The Exchanges, every show

Q How does the company need to change with the integration of hardware? Respectfully, you said it's a software first company. We're a software engineers. Hardware is an entirely different rule game.

A It is and it isn't. Um, so it is in that there are many areas where you need to have hardware experts, um, and, and we've built an amazing team that obviously, you know, deals with things like the design, the components, but also the supply chain, and that's different from software. But you can think about hardware as software as well. You can You can optimize a lot of parts of hardware by shifting complexity into software, and you can also test hardware and software, and so we spend a lot of time building infrastructure for the entire company around simulation platforms, for example, AI infrastructure platforms, etc., and some of that technology is also applicable to hardware, so we've developed our drones extremely fast, and we've tested them extremely fast, and the reason we're getting to that kind of iteration speed, and it is all about iteration, just iterate, iterate, iterate, It's because we can move a lot of the testing into software, and only when, you know, we get to a certain point, we move it into hardware, we test it in hardware, and then we go back into software again. So these two things are, if you do it well, which we're trying to do, are extremely interlinked, and the best hardware companies, I think, are software companies, and vice versa.

AI assessment note: “there are many areas where you need to have hardware experts”

Q For those that make the transition, what will be needed for them to make the transition successful?

A They need to build the teams around it, and this is where one of the problems lie, because you, um, there's a scarcity of talent around go-to-market, government relations, even compliance and other things, even security, to be honest, in, in defense. So, so all of these companies would be competing for a very small pool of people, and I, it's just impossible to, um, to, to, to, to have turned them all into primes. It, it, it will just, it, it, it just not gonna happen. So you end up coming back to the innovation side, you end up with these, with something that looks like product market fit, and you think it's great technology, you've shown it, and it can do something, maybe take a drone down or something. But I had to learn that, that is just a very small part of building a prime. It's like one eighth, maybe, or something. It's product market fit. Then you have to do all the rest. And, and for that, you need to build the infrastructure to build a prime. Which Andrew has done, for example, it's a good example. Um, we've, we've done it too. We're certainly in the process of doing it. Um, and you know, still a ways to go, but, um, but I think that's what's underappreciated. And it's, it's not underappreciated with, I think, VCs that know about defense. Um, but with, I think VCs that are maybe as distant to it as I was when I was previously in the gaming industry. Um, I, I think fo…

AI assessment note: “They need to build the teams around it”

Q Do you fear that we are falling further and further behind? Like everyone says we are.

A I, so I, I think we are falling behind, and that, but that trend is new, that, that already started a few years ago, and part of the reason we wanted to build Helsing was to show that you can build a company in Europe fast to scale in deep tech, and just provide a shortcut, um, that, you know, actually this is doable, and we wanted to show that it's doable, including the fundraising. Um, so I think Europe is falling behind, but it doesn't have to be that way. So, The things that we have in Europe, in particular talent, we have incredibly good talent, um, including on the engineering side. So we hire almost exclusively from Europe at the moment, not entirely, but, um, but almost exclusively. And the talent is, is amazing. The talent pool is amazing. Uh, people's attitudes are amazing. Um, there's none of this, um, kind of nine to five mentality. People really want to make a difference and, and they work hard and they work intensely Wherever that's required. So I think that's a myth.

AI assessment note: “I think we are falling behind, and that, but that trend is new”

Q I spoke to Matt Clifford before the show, and he provided a great question. He said that I had to ask, Helsing is one of the first deliberate European tech sovereignty companies. Which other ones do we need in which sizes?

A Well, I think we need, um, certainly companies in energy. Uh, energy sovereignty is, is a huge issue for various reasons, and some of that, you know, may be in conventional technology, some of it may be in computer, in future technologies like, um, like fusion. Um, we need, uh, sovereignty ideally around semiconductors. It's gonna be very hard to achieve unless there are big changes in, in technology and various other areas. Obviously defense is another one, um, And, and a few others. Uh, I'm not sure whether we'll be able to create those companies kind of in the next two or three years to a point where they provide sufficient, um, sovereignty, but I'm very sure we can do it over the next five to 10 years.

AI assessment note: “I think we need, um, certainly companies in energy.”

Q The need for European sovereignty has become more important. Can you explain that to me?

