Marathon Series: The co-founder of Skype joins me in Estonia

Joining me is one of the co-founders of Skype, formerly known as Skyper. Ahti Heinla is, among other things, the co-founder of Kazaa, which I remember as one of the first ways of getting music and movies.

I’m excited to have him here but the thing that he’s probably more excited to talk about is the cool little robot that I saw outside the office here at LIFT99. It’s part of his latest company, Starship Technologies. we’ll talk about that and more in this interview.

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Ahti Heinla

Ahti Heinla

Skype

Ahti Heinla is the cofounder of Skype, which specializes in providing video chat and voice calls.

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Full Interview Transcript

Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy, where I interview entrepreneurs about how they built their businesses for an audience of real entrepreneurs. I am in Estonia, and I am super excited about today’s guest. Joining me is one of the co-founders of Skype, formerly known as Skyper. Ahti Heinla is, among other things, yes, the co-founder of Skype, the co-founder of Kazaa, which I remember as one of the first ways of getting music and movies. I’m looking at your face to see if you’re excited to talk about your past or not.

Ahti: Kazaa maybe not so much, but yeah.

Andrew: But you’re going to do it.

Ahti: A few words.

Andrew: Let me adjust, actually, your mic. I see that we could adjust it more. I’ll tell you why I’m excited about it. I love to see how people build up their businesses, how they got here. And I feel like what you guys did at Skype was one of the huge, exciting success stories and moments of the internet. At a time when it felt like things were failing, the internet was not really as meaningful as it was, you guys came out and said, “Look, this is something that connects you with your family, that does something that’s magical.” One of your co-founders did this Reddit ask me anything where someone just said, “I have no question. I just want to tell you I work really far away from my family. This was the only way I could talk to my wife and kids, and it just meant so much that you guys created it.”

Anyway, the thing that you’re probably more excited to talk about is this cool little robot that I saw outside the office here at LIFT99. It’s part of your latest company, Starship Technologies. You guys have a robotics company that makes these little cute robots that I’ve actually seen people take photos of. What they do is they will do delivery from pizza places or other restaurants, and zoom packages directly to my house. I use my app. Not yet to my house, but eventually. Just hit a button, take out my package, and get it, right?

I’m trying to read your face. The problem with Estonians, for me, someone who is like so exuberant is you guys are not as exuberant. You’re just watching Andrew, “Where is this energy going?” All right. We’re going to find out how this whole thing happened thanks to two phenomenal sponsors. The first, Ahti has heard me talk about for a while. He knows them as being so identified with my company that when I talked about Toptal before we started he said, “Oh, yeah, of course, everyone knows the connection.” So Toptal for hiring developers. The second is a new sponsor, ClickFunnels, for building phenomenal funnels that convert. Ahti, good to have you here.

Ahti: Thank you for having me.

Andrew: How many deliveries are you guys doing now at Starship?

Ahti: He have done more than 100,000 deliveries with Starship robots so far. We are at the point where we have really proven that this works. People like it. People want to use robots for delivery, and they find value in it, so we are going to scale.

Andrew: How many a day?

Ahti: Right now, we have done 100,000 to date. To get from 50,000 to 100,000, it took us something like four months, or something like that. So that probably means that it’s around 1,000 per day.

Andrew: A thousand per day is what you’re up to right now.

Ahti: Yeah.

Andrew: Where can I actually get a robot deliver me food?

Ahti: So, in the U.S., there are two universities where we are operating right now. One is the George Mason University, near Washington D.C., in Virginia. And the other is Northern Arizona University in Flagstaff. And we’re going to expand to more and more universities in the U.S.

Andrew: I read 20 universities is your goal?

Ahti: Well, our goal. So what is the goal? Our goal is however many universities there are in the U.S. That’s the goal.

Andrew: To be everywhere, at every university.

Ahti: Yeah, absolutely. The thing is, the solution we have works really everywhere. People love it. People want to use it. Of course, we want to scale as quickly as we can.

Andrew: You mentioned two universities. What is this thing that I saw that you had partnerships with Domino’s in Germany, London food delivery firm Just Eat, DoorDash in the U.S.? Are you actually making food deliveries through them, or are they just testing it out?

Ahti: Right now we are not, but in the past we did. We did experiment with a number of different things, actually, many, many different things. You know, we delivered everything from flowers to packages, and so forth. Then we tried really various different urban and suburban environments. Because for these robots, really, for the autonomous driving software and so forth, and how people perceive them and so forth, it actually really matters where you are, like in the middle of Manhattan or whether you are like a more quiet part of Palo Alto, or something like that. It’s really different. The value people get from it is different, and the way that they perceive it is different, and so forth. So we tried all of these things. We tried different combinations.

Andrew: Just to see, “What’s going to work? What’s going to do it?”

Ahti: Exactly. Yeah, and the different types of partners, and so forth. So, initially, we started out thinking that we would sell delivery services to other companies. You know, we can still do it. But, right now, we’re focused on a direct-to-consumer business model where the consumer uses our own app, then orders food, and groceries, and things like that.

Andrew: And universities are where you’re going because they’ve got . . . Why? Why did universities work?

Ahti: Essentially because there is a high density of students, they are early adopters, and they need food. They live on campus. They live on campus all day. They need breakfast. They need lunch. They need dinner, and so forth. That’s actually different than in a suburban neighborhood. It’s different because people are at work during the day, and they need either breakfast or . . . Probably, people are in a hurry in the morning and they need dinner, and everybody needs dinner at the same time. Essentially, the university model is something where we see that we can scale the quickest.

Andrew: Yeah, and it’s an environment where one person can make a decision. You don’t have to wait for local laws to change, right? Whoever’s running it in the university can say yes. There aren’t a bunch of cars to interfere with. I get it. Let’s go back in time a little bit, touch a little bit on Skype, to the point of discomfort a little bit. Then we’ll talk about some of the things you did before. Maybe not discomfort. I don’t want you to ever feel uncomfortable.

Ahti: I’m always comfortable talking about things I’ve done.

Andrew: Let’s talk about your past. What did your parents do?

Ahti: My parents were actually software developers, so my mother taught me how to program computers when I was 10 years old. She just came home some evenings and said, “Ahti, I’ll teach you something new,” you know, like parents teach their kids.

Andrew: How did she teach you when you were 10 years old, from what I understand, to program using Pascal?

Ahti: Back then, you know, that was 1982. There wasn’t internet. There were actually like real paper books and so forth. So she had a few books about Pascal and computer programming, and she took some little tasks to be done using the computer, and taught me how to do it. Back then, we didn’t have like a personal computer or anything. This was Soviet Union. I don’t know how many computers there were in Estonia at that time, maybe 20 computers or something.

Andrew: So she taught you how to program on paper?

Ahti: Yeah.

Andrew: Get out.

Ahti: So it was on paper. And there were computers at my parents’ workplace, of course. So I actually did program on paper.

Andrew: Because she would have time reserved at a computer, and occasionally she would bring you with her, and you would sit and get to actually program. But you used to program, at first, or at times, on paper.

Ahti: Exactly.

Andrew: Wow-wee. I read that you used to get punch cards back at your house, and that was kind of a fun thing to have, actual punch cards.

Ahti: Yeah, I played with them when I was a kid.

Andrew: Played what with them?

Ahti: Well, the games kids play. I guess I was, you know, building houses.

Andrew: Using punch cards?

