's what's happened.

[44:03](https://realalpha.app/v/z6gH_v0buUc/?t=2643) So, separately, Pronto is working on mining for eight years on their own, seven, eight years on their own. Go ahead. Also a great target for autonomy because, you know, maybe the worst job for humans there is, is the mining jobs. And we have, so our mining customers, because we're operating in a bunch of mines around the world, our mining customers have existential safety problems. Or let's call it safety issues, safety concerns. Like where bad things can happen on any. given day. And you've got real people that are putting their lives on the line when they're at these mines. And so when you automate certain parts of mining, you dramatically improve safety. And you, I mean, in a real way. That's like, when you look at the work that's being done and how it's being done, it's a little bit heart-wrenching when you are exposed to it and you see how mines work.

[45:08](https://realalpha.app/v/z6gH_v0buUc/?t=2708) It's not the mine's fault. It's just the nature of the work. And there's a massive safety upside that goes along with the productivity upside, which is really special. So what happened is that Pronto just now is coming past human productivity. So it's like any enterprise software company. You do some cool pilots with big companies. You got stuff, and you're like, Dude, I've got like eight seats at this 10,000-person company. And you're like, okay, maybe. And then all of a sudden, it's better. And in the autonomy world, it's about it's better than human productivity. That means your mines and the quarries.

[45:52](https://realalpha.app/v/z6gH_v0buUc/?t=2752) And it's like, exactly. Go time. That's when you hit the gas. So we're going to see super exponential. We're seeing it. We're in the middle of it right now. super exponential growth on the mining side, which is super special. These guys ran a very lean startup for a long time. And now I'm going to their customers who are begging us to move faster and get more out there. We have to manufacture kits. Sorry, we have to do supply chain and manufacture kits. We have to install these kits on these machines that are in the middle of the Amazon or on the border of Saudi and Iraq or like in these crazy wild places and do it fast.

[46:32](https://realalpha.app/v/z6gH_v0buUc/?t=2792) And then do the change management in every one of these minds. So they're like, it's time to go, let's go. And they're pushing us. And so our, you know, how we talk to them is like, look, we were a lean startup and we're going to muscular. Yeah. And that's how I talked to the team too, because you don't want it to get fat. Yeah. It's like lean muscle, you know? Yes, yes. But we need some protein shakes, you know, and creatine and things like that and it's about process professionalizing a lot of this stuff but it's in some ways the growth there is almost deterministic as long as you do the professional things to like get all that stuff in mind but what it means is that existing minds are going to be producing more and they're going to be able to go much further and getting more and new minds are going to emerge that couldn't, that were not viable before.

[47:26](https://realalpha.app/v/z6gH_v0buUc/?t=2846) And what that means for AI, what that means for progress here and everywhere, super big deal. Yeah. Yeah. And so to continue, we'll get to the partnership conversation. At what point does this become sort of a, are you thinking from the beginning, this is a conglomerate or at what point does this become all wrapped up in the, in the atoms? Well, so this, I mean, the fundraise was part of it. So what happened is we started the fundraise. And, you know, Ben remembers this because I gave him a preview at first in Vegas, actually. And I'm like, I was like the guy with a trench coat that's got like 20 watches.

[48:05](https://realalpha.app/v/z6gH_v0buUc/?t=2885) I'm like, which watch do you want? I got all kinds of watches. And he's like, dude, I just want the whole freaking trench coat, dude. Like, you know, the idea being, I don't want to invest in mining or transport or food. I want the things that you're doing. And let's be partners for all the things you do. And so that was the impetus for bringing the companies together. Creation of atoms. And the funding itself. Yeah, the creation of atoms and the funding. itself uh being at what we would call top co level yeah right and so now it's just one entity i mean there's sub entities there all over the place but but it's one equity structure uh which is great for the employees and great for me because managing i honestly i don't know how elon does it or did it slash does it it's pretty wild and i'm really glad i don't have that headache to be honest yeah yeah yeah it's very conflict yeah complicated alignment um but you know it it's a kind of an interesting point because it's very obvious to you know when we talked about it here the way it should work and i and i think the the narrative of how these things get built is um mistold constantly by the industry by the press which is you know if you hear about

[49:37](https://realalpha.app/v/z6gH_v0buUc/?t=2977) how did Facebook come about? How did Google come about? How did, you know, Tesla come? Oh, they had this idea. And the idea was to do this. But that's not really what happened. A lot of motherfuckers had that idea. You know, there's a lot of those ideas out there. And, like, if you look at Tesla, there was a very famous documentary called Who Killed the Electric Car that came out before Tesla. And if you were an entrepreneur watching that, What you would see is big oil, big auto, big government. We're never going to let that happen. They would kill you. But then the reality is, oh, Elon Musk, that motherfucker is hard to kill, right?