A Again, I mean, it's been clear for many years now that, um, we cannot rely on partners to Secure and, and protect Europe, at least not, um, at least not, um, over a long period of time. I think right now that's still, that's still there, but I think over time there just won't be, I think the capability even of partners and, and, and as it looks to also not the willingness to do so. And quite frankly, I think as a continent, as Europe, which is still rich, we should have that kind of pride. We should want to protect ourselves. We should not need to rely on others. We should, You know, be equals in a, in a partnership, and that's what our partners want as well. And so it's, it's natural, I think, that we need to go there anyway. We've just been so used to a different kind of situation that it just, we just need to unlearn it now and, and think about security ourselves.

AI assessment note: “we cannot rely on partners to Secure and, and protect Europe”

Q The need for European sovereignty has become more important. Can you explain that to me?

A Again, I mean, it's been clear for many years now that, um, we cannot rely on partners to Secure and, and protect Europe, at least not, um, at least not, um, over a long period of time. I think right now that's still, that's still there, but I think over time there just won't be, I think the capability even of partners and, and, and as it looks to also not the willingness to do so. And quite frankly, I think as a continent, as Europe, which is still rich, we should have that kind of pride. We should want to protect ourselves. We should not need to rely on others. We should, You know, be equals in a, in a partnership, and that's what our partners want as well. And so it's, it's natural, I think, that we need to go there anyway. We've just been so used to a different kind of situation that it just, we just need to unlearn it now and, and think about security ourselves.

AI assessment note: “we cannot rely on partners to Secure and, and protect Europe”

Q For those that make the transition, what will be needed for them to make the transition successful?

A They need to build the teams around it, and this is where one of the problems lie, because you, um, there's a scarcity of talent around go-to-market, government relations, even compliance and other things, even security, to be honest, in, in defense. So, so all of these companies would be competing for a very small pool of people, and I, it's just impossible to, um, to, to, to, to have turned them all into primes. It, it, it will just, it, it, it just not gonna happen. So you end up coming back to the innovation side, you end up with these, with something that looks like product market fit, and you think it's great technology, you've shown it, and it can do something, maybe take a drone down or something. But I had to learn that, that is just a very small part of building a prime. It's like one eighth, maybe, or something. It's product market fit. Then you have to do all the rest. And, and for that, you need to build the infrastructure to build a prime. Which Andrew has done, for example, it's a good example. Um, we've, we've done it too. We're certainly in the process of doing it. Um, and you know, still a ways to go, but, um, but I think that's what's underappreciated. And it's, it's not underappreciated with, I think, VCs that know about defense. Um, but with, I think VCs that are maybe as distant to it as I was when I was previously in the gaming industry. Um, I, I think fo…

AI assessment note: “They need to build the teams around it... scarcity of talent around go-to-market, government relations”

Q Where are we in three years with Russia, Ukraine? Has Putin invaded Lithuania, Belarus, Finland?

A It is very hard to predict. I think there's some, we just don't know how things are going to pan out over the next few months and a couple of years, but I think we do have to take the threat To the NATO eastern flank seriously. I think we have to take it much more seriously than we are doing it right now in, in the UK and in Germany and in other countries. I think Scandinavia, the Scandinavian countries take it a lot more seriously, as do the Baltics, take it extremely seriously, and I think we should listen to them. The, um, I think the threat is extremely plausible in the next few, in the next few years.

AI assessment note: “I think the threat is extremely plausible in the next few, in the next few years.”

Q I heard you say something on Harry's podcast. Did you actually think there's a lot more exceptional people out there than other people believe? Especially if you have a couple thousand employees.

A People. Character and, and, and also performance is not set in stone. So quite often it's also a matter of in larger companies, sometimes it might actually even be harder for people who have a, uh, 10 X potential to, to become a 10 X person. So it's a combination of things. It's probably harder to keep just hiring 10 out of 10 people, but also harder to develop them, but it's still worth it. I mean, the, the, the power law in, in talent is, is extreme and they're very few 10 out of 10 people, but they, Make, I mean, it's a cliche, but like we see this every day, they make a disproportionate difference to the company, so it is worth trying to find these people, and it is worth finding a way to, um, give them a home in, in a company where they can really thrive. We try to do this very, very systematically at Helsing, and we, we make for, I think hopefully for everyone, we, we, we create a, a great environment where they're surrounded by amazing people, but, um, you know, for the 10 out of tens, we, we, we go the extra mile.