Ahti: Yeah.

Andrew: Wow. And then I tweeted this out, and this got a lot of people excited, that your mom said to you, “Don’t be a programmer.” Do you remember why?

Ahti: Yeah, because she actually said that it’s a woman’s job.

Andrew: A woman’s job? That’s the way it was back then.

Ahti: Exactly. Maybe it wasn’t exactly like that. But when I look at it, actually, my mother is more than a 70-year-old by now. At her birthdays, right now, she invites the people who worked with her, and the people who studied with her, and so forth. They are pretty much equal, men and women. They’re men and women in their 70s who were software developers all their career. It’s really funny. You know, for me, at my workplace, at Starship, I’m not sure what’s the age of the oldest person who works for Starship. It’s less than 70. You don’t get to see that all that much. But there you see people who are both men and women who are over 70, and they talk about computer programming, and the work they have done, the fun that they have had, and so forth. So that’s really eye-opening in a way.

Andrew: Eye-opening because what? Because there was a time when it was a balance. In fact, if anything, the balance was more towards women being developers. Men were electrical engineers.

Ahti: Yeah. So at my parents’ workplace, it was more that men were electronics. I don’t remember there being any electronics engineer at my parents’ workplace who was a woman, but there were tons who were computer programmers.

Andrew: Got it. And that was the part that excited people, because there’s a sense today that women can’t program, or there aren’t enough in the world. Yeah, I saw you were whistling. Right? And this is just nothing but a cultural construct.

Ahti: Yeah, absolutely. At Starship, we have many women or several women who are programmers. Like, the notion that women can’t program, that’s ridiculous. It’s not like that at all. Certainly, there are a lot of social constructs. I try to, certainly, do whatever I can to change that. Because, in a way, the software development field is missing half of the brain power that exists in a society. Yeah, I don’t like it, but I try to change it.

Andrew: There’s a screenshot here I’m looking at from your LinkedIn profile. The very first item on it is Bluemoon Interactive, founded January 1989. What was Bluemoon Interactive?

Ahti: So Bluemoon Interactive was just a company under which me and my friends were doing various software projects. We were doing computer games. We developed computer games for publishers in UK, U.S., Sweden. We started out when Estonia was still in the Soviet Union, or occupied by the Soviet Union. You know, back then, it was almost like nobody had ever done this before, around us, in Estonia, to develop some software package and sell it internationally, outside the Soviet Union.

Andrew: Were you allowed in the Soviet Union to sell software internationally?

Ahti: Probably not. But, back then, this was at the end of the ’80s, so this was at the time when Gorbachev was already in power, and a lot of rules were relaxed. We weren’t sure really what was allowed and what wasn’t allowed, but there was a lot more sort of commerce happening. This was being viewed as a positive thing, that there’s some sort of entrepreneurship, and people can make money using that, and so forth. People were still struggling to do it. People were really learning how to create a business.

It’s funny. In the U.S., for example, kids grow up seeing business all over the place, everywhere. They know entrepreneurs, either their parents, or their relatives, or somebody runs a small business, or a big business, or something like that. Back then, in the Soviet Union, this was a really, really new thing. It was like going to the moon. Do you know anyone who has been to the moon? You don’t know, right?

Andrew: No, I don’t. Yeah.

Ahti: Exactly, so you don’t know. So you grow up as a kid. You think, “Oh, I want to go to the moon,” but you don’t really know how to do it, right?

Andrew: How did you get to a point where, when this wasn’t done around you, you didn’t know how to do it, you still said, “I can do this”?

Ahti: So it’s a good question. I guess it’s part of your psychological disposition.

Andrew: That’s what it is.

Ahti: Exactly. If I’m trying something, “Will that work, or will that not work?” People have expectations. I guess I have just the expectation that when I try something, it will work. Well, if it doesn’t work, it’s no big deal.

Andrew: You naturally feel that way. That’s who you are.

Ahti: Exactly. So, back then, we tried to develop computer games, even though nobody really knew how to develop computer games before. We tried to sell computer games to the outside world, which was a really, really big thing. Nobody around us had ever done that.

Andrew: So first you programmed the games. Then did you package them up in [inaudible 00:14:33] boxes?

Ahti: I guess it actually went in a way that we didn’t actually package, but we worked with publishers who did that.

Andrew: Publishers in the U.S.?

Ahti: The U.S. and other places as well. I think the first game we developed, we sold to Sweden. I’m not sure how many copies it sold, maybe something like 1,000 copies. Not much, really, probably.

Andrew: And you were getting a percentage of the sale, or a price per box.

Ahti: Yeah, we got money from Sweden. And it was a lot of money back then, actually, because in the Soviet Union this was a really new thing. Nobody sold anything, you know, exported anything, really. You know, the currency exchange rates and so forth actually meant that we made a lot of money.

Andrew: What did they do? Did they send you a check back then that you were able to put into your Soviet bank account?

Ahti: No, no check. Actually, we got cash. There was one point where me and Jaan Tallinn with who we developed these games, we walked on the street in Estonia and we just had our pockets full of dollars.

Andrew: That must have felt great.

Ahti: I guess it did, but I guess we never really did it for the money. It’s good to get the money, right? For sure, yeah, it’s nice to spend the money and so forth. You know, we didn’t do it to get rich. Also, I guess it’s important to talk about, because people’s motivation is actually super important. If you talk about entrepreneurship, if you talk about doing startups, the question, “Why do they do startups? Why did you create your company?” Did you want to have a nice, big mansion and a collection of sports cars, or something like that?

Andrew: I have to be honest with you, not a mansion or sports cars. I hate cars. But stack up money definitely was a motivation. I’ve been wondering during these interviews, especially here in Estonia, if maybe it was a focus on the wrong thing.

Ahti: I’m not sure if it was the wrong thing or not. The thing is that at least people in Estonia, even right now or in the recent years, it’s probably changing, but definitely, back then, if you talk about when Estonia was still in the Soviet Union, you couldn’t count on getting rich by founding a company. That’s like counting on getting to the moon when you’re a kid. You can’t count on it. You can aspire to it, but you can’t count on it, right? I think I had started things because it just seemed that I could change something, I could do something, and I do it for the excitement. It’s nice to get the money, but for me that’s not the primary thing.

Andrew: What was the excitement about creating games? Just to have people play it, or you create it and have it come to life?

Ahti: I was, let’s say, intellectually inspired. It was difficult to create games. I was learning new things. I could do things that I couldn’t do a year ago. I found it intriguing. Back then, a lot of computer game engineering was about computer graphics, like, “How do you create a more realistic look with graphics?” Back then, it was very, very far from any sort of realism.

Andrew: It’s silly to even think about it as realistic. But, yes, that did feel realistic.

Ahti: It was like a couple of characters, a red square and a blue square going in and fighting each other on the screen.

Andrew: The game, was it Kosmonaut?

Ahti: Yeah, that was the first game we actually sold to Sweden.

Andrew: Then, how did you end up, about 10 years after founding . . . ? Was it bankruptcy, or close to?

Ahti: We were struggling. We were living from contract to contract, and we were never sure that we’d get the next contract to develop another game. Often times, we developed a game and tried to sell it. If we failed to sell it, then we had just spent like nine months working for nothing.

Andrew: And that happened?

Ahti: That happened, yes. That happened, I think, several times. So we got out of developing games at the end of the ’90s, so we spent about 10 years doing it, or trying to do it, and having some success but never really making it really big. So that was the background.

