Founders Fund leads $49M Series B in EnduroSat, the 'Dell for satellites' built in Bulgaria

successful. It's linear. Get on linear. You heard it here. It's that easy. Um anyway, we have Delian talking about the Endurosat financing. This went out earlier today. He was just on Bloomberg. Came over here. A little bit of a feeder for TBPN. They're cult cultivating. Yeah. Bulgarian dynamism. Bulgarian dynamism.

Yeah. It really is. Uh Bloomberg really is kind of like the the farm team for us, you know. Yeah. You go on Bloomberg and then we kind of pick the cream of the crop, the best. Ben watches. Yeah. And he says, "I'll let this person perform well. " Hey, how you guys doing? There they are. Welcome to the stream.

Welcome to the show. Fantastic lighting, both of you. You look great. Thank you, guys. Obama would be proud. You guys, you know, he took the gray suit and fumbled, but you guys took the gray suit and uh, you know, really suit the market's up. It's white today. Market's ripping. You guys are announcing a big financing.

Congratulations. Yeah, break it down for us. What's the deal? And, uh, what does the company do? Yeah, introduce everything. Yeah. Um, well, uh, we're leading this $49 million series B uh, for Endurosat.

Um, it's it's predicated on the thesis that we've been, you know, looking at for a long time, which is basically like somebody needs to go build what I call like the Dell for satellites, right?

When I think about like my business at Varta, my job is to build like the re-entry capsules, the drug manufacturing equipment, like the rest of the vehicle is basically just like a standard satellite that I'd much prefer to not have to go, you know, entirely build myself.

And so, kept studying the ecosystem for a long time, seeing if there's anybody there. There's been some US players that have popped up over the past couple years.

But like the sort of oneliner critique that I give of everyone including in some ways of like the VA satellite is that if you look at the overlap between our satellite and like automotive or consumer electronic supply chains very limited.

It's all this like very specific aerospace supply chain that is basically the same component that it's been since 1972 and there's just been no maturation in that. Obviously consumer electronics we now have these like wonderful things called iPhones.

These are mass manufactured super cheap keep getting cheaper over time. You don't have anything like that you know basically happening in the aerospace supply chain.

And so credit to the team at you know sort of enduro sat I show because they like didn't have any venture funding for a long time they couldn't afford to do like the traditional satellite manufacturing approach and so they basically had to go and figure out how to adopt consumer electronics medical devices automotive supply chains but then figure out how to stitch together some great firmware materials etc to make it into a space grade piece of hardware but now they're able to deliver you know sort of components and satellites and services that are literally like 10x delta prices and to the company I'll tell you this is crazy which like is never true for any aeros space company or defense company in the US literally profitable growing 2 to 3x like literally every single year and it like is delivering components and satellites at like 90 plus% margins.

It's just like literally completely unheard of in any other you know sort of aerospace company but they still couldn't get you to write a $50 million check that it came so close but just one mil off. What happened on it?

You know Delian really put the I got to say I don't want to put him in the hot seat but Ev over at Kleiner's got to be in shambles right now. profitable, high margin, you know, uh, space company. It's brutal. Uh, but yeah, I mean, I'd love to hear a little bit of background on the company. Uh, how did you get into this?

Uh, where have you been doing this for a long time and and kind of what's the prehistory of the company before this deal? Okay guys, thanks for uh, for inviting us on board. Really proud to partner with Founders Fund.

companies exactly 10 years ago found it in Bulgaria in a small attic apartment and we were telling everyone hey there should be a better and fundamentally different way to build space infrastructures and actually the idea is pretty simple I believe it's how do we get the cost of data from orbit regardless of the type of sensor to a place where it's affordable for small mediumsiz uh companies around the free three free worlds basically and the idea that um if you look at the radar data for example for very high resolution imagery data today.

First, they're super difficult to acquire at all. And secondly, 1 GBTE cost between 2,000 3,000 $5,000 sometimes. And we figured out, we made a simple calculations about what type of applications there are.