AI assessment note: “Character and, and, and also performance is not set in stone.”

Q I do want to stay on the drones, because otherwise I, I'm going to discuss Europe, but a little bit later. On the drones side, it's a massive introduction moving to hardware as well. It's a big new chapter for the company. Why did you decide that now was the right time to make this big new change? Just talk to me about that.

A Yeah, I mean, Helsing is a software company, it's a software first company, always has been, and always will be, um, you know, Almost everyone is a software engineer. Um, that's where we've come from. That's, that's how we hired. Um, and, you know, we are in a large, you know, in a number of large contracts. For example, we, we, um, you know, working with Saab on the Eurofighter electronic warfare upgrade program. That's pure software, um, you know, our contribution and, and software can make a massive difference. In this particular case, AI can, because we can start to read the intent of shape-shifting Anti-aircraft radar systems, and so software, um, plays a huge role, and we always said it, it creates a 10 X multiplier in terms of capabilities. That's still the case, that will always be the case, and we will always do those software programs. So software and software contracts work in defense, even though some people say it is impossible, it clearly is possible. However, there are some areas where software needs to be, it needs to have a hardware carrier. Um, you know, with the Eurofighter, we have, we have a, A combat aircraft as a carrier, that's great, and we're not building a Eurofighter. But with drones, you need to think about drones differently in order for them to have the effect that you want them to have, which is basically precise mass. So you want to be able to h…

AI assessment note: “However, there are some areas where software needs to be, it needs to have a hardware carrier.”

Q I spoke to Matt Clifford before the show, and he provided a great question. He said that I had to ask, Helsing is one of the first deliberate European tech sovereignty companies. Which other ones do we need in which sizes?

A Well, I think we need, um, certainly companies in energy. Uh, energy sovereignty is, is a huge issue for various reasons, and some of that, you know, may be in conventional technology, some of it may be in computer, in future technologies like, um, like fusion. Um, we need, uh, sovereignty ideally around semiconductors. It's gonna be very hard to achieve unless there are big changes in, in technology and various other areas. Obviously defense is another one, um, And, and a few others. Uh, I'm not sure whether we'll be able to create those companies kind of in the next two or three years to a point where they provide sufficient, um, sovereignty, but I'm very sure we can do it over the next five to 10 years.

AI assessment note: “certainly companies in energy... sovereignty ideally around semiconductors”

Q What decision did you take that was most unpopular?

A I don't think decisions have been particularly unpopular, unpopular yet, um, but, um, we, we just recently announced that we are, um, that we're building strike drones, um, we build strike drone software as well, and, um, that is, you know, fraught with all kinds of complexities, um, that you have to think about around the ethics side of it, both in terms of technology usage, how it's used, et cetera, and that is something that, I think everyone contributed to the thinking around this. Um, we managed to shine a line, a light, um, on areas of technology development that I can't go into sadly that actually we probably didn't think about that much before. So the other important part is that if you have a lot of, I think, intelligent, engaged people look at the ethics problem around technology usage, um, you know, con ops, um, the concept of operations, You, you, you just shine a light on kind of any kind of remaining area, and so you just have much better coverage of, of all the questions that you have to deal with.

AI assessment note: “I don't think decisions have been particularly unpopular, unpopular yet, um, but”

Q I do want to stay on the drones, because otherwise I, I'm going to discuss Europe, but a little bit later. On the drones side, it's a massive introduction moving to hardware as well. It's a big new chapter for the company. Why did you decide that now was the right time to make this big new change? Just talk to me about that.

