May 16, 2025 · 55m · sourcery
How Altimeter's $10B AUM Fund Is Investing In Aerospace, Defense, & Hardtech · Sourcery with Molly O'Shea
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In this episode of Sourcery, host Molly O'Shea interviews Eric Crispin, Partner at Altimeter Capital, about how his background in human capital drives big-ticket venture investments in hardtech, defense, and space infrastructure. Crispin details Altimeter's concentrated investment strategy, portfolio bets on Anduril and K2 Space, and how startups can navigate macro volatility in today's exit environment.
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 18.7% of the talking time here. How this is scored →
Molly as informed peer 3.2 Guest teaching 2.0 Guest disagreement 0.1 Molly pushing back 0.1
speaking balance: gold is Molly, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 46:52 Tempering Drone Market Hype
Eric rejects the popular narrative that hundreds of drone startups will succeed, arguing that the market will consolidate into only a few dominant winners.
Hardest push from Molly ▶ 23:34 Challenging the Manufacturing Bottleneck ThesisMolly introduces Brian Schimpf's conference remarks to challenge whether manufacturing or regulatory compliance is the true operational bottleneck for defense scale.
Biggest teaching moment ▶ 25:00 Detailed Unit Economics of Satellite ArchitectureEric provides a detailed technical comparison between Viasat-III legacy costs and K2 Space's vertically integrated, high-mass 20kW bus architecture.
Molly holds their own ▶ 34:13 Mapping Altimeter's Crossover PortfolioMolly displays comprehensive knowledge of Altimeter's crossover strategy, listing specific anchor portfolio companies across public and private cycles.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Molly as informed peer | Guest teaching | Guest disagreement | Molly pushing back | Why |
|---|---|---|---|---|---|---|
| Career Journey: From Human Capital Leader to Investment Partner | 3 | 1 | 0 | 0 | Molly prompts Eric on his transition from human capital to investing. Eric gives an extensive breakdown of his early career at Khosla, Index, and how board-level reputation led to his role at Altimeter. | |
| The Core Principles of Building Authentic Founder Relationships | 2 | 1 | 0 | 0 | Molly asks about the core tenets of building authentic relationships with founders. Eric highlights genuine curiosity, long-term ecosystem alignment, and prioritizing how to be useful over transactional gains. | |
| The Talent Advantage in Aerospace, Defense, and Hardtech | 3 | 2 | 0 | 0 | Molly inquires why Eric pivoted his focus toward hardtech and aerospace. Eric explains his thesis that talent density is the ultimate leading indicator and hardtech attracts concentrated talent pools. | |
| Convincing Traditional Software Funds to Write Nine-Figure Checks | 3 | 2 | 0 | 0 | Molly asks how Eric convinced a traditionally software-focused firm like Altimeter to write massive checks into hardtech. Eric details how market data, deep conviction, and human capital assessment drive internal buy-in. | |
| Deconstructing the Anduril Investment and Power-Law Success | 4 | 2 | 0 | 0 | Molly frames Anduril as an undeniable power-law winner that reset defense industry culture. Eric validates the framing and shares Altimeter's process in building conviction around Palmer Luckey and Brian Schimpf. | |
| Anduril's Hardware-Software Platform and Regulatory Realities | 4 | 3 | 0 | 1 | Molly brings up Brian Schimpf's comment that defense innovation is bottlenecked by regulation rather than manufacturing. Eric analyzes Anduril's hardware-software platform and acknowledges regulatory friction. | |
| Portfolio Deep Dive: K2 Space and the Satellite Revolution | 2 | 5 | 0 | 0 | Eric delivers a masterclass on K2 Space's value proposition, comparing legacy satellite architecture like Viasat-III to K2's high-power, mass-manufactured bus economics in MEO and GEO orbits. | |
| Value-Add Venture: Applying Human Capital Expertise to Growth | 3 | 1 | 0 | 0 | Molly asks how Eric's human capital background alters his hands-on support compared to conventional VCs. Eric outlines his focus on organizational architecture and filling mission-critical leadership gaps. | |
| Recruiting Magnetism and Executive Hires in Hardtech | 3 | 2 | 0 | 0 | Molly asks whether hardtech startups struggle to source specialized talent. Eric explains that top founders act as talent magnets, though board members provide crucial leverage in executive closes. | |
| Altimeter's Crossover Fund Synergies across Public and Private Markets | 4 | 2 | 0 | 0 | Molly enumerates Altimeter's standout public and private investments, probing how the crossover structure works. Eric explains cross-pollination insights, such as private market trends informing their Nvidia and CoreWeave theses. | |
