Aug 22, 2025 · 57m · sourcery
How 8VC Builds Billion-Dollar Companies | Palantir, Addepar, Saronic · Sourcery with Molly O'Shea
0:00 / 0:00
▶ Watch on YouTube →
gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of Sourcery, host Molly O'Shea interviews Drew Oetting, Founding Partner at 8VC, about the firm's unique incubation engine, 8VC Build, and its strategic thesis on reindustrializing American defense, hardtech, and biomanufacturing infrastructure. Oetting breaks down capital allocation frameworks for physical technology, the operational playbooks behind flagship portfolio companies like Palantir, Saronic, and Resilience, and macro policy levers needed to restore domestic manufacturing.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Molly holds 17.2% of the talking time here. How this is scored →
Molly as informed peer 3.4 Guest teaching 3.8 Guest disagreement 0.4 Molly pushing back 0.3
speaking balance: gold is Molly, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 40:06 Dismissing omnipotent AGI talk as theology
Drew firmly rejects common tech hype framing around omnipotent AGI, dismissing it as essentially a religious discussion rather than practical engineering.
Hardest push from Molly ▶ 14:02 Molly presses Drew to pick favorite portfolio companiesMolly challenges Drew to pick favorites among 8VC's prominent investments, playfully noting everyone hates the question when Drew tries to evade it.
Biggest teaching moment ▶ 35:15 Drew details why tax incentives fail venture hardtech startupsDrew educates listeners and the host on structural corporate tax dynamics, explaining why tools like bonus depreciation only help legacy incumbents like Boeing rather than unprofitable C-corps.
Molly holds their own ▶ 52:10 Molly cites exact Kalshi resolution criteria and GDP dataWhen Drew asks how Kalshi defines manufacturing GDP growth, Molly instantly reads out the fine print benchmarks and current baseline stats.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Molly as informed peer | Guest teaching | Guest disagreement | Molly pushing back | Why |
|---|---|---|---|---|---|---|
| Welcome and Key Takeaways from Reindustrialize Summit | 3 | 3 | 0 | 0 | Molly opens the interview at the Reindustrialize Summit and asks Drew about the genesis of 8VC and its internal company building model. Drew provides an in-depth history of how Formation 8 and 8VC evolved their build arm. | |
| The EIR Playbook and Avoiding Touristy Incubation | 4 | 4 | 1 | 1 | Molly observes the trend of VC funds touristically trying in-house company building during market downturns. Drew elaborates on why most funds fail at this due to misaligned organizational design and internal politics. | |
| Capital Deployment and Check Sizes in Incubated Startups | 4 | 3 | 1 | 1 | Molly asks Drew to pick his favorite portfolio companies among Palantir, Anduril, OpenGov, Epirus, and Saronic. Drew gently pushes back on choosing favorites before breaking down why OpenGov and Saronic represent significant operational triumphs. | |
| Sponsor Segment: Brex All-in-One Financial Stack | 2 | 3 | 0 | 0 | Segment includes an ad read for Brex before Drew unpacks what makes Saronic unique in autonomous naval defense and US shipbuilding capacity. | |
| Domestic Biotech Infrastructure and GMP Manufacturing Challenges | 3 | 5 | 0 | 0 | Molly asks about life sciences and domestic industrial resilience. Drew provides a masterclass on the prohibitive economics of GMP cleanroom facilities, environmental regulatory tradeoffs, and why biopharma manufacturing was outsourced abroad. | |
| Sponsor Segment: Turing Intelligence Enterprise AI | 2 | 4 | 0 | 0 | Following a sponsor read for Turing, Drew details their incubated CDMO Resilience and analyzes the depressed sentiment in public biotech markets versus AI hype. | |
| Patriotism, Industrial Policy, and Financing Hardtech Startups | 3 | 5 | 0 | 0 | Molly asks about optimism around industrial policy. Drew delivers an extensive breakdown of why standard government incentives like bonus depreciation fail startups (which lack taxable profits) and why bespoke project financing is essential. | |
| AI in the Physical World and Construction Automation | 4 | 4 | 1 | 0 | Molly brings up AGI and highlights 8VC's investment in Bedrock Robotics. Drew demystifies sci-fi AGI tropes, arguing AI's near-term superpower is administrative efficiency for physical businesses rather than immediate mechanical labor replacement. | |
| Sponsor Segment: Fourthwall Creator Merch Platform | 4 | 5 | 0 | 0 | After an ad read, Molly asks about balancing growth versus profitability. Drew explains the stark contrast between software capital allocation and physical infrastructure where massive capex must precede production. | |
| Rapid-Fire Kalshi Predictions: Economics, Space, and Aliens | 5 | 2 | 1 | 1 | Molly leads a playful rapid-fire Kalshi prediction round quoting market probabilities on GDP, debt, Mars, and alien disclosure. Drew actively engages and bets contrarian on alien disclosure. |
Statements from this episode (26)
Oetting: Reindustrialization Requires Unprecedented Government and Startup Collaboration
“And I think that it's probably the biggest reality of this reindustrialization concept, I think is that it's going to require the federal government and some state governments and startup companies to interact in a way that is probably hasn't happened in a lon…”
Oetting: Building a University Is a Startup Without Profit Upside
“Building a new university. It's like starting a super complex startup, but there's no like profit, you know, dream at the end of it.”