[50:17](https://realalpha.app/v/z6gH_v0buUc/?t=3017) Like so he by himself kind of decarbonized American auto industry, which is, you know, really unbelievable in retrospect. But then it gets told, right, like if you listen to the politicians now, they're like, oh, he didn't build Tesla. He just like struck a gold mine and is just pulling the gold out. Like all those people built it. But why didn't all those people build another Tesla? Like there's only one because there's only one non-fungible, very rare person in that equation who could do that. And that's why there's only one SpaceX. And that's why, you know, that's why Meta's Meta and Friendster's Friendster and all that kind of thing.

[50:59](https://realalpha.app/v/z6gH_v0buUc/?t=3059) That's a good one. I haven't heard that one for a long time. Yeah. It's good. And so to build, you know, to build a company, you know, a great company, it's always a great entrepreneur. And so when we looked at it, we're like, there's a very few entrepreneurs, you know, in the history of the Valley that built something like Uber. And that Uber, basically, it survived and is still a very valuable company without him, which almost, you know, like that never happens without the founder. I mean, it usually turns to crap very fast. And so, that was what we, like, yes, the idea is great. The ambition is amazing.

[51:40](https://realalpha.app/v/z6gH_v0buUc/?t=3100) It's going to be amazing for the world if he pulls it off. But, like, we want to invest in the guy who could pull it off. And that's kind of what drove the whole thing. And there's a fun thing. I realized this at Uber, too, is that I think – in many ways, maybe Bezos was the guy to sort of really go there, which is the only constraint to your imagination is management capacity. Because, like, look at all the things that Amazon started doing. They were earlier than everybody else starting to do lots of things, right? And so I'm like – By the way, another good one. How many motherfuckers had the idea for an online bookstore or online retail or online any of that?

[52:24](https://realalpha.app/v/z6gH_v0buUc/?t=3144) There we go. And how many Amazons? Yeah, totally. You know, and by the way, Jeff, like everybody who knows Jeff, everybody who's heard him talk, you're like, oh, he's very special. That's a special CEO right there. And look, and that's our business. to invest in that kind of very, very special individual. And they're super rare. And so, I think in many ways, Bezos may have been, I always want to say the OG on something, but then you find out a hundred years earlier, somebody else did that. But of our time, where it's like, how did AWS happen? It literally had nothing to do with a bookstore, really.

[53:06](https://realalpha.app/v/z6gH_v0buUc/?t=3186) Nothing. I mean, there's some fun stories they tell but it's like this is just a whole new thing yeah but yeah by the way it wasn't like the shit that was running amazon yeah i know totally that's my point yeah so yeah so once you get the foothold the beachhead whatever and it's working you can start going you uber rides then it's uber eats then it's uber autonomy then it was uber freight then it's like uber ai labs like you can start letting your imagination with constraints start to do really interesting things. And so, where you start matters. Yeah. You're right. And it has to be, like, you need knowledge.

[53:53](https://realalpha.app/v/z6gH_v0buUc/?t=3233) Yeah. Right. Like, the thing that Amazon did have on AWS is they had knowledge of what it meant to run these things at scale. Mm-hmm. Because they were the first to get there, or one of the first, like, five to get to that kind of scale. And so, they had that knowledge. Totally different business, totally different, but they had the knowledge about what the product should be. And because he's a customer of these things, right, at Uber, he all of a sudden, he knows what the network is. He knows how to do that. And although it's a totally different business, that knowledge is transferable if you can scale and execute and expand management.

[54:28](https://realalpha.app/v/z6gH_v0buUc/?t=3268) And sometimes you go to, sometimes those, look, adjacent categories are way easier than whole new you know, off-the-rails categories. Yes. And there's also, I mean, the amazing thing about AWS is it's one of the few expansions where, like, nobody would think, well, what I want to buy from Amazon is, like, a compute cloud. Like, nobody was thinking that at the time. Yeah, yeah, yeah. You know, like, there's always, oh, I should sell them more stuff they want to buy from me. But that's a whole other thing. But, you know, if you have that level of Jeff's skill, Which, like in terms of organizational design, cultural continuity, that guy is...

[55:12](https://realalpha.app/v/z6gH_v0buUc/?t=3312) Pete Bezos, hard to beat. Very good. Yeah. So, where you start matters. Don't let him living his best life. He gets a lot of bad PR. Well, I was wondering, Travis, you could have had a version of living your best life where you're just like, hey, this is what I do, you know, or was it like, I'm gonna keep doing it forever? Or was it like, hey, I chased the promised land. I got really far, but I could have got so much further. I'm going to get there next. What was the sort of motivation to just get right back in the? It's just I love being in the arena fighting it. And it's not, you know. By the way, he's one of the very rare, rare guys who made as much money as he did and wanted to keep playing.