| Concentrated Investing: Few Bets, Large Checks, High Conviction | 3 | 1 | 0 | 0 | Molly asks Eric to break down Altimeter's concentrated strategy of writing massive checks into few companies. Eric explains why diversification degrades outlier returns and outlines typical check parameters. | |
| Evaluation Frameworks: Software Metrics vs. Hardtech Milestones | 4 | 3 | 0 | 0 | Molly compares SaaS evaluation metrics against hardtech milestones and asks how Altimeter navigates a volatile exit climate. Eric contrasts ARR/churn metrics with technical milestones and private liquidity mechanisms. | |
| Emerging Supercycles in Defense, Energy, and Base Power Spotlight | 4 | 2 | 1 | 0 | Molly asks about drone sector bullishness and highlights Base Power's rapid trajectory. Eric pushes back against broad drone hype by stating only a few winners will emerge, then praises Base Power's talent density. | |
| Kalshi Rapid-Fire Predictions: AI, Wealth, Space, and Aliens | 3 | 1 | 0 | 0 | Molly leads a rapid-fire Kalshi prediction segment covering LLMs, global wealth rankings, SpaceX annual launch counts, and alien disclosure. Eric gives his practical takes and personal software preferences. |
Statements from this episode (17)
Anduril is Altimeter Capital's biggest bet by position size
“Biggest bet right now in terms of position size is Andrel.”
Index Ventures sourced and co-led the seed round for Bridge
“That led us to kind of like source and co-lead the seed for bridge, which eventually got acquired by Stripe after I had since left.”
Hardtech startups gain an advantage by monopolizing talent against fewer competitors
“You kind of can attract, like, exceptional talent into your company at an early stage because there's kind of, like, nobody else doing this thing, and so if someone is passionate or wants to come work on something that's meaningful, that's difficult, that's ch…”
Altimeter's investment in SpaceX informed its bet on K2 Space
“Obviously our investment, you know, in SpaceX helped inform our investment in K-II.”
Altimeter made its first investment in Anduril in fall 2023
“In, in fall of 20, 23, we made our first investment.”
Diversification is the enemy of outlier returns for venture capitalists
“We are highly concentrated investors. We think diversification is the enemy of outlier returns.”
The US government gets far more value per dollar from Anduril
“Ultimately, like, the government is just getting a lot more value per dollar of spend by buying from Andrel”
Technologies acquired by Anduril would not have reached the military otherwise
“They've identified the technology and that technology probably never would have found its way into the hands of, you know, the government or the warfighter without Andrel”
K2 Space delivers comparable power to Viasat-3 at a 10x lower price
“Viasat-III, one of the most high-powered, sort of, like, satellites ever launched into orbit. I think it was, like, 26 kilowatts of power. Cost 500 plus million dollars to make. You can launch one of them at a time. K-II's satellites are 20 kilowatts apiece. Y…”
K2 Space produces reaction wheels 10x to 100x cheaper than Honeywell
“Where you're going to buy a reaction wheel from Honeywell that's going to cost Two million dollars a piece. Well, they can build theirs for, again, like, you know, a 10 or a hundred x reduction in price, and you do that across the entire bus.”
Falling launch costs make larger, high-power satellite designs strictly superior
“Bigger is better in space. You can have, you know, more power, more aperture, more mass. All of that leads to being more effective. The more power you have, Like, it's directly tied to, for instance, if it's a communications use case, like, it's directly tied …”
Public Nvidia and Snowflake positions informed Altimeter's private CoreWeave investments
“All of the private sort of, you know, investment in stuff that was going on in 2022 informed, you know, our public investment into NVIDIA and our public investment in NVIDIA helped inform our private investment into CoreWeave and our, you know, relationship wi…”
Altimeter Capital has made fewer than 70 private investments across seven funds
“We're investing out of our seventh venture fund right now. I, you know, don't quote me on this, but I think like less than 70 total investments on, on the private side across those seven funds.”
Altimeter writes $15M to $25M for Series A and $250M+ for growth
“If we're doing a Series A, it's typically like a 15 to twenty million dollar check, or maybe 25, and then, you know, at growth stages, call it 50 to, you know, two 50 or more.”
Biannual tender offers allow elite companies like SpaceX to stay private longer
“As we've seen with SpaceX you know, they do biannual tenders where if you're an early stage investor or an employee there's opportunities for liquidity, and they've done that very successfully, and you're gonna continue to see that. Now you're seeing that more…”