Business Breakdowns
Episode 59 Anduril: Building The Future of Defense
Business Breakdowns

Episode 59: Anduril: Building The Future of Defense

Business Breakdowns

Episode 59

Anduril: Building The Future of Defense

Brian Schimpf is the CEO and co-founder of Anduril. We cover the evolution of the defense industry, the advantage of Anduril’s business model over legacy firms, and what Brian has learned about selling to the DoD.

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[00:02:52] - [First question] - The history of defense technology and the technological and competitive landscape when he set out to build Anduril

[00:08:22] - What the early experience was like when approaching the government and finding an early adopter

[00:12:44] - Necessity being the mother of invention when it came to developing drones

[00:16:37] - What it’s like to develop hardware and software products at the same time 

[00:20:26] - How the defense business complex works economically and overview of the detailed cost plus model

[00:24:44] - The state of military technology and military conflict today writ large

[00:31:10] - Are we heading to a future where warfare is mostly machine against machine? 

[00:33:34] - Comparing the ghost drone system to predator drones

[00:38:40] - Guiding principles as a firm and deciding on their product roadmap

[00:43:25] - An overview of their product lineup and what they’ve built so far 

[00:48:13] - Having an open innovation policy to promote competition

[00:49:37] - The nuance of politics when it comes to building and running their business

[00:51:56] - Most difficult decisions he’s had to make through Anduril’s history 

[00:53:51] - How he overcame Anduril’s lowest points and biggest challenges 

[00:58:38] - Thoughts on effectively compounding hardware innovation 

[01:02:23] - A moment he’s most proud of and regrets most in Anduril’s history

[01:04:20] - Lessons learned from observing Palantir and SpaceX 

[01:08:37] - The kindest thing anyone has ever done for him

Anduril: Building The Future of Defense

Introduction

Patrick
Today we're breaking down Anduril. Anduril builds high tech defense systems for the US Department of Defense and its allies. Crucially, it does so with a speed that emanates from Silicon Valley. Founded in 2017 by Palmer Lucky who previously built and sold Oculus to Facebook, Anduril has achieved the rare feat of challenging the established order in the defense industry. To breakdown Anduril, I'm joined by the company CEO and co-founder Brian Schimpf. We discussed the history of the defense industry, how Anduril's business is counter positioned against the legacy cost plus model, and what Brian has learned about selling to DOD. Please enjoy this breakdown of Anduril.

The History of Anduril and Defense

Patrick
So Brian, ever since we met over dinner, I don't know what it was, two months ago now, I've been really looking forward to this conversation. I've got a weird fascination with military history. My best friend growing up was a special forces officer. I've just always been around this world without being personally in it. I'm really excited to try to suck as much information out of you today as I possibly can. And given that Anduril is kind of like Tesla, the first new car company that made it in a hundred years or something, something similar could be said of Anduril in the world of defense. I thought an interesting place to begin would be to have you give us a bit of a history lesson of that industry as you saw it maybe when you and your co-founders started Anduril. People have heard names like Lockheed Martin and Northrop Grumman, but give us from your perspective what the history looked like from the seat of trying to start a new company in this very intimidating space.

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