Andrew: And did you end up taking the job at Tele2?

Ahti: Yes, so that was more of a job, even though the thing was that they kind of marketed in a way that they needed a software project to be done, which very few people can do. So they were willing to pay much more than was the regular sort of going rate in Estonia at the time. I don’t remember, actually, what the sums of money were, but they were sort of paying the average salary of a software developer in Silicon Valley, for example, in Estonia in 1999. You could probably buy 20 houses at the price of 1 house in Palo Alto, for example.

Andrew: That gives me a sense of what it was. So you did that. The product you worked on was Everyday.com. What’s Everyday.com?

Ahti: Everyday.com was a portal, like a news portal. Remember, this was 1999. I’m not sure how many of the audience really participated in this.

Andrew: Yahoo was a search engine, but what it really wanted to be was a portal. The first thing that you do when you log into the internet. There was Excite, and Lycos, and all these other guys wanted to be portals. They believed that people would go to the one page. It turns out that was a flawed mentality, right? That’s not what people are looking for. What happened to Everyday?

Ahti: I think nobody has heard of Everyday right now, so I guess nothing good happened to it, but I was part of the team that developed it. I didn’t really spend a long time there, maybe about a year or something like that. But then Niklas Zennström and Janus Friis were also on that project.

Andrew: They were?

Ahti: That’s where we got to know each other, and we did several startups together after that.

Andrew: What’s the first one?

Ahti: It was Kazaa, a file sharing service. After that, there was Joltid, a peer-to-peer technology company. Nobody has heard of that, really. Then the third was Skype, and everybody has heard of Skype. I’ve been part of some successes, but also a number of companies nobody has heard of.

Andrew: I’d rather that than anything else. To have several companies that do well is a huge win, in a world where you could be wrong all the time, but if you’re just right once, it makes up for all those wrong times. Right?

Ahti: Absolutely, absolutely. Well, I think even if I hadn’t had any big success in my life . . .

Andrew: You’d still be okay with it?

Ahti: I would still be okay, because I’m trying, I’m trying to change things. Yeah, I think I would still be okay.

Andrew: The nerviest question that I want to walk in here with is, “Why did the two of them get to be co-founders for a long time, and not you?” Three of you.

Ahti: There were actually more people around the table. The thing is that I think you essentially have to grow to the level where you can be a co-founder. Being a co-founder of a startup is something that, on one hand, anyone can do. Anyone can sit up and say, “Oh, let’s found this startup.” Anyone can actually do it. But, you know, I wasn’t thinking about that at that time. I was just happy that I met some people who wanted to do things and needed the skills that I had. I wasn’t a founder, and I didn’t really want to be, really.

Andrew: What’s the difference between a founder and you? Is it the equity that they put in? Did they put investment money in the company, or something else?

Ahti: In Skype, I actually got founder shares. So, by that logic, I’m a co-founder. On the other hand, I was at the table, but I wasn’t the guy who said, “Let’s do it.”

Andrew: That’s the difference. The person who says, “I’m going to do this. Will you come help me?” is the co-founder. The, “Will you come help me?” is the head engineer.

Ahti: That’s how I look at it, yes, that the co-founder or founder is the person without whom this startup wouldn’t exist. I’m not completely sure, but I think that Skype would still have existed if I were not at the table.

Andrew: That’s not what other people say. But okay, let me take a moment to talk about my first sponsor, and then we’ll come back in. I want to understand a little bit about Kazaa, a little bit about FastTrack, and then Skype, the changes Skype had on the world. First sponsor, a company called Toptal. How do you know Toptal connected with me?

Ahti: I know it because I listen to your podcast, and I think it isn’t a surprise to anyone who has listened to your podcast that that’s your sponsor, or one of your sponsors.

Andrew: You haven’t hired from Toptal. Why not?

Ahti: I haven’t, actually. I’m not actually sure, but they’re active in Estonia. We are hiring most of our developers, all of our developers almost, in Estonia.

Andrew: Because you want them to be local in your office.

Ahti: Yeah. The thing is, for Starship, we already have quite a few offices in San Francisco, and Estonia, and so forth. We want to keep the people who were working on similar things in the same place. I’m sure that that’s also what a lot of other companies want to do. So if you want to hire in a certain place, and there is a company like Toptal who is making it easier for you to find talent . . .

Andrew: I was actually having a conversation with Sachit Gupta who sells our ads, at the airport on the way over here. He said, “Andrew, I think you should stop talking about the negative stuff with the sponsors. If there’s something negative, just leave it out.” And I said, “Yes, I’m changing my mind on it right now.” There’s no way that Toptal is a good fit for you. If what you’re looking for is having people in your office, Toptal is not sending people in your office, and it’s better to have you be aware of that than call them up and try to change the way you’re doing things.

But for people who are okay with remote workers, Toptal is fantastic. You actually go to their website, toptal.com/mixergy, you hit that button, they schedule a call with you with a matcher. The matcher will listen to you, hear you out, understand what you’re looking for, the quirks, the way you work. Then they’ll go back and they’ll find one or two people who fit exactly your criteria. You could decide whether to hire them or not.

If you do and you’re happy, they’ll give you 80 hours of Toptal developer credit when you pay for your first 80 hours, in addition to a no-risk trial period of up to two weeks. If you’re not happy, you don’t pay. And if you do talk to them and you don’t want to keep working with the people they invited you to talk to, you don’t have to hire them. All right. It’s top as in top of your head, tal as in talent, toptal.com/mixergy. I love that you know that.

The original thing with Kazaa, going back in time, we all knew what was happening with Kazaa, right? Am I about to lose you on this? Because I never want to disrespect my guest. But I feel like the music industry was not moving to online. They had to move to online. They weren’t going to. Napster came out, but Napster was centralized. Kazaa said, “You know what? We’ll be decentralized. We’ve found a solution, but we know what you’re going to use it for.” True?

Ahti: Well, we developed Kazaa really as a way for people to share files, any sort of files, really. So, actually, we weren’t very much concerned about what they were going to share.

Andrew: It wasn’t, intentionally, “You guys want to share this. This is going to be a new way that we’re going to get away with.” It’s more like, “Share anything.”

Ahti: Yeah, we even had categories where people could share their short stories they were writing, and so forth. We went to some length to try to develop some sort of categorization system and so forth for the content that people created themselves. Yeah, that was a long time ago. Things have changed. Now, people are not using Kazaa. I’ve been part of things that have succeeded and that everybody’s still using right now, and some things that people are not using anymore.

Andrew: By the way, did you know that over a decade after you started it, people are still using it? After you walked away and the whole thing walked away, there were people using versions of it? I didn’t know that until I started looking you up.

Ahti: I guess so, maybe. I’m no longer involved with Kazaa, because . . .

Andrew: There’s something called Kazaa Lite that apparently kept going. All right, let’s get to Skype then. What did you guys realize that gave you the insight to create Skype?

Ahti: I think we were really lucky to have tried this at the right time. We essentially were at the right place at the right time. We realized that, you know, back then, you had to pay quite significant sums of money for international calls. Both me and Jann Tallinn and other people, and Niklas, and Janus, we are from Europe, right? Europe is a continent full of small countries. That means that there’s actually a big chance that you have a friend, or a business partner, or somebody you need to talk to who is actually not in the same country, because the countries are so small.