And we decided okay if we are to ever enable fundamentally accessible universally accept accessible space for multiple other entries and really different innovations to uh spin out and finally get into the space industry.

And if you are to ever link this hardware ccentric excruciatingly painful supply chains with the actual objective uh data consumer markets that have nothing to do with space uh this will be a gamecher and it's it's going to be good for humanity in general and good great for the business as well.

And the idea was very simple. We need to get the data 1 GB data from orbit from any type of sensor as low as possible and as close as possible to $1 per gigabyte. And I think this will open the gates of innovation in space like never before.

So we started with the idea okay to do that we need to absolutely change and be very asymmetric in the way that we build the satellites. We need to figure out the way to automate everything. We started with the idea the satellite is just a flying workstation in orbit.

is technically everyone in the whole industry is super obsessed about hey my satellite is x amount of kilograms or pounds my satellite is has x amount of connectivity always obsession about the technology and I believe the whole shift should be we need to be in love with the challenge that we're trying to solve the challenge is very simple if we get massively improved and instant access to space data fundamentally changes everything for the businesses for defense for any type of ecosystem within the democratic world this is a fundamental ally important for us challenge.

So we started by redefining how to build satellites, redefining how we operate satellites and we started with the idea that the satellite is designed for manufacturing which was unheard of in the industry because usually it's one of it's like building Rolls-Royces and we decided no no I think there should be a different way of approaching let's from the get-go design a satellite thinking about the AIT the assembly engineering teams how they can assemble the satellite faster and we just announced today with our latest gen satellites after 10 years of experience We've put everything that we know inside it.

We are very excited. We will have a hard ways to scale this in the in the coming months. Very challenging, but I think it will fundamentally change the perception of the industry because we can assemble a relatively large satellite for six hours by individual engineer. And typical by the way is like 90 days.

So like most 300 kilogram satellites, it's like three to four technicians, 90 days to like get all the components, testing, etc. Whereas these guys have simplified it, you know, sort of down to six hours.

And to give you a sense of the scale, by the end of this year, they'll be manufacturing about 60 60 what are called ESPAC class satellites. Think of that as like, you know, basically 200 to 500 kg, 60 of those per month. It'll make them the largest satellite manufacturer in the entire world other than Starlink.

And that's like at the end of this year, not like hypothetically in the future, etc. And by the way, they're doing that at like, you know, 75% margins, profitable, growing fast, etc. And they already have like, you know, 300 plus customers, not like one or two, you know, sort of super concentrated.

And so at some point I've been tracking him for like 6 years. And I kept kind of discounting it cuz I was like look if I bring up the idea of like a Bulgarian space company to like f up like you're so biased like what are you doing? Like clearly you've just got these crazy blinders on.

But at some point I kept meeting with him for like five or six years and I was like it's just it seems like it's the best tech. It's growing really fast. It's really great margins.

And so I brought it up to like you know my partner Sean Lou who's like you know sort of the growth version of Delhi and really likes industrial et like Sean am I like crazy or like is this like actually I think even really good from like a numbers basis let alone technology basis and he was like let's [ __ ] do this immediately and I was like okay cool.

My other favorite anecdote from the company is like um so Raicho basically started to like recruit and repatriate basically Bulgarians from like Arabus Holly's America etc and got them all back to Bulgaria but at some point he was like I'm going to run out of this talent pool like there's not like a million of these types of engineers.

And so he's like, "You know what I'm going to do? I'm going to just make my own talent pool. " And so he went to the local like university in Sophia, which like plenty of problems in Bulgaria, but like you know, minting like physicists and like computer engineers and mechanical engineers, we do that all day in day out.

And so he went to the university, he's like, "Look, I'm going to take over your like junior and senior year program. We're going to change your like aerospace engineering to just be like, we're just going to teach you how we build things at Enduro. We're going to give you effectively what look like client projects.

