Torsten Reil, Helsing Founder: Raising $828M to Build the Defence Champion of Europe | E1237

1. 0:00 – 0:53

   Intro

   1. TRTorsten Reil0:00

      When we started Helsing in March 2021, we actually put one of our slides that we thought there were going to be two galvanizing events. One of them was going to be an invasion of Ukraine by Russia, the other one an invasion of Taiwan by China. There is a big wave coming towards us, and it's, it is autonomy and software in defense, and it's unstoppable. The thing that we have to avoid is the Tesla moment for the defense sector. 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.

   2. HSHarry Stebbings0:29

      Where are we in three years with Russia-Ukraine? What happens in China and Taiwan?

   3. TRTorsten Reil0:33

      Again, I think it's plausible that there will be a-

   4. HSHarry Stebbings0:35

      Ready to go? (instrumental music plays) Thorsten, I've wanted to do this for a long time. Thank you so much for joining me today.

   5. TRTorsten Reil0:51

      Very good to see you. Thanks for having me.

2. 0:53 – 4:38

   How NaturalMotion Influenced Helsing

   1. TRTorsten Reil0:53

   2. HSHarry Stebbings0:53

      Now, I wanna start, uh, with lessons from NaturalMotion 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?

   3. TRTorsten Reil1:07

      It, it was a long journey. Um, NaturalMotion started as a spin-out, uh, out of university, o- 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 a 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, 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 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 wanna 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." Wi- we did focus, um, but only up to a point. Uh, 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 was going to be. Um, we, we watched Rockstar work, and we were big fans of, of Rockstar Games, and we thought, "Well, we should give it a go as well," and ended up making games for iPhone, which, um, which worked out very well. We got a, a lot of support from Apple, um, ended up creating CSR Racing, which was one of the, uh, largest iPhone games, uh, at the time. And at that point, the company did take off, and this kind of approach to risk-taking and going all in, um, uh, stayed with me and I think stayed with, with Helsing now. We, we are big believers of focus, um, just doing very few things, um, and when things don't work, we try to adapt very quickly.

   4. HSHarry Stebbings3:00

      If that's what worked that you've taken with you to Helsing, there are things that naturally don't work and you want to discard. What didn't work that you're like, "No, leaving that behind"?

   5. TRTorsten Reil3:10

      Um, I, I think one of the things that I, I didn't quite appreciate was how important hiring is. And I know everyone says that it's, a team is the most important thing and hiring should be a priority, but to really do it, to really do everything you can to get the very best people requires a different mindset and actually requires a lot of time in your calendar as well. And with NaturalMotion, we had a lot of great people, um, but we also, you know, eventually got, I think into a rhythm of, of, of maybe hiring people that, um, were just there to add headcount, to get certain things done, um, to accelerate a project, and the reality was that almost never happened. In fact, what happened was that if you added more people, complexity went up, uh, the company slowed down, it became much harder to manage, and we had to, we had to fix it a couple of times with, with quite large changes in- including riffs just to get the company to work again. And when we started Helsing, um, I started the company with, with my co-founders Gumbet and Nicholas, we made a commitment from the beginning that that wouldn't happen to us and that we would focus on hiring and really getting the really exceptional talent from the very beginning. And it transformed, I think, the company. I mean, Helsing is now a company that isn't even that large, but we, we, we try to just hire people that are exceptional, and we do everything we can to get those people into the company. We, we hustle like crazy, whether it's on LinkedIn, whether it's through network, and we, I mean, we won't give

3. 4:38 – 7:35

   Hiring The Exceptional People

   1. TRTorsten Reil4:38

      up until we, we get the person that we want.

   2. HSHarry Stebbings4:40

      How big is Helsing now?

   3. TRTorsten Reil4:41

      It's about 350 people.

   4. HSHarry Stebbings4:42

      Okay, 350 people.

   5. TRTorsten Reil4:44

      Yeah.

   6. HSHarry Stebbings4:44

      Exceptional people, by very definition, are exceptions. My point to that being, is there not a certain size whereby you have to accept good because there are not that many exceptional people?

   7. TRTorsten Reil4:55

      Actually, I think there are a lot of exceptional people, and, um, 350 people isn't that many. It, it is possible that at 3,500 and maybe at 10,000, you start to have to make compromises. But I'm not sure how large a company has to grow in terms of headcount. In, in our experience, the, the top performers do the work of many people, and they give the company a light-footedness that otherwise wouldn't be there and the speed that otherwise wouldn't be there. So I'm not sure you need to grow into crazy headcount numbers and compromise.