A Yeah, I mean, Helsing is a software company, it's a software first company, always has been, and always will be, um, you know, Almost everyone is a software engineer. Um, that's where we've come from. That's, that's how we hired. Um, and, you know, we are in a large, you know, in a number of large contracts. For example, we, we, um, you know, working with Saab on the Eurofighter electronic warfare upgrade program. That's pure software, um, you know, our contribution and, and software can make a massive difference. In this particular case, AI can, because we can start to read the intent of shape-shifting Anti-aircraft radar systems, and so software, um, plays a huge role, and we always said it, it creates a 10 X multiplier in terms of capabilities. That's still the case, that will always be the case, and we will always do those software programs. So software and software contracts work in defense, even though some people say it is impossible, it clearly is possible. However, there are some areas where software needs to be, it needs to have a hardware carrier. Um, you know, with the Eurofighter, we have, we have a, A combat aircraft as a carrier, that's great, and we're not building a Eurofighter. But with drones, you need to think about drones differently in order for them to have the effect that you want them to have, which is basically precise mass. So you want to be able to h…

AI assessment note: “software needs to have a hardware carrier”

Q Now, I want to start, uh, with lessons from natural motion, actually. So over a 15 year period, you built the company before selling to Zynga. And I just wanted to start with, what did you do the first time that worked and you took with you to Helsing?

A It, it was a long journey. Um, natural motion started as a spin out, uh, out of university, uh, out of Oxford. And we were trying to create physically simulated creatures Controlled by neural networks, which was a crazy idea at the time. This was the time, I think, of the Pentium processor or something. Um, so it was, it's hard to do computationally, but it worked quite well, and we ended up, um, using it in, and licensing it for visual effects in big Hollywood movies, like Lord of the Rings, Harry Potter, Spider-Man, then for big video games like, uh, GTA IV, GTA V, uh, Max Payne, um, and many others, and that worked quite well, um, but it only worked I would say okay in terms of, in terms of revenues. You know, as a, as a founder, you, you want to get to a hockey stick, um, movement eventually, and, and that wasn't the case with the technology business. It was growing, but it was growing reasonably slowly, and I think one of the things that we did do well was that we, we recognized that growth wasn't as strong as, as we wanted to, and we, we took a big, um, took a big risk and pivoted the company to doing games ourselves. Um, so you know how people say, focus, focus, focus. We did focus, um, Um, but only up to a point, at one point we said, this isn't working the way we want it to, so let's pivot to actually making games ourselves, and we, we were very naive about how easy it…

AI assessment note: “we recognized that growth wasn't as strong as, as we wanted to, and we, we took a big, um, took a big risk and pivoted”

Q Where are we in three years with Russia, Ukraine? Has Putin invaded Lithuania, Belarus, Finland?

A It is very hard to predict. I think there's some, we just don't know how things are going to pan out over the next few months and a couple of years, but I think we do have to take the threat To the NATO eastern flank seriously. I think we have to take it much more seriously than we are doing it right now in, in the UK and in Germany and in other countries. I think Scandinavia, the Scandinavian countries take it a lot more seriously, as do the Baltics, take it extremely seriously, and I think we should listen to them. The, um, I think the threat is extremely plausible in the next few, in the next few years.

AI assessment note: “the threat is extremely plausible in the next few years.”

Q the structure there? So you have lots of three to four people teams. You know, we just had Nick on the show from Revolut, and he spoke about running 27 bets at the same time. And each team having eight to 10 people, three to four million pounds each, and then they manage that in kind of, uh, alignment. How do you structure those small teams and then monitor performance?

A So, first of all, we don't have a large number of small teams. Um, we have, um, I would say a handful, um, that work on particular, um, projects. And then sometimes, you know, you rally around something and it can become a little bit bigger. That's happened over the last few months as we were working on particular projects. Um, But what we try to do is identify areas that we know needs to exist. We put a small team on it, um, we try to allow people to self-select as well, obviously, um, so that you have a team that communicates well, um, that is highly performant, and then they work on the task, and, and they may actually move off it eventually, and another team takes over, but that's worked really well for us.

AI assessment note: “we don't have a large number of small teams. Um, we have, um, I would say a handful”

Q the structure there? So you have lots of three to four people teams. You know, we just had Nick on the show from Revolut, and he spoke about running 27 bets at the same time. And each team having eight to 10 people, three to four million pounds each, and then they manage that in kind of, uh, alignment. How do you structure those small teams and then monitor performance?

