Gil: Anduril Expands Defense Market Cap Through 50% Margins
Elad Gil · How Silicon Valley’s Most Prolific Investor Picks Unicorns | Elad Gil Interview · Oct 8, 2024 · at 11:34
Angel investor Elad Gil discusses the business model differentiation of defense technology startup Anduril compared to legacy defense contractors.
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“The traditional defense tech companies are what are known as cost plus, which means if you have a million dollar drone, they charge five percent. So they can't make more than five percent margins. They make 50 can a drone. You're Anduril. You can sell 10 better drones for a million dollars. You make 50% margin, which is traditional hardware margin. You make 10 times the margin dollars. And so one of the things that people don't appreciate about Anduril as a business is it's a market cap expansion in the defense world. Because you have a higher margin, higher leveraged business, right?”
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