   8. HSHarry Stebbings5:23

      How, how quickly do you know when someone is exceptional?

   9. TRTorsten Reil5:26

      I think quite often within 30 minutes of an interview. That's what I usually try to achieve.

   10. HSHarry Stebbings5:32

       What are the clearest signs?

   11. TRTorsten Reil5:33

       I think it's just a feeling. The thing I always look forward is, is, uh, look for is, is effortlessness, is, you know, not trying too hard, um, and just being so kind of on top of the detail of everything that kind of the effortlessness shines through. That's the main thing I, I look for.

   12. HSHarry Stebbings5:51

       I look for unwavering imbalance. (laughs)

   13. TRTorsten Reil5:53

       Okay. (laughs)

   14. HSHarry Stebbings5:55

       Like, in any area of life, I just want the spikiest point. Like, what did you do that was truly exceptional?

   15. TRTorsten Reil6:00

       Yeah.

   16. HSHarry Stebbings6:00

       And it could be in anything. But if you have that capability to go so all in on something, I wanna know why and the mindset behind it.

   17. TRTorsten Reil6:06

       It's interesting. I never ask questions in interviews like that. Um, I don't have a set of questions, so I just, I just try to get into the flow.

   18. HSHarry Stebbings6:13

       Really?

   19. TRTorsten Reil6:13

       Yeah.

   20. HSHarry Stebbings6:14

       Wow. And you don't find there's commonalities in the questions that you ask?

   21. TRTorsten Reil6:18

       No. And I find them quite often too staged, and, and people... I, I always think people can tell when a question is staged, and so they're not themselves. So it's easier for me to just go with the flow and just kind of see where it goes.

   22. HSHarry Stebbings6:29

       I heard this quote. Um, it was actually Mark that told me this, and I think it's... You said it before, but if you have two good people, replace them with one outstanding person.

   23. TRTorsten Reil6:39

       Yeah, this is about talent density. We, we, um... Uh, I think I mentioned, we, um, s- w- w- we do, we do a, um, a founder offsite every, every, um, three months, and we make kind of decisions about how we want to run the company. And, and one of the decisions that we made was that we, we, we really do everything to go for talent density, and, and that means really taking hiring seriously, but also taking performance management seriously and making sure that only people, you know, that, that are Helsing people, are, are at Helsing. And that means very often that we try to reduce the number of people overall. We, we found that the most performant teams are, are really small in the company. You can achieve a lot, um, in particular around software with three to four exceptional people. And so we'd rather have a team of four exceptional people than eight good people. It makes everything easier. It's also cheaper, by the way, even though you pay above market rate, it's cheaper to do it that way.

4. 7:35 – 12:19

   Structuring & Managing Small Teams Effectively

   1. TRTorsten Reil7:35

   2. HSHarry Stebbings7:35

      Can you just talk to me about the structure there? So you have lots of three to four people teams. You know, like, 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?

   3. TRTorsten Reil7:57

      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.

   4. HSHarry Stebbings8:34

      How do you performance manage well, and what's been your biggest lessons in doing that?

   5. TRTorsten Reil8:38

      First of all, I think you need to want to performance manage. Um, performance management is exhausting because you basically have to have difficult conversations with people. Sometimes they work out and they become better. Sometimes, um, you know, you decide to part ways. First of all, you have to have a mindset that this is necessary for a company.

   6. HSHarry Stebbings8:54

      Do you need to do one-on-ones?

   7. TRTorsten Reil8:56

      In general?

   8. HSHarry Stebbings8:57

      Yeah.

   9. TRTorsten Reil8:57

      No, I, I don't do any. I-

   10. HSHarry Stebbings8:59

       You don't do any one-on-ones?

   11. TRTorsten Reil9:00

       I don't do any. I think, um, one-on-ones work for, um... One-on-ones work for people, um, I think that are used to them, that have structured them properly, um, and that work with people who need, I think, guidance in their development. The people I work with are usually senior and, and don't need that much guidance. If I need a one-to-one with them every week, I think something's probably gonna... Is probably going wrong. I also think that there is a tendency for one-on-ones to clog up the calendar. Um, you have a lot of them, um, you tend to repeat a lot of things. I used to do them religiously, by the way. I just stopped doing them. And it hasn't, it hasn't had a negative impact.

   12. HSHarry Stebbings9:35

       So I interrupted that, you there. So you need to want to performance manage, and a lot don't because it's hard. You have to have hard conversations. What else?

