Space Putin Digest vol 1

Hello everyone! I’m going to try out a new weekly newsletter format. This time called the “Space Putin Digest”. Props to those of you who get the reference. So, what were the biggest things that happened in space this week?

(1) SpaceX flies and lands Starship for the first time!!

So I kept looking for good in-depth explainers on why Elon/SpaceX decided to switch over from an aluminium-lithium alloy over to steel, and none the popular space YouTube channels or Twitter personalities had great explanations for it. My favorite one was Real Engineering (link), with an ok runner-up of Everyday Astronaut (link). But neither were quite satisfying. So here’s my attempt at doing a more in-depth layman’s explanation of why SpaceX switched to stainless steel and why it matters SO MUCH

First, this isn’t the first time stainless steel has been used in rockets! In the early Atlas rockets days, stainless steel was our best option, however, because the strength to weight ratio (STWR), basically how strong is a metal relative to how much it weighs, and because our rocket engines were pretty rudimentary, the only way to make a reasonable rocket design with stainless steel (SS), was to keep the SS so thin that you had to keep the rocket tanks pressurized or else the rocket would actually collapse on itself, like a balloon (link). And stainless steel was particularly hard to work with at large scale, since it was so soft and sticky that if you tried to “cold-form” (rather than heat up a metal and pour it a mold, instead bend it into shape, and it ends up stronger) it would end up getting stuck on itself and fracturing.

So aluminium-lithium alloys got invented, which had a much better STWR, so we switched to that largely. They were much more expensive, but in the early days of rockets, all that mattered was who could even build a rocket, with cost not being much of a consideration.

Fast forward to 2002 when Elon was starting SpaceX, and the same was basically true then. Rocket cost didn’t really matter, and STWR is still all that mattered so he stuck to that.

But now in 2018, SpaceX has quite a different set of considerations. Their rockets are returning to Earth on quite a regular basis. And the market has gotten much more cost competitive all around, with other big launchers working on reusable rockets and small launchers being cheaper/faster due to their size.

Before, rockets just went up and were done for. Now, your rockets need to be able to (1) get back to earth (2) be refurbished easily and (3) manufactured at scale since the space economy is booming baby.

So let’s talk about why stainless steel kicks butt at these! (1) When you’re bringing a rocket back from space, you’re going fast! Real fast! And right now SpaceX expends a lot of fuel slowing the rocket down before it enters the atmosphere so it doesn’t burn up. SS’s melting point is much much higher than other metals, and so rather than expending fuel, you can use the atmosphere to slow you down and have a pretty minimal heat shield.

(2) SS is super easy to weld! It also is pretty anti-fragile, because it actually heals over cracks naturally rather than encouraging them unlike most alloys and carbon fibre. And, interestingly enough, when it gets cold, unlike most metals which become brittle and fracture, SS actually becomes stronger. This matters because rocket fuel is cold, real real cold.

(3) SS is real damn cheap. We use it in pots! Pans! Cybertrucks! And, quite recently, a company in the UK invented a new lubricant which allows us to “cold-form” steel, i.e. we don’t have to heat it up to get it into shape, even at pretty large scale. So the manufacturing costs are super cheap.

So Elon’s old rockets were expensive, hard to manufacture, hard to refurbish, and the weeney little metal had to be slowed down so it didn’t burn up. SS is everywhere, easy to manufacture, easy to weld, and it’s a big strong boy when it’s got cold rocket fuel or barreling through the atmosphere.

So in the old days when rockets were thrown away, sure you just wanted to optimize your STWR, but in 2020, the calculus is pretty damn different.

P.S. If you’re wondering why SpaceX has gone quiet on the Falcon Heavy (3 Falcon 9s strapped together), it’s mostly because the world of heavy launch has died down. With launch getting so cheap, a lot of companies and the military are hesitant to put up a huge multi-$b satellite up into a high orbit when it’s made obsolete by a constellation of smaller, cheaper satellites in a lower orbit. So SpaceX is just jumping straight to super heavy launches with starship, hoping that when it’s done being developed they can use it for the moon, point to point on earth, mars etc.

P.P.S. And you GOTTA watch the “tin” can fly 150m and down, it’s so cool to see (link)

(2) Space Force awards $7b to ULA + SpaceX

SpaceX and ULA knocked out other competitors like Blue Origin for a shared $7b contract over the next ~5 years. These contracting processes are super competitive and it’s a huge deal for SpaceX and ULA to know they have pretty significant guaranteed revenues coming in from the military (linklink2)

(3)Astra, a bay-area based small launcher misses their launch window because of a boat!

The only Bay Area-based launcher, Astra, had to call off their maiden flight attempt originally because a boat got in the way, and later in the week the weather and winds were too high. They still haven’t announced their next launch window. Always love to see more launchers come online, although, realistically between SpaceX, ULA, Blue Origin, RocketLab, and Arianespace, there’s probably not much room left for more launchers in the market. Space is a big market but it’s not quite that big yet (link)

(4) Demo 2 landing

Remember when SpaceX sent people up to space! Well we decided that we should probably try bringing them back first before we send the next crew, currently targeted for late September! (link)

Ok, hope you enjoyed it! I know this Substack has quite the variance on what gets published but, oh well, you’re along for the ride.

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Operators Ep 7: Bob Meese (Duolingo)

  
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Bob Meese is the Chief Revenue Officer at Duolingo. He joined the company at <$1m in revenue and has helped them scale up to $100m+ through app subscriptions. Previously he was at Google for a number of years focused on Google Play.

