How to build $10B+ techno-industrial startup
Is it possible to systematically build $10B+ companies?
Elon didn’t work in aerospace before SpaceX ($350B). Eric Lefkofsky didn’t work in cancer diagnostics before Tempus ($8B). Brad Keywell didn’t work in heavy industrial equipment before Uptake ($2B). The founders of Palantir ($220B) did not work in government prior to founding the company.
These founders have shown the ability to consistently build massive companies in domains where they don't have experience. In fact, these founders are so good, they can repeatedly build multiple $1B+ companies.
How were these founding teams able to spot ideas that insiders could not?
What methods did they use to build the domain knowledge needed to innovate in an unfamiliar industry and mine for ideas?
Can these methods be dissected, understood, replicated and taught to the next generation of founders?
If these magical methods exist and can be taught, will we see a rise in successful vertical integrator startups?
Many founders believe that you should solve a "personal problem", but these examples suggest an alternative framework for building big companies — pick an industry that hasn’t seen very much innovation and follow a rigorous research playbook to spot the right idea. If this theory is true, then every aspiring founder should aim to learn and apply the “magical arts” of incubation to their own repertoire.
The aim of this lecture is to explore two topics
First, the incubation techniques that certain serial entrepreneurs use to find their $10B+ ideas
Second, a specific class of startups called vertical integrators, the type of vertically integrated hardware-software startups that seem to have the highest chance at becoming $10B+ companies using this type of incubation.
These were the Standard Oil, Ford, AT&T, General Electric of the past generation
These are the SpaceX, Tesla, Apple & Nvidia, TSMC’s of the current generation
These will be the Redwood Materials, Anduril, Gingko Bioworks of the next generation
About me
I'm a YC founder, ex Uber ATG engineer (self-driving cars) and I've always been fascinated with how great founders can dig into new domains and build massive companies. I'm currently considering vertical integrator ideas for my next startup.
Reading list
https://wanderingfounder.substack.com/p/can-you-systematically-build-10b
https://wanderingfounder.substack.com/p/how-to-predict-the-rise-of-a-vertically
https://www.notboring.co/p/the-techno-industrial-revolution