[55:56](https://realalpha.app/v/z6gH_v0buUc/?t=3356) And start over basically. Not totally, but almost completely, right? Yeah. So, the, yeah, you got to really want, because also remember, I did it stealth. So, what it means, here's the thing about stealth is that. Stealth and starting at the bottom, right? Doing it by hand, right? Like I walked in, I acquired this company. I'm the executive chairman. I acquired Cloud Kitchens, partnered with a buddy of mine, Diego, right? And there were like six people in the company that I acquired, okay? So it was so funny because you got to think, the last all hands I did had 20,000 people. The next all hands I did, and it's the only company I was in, had six.

[56:40](https://realalpha.app/v/z6gH_v0buUc/?t=3400) And I stood in front, just like the same, and I'm like, let's fucking go, guys, let's do this. Charts, you know, like here, let's happen, you know, let's roll, let's do it. And these guys who, like, I just walked in, they're like, what the fuck just happened? They went to work that morning at a six-person startup, and an hour later, the founder of Uber is now the CEO. Yeah, that is wild. And by the way, like we've seen it so many times where somebody gets to the penthouse and they're like, oh, I want to do a new thing. But they don't want to go all the way down to the ground floor and start at the bottom fucking putting the building together.

[57:24](https://realalpha.app/v/z6gH_v0buUc/?t=3444) Okay, now you're in a fucking shotgun house. They want to jump all the way to the – which never works. You can't start at the top. And the bottom thing also is about there's a humility thing to it. Yeah. And there's like, there's an anti-fame thing to it. And what I mean by that is imagine, you start from the bottom, you also do it stealth. It means you plus everybody in your company gets fulfillment from the work they do every day, not because they're going to get famous, but because they enjoy the people they're working with and what they're doing day in, day out. By the way, if you can pull it off, that's a very significant cultural advantage because as soon as the company feels like it's doing something for the outside status, it's a dangerous, it's a volatile fucking situation.

[58:18](https://realalpha.app/v/z6gH_v0buUc/?t=3498) That's right. You start making decisions based on external validation versus internal correctness. Yeah, you lose true north. Yeah, and that's part of the upside of stealth and part of what I was doing. Because remember, I wanted to build without worrying about what the New York Times was saying. Yeah. So it starts with internal correctness versus external validation. Yeah. Which once the company starts doing that, it's hard to, like, you already see this with the big labs. People keep going, oh, why did the big labs, you know, smack themselves in the face? Well, it's because they need that external validation for their employees because their employees are addicted to it.

[59:01](https://realalpha.app/v/z6gH_v0buUc/?t=3541) I want to be a good guy. I want to be a good AI researcher. So, go ahead and tell them that we're going to take all the jobs. It's like, really? You want to say that? You don't even know if it's true, but you want to say that. Well, why are you doing that? Well, it's that external validation is so important to them. And it's so important not just to the people running it, but to all the people in the company. And so, they almost have to do it. Even though they, if you want it, if that's what you think, then work on, like, those problems. work on, like, oh, you don't want it to reward hack. Well, why don't you try and solve that as opposed to go running your mouth because you care about the external validation more than the actual thing.

[59:43](https://realalpha.app/v/z6gH_v0buUc/?t=3583) And that's the, it's very easy to slip into that. Like many companies slip into that. And it's hard to, once it gets out of the bag, it's very hard to put that in. There's a human nature aspect to being proud of what you do, wanting your mom to be proud of what you do and your community at large. So, there is a human nature piece, which I was malnourishing by being stealth, but it forced an emotional intelligence that's very powerful now that we're moving out of stealth. And it will be interesting to see how the coming years go. Yeah, that's going to be a very interesting cultural case study, see what the company is like over time.

[1:00:27](https://realalpha.app/v/z6gH_v0buUc/?t=3627) Yeah. yeah yeah yeah so we've talked about you know what books were to amazon you know food is to atoms in the sense of it's where you start and where you start matters so yeah why was it important that you started at food in terms of what's generalizable what's Yes. So here's the thing, right? So what Cloud Kitchens was, uh, was all about the way I saw it. And this was what I brought to the party, but it was like, this is digitized manufacturing and digitized real estate. It was called, we, I called it when I came, people know as Cloud Kitchens because that's what we'd sell restaurant customers on. But the name of the company was city storage systems. Ah, okay. Storage for the physical world. This is digitized real estate. Yeah.

