The Exchanges

Q Let's break this down. So like, what was the process like and why are these the perfect investors for it?

A So the process went faster than we were expecting, uh, when you have, you know, a track record of being able to execute and use words like on time, on budget, uh, building for America. And here's the proof. We were able to go from initial conversations to sign term sheets, uh, in about four weeks. Actually, maybe a funny story. I just had my first kid about a month ago. I signed the term sheet, and my wife went into labor four hours later. So the timing was phenomenal. We got really fortunate on that, and the reason why these are the right investors, when you think about, you know, Eric and Brad at Altimeter, they understand hardware. They understand how to scale Businesses outside of pure SaaS. Uh, when you look at their portfolios, when you look at their personal experiences, They understand what it takes in terms of workforce development, thinking about who are the right customers to have? How do we go and build this into a generational business? And when you think about funds like One Investment Management, they do infrastructure, they do mining, they understand project finance and all of the different pieces that we'll need later stage as we go into hyperscale.

AI assessment note: “We were able to go from initial conversations to sign term sheets in about four weeks.”

Q So we need to get into Vulcan. What is Vulcan? How did this begin?

A Yeah, so Vulcan Elements is a manufacturer of rare earth magnets, uh, which has been in the news a lot lately. This company started about two and a half years ago. Uh, I had just gotten out of the Navy and was at Harvard Business School, uh, completing my MBA. Was looking at really the three critical components that will define the 21st century. Semiconductors, batteries, and rare earth magnets. And the way that we generally like to describe it here is, if you think about your own body, a semiconductor is like your brain, a battery is like your heart, and a rare earth magnet is like your spine. And everyone was focused on semiconductors and batteries. Uh, frankly, those are critically important and they should be worried about that, but we weren't thinking as a country about the third leg of that stool, the rare, the rare earth magnet, which converts electricity into motion. And we saw that China was producing over 90, up to 94% of the global supply and the US was producing less than one percent. And when you think about the next generation technologies that will define the 21st century, whether that's Autonomous vehicles or robotics or the data centers that enable AI, drone technology. All of that has to have a rare earth magnet turning that motor, sensor, actuator, generator into motion so that we win the national security and the economic fight that we're going to be in for …

AI assessment note: “Vulcan Elements is a manufacturer of rare earth magnets... This company started about two and a half years ago.”

Q Let's talk about your team. So how did you assemble the talent for your team? We're in your facility right now in North Carolina. What kind of local talent did you pull or talent from outside state lines? Tell us about it.

A Asking who's on our team is my favorite question. That's the best question that you could ever ask me. Uh, so my co-founder, he's a PhD in electrical engineering with a focus on magnetics. He opened one of the first rare with magnetic slabs in the United States in two decades. Uh, down at the University of Central Florida. Our COO, uh, his name is Jake Bowles. He was a boots on the ground SpaceX engineer for several years, and then, uh, was a senior manufacturing engineer at Ursa Major. Our chief of staff, Jonah, uh, he has deep defense background, uh, working at the Pentagon, thinking about, uh, academic research around Military readiness, uh, ensuring that America continues to be the America that we've had for the last 75 years. And when you think about the technical team that we have, one of the reasons why we're in the research triangle is we did an analysis of the top 50 cities in the country. And we really, we really looked at four parameters. The last two are the most important. The first was proximity to customers. Second was proximity to suppliers. But then the last two were states that were open for business. That want advanced manufacturing in their state. But the fourth most importantly is where can we find pockets of the U S where you can find incredibly talented PhDs, engineers, and technicians all within a 45 minute radius. So you can't build this in the middle o…

AI assessment note: “one of the reasons why we're in the research triangle is we did an analysis”

Q How are you able to do that? You're such a young company.

A So I think it's two things. One, it's the amount of pre-work that we did getting this facility ready, making sure that all of the wraparound utilities and electrical and heat exchangers and water chillers were ready to go, that they were at spec. I think that that's something when we talk about re-industrialization and building new manufacturing companies, it's not sexy, but if you miss it, you're delayed six months. Or you get your equipment and you need to completely redo all of the piping or all of the welding, which that burns money, that burns time, that burns trust. We nailed that in this facility. And then the second thing, and it's why we nailed that in this facility is our team. Uh, one thing that we have done is The rate of learning here is exceptionally fast. So our COO, his challenge was when he started the company, I told him, go and build a team like you would have seen at SpaceX or at Ursa Major, where you were moving, you were executing, you were kicking down hard engineering problems every day. We're not admiring problems, we're fixing problems. And that's what we've done. Uh, I mean, we're very fortunate in that You know, the last five positions that we've filled, we had over 500 applications and that's with zero marketing. Uh, that's with a very low media presence. People hear about the mission and they want to come and work here because they know that this i…

AI assessment note: “So I think it's two things. One, it's the amount of pre-work”

Q Plaid trust and use bricks. Start today at brex.com slash sorcery. That's B-R-E-X dot com slash sorcery. Can you share more about America's current industrial beast? Because at Reindustrialize, there were some, like, SMBs there. There were some, like, mom and pop shop manufacturers. Um, but working through this and getting your own hardware and all of that, like, what, what kind of talent do we have on American soil?

A I think people underestimate the talent that we have. When you look at the SMBs, those mom and pop shops that have been doing CNC machining or welding or any other type of metal work for the last 25 years, we have incredibly sophisticated technicians in this country. Uh, we have second, third, fourth generation welders and people who've worked on furnaces, and we have really dense pockets in our country. Uh, when you think about states like North Carolina or Oklahoma, uh, Indiana, Pennsylvania. And so I think what we're seeing is Now you have Silicon Valley thinking about it. You have DC thinking about it. You have more capital flowing to these areas. And what's important is people in high school or people in college or, you know, in their early twenties, they're saying, I can go and build. I can go and use my hands again. Can we go back to 1950? No, we have to be able to understand automation and how AI is going to actually influence next generation factories. But I think that through things like re-industrialization, that conference, and just all of the signaling that DC cares about this, that Silicon Valley cares about this, we're making it sexy again to some fourteen-year-old, some eighteen-year-old who says, I want to go and build and serve this country with my hands. Uh, and the other thing that I would say is never underestimate America's ability to go and train talent. …

AI assessment note: “we have incredibly sophisticated technicians in this country”

Q We just came off of re-industrialize. I missed you there. I know you just had a newborn baby, so you get an excuse, but re-industrialization is the heart of the conversation right now and America's manufacturing efforts. So I want to know from your perspective, why is Vulcan or what is Vulcan's role in re-industrialization?

A So when you take a step back and you think about the broader impacts of geopolitics or economic statecraft, One of the leading indicators of a country's military and economic might is its manufacturing capability. And you can look at multiple sources. You can look at The Rise and Fall of Great Powers by Paul Kennedy. You can look at Freedom's Forge by Arthur Herman. You can look at Ray Dalio's The Changing World Order. Every single one of those books has a very common thread. And as we think about re-industrialization, whether it's around drone technology or shipbuilding, The picks and shovels, the chips, the rareth magnets, the batteries, if we forget about those, We lose because we can't actually go and build those grand pieces of equipment that we're relying on as a country. Uh, I think Marco Rubio said it really well during his confirmation hearing. If America does not start manufacturing things, we're going to have to ask China what we're allowed to build and buy in five years. And that is down to the critical component level. And that's why Vulcan Elements is so important is we are going and filling that critical gap right now So that across the economy, across national security, we can go and deliver those amazing technologies that our grandkids are going to rely on.

AI assessment note: “that's why Vulcan Elements is so important is we are going and filling that critical gap”