You know, that doesn’t always happen in the U.S., for example, because it’s a big country. Europe is a network of small countries. So international calls actually were quite expensive. At some point, I calculated. I sort of took the price list of telecom, and I took how much per minute you would need to pay for a phone call from Tallinn, the capital of Estonia, to New York. Then I calculated, “Okay, there’s another price list from a telecom offering internet connectivity. If I need to transfer the amount of bits that’s required for this one-minute of voice recording, if I just recorded this voice on one computer and transferred these bits to New York, how much would I need to pay for this transfer?” The difference was 1,000 times.

Andrew: It was one-thousandth less, okay.

Ahti: Exactly. It’s essentially the same service, so it’s a very, very similar services. It’s transporting information. One is in the form of voice. The other is in the form of bits. You can transform voice into bits and vice versa, so it doesn’t really matter. So you can transform the voice into bits in one computer on one end, transfer them to New York as bits, not as voice.

Andrew: And then back from bits to voice.

Ahti: Then back, exactly, and you save 1,000 times, right?

Andrew: Did you start off with, “I have this technology”? Was it FastTrack that was peer-to-peer? Did you start off with the technology and then say, “What can I use this for?” Or was it the problem and then said, “How do I solve it?” Or am I being too anal?

Ahti: It was vice versa. We were experienced in the technology of peer-to-peer networks. We first had the need that, “Okay, how do we make all of this software system to work? How do we transfer this voice to New York?”, so to speak, “What is the software that we need to . . . ?”

Andrew: It was first, “We have the technology,” and then it’s, “What problem do we apply it to?”

Ahti: No, no, other way around. It was first that we needed to transfer these bits to New York, right?

Andrew: I’m sorry. Forgive me. I just love this company and I want to understand it. First, you said, “We see a problem with the phone prices being too expensive.” Then it’s, “Wait, we have the technology.” That’s the first one. Clearly, the problem first.

Ahti: It was clearly the problem first. When we decided to found Skype, we didn’t actually know the expertise in peer-to-peer technology that we had would actually be useful.

Andrew: It was, “We have a problem. Let’s solve that. Hey, wait a minute. We solved this in some capacity before.” Got it.

Ahti: Exactly, that’s how it was. That was probably part of the reason why we could develop Skype relatively quickly, like in 9 months with 10 people, or something like that.

Andrew: And there were other people who made attempts at this before. The difference between you and them was . . . ?

Ahti: I think the difference was that we tried to make it easy for people to use. This concept of voice over IP, that’s the concept I described, transferring the voice to bits, and then to New York, and then back to voice.

Andrew: There were Wall Street Journal articles about this five years before Skype launched.

Ahti: Exactly. It was something that people knew that could be done in principle, you know, technically. But nobody had made it easy for people to actually use. It wasn’t technically straightforward to do it for various reasons, depending on how your internet connection was built, and so forth. Let’s not get into all of this technical details, but it wasn’t easy to actually make it happen in a way that 99% of people could actually use it. So we were probably the first company who actually made it easy for people to use.

Andrew: Was it the user experience of the app that they looked at that was the difference, or was it what was happening on the backend?

Ahti: One was the user experience, but the other was just to make it technically work. You know, most people’s internet connections were not really fit to do it in a really easy way [crosstalk 00:33:28] way. Yeah, and for various reasons, it wasn’t so trivial technically. But we figured out the ways how to do it technically in a way that 99% of the people could actually use it by downloading and calling somebody. You didn’t need to configure a lot of things in a really complicated way, and so forth. Nobody does it right now. If you look at any sort of software or any of the apps that people are using, they’re not expected to really fiddle around with lots of settings and so forth to just make the basic functionality work. That was actually, back then, the reality, that a lot of times you really had to be like a computer enthusiast to get almost anything to work.

Andrew: Why do you think you guys figured that out, that the user experience was so important, when others didn’t?

Ahti: Probably a lot of people knew that user experience was important, but they didn’t have, maybe, then the technical experience to figure out a good technical solution for that.

Andrew: How did you have this?

Ahti: It’s a good question to ask, but the thing is, for us, it’s just natural. We got this idea, “Let’s do it like that. Let’s do it using peer-to-peer technology. That’s the solution we’re going to use.” It’s actually very hard to answer the question, “Why didn’t anyone else come to the same idea?”

Andrew: Is it possible that you did because you created games? And when you create games, you cared about the design of the game we talked about.

Ahti: Potentially.

Andrew: Potentially, but not necessarily.

Ahti: Not necessarily. Lots of people cared about design. Really, it’s hard for me to answer the question, “Why didn’t anyone else come to this?” In principle, anyone can come to any idea. I could have created Twitter. I could have, right, but I didn’t.

Andrew: Twitter wouldn’t work without other people. I thought the difference you guys had was that it was peer-to-peer, which meant that you didn’t have very expensive costs to make it work, so you could offer it for free. That was huge. Which meant that if my dad signed up for Skype, he was telling all his friends, “You have to go sign up for Skype too,” otherwise he has no one to talk to. Right? And I thought because you guys gave it to him for free, that made it easier to spread. No.

Ahti: Yeah, certainly. Skype spread quite quickly. It was actually something that you couldn’t use alone. So you could hear about something. Suppose you read an article or something that there’s some cool new thing, Skype, and so forth. So you install the app, but in order to use it you actually needed to convince a friend, and then you can try it together. You convinced your friend. Your friend thinks, “Oh, this is really cool. Who else can I use it with?” Then this friend needed to convince another friend, and so forth.

So it spread like wildfire, with word of mouth, really. That was part of the success. It was built, technically, in a way that everybody could use it. It wasn’t that you needed some sort of complicated network configuration and things like that, which probably the previous voice over IP application needed. It just took off like wildfire. I think we had, first, 10,000 users on the first day. Right now, it’s actually nothing, 10,000 users. You get 10,000 users by having one piece of news in TechCrunch, or something like that. Back then, I think there wasn’t actually TechCrunch.

Andrew: So it just kept spreading and spreading. Did you, at that point, feel a sense of excitement and satisfaction?

Ahti: Oh, yeah, of course.

Andrew: You did.

Ahti: We felt like we were a rocket. We got lots of users. There was lots of new pull from the market. People wanted to use it more and more, until we were just struggling to keep up with the load. Our software was crashing because too many people wanted to use it and so forth, and we were just excited to get things fixed very quickly. Yeah.

Andrew: I mentioned earlier a little bit of trivia that I read, which it was supposed to be called Skyper at first. Where did Skyper come from?

Ahti: I think it was kind of like we were peer-to-peer that people talked to each other. Then, at the same time, we wanted this to be a solution people could use anywhere to talk to anyone. We thought the sky was sort of a symbol of freedom where you can do anything, and so forth. But then I think we found that skyper.com was taken, and so we decided to drop one letter, and skype.com was available.

Andrew: I thought it was like sky-hype, and you guys were just going to pump it up.

Ahti: Actually, hype wasn’t part of the thing.

Andrew: No, I was just trying to figure it out. The thing that bothered me was when people called it Skypee. Oh, that just used to get me. I don’t know why stuff like that frustrates me.