In this episode we talked about how Duolingo runs experiments, both to optimize their funnels, but also new revenue lines, including their newly introduced successful revenue line, a digital version of the toefl test. We also talked about how enabling monetization has allowed the company

It's time to build homes

The mantra of 2020 has been “it’s time to build” and Cover is a company doing just that — literally. Today Cover, a full-stack homebuilder, is announcing that Founders Fund is leading their Series A, along with participation from Lennar, Valor Equity Partners, General Catalyst, 50 Years VC, and Khosla Ventures. Capital-intensive businesses eh?

Before we dive into what Cover is working on, it’s worth taking a step back and talking about the history of home building, and what some of the more recent innovations in the space have been. One of the first major innovations in homebuilding was in 1832, when “balloon framing” was introduced which allowed for much easier and less wood-intensive multi-level home construction. Below is a photo from a home being built in 1877 in Nebraska with this technique.

Unfortunately, one would have hoped that 190 years later the process of homebuilding would have radically changed and simplified. Instead, it has only gotten more complex, as at the turn of the 20th century, amenities such as heating and plumbing became much more common. Homebuilding now required several different types of skilled labor that needed to be coordinated rather than mostly woodworking. This introduced a ton of cost and logistical challenges as now, the woodworking had to take into account pipes and ducting that had to run through the interior cavities of the home. If there were mistakes in this preparation, which was common, the easiest way to fix it was to bring in the skilled plumber and have them reshape the pipes into whatever shape would work with the current version of the structure.

A popular saying at that time was, “When building a home, there are 3 major factors. Quality, Cost, and Timeline. You can pick 2 of them to control”. No matter what, when building a home you had to make trade-offs.

Innovation in Home Construction before Cover

The traditional homebuilding process essentially looks like the following: ship a bunch of construction materials to a site, hire a bunch of skilled labor to assemble it, roughly following a schematic but mostly just working off their instinct and eyeballing it. In the more recent years there have been some attempts at innovating on this process, although, I believe they have all fallen short.

The first major innovation was called “prefabricated homes”. The idea is you’d build most of the home inside of a factory rather than building homes on-site, where you are subject to weather delays, and relocation of your building crew/long commutes. There are a couple of problems with this approach. First, you’re still building homes the same ol’ way, i.e. skilled laborers like plumbers & electricians working manually on custom projects. Second, in the prior model you can “flat-pack” all your construction materials onto a few trucks and ship them over to the site. With prefab, you instead have to ship over a whole home, which takes up many more trucks since you can’t flat-pack it, and then once it arrives, you need to crane it into position. As it turns out, most of the economic gain that you get from having your employees commute to a single location and not having to deal with weather delays, gets lost from all the additional cost of installation.

Ok, so back to the drawing board! How do we make a home in a factory, but not deal with the cost of shipping an entire home? Well the next step of innovation was called “modular housing”. What that meant was you still used high skill labor, but now rather than building an entire home in the factory, you would split it up into pieces, building a whole wall, or ceiling with all the electrical + plumbing. That way, you can flat-pack it all and you don’t have to crane in a home, instead you would just put together the lego pieces. The problem with this approach has been that plumbers, electricians etc. aren’t working with extremely tight tolerances during their building process in the factory. So when all the pieces arrive on-site, if you have a couple of ceiling “modular pieces”that are a bit too long, your ceiling ends up hanging off the side of your building. Turns out you end up having to send in highly skilled labor to touch up all of these assembly issues, and so this whole process ends up, yet again, not being much better than just having done the traditional homebuilding process from the get-go.

So, unfortunately, despite being the major cost item in most people’s lives, the economics of building and owning and renting a house remains largely unchanged from where it was 190 years ago, unlike almost every other line item (aside from healthcare and education), which has massively decreased in real dollars. So how do we do the same with homes? How do we massively decrease the cost structure? Well we need to pull out the need for highly specialized labor and instead make this a highly repeatable and efficient process which can be done by less skilled labor.

Well where has this done before? With cars of course! In 1913 Henry Ford invented the moving assembly line which massively decreased the cost of producing a car and opened up car ownership to the masses.

Cover

So, what does Cover do? Cover is a full-stack home-builder, starting off with a market focus on additional dwelling units (ADUs) in the LA area. That means that customers can come to Cover with some space in their backyard and Cover will handle everything from design, architecture, permitting, foundation & sitework, construction, appliances, and all the way to a certificate of occupancy. Most of the startups going after this space tend to just be marketing landing pages + some design software, and then they hand off the construction to a traditional property developer or general contractor. Which doesn’t really innovate on the core cost structure…

Cover produces homes like this (link):

And like this (link):

But these homes are all made of modules, made on an assembly line, in a factory, by low skill labor + automation, at aerospace-levels of tolerances, meaning that when we take those modules to a site, they fit together perfectly. This cuts out the biggest cost component, the skilled labor like plumbers, electricians etc.

And, most importantly, unlike any other company that has tried to create the “assembly line for homebuilding,” each of their homes is a completely custom design. No cookie-cutter homes here. It involves a lot of complicated software and mechanical engineering, but Cover lets you design your perfect home, which then gets chunked down into modules, assembled on their line, shipped to your site, and assembled in just a few weeks.

Cover is the future of homebuilding, with zero compromises, fully customizable, high quality, and on our way to being cheap and available to the masses as we follow the Tesla approach of Roadster → Model S → Model 3. Come and join us on this journey by visiting their website, (link). It’s time to build.

P.S. Feel free to check out their Forbes coverage today (link) and a podcast Solana and Alexis (CEO of Cover) did to discuss the future of housing (link)

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