" And then just whoever gets the A is we're going to hire on the other side. And so now of the like 300 person team, 80 of them are people that have graduated from this program. And so if you walk around the office, it's like just these cracked 23 to 26 year old Bulgarian kids grinding like 12 plus hours a day.

They're [ __ ] thrilled because it's either this or they go be like a technician at Lufanza. And so it's like this is so much more, you know, it's interesting. They impact the like frontier of space. And by the way, Bulgaria's never had any of the [ __ ] entitlement that America has had, right?

The whole wave of like wokeism, DEI, like you know, entitlement activism doesn't [ __ ] exist. The country is too [ __ ] poor to do it. And we like all by the way, we hate socialists. We still do. And so all that stuff is like, you know, bred in Marxism. We [ __ ] hate Marxism there.

I was literally doing a run through like, you know, uh, you know, the downtown Sophia the other day and I [ __ ] loved it because I like stumbled across this old Marxist statue and literally there was all these like hammer and sickle sickle like, you know, things with just huge X's in them and everybody just out the hammer and sickle.

I'm like, "Fuck yeah, man. This is what we [ __ ] need. " In America, you have [ __ ] people like pro- Hamas, pro- Marxism, these [ __ ] crazy people that are super entitled.

And Bulgar is just like, "Yeah, we're just going to kick your ass and we're going to become like the TSMC of aerospace where it's just going to be this national jewel. We're going to [ __ ] mint the engineers. When a kid is born, he's literally going to be doing aerospace at 2 years old.

He's going to study it in middle school and high school. He's going to go to the university and he's going to graduate and he's going to immediately want to go work in Enduroat. We're going to build up the whole ecosystem here. " Yeah.

So, I mean, with that TSMC analogy, uh, obviously TSMC is, uh, fabbing for Nvidia and for Apple silicon. Those have slightly different trade-offs, different memory, GPU cache, like all these different things that are going on on the chip on an enduro. What am I customizing?

What are the FL what like what have you decided to say this is standard? And then this is the USBC port that you can plug a camera into, a microphone into like what are we what are we customizing once we buy one of these and what are the different vectors of uh differentiation that are possible? Yeah.

So the the the biggest uh thing in uh in our I believe in in our impact and the customer basis, we tried to simplify the way that the satellite is perceived by literally building all the subsistence of the satellite completely in house and making sure that you can dynamically repurp the satellite basically to change the performance of the power of the communication of the processing to address the exact need of the exact sensor that you want to take to orbit.

One example, if you need a radar, of course, you need much more power. You need peak power that are much much higher if you rather than if you need a high resolution imager camera.

And our goal was always how do we build a chassis of a satellite as a as a bus or as a platform that can objectively take to orbit all of these things without the customer or us ever having to modify the bits and the pieces of the satellite.

So the only thing that we modify is of course the mechanical part that holds the payload, the sensors to the satellites because those are always unique and we use the same mission software that is fully based on the cloud.

So you don't need any more mission control if you're a customer of us and and and basically again we always go back to the idea of why we do that. It's not about the technology or the progress because any innovation has its own lifespan and sometimes it's short, sometimes is amazing.

But the idea is that how do we get to a point where you can get any type of space data and you can impact your business on the ground and and our idea was well you can do that only if we absolutely change the perception of what satellite is and you you simplify it for the customer.

The satellites become overwhelmingly more complicated more more resilient more oriented towards the defense lately but at the end of the day you should not transfer this complication in the operations of the customer.

So one idea was what people don't understand is in the space sector 90% of the so-called space companies actually their only source of revenue is the data that they generate in orbit and only 10% of the total global market of so-called space companies are the actual rocket builders and satellite builders like us.

So if you look in the broader spectrum of problems for us is how do we enable these data companies to never ever have to touch satellites in their lives because in reality we have multiple constellations fantastic innovators unbelievable results but not on the finance on finance catastrophic results. Why?