Oetting: 30% of 8VC's deployed capital goes to internally co-founded companies
“It's now 30% of what we do. All of our capital employees and, you know, 30% of it goes into companies we co-founded.”
Oetting: 8VC has co-founded over two dozen companies over past decade
“And I think Joe and I and the rest of the EPC crew have probably done over two dozen at this point over the last, you know, decade or so.”
Oetting: 8VC employs three to six full-time EIRs to incubate startups
“The predominant way now is that we have a group of three or six EIRs at any time that are, you know, they're full-time employees at APC, but they're working only on sort of the process of either coming to an idea or getting it ready to kind of launch.”
Oetting: Over-refining startup concepts makes them less appealing to top founders
“I think also top founders, like, they want to have They want an idea to be theirs, at least to some extent. And so if you over refine the idea, then it can become less interesting to a founder who wants to, you know, take it, you know, put their own, kind of p…”
Oetting: Combining investing and incubation fails without intentional culture and incentives
“I think the thing that's underappreciated is how much your organization has to be designed intentionally to make to balance this sort of dichotomy of starting companies and investing in them. There, there's definitely some overlap, but I think if you don't int…”
Oetting: Sutter Hill has done venture incubation better than anyone
“I mean, Sutter Hill has done this better than anyone.”
Oetting: 8VC Writes Initial Incubation Checks Between $3M and $40M
“The initial check size for us is like, it's probably three to four million on the small side and maybe 25 to 30 or 40 the bigger side.”
Oetting: OpenGov's ~$2B exit rivals Palantir on a relative basis
“On a relative basis, like, I think having like a nearly two billion dollar exit for state and local Government software is like probably equivalent to like a Palantir type outcome or something.”
Oetting: Saronic employees work in person six days a week
“They also work six days a week in person, which is pretty cool.”
Oetting: The US has fallen behind most in shipbuilding capacity
“Figuring out how to build ships in the United States again, which is an area that we probably have, you know, the fallen behind the most. In terms of our capacity. And that's on the defense side, but also on the commercial side as well.”
Oetting: Saronic acquired and is retrofitting an old shipyard
“They bought a, an old shipyard you know, and they're retrofitting that, but then they're, they have much bigger plans too.”
Oetting: Drug developers ignore manufacturing efficiency due to 90%+ margins
“Part of that's because if you're successful, it's, you know, like a 99% margin business. So if you can do it, if you're really bad and it's an 89% margin, who cares?”
Oetting: Life science GMP facilities carry immense fixed costs regardless of utilization
“In life science, these facilities are incredibly expensive. They require huge amounts of labor that needs to be there, whether there's a commercial project or not. Because you're a GMP manufacturing facility, you can't have, you know, mold accumulating. If you…”
Oetting: Pharma companies resist new manufacturing tech to protect approved drugs
“Pharma companies are rationally incredibly averse to switching their process because they've already, you know, they make tons of investments or acquisitions across all these different sort of binary bets. You get one that works, you don't want to have to go d…”
Oetting: Genomic medicine will transform economy and lives almost as much as AI
“I think there's going to be almost as much of a change in, like, the way that our economy and our lives work from genomic medicines as from AI.”
Oetting: Bonus depreciation tax incentives fail to help venture-backed startups
“Bonus depreciation is awesome. If you're Boeing, It's awesome if you're a real estate developer. And that's great, but it doesn't do anything for a startup because they're a C Corp. So it doesn't pass through their investors. They have plenty of net operating …”
Oetting: 8VC companies Resilience and Saronic will manufacture exclusively in US
“We're not going to build our, you know, our fill finish facility in any other country at Resilience. We are 100%, we're more than 100% all in, in that facility, right? Cerronek's not going to go build ports in, you know, some random tax haven place just becaus…”
Oetting: AI will drive massive 20-year productivity boom for physical businesses
“I think it's gonna be a massive productivity gain, at least for the next 20 years. If you're like, you run a construction company, or you have an HVAC business. Because right now you're paying some person 50 grand to make your website. Like that's done.”
Oetting: Trade labor robotics is much further off than software automation
“Maybe robotics will get there and there'll be, you know, a real sort of conflict between, you know, whatever robot can do electrical work and electricians. But I think that's much farther off than you know, automating low-level web design.”
Oetting: 'Build It And They Will Come' Is Bad Hardtech Strategy
“Well, like with resilience, one thing we learned, which is going to sound very obvious, but you know, early on, we took a little bit of like, if we build it, they'll come strategy. That's a bad idea. It's much better to buy or invest in a facility alongside a …”
Oetting: Growth Hardtech Needs Risk-Tolerant Infrastructure Project Financing
“There's a big gap between using venture capital and the private credit markets that are more traditional and sort of profit oriented. And there really needs to be an basically infrastructure financing or project financing for growth stage businesses. That's a …”
Oetting: Trump Will Boost US Manufacturing Share, But Under 13.1% GDP
“I think that the Trump administration will bring, will make a big dent on that, that will improve, but I don't think it'll hit 13.1%.”
Oetting: AI Productivity Will Substantially Mitigate US Debt in 20–30 Years
“I believe over the next 20 or 30 years it will make a huge difference. Yes. I just think in the short run, there's investments that need to be made to realize that. And I think that, you know, the way that our system deals with that is by adding to the debt.”