All right. My second sponsor is a company called ClickFunnels. This I’m going to introduce you to. I didn’t think I needed ClickFunnels. I could create web pages using HTML. I got WordPress. I got all this other stuff. I didn’t need it. Then this guy, Caleb Hodges, said, “Andrew, you hired me to create an onboarding process for new people. I’m going to create it in ClickFunnels.” I said, “No, you don’t need it. I don’t need another piece of software.” He said, “Andrew, trust me.” I said, “Okay, that’s why I hired you. I trust you.”

He created this landing page. I forget what it was for. He created a landing page. I know what it was. I was excited about chatbots. I invested in a couple of companies, I learned about it. I said, “Great, so you created a landing page.” He created an onboarding flow. He actually, as a third page, sold people on something. It was great, and the thing took off. I kept it, and we kept adjusting it and tweeting it, and tweaking it.

Anyway, I got a framed gold record a couple of months ago because I hit over $1 million in sales just from this one sequence of pages that I never even wanted. But it’s so easy that all they do is create web pages. They take strangers, tell them about your products, collect their email addresses, then say, “Hey, if you want, you can buy this.” Even when they buy, there’s a little checkbox that you could add that says, “Do you want to upgrade to this?” People upgrade. Anyway, super clear.

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Then, it was done. Let’s talk now about when you sold the company. It was one of the biggest sales ever at the time. It fired up people’s imagination. I get it. Did you have a moment, by the way, where you could just go, “Look, this company that I previously had almost went out. We could still be under the Soviet Union.” Life could have been a whole other way. It turned out great. Did you take a moment to celebrate? Did you do anything fun?

Ahti: Anything fun? Well, for fun, I was just thinking of founding new companies and doing new products.

Andrew: That was it?

Ahti: Certainly, yes. I like to travel. I like the time off to travel a little bit.

Andrew: Where did you go?

Ahti: Really, I wasn’t really spending the money too much. I still live a relatively modest life. I was just thinking, “What other cool things can I do?” For me, I’m really a person who wants to start new things. For me, I guess I felt at Skype, after I had been at Skype for five-and-a-half years, I was more feeling, “My job is done.” I was the chief technical architect and founding engineer. I think you know, all of the technical architecture was already done. I decided to move on, and I left Skype, and I was thinking, “What other cool things could I do?” I tried a number of different things. I’ve actually been founding a number of companies that never got past the point where it’s just a couple of founders, or maybe a couple of people we hired, and tried something, and decided to shut it down.

Andrew: Why? What did you learn from that?

Ahti: I certainly learned that not everything you touch turns gold.

Andrew: Did you used to think that?

Ahti: Not really. But, still, considering that with Skype we had such great success. People who were early at Skype, like the first 10 people or something like that, after leaving Skype, most of us went to found new companies. All of them failed. All of them failed. Everybody who were early at Skype and founded another startup after Skype, that startup failed. It was probably like a hard landing for everybody. Yeah, you know that the success rate of founding startups is not guaranteed. It’s not like you found something and it becomes like this amazing success. But if one of them does become an amazing success, you kind of start thinking your next one will be an amazing success, and bigger than the previous success, and so forth. So that’s not always what happens.

For example, Taavet Hinrikus, who was the first employee of Skype, he was doing something. He founded something which failed. But the next one he founded was TransferWise, which is hugely popular, one of the most popular or most successful fintech companies that helps you change money at better rates than the banks are offering. They’ve got millions of users, and they’re a unicorn, and so forth. That wasn’t the first startup he founded after Skype. The first one that everybody founded burned. I did also. I founded a number of startups.

Andrew: What was the one that was most painful?

Ahti: I think all of them are really painful. All of them are painful. All failures are really painful. The thing is you have to compose yourself, and just wake up to the reality that, “Okay, this thing doesn’t work,” and you need to close it down, and you need to found another one, or you need to try something else.

Andrew: How do you get from that point of failure to saying, “I’ve got to pick myself up,” without letting it define you, without saying, “Maybe it wasn’t me. Maybe it was those guys”?

Ahti: One thing that I haven’t actually experienced is if you get to the point where you, let’s say, have hundreds employees and so forth, and you’ve raised tons of money and so forth, and you then fail. I imagine that actually could be really, really painful. But if it’s at the level where it’s just you and a couple of people, you come to your office at some point, and you sit around the table, and you all fit around the same table, and you look each other in the eye and just decide, “This is not going to work.”

Yeah, it’s painful. But, on the other hand, suppose like in relationships, in dating, in marriages. You live together with somebody for a couple of years maybe. Then, at some point, you decide, “Okay, it’s not going to work,” so you split. After you split, do you get demotivated and think, “This dating and marriage thing, this is not for me. I’ll never do it again”? You probably actually don’t do that. You will try again, right? I also tried again.

Andrew: Eventually. People who I’ve met who were divorced almost always say, “It’s not for me. I’m never going to do it again,” and then they come back to their senses later.

Ahti: Okay, I guess there are different sort of people. I’m not that sort of a person. I always think, “Okay, I have to try again.”

Andrew: I do see that about you. One of the things that I’m going to walk away from this is thinking, “Why am I not doing that more often?” I feel like you’ve got less attachment to your successes and your failures. Is that true?

Ahti: That’s probably true, yes. That’s probably true. In terms of successes, Skype is probably the biggest success I have had so far, but I’m not actually defined by Skype. Actually, I’m no longer really using Skype. That was a long time ago for me. We founded Skype in the end of 2002, so that makes it 17 years ago, right? That’s past me by now. I’m not even using our product anymore.

Andrew: When we were talking out there, I said, “Is it okay if I bring up the way you’re dressed?” I now know why I want to bring that up. I had this impression of you that I expected when you walked in, for some reason I thought you’d have this cool leather jacket on, like jeans, but you know that they’re more like cool and more expensive than the regular person’s jeans. Like, everything, I thought it would be like whatever level up that would make everyone else’s stuff feel like crap. You don’t. You just look like you’re . . . t-shirt, regular pants.

Ahti: Yeah, absolutely. I’m very, I guess, regular in the way I dress. I don’t actually pay too much attention to clothes. There’s a lot of things I try to pay attention to. For example, at my company, I pay attention to a lot of different things. I try to make everything better, and so forth. I guess I feel like I don’t really have all that much cognitive bandwidth.

Andrew: Cognitive bandwidth, interesting, that’s what it is, “I just don’t have time for it.” But there’s also this, “I don’t need to impress you. I just am in my world.” Is that what it is?

Ahti: Yeah, I don’t really try to impress anyone, right? If anyone inspired by what I have done, then that’s great, but I’m not doing it to impress anyone.

Andrew: Let’s talk about, then, Starship. I’ve got a whole agenda for Starship here. By the way, this is where I saw 100 university campuses, in one of your press releases. So it’s not like you guys have 100 universities lined up for the next 24 months, that’s the goal. That’s your plan. Now that you know it’s going to be universities, you’re going to go to 100 in the next 24 months.

Ahti: Yeah.

Andrew: Got it. Okay. I thought you had 100 already lined up. You mentioned, “I’m always looking to fix things.” Do you have an example of something that you fixed that other people wouldn’t pay attention to at Starship, your robotics company?

Ahti: At Starship. I think I have actually a better story in terms of Skype. In Skype, there were quite a few things that I paid attention to. I was the chief technical architect. For me, for example, the technical architecture of how these people were connected to each other via internet, that really mattered. There’s a number of different technical ways how you can do that. For example, it was important to me that people who were in the same office, they got a direct connection to each other without these bits needing to go outside the building. That was actually important when they’re transferring files to each other. That was something, for example, I paid attention to. I paid attention to, “This has to work.” It’s considered a bug if it doesn’t work. Sometimes we broke that, but I paid attention to that. It’s like a small detail. The overall service would still work even if the bits would leave the building and come back, but for me that was important.