Because they always try to build their own very unique satellites inhouse while you are actually a data company and the only source of revenue and positive impact is your data or the intelligence out of this data.

And then the question is, okay, it's like you being an Uber and trying to suddenly buy cars and build roads or if you're RBNB and suddenly they decide, okay, let's let's just go banana crazy and and buy all the hotels and maintain stuff and whatever.

And I think the space sector has always been for some reason in this conservative paradigm shift of super smart people focused on technology more than the challenges and at the same time trying because they're so enthusiastic and smart about the technology focusing all the efforts of diversifying and doing what is fun for them to do but not realistically spending the whole damn time to impact society via data.

And our job is to get them back to reality check hopefully or at least to help them see that there is an alternative route uh and to tell them guys if you're a data company please focus on data because this really really matters to everyone else that you are providing these data and services.

Let us build part of your infrastructure. So this is the thesis behind it. It will be a long not rosy road ahead. We have a huge amount of challenges to actually produce at scale such a vast amount of infrastructure. I mean SpaceX is an juggernaut and it's incredibly innovative company and kudos to everyone involved.

We're teeny tiny spect on the universe and we did the things completely asymmetrically and different than a SpaceX for example. Why?

because everyone in the industry is looking at these titans of an industry super innovation uh driven company and and mindset that is a battlefield basically which is very unique and then you say I do the same but it's like if you go to the super bowl and you try to win against the winning team with their own strategy on on their own turf right this is insane so we went completely the opposite how do we assemble satellite design for manufacturing to handle multiple data services how do we uh completely eliminate the need of our space data customers to ever need the mission control How do we automate operations?

How do we hedge the financial risks? So we we are actually providing to all our customers in space. Fix costs for getting your sensors to space for the first time transparency in planning of your own infrastructure in orbit.

And we take care of the risk and we ensure our customers so that if satellite fails, no questions asked, we get you new satellites and that's the the vision and we go step by step.

So it's an incremental amount of a lot of technology innovations and patented ideas and a lot of just seeing what else can we optimize so that we objectively lower the data to get as close as humanly possible to $1 per gigabyte of any type of sensors.

And just to give you one one last example as a data because I I love to work with data. Uh right now our current gen 3 from the get-go would achieve already uh pricing per gigabyte lower than $200.

So from 2,000 to 200 and we are really bullish on the idea that it will take us a little bit of time maybe a year or a year and a half to really mature this technology and ideally we get it as close as humanly possible to $1 which will open the gates of innovation. I hope so.

My oneliner that I'll uh you know end on is in a traditional satellite if you wanted to double the amount of power storage you want to do you have to redo the thermal analysis the center of gravity the vibration analysis the structure etc.

If you want to double the battery storage, an Enduroat satellite, it is literally plug in an extra battery module, turn a knob, you're done. The satellite is software defined. It automatically knows, oh, I've got a second battery module. That means my weight shifted this way. That means my thermal shifted this way.

It just pre-calculates all that and knows exactly how to deal with it. And that way, the company can just focus on like mass manufactured individual modules. And you can still offer customization to the end client. You want to double your power, you want the bigger radar, you want slightly bigger, great.

You can have whatever satellite you want. It still is custom fit for your need, but it's mass manufactured. So, I mean, uh, VA is unique in that it's not a data company. Is there a world where you two guys work together in the future?

Yeah, I mean, look, I think when we, you know, sort of first started to get to know one another, you know, his satellites were far smaller than the Varta, you know, sort of satellites. And so, this Gen 3 is the first time where they're starting to get into that size class.

But, yeah, look, those power systems, those radios, those avionics, it's still very relevant to us. Like, we're definitely still trying to drive down the cost. We're just, you know, one of the few companies that isn't a data company.

dollar kilogramdamental equas and it allows you know I always think about like Ben Thompson with trajectory where it's like when you have these early markets you have to be fully vertically integrated right SpaceX had to do from soup to nuts like build the rocket build the engine build the Starlink satellite sell the surface etc but as this matures you have these like horizontal players and like you know VA the goal is like I just want to be the horizontal player on like you know biio manufacturing and re-entry capsules but like I don't need us to be the worldass best, you know, sort of bus provider.