   13. TRTorsten Reil9:42

       Yeah. So, so this is something I, I noticed when I was mainly angel investing in, in, in startups is that, you know, you, you get a... Eventually you get a certain number of people who are not a good fit for the company, and they, they clog up the system in the company. They make everything harder. Uh, they create pockets of unhappiness because they feel, uh, maybe neglected or not understood, um, or they don't fit into the culture, and you kind of tolerate it quite often as a founder, and you tolerate it up, up to a point where you think, "This doesn't feel like my company anymore. Like, what happened?" Um, that happened to me at NaturalMotion, by the way, um, at some point, and it's really painful for a founder. But the reality is that if you want to counteract that, you have to make performance man- management one of the main things that you do from the beginning. You have to commit to it early on. And that means that you have to do the performance management, but probably as importantly, you have to also do what we call performance management calibration with all the leaders. So what we do at Helsing is that every quarter, um, we get all the... Well, one cohort, so one quarter of the leaders together, and they go through all the performance ratings that they gave, um, their people in their teams, and then, um, the, the leadership team listens to it and gives feedback, not necessarily on the person, but actually to the way they rate the performance and help them calibrate it against what good looks like at Helsing, uh, either because they've been too harsh or vice versa, because they've been too lenient. And, and we do this religiously, and it, it creates a culture of, I think, a well-calibrated performance system. And you need that because otherwise, you end up with a lot of unfairness and, and also with not enough scrutiny, to be honest.

   14. HSHarry Stebbings11:23

       When you go wrong, you also have to review yourself and review the hiring process that has got you to that state. When you've gone wrong in hiring, what did you not see that you should have seen?

   15. TRTorsten Reil11:33

       I, I think it can be all kinds of things. Um, it, it will sometimes be, um, culture fit. Uh, it'll sometimes be, um, the willingness to go the extra mile, like to do whatever it takes to get something done. It can sometimes be just technical performance. I mean, people might have aced it in, in their interview and in their, in their tests, but maybe if you give them a, a new problem, they, they, they're not able to do it. I think the, the key is to recognize it early, to recognize it in the first few months, to work, obviously, with people to improve. Uh, but if that doesn't work, then to part ways and do it amicably.

   16. HSHarry Stebbings12:07

       When you put someone on a performance improvement plan, it does not work from there. Agree or disagree?

   17. TRTorsten Reil12:12

       Uh, well, I, I, I've seen actually quite a lot of people turn around, uh, including at my previous company as well in, on a performance management plan. So it's not a foregone

5. 12:19 – 17:44

   What is Helsing Speed?

   1. TRTorsten Reil12:19

      conclusion.

   2. HSHarry Stebbings12:20

      You mentioned doing whatever it takes to get something done. I heard about Helsing speed beforehand from a lot of your investors. What is Helsing speed?

   3. TRTorsten Reil12:27

      H- Helsing speed is, is, um, something that I, I nicked from Zynga. Zynga had, um, Zynga Speed. And Helsing speed is basically-

   4. HSHarry Stebbings12:35

      Incredibly creative. (laughs)

   5. TRTorsten Reil12:36

      Very creative. And, uh, and we, as the founders, like, f- felt very early on that, um, speed was one of the most important things. We... W- w- when we started, I mean, it's a couple of things. When we started, we, um, we wanted to be fast 'cause we n- we needed to be fast. We had, we had to catch up. I mean, it felt already, we started the company in, in 2021, that something was brewing, that, um, the geopolitical kind of tectonic plates were shifting, and we felt that we had no time to lose. And so the reason we raised quite a bit of money from the beginning was because we wanted to make sure that we could be fast and, you know, speed became one of the main things, um, for us. So one of the things w- we... Everyone's aware of Blitzscaling, um, you know, the, the book, um, and, you know, it's, it's a, it's a big book, but you can summarize it quite, quite quickly. Um, you know, there, there are sometimes situations when capital is available where it's, where it's okay to be inefficient, um, so that you can be effective basically, uh, and, and, and very fast, and we embraced that from the beginning. We, we tried to get recruitment up and running really quickly, uh, which was, which was crucial for our performance culture. You need to basically always have pressure on the pipeline of good people coming in, in order to be able to manage other people out, and so that you end up with a pool of people that are, that are amazing. And so we wanted to shortcut that and find a third party that, um, you know, we... I wouldn't say overstaffed, but staffed very well so that we could get people in. I mean, we did a whole bunch of other things just to be fast, knowing that eventually, we needed to settle at a different kind of level and not be inefficient, um, but be efficient and effective at the same time.