[1:01:10](https://realalpha.app/v/z6gH_v0buUc/?t=3670) This is a food computer with a basis in real estate, storage, okay? That needs a network. Yeah. So, this was the name of the company from the beginning or once I came in, okay? It was purposely boring because I was going stealth. You imagine selling something called Citi storage systems? Like, people are like, what is that? They'll forget literally 20 minutes after you talk to them. They're like, Citi, CSS. They're like thinking HTML. They're like, they're confused. They don't know what's going on. So for me, the framework was already there. I already thought about this as digitized manufacturing and real estate, about an Atoms-based computer, about a food computer, and that's why I was excited.

[1:02:00](https://realalpha.app/v/z6gH_v0buUc/?t=3720) The idea captured me because of that. And so it wasn't like, why'd you start with food? It was like I saw something different than even maybe the original team that was working on it saw it, but I saw where it was going and in the way that I just described, and that's what the romance was about. And, yes, there are lots of digitized manufacturing problems out there. Yeah, like mining. Like mining, like a whole bunch of other things. um but this is just captured me at the right time you know i was sitting at the bar and somebody came up and we had a great conversation you know went to cabo the next weekend and then just put a ring on it like let's go serendipity man yeah it's a real thing so and that's okay because the thing is if you believe that you can like find something make it work just grind it out make it work will it into working your imagination can keep going so for me it wasn't it's not as much about where you start it's about making sure you're passionate about where you start and then where you go you have no idea and this is very much i go back to the bezos style which is like your imagination will just keep coming up with new cool ideas and so it's not about where you start it's about why

[1:03:30](https://realalpha.app/v/z6gH_v0buUc/?t=3810) you start and how you build a culture that allows you to keep going into new places over time and lets your imagination when it's right flourish yeah that's what it's it's not an idea it's an idea maze and the more you learn about the idea and all the things and you you don't know any like the thing that is so hard to understand coming from the outside is you know so little when you start like when he's i mean he didn't even tell me he started he he didn't know fucking 1% of the fucking problems he was going to run into with cloud kitchens. Yeah, for sure. Because you've got to really get into it.

[1:04:06](https://realalpha.app/v/z6gH_v0buUc/?t=3846) By the way, what tech guy knows anything about real estate? Yeah. 0.0. Yeah, so you, it's all, the whole thing is a learning process. And then it's the best entrepreneurs can take those learnings and then apply and multiply the applications. And that's, you know, it's just a very, very rare thing. Like, look, the fact that Elon has taken SpaceX to Starlink to data centers in space, it's just like nobody. It would start there. Or think about this. The first roadster is now optimist. Yeah. Okay? Talk about letting the imagination flourish is a beautiful thing. Yeah, understanding what the core, core principles are and applying them.

[1:05:01](https://realalpha.app/v/z6gH_v0buUc/?t=3901) So with that said, paint us a picture about the future of atoms or maybe you say some of the guiding principles that will dictate which industries you enter next or how you think about where you go from here. Yeah, look, I tell people I'm very focused right now because it's only food, mining, and transport. There's so many things I haven't done yet. Like I'm so constrained right now. But it goes back to that thing I was saying before is you've got to find that beachhead, make it flourish, push, build management capacity to solve 98% of the problems that are going on. And then you have the room to go do a new thing. And really what it is, it's, you know, I've been accused of using the marathon analogy too much. And I'm going to live up to that, which is, you know, at some point you might be doing a business and it just starts working. I started seeing that on rides at Uber, where it was like, I had my leads in different geos, and I'd call them up because we would jam on hard ideas and crank and all this. We didn't have much to talk about. Yeah, because shit was working. It just worked, you know? And they're like, Travis, we got this. I don't know why you're calling me right now, you know? So actually, this brings up one of

[1:06:25](https://realalpha.app/v/z6gH_v0buUc/?t=3985) the things that he did best at Uber, having had to deal with these guys, was like, if you look at Most companies, most of the, really the big tech companies that emerged in the 2000s, 2000s, and 10s, the management team were kind of professional middle managers, et cetera. He had so many guys who you would have gone, no, that's a founder. You know, that's a founder over there. That's a founder over there. That's an actual entrepreneur. And it's amazing that he's not building his own company because he's, like, working for Travis. But that enabled them, like, to get to a multitude of ideas, you need, like, a team like that.