Ideally, we like are the master assembler of a bunch of the best components and I'm hopeful that, you know, Enduro can be that winner of that horizontal layer of, you know, sort of components and satellites. It's amazing. Thank you so much for stopping by. Right, Joe. Last question from my side.

Uh, is is Delian as famous as we think in Bulgaria? Is he like a household name at least among, you know, tech interested folks?

among the tech the tech industry I think he's a superstar among the normal people I don't think that they know him very well superstar all I heard superstar all I heard to adapt to to his Twitter account ex accounts and stuff like that so we we are still in the honeymoon phase where we are taking good care of knowing each other and our our good and strange habits well I I heard superstar and honeymoon that's All I need.

Yeah. I I hope you made it to win the deal. I hope you made him assemble just one just one satellite. Yeah. Actually, I'll be honored to invite you guys. Seriously, because we are also having large operations in Denver and very soon we'll be amplifying them.

So, ideally, end of this year, beginning of next year as an experiment, it would be absolutely lovely to if we succeed to invite you and with your own hands to to to try it out and tell us are we bullshitting or is this something like really meaningful that could impact the industry. I love it.

TVPN needs its own satellite by the end of next year. We're building a dish live photos of the studio. Yeah. Yeah. Yeah. Yeah. We're vertically integrating for sure. Yeah. We have to in an industry like you have to. You have to. It's been fantastic. Uh we'll talk you guys. Congratulations. Very cool. Very cool.

Have a great rest of your day. Goodbye. Uh let's take a second to tell you about numeral sales tax on autopilot. spend less than five month five minutes per month on sales tax compliance. Jordy, ring that gong. [Music] So, I think they missed you on the wide, but you can you can ring the gong for public. com investing.

For those who take it seriously, I want to see Jordy on the Let's do it. Public. com, baby. They got multiasset investing, industryleading yields, they're trusted by millions. Wait, I just realized we need an actual air horn. We do need an actual air horn for sure for sure.

The soundboard will eventually be instantiated purely with a live band. Physical objects. Live bands are Lindy on talk shows. The soundboard is a poor similocum of what we could be having if we had play the and their band plays it. This is obviously in the cards. You know, it's great that we have the live.

We need to do a live studio actual people to just say, you know, Ben holds up the laugh sign and everybody just goes, I mean, just go Yeah. Yeah. Just go just go recruit them from USC, UCLA business schools, you know, come in, learn about venture, learn about business, offer your voice for some laughs. Be great.

Be great. Um, they're like, "Oh, no. Socialism mentioned. " Boo. Anyway, IPOs are back. Tech IPOs are back. kind of Katie Roof wrote about the three successful debuts this month and what it means. Silicon Valley Rejoice tech IPOs are a little bit back. We love to hear it.

Oh, we actually have our our our first uh fellow guest. I don't think we have time to go through this, but MT uh Mntn went out. Uh the advertising technology business connected to uh Ryan Reynolds and um Hinge Health went public. So that's great. Um yeah. Yeah, we definitely do.

and uh Chinese battery giant contemporary Amperex Technology Co. Soaring introduction on Tuesday and the favorable debut for Israeli Robin Hood competitor E Toro Group. So there's been a couple big uh big IPOs. So he company which one so M it's called Mnt Mountain.

Yeah Mountain we were thinking about having uh somebody on one of the VCs who founded the company or funded the company early. Um, but anyway, uh, I say we move on to the Teal Fellowship. We got the Teal It's Teal Fellow Tuesday. Uh, why don't you why don't you kick it off with your post?

Oh, because I feel like that really sets the stage. Yes. Yes. Yes. So, so I went on X and I