A So, first of all, we don't have a large number of small teams. Um, we have, um, I would say a handful, um, that work on particular, um, projects. And then sometimes, you know, you rally around something and it can become a little bit bigger. That's happened over the last few months as we were working on particular projects. Um, But what we try to do is identify areas that we know needs to exist. We put a small team on it, um, we try to allow people to self-select as well, obviously, um, so that you have a team that communicates well, um, that is highly performant, and then they work on the task, and, and they may actually move off it eventually, and another team takes over, but that's worked really well for us.

AI assessment note: “first of all, we don't have a large number of small teams.”

Q Who's your friend and who's not your friend?

A Well, probably Saab is a friend, for example. We work very closely with them. Um, they're shareholders in Helsing as well. Um, so they're clearly close friends. Um, others, um, I think it can fluctuate. I, I, I, I don't mean to suggest I, I think we all Genuinely need to work together. I think we all have bigger fish to fry, and, and defense primes will always have a role. Um, we, we don't think that they, um, you know, they, they, they will disappear. Um, in fact, I actually, I think they will, they will grow if we do things right. The thing that we have to avoid is the Tesla moment, uh, for the defense sector. If there, there's a big wave coming of new technology, and it's all around autonomy, software, and AI. Essentially, again, precise mass. If we collectively, including the primes, don't understand that and don't adapt, the same thing is going to happen to defense as happened to the car industry, where basically the new, the new wave was electric software and autonomy.

AI assessment note: “probably Saab is a friend, for example... others, um, I think it can fluctuate.”

Q What decision did you take that was most unpopular?

A I don't think decisions have been particularly unpopular, unpopular yet, um, but, um, we, we just recently announced that we are, um, that we're building strike drones, um, we build strike drone software as well, and, um, that is, you know, fraught with all kinds of complexities, um, that you have to think about around the ethics side of it, both in terms of technology usage, how it's used, et cetera, and that is something that, I think everyone contributed to the thinking around this. Um, we managed to shine a line, a light, um, on areas of technology development that I can't go into sadly that actually we probably didn't think about that much before. So the other important part is that if you have a lot of, I think, intelligent, engaged people look at the ethics problem around technology usage, um, you know, con ops, um, the concept of operations, You, you, you just shine a light on kind of any kind of remaining area, and so you just have much better coverage of, of all the questions that you have to deal with.

AI assessment note: “I don't think decisions have been particularly unpopular, unpopular yet”

Q Can I ask, what's been the hardest moment where you needed, um, to get through it?

A Um, well, we've been through, um, hard moments, like, throughout the company, while there's lots of noise in the market, and all kinds of other things, and you still have to build a company, and it's time consuming, there are lots of setbacks, and it is much easier to do it, um, if, if, if you have several shoulders, uh, rather than just one, to get through all of this stuff, and, and there'll be more setbacks happening, like, with every startups, um, you, you just don't know what's going to happen, and there'll be, You know what it's like with a startup. That's what I experienced at Natural Motion. You're already on the floor. You've already been punched in the face several times, and then another one comes, and then another one comes, which you didn't expect. Those are the worst, is when, is when you kind of already, fuck, I'm done, and, and, and it's, and it's relentless. But the thing, the only thing I would say is that with Natural Motion, we got out of it eventually, even out of, we had some situations that were very hard to get out of, And we, we still managed to do it. And it wasn't some kind of.

AI assessment note: “we've been through, um, hard moments, like, throughout the company”

Q Can I ask, what's been the hardest moment where you needed, um, to get through it?

A Um, well, we've been through, um, hard moments, like, throughout the company, while there's lots of noise in the market, and all kinds of other things, and you still have to build a company, and it's time consuming, there are lots of setbacks, and it is much easier to do it, um, if, if, if you have several shoulders, uh, rather than just one, to get through all of this stuff, and, and there'll be more setbacks happening, like, with every startups, um, you, you just don't know what's going to happen, and there'll be, You know what it's like with a startup. That's what I experienced at Natural Motion. You're already on the floor. You've already been punched in the face several times, and then another one comes, and then another one comes, which you didn't expect. Those are the worst, is when, is when you kind of already, fuck, I'm done, and, and, and it's, and it's relentless. But the thing, the only thing I would say is that with Natural Motion, we got out of it eventually, even out of, we had some situations that were very hard to get out of, And we, we still managed to do it. And it wasn't some kind of.

AI assessment note: “Those are the worst, is when you kind of already, fuck, I'm done”