[1:07:13](https://realalpha.app/v/z6gH_v0buUc/?t=4033) And there's just not that many people who can build that kind of – it's just a very hard to attract and maintain that level of capability because those guys, unless you're building something absolutely spectacular, you know, they're not going to be in. And even if you are, you're dealing with – you've got to be able to manage that. Well, what happens is the management of it becomes an empowerment puzzle. Yeah. Yeah. So – Yes. Okay. By the way, that I don't like here. I know. So you've got – I've got – I'm running Uber, let's say. I have, I don't know, five continents going at any given time. you have an engineering team that's multiplexed across a finance team that's multiplexed across a product like there's a lot going on and the only way it works is okay you have that entrepreneur there but they have to basically empowerment starts with alignment which is okay what's the strategy do we realign on it that's the challenge right empowerment plus alignment So, alignment on the front end, accountability on the back end.

[1:08:29](https://realalpha.app/v/z6gH_v0buUc/?t=4109) Yeah. And we would call this Let Builders Build. Yeah. And so, but you— By the way, there's also—so you've got alignment, but alignment is multidimensional. It's alignment on, okay, what are the goals? What are the objectives? Also, what is the culture? Like, what is the behavior you guys are doing over there? Because that's going to affect us over here and us over there and so forth. So, like, we can't dilute the culture because we gave you autonomy. We've got to have that. And that combination is, it's like a very high level of management skill. And that leader has to be good enough to do it.

[1:09:08](https://realalpha.app/v/z6gH_v0buUc/?t=4148) Yeah. And that leader then has to work with the CFO and the CFO's people, the product, the head of product and the product guy's people, engineering and engineering's people to make sure that it works. Because if I'm a single point of failure, it ain't scaling on 24 time zones. There's no freaking way. And I think that's the difference between what we did at Uber versus we're seeing how a lot of other companies are expanding internationally that are buying things. like I was like well I buy we can just freaking do this a city's a city let's go and then if you buy it guess what you brought another culture yeah okay and now you got another reputation and then that reputation is going to seep back and then okay now you don't have a culture and by the way because how are those motherfuckers getting away with that in Korea when we can't get away with that in the US like all those things and by the way your product your technology is a reflection of your culture so then what happens is you just have the culture is reflected in the technology and in how even that technology is built.

[1:10:12](https://realalpha.app/v/z6gH_v0buUc/?t=4212) The product decisions that are made and now you've got to fuse these products and technologies together, which is very hard. Two years later, maybe. Yeah, exactly. That's why I didn't buy Lyft. By the way, that was a very different culture. Yeah. I can attest. This was the reason I couldn't do it. Yeah. Yeah, super interesting. And so you're constrained now by three different industries. You take him off script. No, no. What is the criteria that's going to determine if and when you go into another? Yeah, it's the beachhead thing. And it's the, I'll go back to the marathon analogy, is that if it's getting easy, you must make it hard again.

[1:11:02](https://realalpha.app/v/z6gH_v0buUc/?t=4262) But you've got to get it too easy. You've got to start, and it's a buy. It's like a, it's like a, it's like a feeling where basically I'm constantly creating problems. Yeah. I'm a problem creator. A problem creator might be like a, like creating a problem might be like, hey, let's do Uber in China. Okay. That's creating a real frigging problem. And by the way, you don't have a full understanding of that problem when you create it. And why is that hard? Because, well, if you create a problem, you have to solve it. Yeah. So I have this like framework I call the meta problem, which is the derivative of your problem creation, Dt, must be less than the derivative, less than or equal to the derivative of your problem solving, Dt.

[1:11:57](https://realalpha.app/v/z6gH_v0buUc/?t=4317) And if it's not, you have a real fucking problem. Yeah, well then – You're underwater. Yeah, then you're underwater. But – And then you can drown. Yeah, if you have multiples of those, you're really underwater. That's right. So, when you create a problem, you're guessing at what your capacity is to solve problems. And you're guessing six months, 12, 18 months ahead with only a certain understanding of what the nature of the problem is. And when you get it really wrong, you're underwater. And then you must stop all problem creation so that you can get back above water. And then when you go from your neck and then you're like at your waist in terms of how underwater you are with your problem solving, when you're at your waist, you're like, oh, I could get, I could.

[1:12:40](https://realalpha.app/v/z6gH_v0buUc/?t=4360) You get to here, you create more problems. You let the problem creation spigot open. And by the way, when you talk about capacity, a lot of it in this case is he's talking about his personal capacity because he's got to be able, if he's creating a new large problem, he's got to be able to not pay attention in nearly the level of detail to the other parts of his business. those have to be working because if he's solving problems over there and created a big new problem and that one gets in trouble like then so it's not just like capacity of the team it's also personal capacity and that it's a little bit of both it's a little bit of both and like it's a real i never felt like i never felt like rideshare was solved because what happened oh it's time for autonomy yeah okay all right let's go by the way you were right about that yeah yeah no just despite uh yeah i'm not going to even mention names and so if you if you had still been running uber um you know in this other universe or some of the vision that you have here with atoms would that have been you know could you have gotten to mining with like it's a continuation the same vision Right? So the digitizing the physical world, the atoms-based computation, that was already set. And so if the future of food is about infrastructure, automated production, automated logistics, that's the future of Uber Eats too.