Andrew: I’m getting a sense of it, and I’m also feeling like, “Oh, I should be paying more attention.” Every time you talk, I either am lost in your story or I’m lost in your story and I relate it back to, “How do I . . . ?” I came into this conversation, into this whole trip saying, “I’m not just going to listen to people’s stories. I’m going to make sure to just internalize and see what I can apply back to my life.” That’s why I’m checking in with you and saying you’re not attached to your success, and seeing, “Where am I? How true is my analysis of the situation before I start to adjust my life based on it?” I have somewhere in here where you came up with the idea for Starship. Oh, I know what it is. There, you were building robots as a hobby.

Ahti: Yeah, I did.

Andrew: Just for fun at home?

Ahti: Yeah, just for fun. At some point, when my daughter was born, when I became a father, you know, raising kids is a lot of work. It takes a lot of time, especially when they’re really young. I really thought, “I can’t be doing a startup at the same time. It would be too much. I don’t really have time.” But then I needed the intellectual stimulation, so what do I do? I thought, “Well, I can have a technical hobby, you know. I can take up robotics as a hobby at the same time.” That worked. I could do it. I participated in a couple of robotics competitions.

Andrew: Before we get to the competitions, forgive me, what’s an example of a robot or a robotic product that you created at home?

Ahti: I actually did it just for competition, so there are a number of these robotics competitions where people compete for a certain challenge. There are various types of them. One thing which is popular is the sumo robots, like robots fighting each other. Whoever wins gets first place, and so forth.

Andrew: [Dean Karnazes 00:52:19] popularized it.

Ahti: I didn’t do something like that, but there’s a robotics competition in Estonia which is actually one of the biggest in the world, if not the biggest in the world. We have more than 1,000 robots competing with each other. It’s a competition called Robotex. There was a competition which looked a little bit like robot football. I thought the contests that year really seemed like crap. They were not really, really good robots.

Andrew: You felt like you could beat it.

Ahti: Exactly, I felt like I could beat it. You know, that’s something I could do during this year or something when my daughter was really young. I’m not really doing a startup, but I could be winning this robotics competition, so that’s what I wanted to do. Of course, I lost horribly, because building robots is actually very much harder than people think. Everything that can go wrong will go wrong.

Andrew: Like what? I tend to underestimate it too. It feels like, “Well, it’s motors, wheels, and a remote control.”

Ahti: Yeah, a lot of things can go wrong. You know, a lot of it is because of the hardware. My background is software, right? So software, you write it once and you can run the same software 1,000 times. With the same inputs, it actually will always give the same output all the time. Not so with hardware. With hardware, the lighting conditions, the temperature, these things all impact you. It could actually be that you build some sort of electronic circuit, and you try it, and it works. And you take it to another place where it’s warmer, or a little bit colder, or the lighting condition is different, or there’s some radio interference, or something like that, and it actually doesn’t work. That’s always what happens at robotics competitions. The contestants think they have this perfect robot that worked really well while they were building it, but when you’re at the competition maybe it doesn’t work so well.

One other thing is that there’s so many things technical that can go wrong. Your mechanical solution can go wrong, your electronic solution can go wrong, and your software solution can go wrong. So, always, things take more time than people think. Unfortunately, with robotics competitions, the date is set. You can’t change the date, right? You plan your work that, “Oh, I need to start building this robot three months before.” In reality, it turns out you need five months. So the competition date is the same, so you just go to the competition with a half-finished robot that doesn’t really work. You think you’re going to win, but you’re actually going to lose. That’s what happened to me.

Andrew: And then there was one for NASA that you entered, and you lost there.

Ahti: Yeah, NASA has this series of competitions called NASA Centennial Challenges, like an XPRIZE type of thing where they set up your prize money. I think it was a $1.5 million, or something like that, for the team that develops the best robot that could be used to collect rock samples on Mars, and the moon, and so forth. The competition actually didn’t take place on Mars or the moon. It was actually in a city park in Worcester, Massachusetts.

Andrew: And you flew to Worcester, Massachusetts, and you entered?

Ahti: Oh, yeah. Yes, yes.

Andrew: What happened to your robot?

Ahti: We didn’t win, but we didn’t get the worst result either. We were somewhere in between.

Andrew: But it collected rocks.

Ahti: It did collect some rocks, but not enough. We didn’t really fulfill the criteria for winning. Actually, NASA does these competitions in a way that typically it takes three or four competitions before somebody actually solves it. We were on the second year, and third year, and so forth. After that, we pulled out. But some people actually continued and then eventually actually solved this challenge, and developed a robot, and actually could collect all of the rocks that were necessary to be collected. But for us, it was an expensive hobby, really.

Andrew: When you say us, how did it go from you at home with a baby to us?

Ahti: Yeah, it was a team. I assembled a team of about 10 people. I paid some of them, so it was like a semi-professional team.

Andrew: And this was your hobby still?

Ahti: Yeah. For me, it was an expensive hobby, really.

Andrew: Because you just had to solve this one problem.

Ahti: Yeah, I was excited by it. You know, building robots is definitely super cool as an engineer. It was really very much intellectually stimulating, for sure. You know, competition in general is also something that inspires people.

Andrew: That’s why they do it.

Ahti: Exactly, like in sports. It’s like, you know, “Oh, I got third place today. Maybe tomorrow I’ll get second place,” and so forth.

Andrew: NASA just said, “Help us figure this out.” They’d have to pay you money. But if they say, “Do you want to win?” you invest your own money to figure it out.

Ahti: Yeah.

Andrew: All right. How do you go from there to the business idea?

Ahti: Actually, back then, the team for the NASA challenge cliqued so well, the team of engineers. We had mechanical engineers, electronics engineers, software people. We were discussing, essentially, other people in the team were saying, “Ahti, let’s do a startup together. Let’s do a robotics startup together.” I actually told them, “No, let’s not do it, because what we’re doing is fun. This is pure fun.”

Andrew: Ah, “Why ruin it now?”

Ahti: Exactly, “Why ruin it?” Robotics competition is fantastic. It’s a fantastic experience. It’s complicated, it’s rewarding, and so forth. It’s hard work, but it’s also very inspiring and it’s a lot of fun. Doing startups is harder, actually. The competition is tougher. You have to compete with the whole world. It’s sometimes painful.

Andrew: You also have to persuade everybody. When you’re just doing it for yourself, you get to do it. When you’re doing it as a business, you have to persuade other people.

Ahti: Exactly. Like, in this NASA competition, we just had to persuade the judges, right? If you need to persuade real world customers, it’s actually much harder, and investors, and the media, and so forth.

Andrew: But still, they were pushing you and saying, “We could do something.” You were also seeing an opportunity.

Ahti: Yeah. At the same time, I also got together with Janus Friis again from Skype. We always liked working together, so we wanted to get together again and do a startup together. It was just the two of us. It wasn’t sort of a bigger founding team of Skype, which was like seven people around the table, or something like that. It was just the two of us. Niklas Zennström was doing another thing, and everybody else was doing their own thing by that time. Me and Janus got together and thought, “Okay, let’s do a startup together.” Of course, we wanted the startup to be bigger than Skype, so we thought, “What are the markets that can be bigger than Skype?” We were thinking, “Oh, robotics is actually an opportunity now, and we actually kind of have a robotics team that are dying to do a startup.”