   6. HSHarry Stebbings14:14

      I think a lot of founders will kid themselves that they are in this situation where blitzscaling is necessary, they need that cash, and it's okay to be inefficient in o- in order to be effective, when it's actually not the case. How do you think about when it is the case versus when it's not?

   7. TRTorsten Reil14:28

      Yeah. So I think you need to make a commitment early on that it is usually a transitionary per- so a temporary period. Um, so we, we wanted to do it for the first six to 12 months. So with recruitment, for example, we, we used a, a great third party, and then eventually, um, we moved into in-house, which we-

   8. HSHarry Stebbings14:44

      How much did you raise for your first round?

   9. TRTorsten Reil14:45

      So the seed was €8.5 million, but then we were lucky to, um, uh, have Daniel Ek and Prima Materia invest €100 million, um, about f- four months later or so.

   10. HSHarry Stebbings14:56

       How on earth does that happen? With respect. We both love Daniel and Jack-

   11. TRTorsten Reil15:00

       Yeah.

   12. HSHarry Stebbings15:00

       ... but like, eight to 100 is a relatively atypical path of funding.

   13. TRTorsten Reil15:05

       Daniel came into the, into the seed round. He, um, was a, was an investor in our seed round, the €8.5 million, and within I'd say two or three months, I think he developed so much conviction that, that, um, he asked like, "I would like to lead your series A. How much, how much money do you need?" And I said, "Ideally €100 million." And, and, and he gave us the money f- you know, through Prima Materia, who've been, who've been amazing to work with, and it allowed us to do the speed thing that I just mentioned, but a couple of other things as well. It's... It, it allowed us to, to really focus on top talent very early on. And the, and the second thing that it allowed us to do is, is to not go for innovation, um, you know, projects in defense, for incubators, and, you know, little grants here and there. But because we were quite well-funded, we, we could go for programs of record, um, so the official large programs, which were hard to get and very risky, but we were well-funded enough that we could, we could just take the risk, and that worked out very well.

   14. HSHarry Stebbings16:01

       Is Helsing a company that only a serial entrepreneur could found when you look at the capital requirements?

   15. TRTorsten Reil16:06

       I'm not sure about that, but I, but I think it, it does make it easier. I, I would say Helsing is a company that you can only co-found. You need to have multiple founders.

   16. HSHarry Stebbings16:15

       That's so interesting 'cause I, I interviewed, um, you know, uh, Trey from Foundless Fund and Anduril, and he said the single most important thing about Anduril and the reason we're successful is because, you know, I specialize in selling to governments. We've got Matt Grim, who's amazing on operations. We've got Palmer, who's amazing on product. We've got Brian, who's a phenomenal C- The combination of our skills.

   17. TRTorsten Reil16:37

       Yeah.

   18. HSHarry Stebbings16:37

       How do you think about that with that?

   19. TRTorsten Reil16:39

       It's similar with us. I mean, we, we... Gunter, Niklas, and I all come from different directions. Now obviously end up doing something similar, but we have maybe different emphasis on, on the various things that we do. And the company of the complexity of Helsing, I mean, it's a defense company, so that comes with all kinds of complexities around, uh, obviously, um, government relations, um, go-to-market, security, um, export law, a- and many other things that is too much to stay on top of, in addition to building the company, building the org and everything else for one founder. And so the three of us have, um, different backgrounds, but we also just provide bandwidth. And then the third thing that we do is because so many decisions are difficult, um, we, we are sounding boards for each other, like, all the time. We are in touch all the time. We talk, I don't know how many times a day, and it... That would have been much harder as a single founder. I was, uh, a single founder at, um, at NaturalMotion, and, um, at least for a long time was, was on my own as a founder, and it, it was much harder also to make the right decisions.

6. 17:44 – 21:03

   On the Annexation of Crimea by Russia

   1. TRTorsten Reil17:44

   2. HSHarry Stebbings17:44

      You said about the tectonic shifting plates and the geopolitical landscape that you saw that made you want to move fast. What did you see that very few other people saw in the tectonic plates shifting?

   3. TRTorsten Reil17:56

      I think the watershed moment was the annexation of Crimea in 2014, um, by, by Putin, and, and as importantly, the, the reaction or lack of reaction by, by, um, European and, and Western governments in general. And we obviously, you know, acknowledged it and, uh, and took note, but we didn't really understand the threat. And the danger, I think even back then, that that created was that you essentially allowed, uh...... someone with territorial ambitions to, to do more. And it felt like the clock was ticking, um, un- till that was going to happen. And so when we, um, started Helsing in March 2021, which now feels like a very different time, we, um, we actually put in, in our, uh, one of our slides, um, that we thought there were going to be two galvanizing events. One of them was going to be an invasion of Ukraine by Russia, the other one an invasion of Taiwan by China. Um, so we got the Russia and U- Ukraine invasion right. What we got wrong was the timing because we thought it was going to happen in 2025. But in the event, it happened 11 months after we put that slide together. And so ever since then, we, we feel like it's... Sadly, it is rational to be pessimistic at the moment, and it feels like, um, this hasn't quite fully sunk in, I think in, you know, across our democratic societies.