[1:14:21](https://realalpha.app/v/z6gH_v0buUc/?t=4461) now it doesn't mean when you're an oem and you make a food computer it doesn't mean you have to make all the parts right yeah and so but but it but the future is the same yeah and so um so that's my point is that is that once you have that framework why is the framework important it's because it tells you what the future is going to be yeah it's correct and it also is it's also compelling like it's interesting once you start seeing things like by the way i built with my team like 500 cloud kitchens facilities around the world like you could just look at it as like why are you building kitchens which of course i would i sort of would go around all the time and tell people i'm just your local humble kid i'm just your local humble kitchen builder you know just sort of messing around but like when you're hiring it's like why does this matter yeah oh that's right it's a food computer yeah but once so it's a mix of it's telling you where the future is going and it's pointing the way towards where the interesting things are and it's helping you describe this in a way to really top quality talent who now can see what you see and can get excited about it yeah yeah and and there There's another kind of interesting thing which we went through when we were understanding the business, which is unlike in a computer where you have storage and that storage kind of becomes obsolete over time, in the physical storage world, in real estate, if you have the computer optimizing the storage, the storage becomes more valuable.

[1:16:07](https://realalpha.app/v/z6gH_v0buUc/?t=4567) So you build the food computer, and the storage is essential to deliver the end service, particularly before there's OEMs and everybody knows there's a food computer available. But that food computer multiplies the value of the real estate. So it's weird. Imagine a computer that multiplied the value of its storage. I guess it's a little like in AI, like if you've got data, all of a sudden data has become valuable in a way that it wasn't really before. Well, or you think of it this way. We could go to a data center. That's real estate, right? How much, how many, how many tops are now happening at a data center today versus 20 years ago?

[1:16:47](https://realalpha.app/v/z6gH_v0buUc/?t=4607) Yeah, exactly. Yeah. So, and how much value is coming out of those tops? Right. So, the value of a data center in terms of what it provides society is going up over time dramatically. A lot. And there's a lot of happy data center owners right now because of it. No doubt. Yeah. No doubt. My friend Rob Roy. Yeah. So, that's Rob. Yeah. We'll get him on soon. So speaking of, you know, painting this vision to talent and just talking about where the future is going, talk more about the emerging category that Adams sits within or you're calling industrial AI. Yeah. So look, I did a vision letter when we launched Adams that outlined sort of vision for like physical AI where we sit in it and even went into like what a physical AI stack is.

[1:17:40](https://realalpha.app/v/z6gH_v0buUc/?t=4660) And it's really, in some ways, it was like, it was philosophy about where the technology world in the tech industry in the physical world, where it's going to go. But what I didn't do was get to the brass tacks and sort of when you look at, okay, well, there's software, there's bits that are affecting how atoms, what happens to atoms, like how they're assembled, where they go, what function do they do in the physical world. um we basically we started uh i'm all over the place right now cut edit but um we wanted to create we wanted to create an easy way to understand what it means and i would i said okay adam's mission physical automation to transform industries you're like okay, okay, kind of gets me there. But what does that mean exactly? Well, it means we take entire industries that are ripe for automation and AI, and in doing so, that these are physical industries, and in doing so, just completely transforms them. In a sense, you've had one idea.

[1:19:07](https://realalpha.app/v/z6gH_v0buUc/?t=4747) like the uber and atoms atoms is the evolution of uber in a sense in that you kind of said okay we're the cisco of the physical world um and then you're like well what about the other parts of the physical world and you built that that you extended that vision into the computer and now you're adding the parts um but the computer is around an industry yes so we make computers for industries. Yeah. Those computers are... Right, that's an important kind of distinction. They're industry-specific computers. But generalized networks in some sense. Yes. So you go, okay, why are we doing transport? Well, because you've got to have wheelbase for robots.

[1:19:54](https://realalpha.app/v/z6gH_v0buUc/?t=4794) Okay, cool. But like actually what it means is every industry is moving things. There's some movement of things eventually. And you must have wheelbase as part of what they do if you want to automate full stack that industry as an example. But transport itself is an industry too. Yeah. But maybe a horizontal one versus a vertical. Right. Yeah. Peter Thiel, a decade ago, you know, famously, you know, sort of talked about how we've had so much progress in bits, but not in atoms and because of regulation or for whatever reason, it was just easier in bits and here we are and we're finally getting to it in a real way.