Andrew: Wait, why is robotics all of a sudden a thing now, where it wasn’t before?

Ahti: It’s a thing because it has gotten easier.

Andrew: What’s changed?

Ahti: What’s changed is that by now, there’s this ecosystem of building hardware that didn’t really exist about 20 years ago. One thing, generally, I think was a good lift for software startups back in the days of the first dot-com boom was that servers got cheaper. Before, like in the ’90s, you actually had to invest $1 million to buy servers for your startup. So you needed a lot of investment to get these things off the ground. Until recently, it was still like that for hardware. Now, it’s actually a lot easier. There’s tons of services, like there’s 3D printing right now, which is commercial and you can use it. For a few hundred dollars, you can actually . . .

Andrew: Do you use 3D printing now to create parts when you’re experimenting?

Ahti: We did use 3D printing much more at the start of Starship. By now, Starship has raised $85 million. We can actually spend $1 million on some high-quality parts and so forth. But in the beginning we actually did use 3D printing quite a bit.

Andrew: What else is there that’s easier to get now than before?

Ahti: Yeah, like various sensors, for example.

Andrew: Sensors.

Ahti: Sensors. Your robot actually does need sensors. It does need to understand what’s going around itself in the world.

Andrew: I saw the video. You guys have the best fricking videos. So I saw the different sensors. There’s two cameras, right? There’s also a set of sensors that do what underneath the cameras?

Ahti: The cameras, there’s actually nine cameras. Then there are also ultrasonic sensors, there are RADARs, and so forth. So there’s lots of sensors that are necessary in the robots.

Andrew: And why is it cheaper now? Are there more people using these sensors than before?

Ahti: Yeah, exactly. It’s more of an industry now. Back maybe 20 years ago, it was more like a really industrial specialized thing. There weren’t so many companies and hobbyists also trying to build all sorts of robots and all sorts of things. Now there’s a whole market. There’s a whole industry catering to people prototyping these hardware solutions and so forth. So we realized, me and the others we also realized, “Now you can actually do robots as a startup.” Back in the early days, you actually couldn’t do that. One thing that startups often thrive on is technological changes that makes things possible that were not possible five years ago.

Andrew: So you found the technology, the enabling technology, was there today that wasn’t there five years ago. Then let’s talk about how you found the problem. Because, with Skype, you were telling me, “We found the problem because we were calling internationally all the time.” How did you find the problem to try this technology too?

Ahti: With Starship, it was a little bit different. We knew that we wanted to found a startup which could be really big. We had Skype as a benchmark. We didn’t want to do something really small. Now, we did consider that robotics is now an option which wasn’t really an option five years ago, right? Then we thought, “Oh, could we then do something with robotics that could be really big?”

There’s actually lots of robots being built in the world. If you go to YouTube and you Google “robot,” you will actually find lots of different things. You see actually most robots being built in the world are actually not being built for a huge commercial need. There are these Boston Dynamics walking robots everybody has seen, and so forth, but you have seen them as YouTube videos. You haven’t really seen them as products. Then there are people building robots for robotics competitions. That’s not for a commercial market either. Then there are people building robotic corkscrews, and something like that, but that’s not really a huge market.

Andrew: So how did you find your huge market?

Ahti: We were thinking, “What can we do? What are actually the big markets that can be done with robotics?” We thought, actually, agriculture is actually a big market that can actually be made much easier with robotics, but neither of us really grew up on a farm or something like that. We didn’t really find the connection with that. We thought delivery was something that could, in principle, be done by robots. Actually, in fact, people actually believe it will be done by robots. If you look at the science fiction movies . . .

Andrew: It’s always a robot deliver.

Ahti: Yeah, exactly. It’s always a robot. You don’t see a UPS van in the science fiction film, like Minority Report, for example, or Matrix, or something like that. You don’t see that.

Andrew: I think I made the jump to it fairly . . . it made sense to me immediately, because my fricking packages keep getting stolen. I live in a really good part of San Francisco. There’s still a lot of theft. Packages keep getting stolen. So, for me, it felt like, “Well, I can’t be home at a specific time. I can’t have this package constantly getting stolen. What do I do?” We’ll have it delivered to the office, and now I’m the last-mile driver. But that’s not what you saw. You just said, “I need a big market. Where can we actually do this? Delivery does make sense.”

Ahti: Yeah. We realized people have problems with delivery. Delivery, it’s actually probably the last, so the only industry which is big but hasn’t been automated yet. If you look at people cutting wood in a forest, that’s automated. It used to be done by a lumberjack who had hand tools. Now, it’s automated. But delivery is still not automated. There’s still a guy with a van. Yes, it’s a van which helps the guy to travel, to cover larger distances in the same day, but it’s still one guy that hand loads your package or your food. It’s even worse with food, because food delivery is on-demand, like, “I’m hungry right now. I need something exactly when I’m hungry, which is right now, and I need it in half an hour. I need it right here where I am.” That’s actually really expensive to do with people.

Suppose you’re operating like a courier company. You have people, or your contract workers, or whatever, crowdsourced your labor and so forth. You know, these people want to make a living. They want to make, let’s say, like $14 an hour or something like that. So how many deliveries can these people do? Let’s suppose, on an average, you can get something like two deliveries done in an hour. That means these people need to get $7. Are consumers willing to pay $7 for every delivery? Yes, some people certainly are, but it is also a problem for people.

Andrew: A problem that it’s too expensive to basically be paying for someone who’s been sitting around for half an hour waiting for your order. That’s the problem that you saw.

Ahti: That’s one problem. The other thing is that since it’s done with people, then you can’t really have it 24-7, for example. It gets insanely expensive if you actually want to get 24-7 on-demand service. People actually expect, by now, actually, they want delivery to be instant, in five minutes or something like that, but they’re not willing to pay for it. Right? They’re ordering stuff from the internet, and often times the delivery costs more than the thing that they’re ordering from the internet.

Andrew: Actually, I’m nodding with you every time it’s true, but I found myself nodding now and saying, “No, it doesn’t. It costs me practically nothing on Amazon to have someone come deliver it the same day.”

Ahti: Sure, exactly, but then it’s essentially being subsidized. The company that’s offering this service to you is then, essentially, hiding the cost of the delivery in the price of the product. So if you look at the delivery industry, the cost still exists. For you as a consumer, maybe you don’t see the cost, but the cost exists. So we realized that there is a problem. We realized we can solve it and, you know, “Let’s just do it. We can’t stop doing it.”

Andrew: Did you sit down and say, “How many products can fit on a van?” No, you’re not thinking about Amazon. That’s why you’re not picking delivery of products from Amazon or something like that. You’re thinking food, because that is the biggest waste. There’s someone sitting there, waiting, and then that person will take 20 minutes minimum, even though I live in a big city, to get to my house. I watch them on the map now on these different apps. Got it. That is wasteful. We can solve it. That’s the application. You weren’t sure where, so you tried it in different cities. It turns out, of all the different places, cities, campuses, I think, Intuit campus you were on, and everything else, none of them was easy and clear like college campuses. So now you’re focusing on college campuses.