[1:20:34](https://realalpha.app/v/z6gH_v0buUc/?t=4834) Well, and it's like, I think the entrepreneurs that are coming up since the Uber time are not. Not scared of regulation the way the bits. Yeah, well, that was a breakthrough in a large sense that you made, yeah. Yeah, and so what it means is. Well, and then they've been trying to regulate bits lately. Yeah, totally. But these go together. Yeah. Because it's like once the bits start controlling atoms in the physical world, then the regulators are in the game big time. Yeah. And because that's generally how regulation works, it's about our physical world, and that's how it's been for thousands of years, really, certainly hundreds.

[1:21:09](https://realalpha.app/v/z6gH_v0buUc/?t=4869) And so, yeah, once you get in the physical world, you're like, okay, regulatory is a thing. And you say, okay, when in the past have we seen something like this? And it's like, if you start studying the second industrial revolution, there's so many parallels between what the Carnegies, the Rockefellers, the Fricks, like you just go through the list. Fords. The Fords, what those guys had to deal with in that massive, rapid change at that moment. Same, very similar political climate. Yeah. Very similar. That's right. The new dealers were not that different than the current, in terms of their complete hatred of the industrialists.

[1:22:05](https://realalpha.app/v/z6gH_v0buUc/?t=4925) That's right. Okay. So, like, there's a guy, Frick. who I think was Carnegie's partner, and this is about steel and how to process steel and do it at scale. I believe this story is accurate. Let's just say mythology possibly true, but I believe it's true. An anarchist broke into his office while he was working. This is in like the early 1900s or late 1800s. An anarchist broke into his office, shot him in the neck he got it stitched up went back to work that day and like somebody's gonna look it up i i believe it's true yeah but somebody should should fact check but you get the vibe of what's going on and how those guys rolled and think about some of the entrepreneurs today that roll that way not all of them do the bits guys don't necessarily roll this way elon rolls but the adams guys roll this way definitely right and so the second industrial revolution and you look at the characters and what they had to deal with and the adversity they had to go through um by the way they're also none of these guys is jesus so they had their they had their flaws too um but there's a really country there's a very interesting parallel to what's happening slash about to happen now with like the coming industrial age

[1:23:34](https://realalpha.app/v/z6gH_v0buUc/?t=5014) if we're selling our own book we would call it the Adams Age yeah there's a book actually that's very interesting on the kind of building of the war machine by the industrialists which won us World War II no question and the resistance that they got it's called Freedom's Forge and you know it was Bill Newton who was like the complete badass who figured out, like, the mass production at Ford and then got in an argument with Henry Ford and went to Chevy or went to GM and, like, built Chevy and, like, all that kind of thing and then went to work for the government for a dollar and to industrialize the nation.

[1:24:12](https://realalpha.app/v/z6gH_v0buUc/?t=5052) And the way he got fought by the press and everybody, like, on the most basic thing, like, he's like, well, if we tell him to shut down making cars, and cars, by the way, employ 20% of America at the time. If we tell them to shut down making cars to make tanks and other things, then we're going to have to give them some money. So, like, can we give them cost plus 7%? And which... You know, like seemed very reasonable, like reading about it. They're going to profit on the war. Like in Eleanor Roosevelt, like everybody was just out to kill this guy. And, you know, somehow, but that kind of resistance is like very similar to what we're seeing in data centers today and that kind of thing where I think the governor of New York just banned data centers in this state.

[1:25:04](https://realalpha.app/v/z6gH_v0buUc/?t=5104) There's a lot of parallels politically, which actually I would just call that resistance to change. yeah and nature very fast change that's correct so i you know i like you know i sort of think of it as like the most important truth seeking is the seeking of valuable unknown truths but if you're good at finding valuable unknown truths you're creating change then you know things other people don't know which means you can do things that other people can't do and the better you are at it, the faster the change comes. And the faster the change comes, the more nature will do what it does. It's called resistance to change. Yes. And so you have to figure out how to bring big time progress to overwhelm resistance to change. And you also have to build trust as best as you can so that you have more advocates versus adversaries. And this is the dynamic. And one of the things I want to say just on the industrial the industrial very hard to do by the way very hard everybody loves progress it's change they can't stand yeah yeah those two happen to go together yeah so like but on the industrial ai thing it was like my whole vision note was physical ai and like this theoretical thing it was very academic and theoretical and i want to say i want to get