Ahti: Yeah, ultimately, I think everything will be a win in the sense that once we scale big with the university campuses, we will also be able to go to other places. We have just seen that the university campus is the first place for us to scale. How many people are there in the world, like 7 billion by now or something, or is it 8 already? Seven billion. So out of the 7 billion, there are probably a bunch of rural areas and a bunch of really dense city centers where our robots wouldn’t be applicable, but a good 2 billion people we can actually serve. We could actually serve their daily needs for food, for groceries, for packages, and so forth. So that’s a big market.

Andrew: Let me not forget medicine. One of the biggest things it solved, my pain point was getting Alto to deliver my medicine from the doctor’s office. But even that, you can’t count on it. Right? Do you think about medication at all?

Ahti: Oh, yeah. Pretty much anything can be delivered. The thing is, we want to automate the movement of things in the world, really. Once this is automated, once the technical solution is there, it could be used, in theory, for everything. People will want to use it for everything, because if it’s a lot lower cost than using a traditional courier, then people are going to want to use it. How many years ago, like 20, 30 years ago, people used to buy flight tickets, and they went to a travel agent to buy a flight ticket, right? By now, it’s everything on the internet. People actually love it, right?

I’m sure, 30 years ago, people thought, “Oh, I prefer this human contact with a travel agent who knows my desires and where I want to go,” and so forth. That’s not true. Actually, he or she doesn’t really know it. People actually enjoy getting these things done when they want it, 24-7, just on the internet. It’s easy. The thing is, we want to do the same thing through the movement of things. “I want this . . . ” whatever you want, “coffee,” “orange,” “toothbrush,” “beer.” You want different things.

Andrew: I’m super optimistic about this. I’m optimistic about entrepreneurship and technology completely, in a world where I feel like most people become pessimistic. I’m optimistic because I do have pain getting my stuff delivered to my house. I’m optimistic because I have an injury that I need an insole, but I don’t have time to go to the podiatrist just to pick something up, and I feel weird paying somebody $50 to go get it for me.

I’m trying to think, “How do the pessimists think? What would they say?” The people who are not as excited about tech anymore, like Kara Swisher, she used to be excited about tech. All it is is now she’s thinking about, “It’s just a bunch of monopolies against our privacy and against our well-being.” I’m thinking, in her place, she might not be excited about this because maybe she would think that there is a monopoly in products, which is Amazon, “Amazon’s going to come into this and steal your space.” So it feels helpless. You don’t feel that, right, or do you?

Ahti: If I all the time were thinking, “Oh, some big company can just do the same and can beat me,” I wouldn’t be an entrepreneur. I wouldn’t do anything.

Andrew: So just optimistic thinking. Okay, here’s another angle on this. What about putting people out of work and then people will not have jobs?

Ahti: Well, the delivery industry is growing at such a pace that I don’t think that our robots are actually putting any out of a job. I think there is actually enough work for both robots and people. Our robots are not going to be delivering really big things, for example, like a piano. We wouldn’t be delivering that, or a car. We can’t deliver that.

Andrew: You’re saying there’s room for other stuff. You’re just expanding the market because, “There’s food that I’m not having delivered right now, because it’s costing me too much. But you know what? If I could have that salad delivered, I would have it delivered. Instead, what I do is I pick up pizza on the way home.”

Ahti: Yeah, exactly. As for being an optimist in this industry, I think this is how you’re built, really. Of course, technology can be used for good things, for bad things. I’m building it, you know, to get some positive change in the world. Really, there’s a lot of things I could be thinking why it would be a bad idea to start something. I’m an Estonian. I live in Estonia. The startups here, it’s not such a proven model as it is in Silicon Valley that you do a startup, “Of course, you can fail, but eventually you will be successful. Eventually, you will get rich,” and so forth. It’s not a proven thing in Estonia, because we are earlier in this evolution or curve of development.

Plus, Estonia is so small that there are not just tons of unicorns. Not everybody knows somebody who has created a successful startup. It’s not such a proven thing. I could be thinking, “What am I doing here in Estonia? I have no chance of getting some success with startups. These other startups in Silicon Valley, they’re going to win all the time,” and so forth. But I’m not built like that. I wouldn’t be thinking that way. I don’t really care whether the average success rate of startups in Estonia is lower than in Silicon Valley or not.

Andrew: Is that true? You don’t even know. I don’t know if it’s true.

Ahti: I would think it’s probably lower, because of the infrastructure. The overall infrastructure, like, Estonia is a really small place. You don’t have 30 VCs who are real experienced in building startups, funding startups, that can give you advice, and so forth, and accelerators, and things like that. Yeah, there are a couple of investors. There are a couple of accelerators here, and so forth, but it’s still very small compared to Silicon Valley. Estonia is just 1 million people, like 1.3 million people.

Andrew: 1.3, yeah.

Ahti: Yeah, it’s like really, really small. We don’t have all that much infrastructure here. But guess what? You can still do a startup. Maybe your success rate is lower, but you can still have success. You can still do it.

And if I would be thinking that, “Oh, I stand no chance,” I just wouldn’t be myself. I just wouldn’t be doing these things. I always think, “Yes, I can do these things.” Yes, there are other startups there you’re competing against maybe, maybe on the same space. But I’m thinking, “I can beat them. I can beat the competition, wherever they are, regardless of who they’re funded by, regardless of what credentials they have from university, and so forth. I can beat them.” So far, Starship appears to be the lead in this market. We are still leading the market, and there are no competitors that have caught up with us. Seems we’re working, right?

Andrew: Yeah, I’m so excited about this. I’m glad to hear you say that. That is a great end place, and still I’m going to add onto that. I know that when you guys started Skype, there was no thought that, “Someday Andrew can create a podcast and start interviewing people remotely in a way that he couldn’t before, because it gets recorded,” and then that’s what happened. I don’t exactly know where this is going, Starship. I think to say, “It’s going to deliver food,” is just the beginning of something that we can’t anticipate the end of, and I’m psyched about that. I’m psyched to see that you’re doing it. I’m psyched to see that entrepreneurs are doing it.

I do think that it sounds so clichéd and hokey to say, “Entrepreneurs change the world,” but you fricking guys, you changed my world, and I know you’re going to change other people’s worlds. I’m excited to see what’s possible. Or, maybe it doesn’t work out, and you’ll have had an excellent adventure. I’m so excited to be here. I’m excited to have this interview done. If people want to go and see . . . I actually think your Instagram account might be a better place to send people. Your videos, whoever created those simple videos showing, with frequently asked questions, “Can this go over a curb?” Boom, you show it go over a curb. “What happens if somebody comes in front of it? How do you handle it?” Then you show the way that it handles it. I feel like that’s better.

I don’t even know how to send people to your Instagram account. So, instead, what I’m going to do is tell people they can go check out Starship Technologies, and the URL for that is starship.xyz, just like Alphabet, the Google company, alphabet.xyz. You guys haven’t seen the top-level domain?

I want to thank the two sponsors that made this interview happen, who believe in entrepreneurship enough to invest in this, and to help me go around the world to do my interviews. The first is the company everybody now associates me with. It’s Toptal. Check them out at toptal.com/mixergy. The second is my new favorite, not my new favorite, it’s been my favorite for a while, a tool to create funnels. It’s called ClickFunnels. Check them out at clickfunnels.com/mixergy. Ahti, thank you so much.

Ahti: Thank you, Andrew.

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