[1:26:25](https://realalpha.app/v/z6gH_v0buUc/?t=5185) something that was practical brass tacks. Industrial AI is basically this stack of software, sensors, robotics, machinery that automates an industry. And we take it one industry at a time and it just became much more real and clear about what it is. You go physical AI, you're like, oh, so you're doing a humanoid. I'm like, no, no, no. We're like the non-humanoid guys. I don't have a problem with them, but that's not what we do. You're like, oh, do you do like some military thing you're like no that's not my thing either you know it's like so this felt very clean about what it is we're about and how we're going after it by the way you know a really interesting point on this whole thing is one of the things that we completely forgot how to do we were the best in the world by far we taught the world how to do was manufacture and now we've basically forgotten how to do it as a country other than like elon like if you need somebody who knows how to manufacturer. You literally have to get them from Elon. And we're going to have to relearn that and actually the beginnings of that are literally data centers. That is a manufacturing problem to a large extent with the cooling and the power and

[1:27:29](https://realalpha.app/v/z6gH_v0buUc/?t=5249) you've got to build your own power and all that kind of thing. And there's so much resistance to that from the exact people who were just harping and harping for years about all the manufacturing jobs are going away. Well, they're back. But we don't want them. And so that's how tough this story is and this kind of narrative is. Yeah. Thank God there's still enough places that are still welcoming data centers. Yeah. That it's not like... The federal system is a wonderful thing because it's like you have this competition of some kind. Thank God for states. Yeah. It's really interesting how that works out. Yeah. Otherwise we'd be Europe. Yeah.

[1:28:07](https://realalpha.app/v/z6gH_v0buUc/?t=5287) Okay. So we were talking offline. You were saying when you started Uber, you you know, worked with people who would choose to work with you. Now you're in a different position. You have, you know, a bit more choice. You've been building in stealth. Now you're, this is your coming out story. Talk to us about, you know, what kind of team you're building here, how folks can help. Well, look, we just multiply the number of industries we're going after by three. So that's a kind of a thing. And each of them is a multi-trillion dollar opportunity. And, you know, look, I... I had some awesome guys, like, you know, this is kind of a funny thing to say, but when you make somebody hundreds of millions of dollars, it's hard to hire them again.

[1:28:51](https://realalpha.app/v/z6gH_v0buUc/?t=5331) I've never had great success hiring rich people. Yeah, so there you go. So, you know, but, you know, there's the crew, like Emil Michael's now undersecretary of defense, but he was my right hand on doing just epic deal-making and strategic moves. i need the next emil michael if that makes sense uh like a head of corp dev biz dev that can build an inspired team an inspiring team as an example um we're we're uh we're in the market for a general council so we're looking for somebody who can ride shotgun and yeah and uh and make sure that i'm um you know so i i like to go to the line we should be like a few inches off the line that's a good thing to do um and then of course it's just the like i i need a i need a ceo of my mining business yeah like i uh i need to build technical leadership across the board from autonomy heavy duty robotics and it's really like we have lots of folks coming in like all the time, but it's like those epic leaders that can inspire their team to just go above and beyond and do really like make magic. Um, so we're all, no matter where you are as an entrepreneur, the, the, the talent game is the game. And, uh, again, when you multiply the industries by three, you're, we're back in the flow. And because we were stealth for so long, we weren't in the flow.

[1:30:30](https://realalpha.app/v/z6gH_v0buUc/?t=5430) we were cold calling everybody and I think it's one of the beautiful things about us being back out there is okay like we can now have like a place for people to understand who we are, what we're about and I can start putting teams together that can be out there in a very public way and let people know the great work we're doing and if you're joining now you're joining both with the benefit of having all the lessons you've learned and things you've proven out with Cloud Kitchens and of course Uber before that it's almost two decades but early enough such that there's the upside of the enormous opportunity going forward.

[1:31:12](https://realalpha.app/v/z6gH_v0buUc/?t=5472) And the ability to do something like super meaningful. I mean, save kids from working in the mines, you know, basically making it so that everybody can have great food like, you know, instead of like eating super healthy food that gives people their time back while also saving money. Yeah, it's a hell of a mission. Yeah, so we're having a lot of fun. It's good times. It's a great place to wrap. All right, cool. Thank you. Awesome. Thanks, guys. Thanks for listening to this episode of the a16z Podcast. If you liked this episode, be sure to like, comment, subscribe, leave us a rating or a review and share it with your friends and family. For more episodes, go to YouTube, Apple Podcasts, and Spotify. Follow us on X at A16Z and subscribe to our sub stack at a16z.substack.com. Thanks again for listening and I'll see you in the next episode.