   4. HSHarry Stebbings19:20

      In 2014, the annexation, we didn't understand or we didn't really prioritize enough? I struggle to believe we don't understand, Thorsten.

   5. TRTorsten Reil19:29

      I think we probably intellectually understood it, but we didn't really want to think through the consequences 'cause the consequences were that we needed to start thinking about defense again, about conflict, uh, all the suffering that comes with it, and we didn't want to think about it. We thought it might go away. And actually, that happened, uh, for many years afterwards as well, and, and even to some extent now. And I understand it. I understand it emotionally as well, but I think it's intellectually lazy to not take the s- next step and think about what actually is required to protect our democracies.

   6. HSHarry Stebbings20:00

      Before we go into what's required, what happens from here?

   7. TRTorsten Reil20:03

      The, the question is whether we are prepared again to think it through and, um, and, and commit to the next steps, which are an increase in defense spending, even if it is expensive, even if that means making sacrifices elsewhere, because the sacrifice that otherwise we'd have to make is, is potentially so large, thus it's the right thing to do. That, I'm not sure is happening at the moment.

   8. HSHarry Stebbings20:24

      I mean, Keir Starmer has actively said we will not have an increase in defense spending.

   9. TRTorsten Reil20:28

      Well, I think most governments are actually committing to an increase over time. So we are at, I think, roughly probably 2% right now on, on average in NATO. That's quite low. Historically, it's been, through the Cold War, it's been 3 to 6% or so. Um, but if you look at Poland, Poland's gone from, I think, 2.1% or so to 4.6, 4.7, uh, within just a few years. So it's clearly possible. Whether every country is going to act at that speed, um, remains to be seen. I think there are budget pressures everywhere. We, we understand them, and, you know, you have to convince a lot of people to actually rechannel so much money towards defense. It's not easy. I, I get that. But I think it's gonna

7. 21:03 – 23:49

   How Trump’s Stances Impact European Funding Needs?

   1. TRTorsten Reil21:03

      happen.

   2. HSHarry Stebbings21:03

      How do you think a Trump administration changes the European funding requirements in this situation? Because he's actively said before, "You are not pulling your weight."

   3. TRTorsten Reil21:11

      Yeah, I think we've already been on that trajectory, uh, I think starting from 2016, um, where obviously similar arguments wer- wer- were being made, and obviously with the, um, with the Ukraine conflict, um, defense spending has gone up, um, you know, sometimes part of the, the general budget, sometimes as part of separate budgets, like in Germany, the 100 billion. So that's already happening. Um, I think we've already been on that vector. Um, I think the need for European sovereignty ha- has clearly become even more important. So I think we're just gonna go further down on that vector. It might just be that we, we're gonna have to go faster.

   4. HSHarry Stebbings21:42

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

   5. TRTorsten Reil21:46

      Again, I mean, it's been clear for, uh, eh, many years now that, um, we cannot rely on partners to secure and, and protect eu- uh, Europe, uh, at least not, um... yeah, at least not, um, over a long, uh, 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 of partners and, and, and as it looks, also not the willingness to do so. And quite frankly, I think, eh, 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.

   6. HSHarry Stebbings22:35

      Will Trump pull out of Ukraine?

   7. TRTorsten Reil22:37

      I don't know. Um, I, I don't think anyone knows. Um, I think, you know, it's clear what, you know, he talked about. It's clear, um, that he's made certain statements, but we'll see, we'll see what's gonna happen.

   8. HSHarry Stebbings22:48

      Many people think that we are on the cusp of a defense spending boom. Do you think that's actually realistic? You mentioned the other 2%. We all appreciate it needs to go higher. Is that rational, and are we at the cusp?

   9. TRTorsten Reil23:01

      Yeah, I'm not sure whether it's a boom or not. I think we'll see some countries increase their defense budget a little bit. We'll see others, I mentioned Poland, increase it drastically, in particular the, um, the, the countries that are most exposed, um, you know, to the, to the eastern flank, to the NA- NATO eastern flank, are more likely to increase their defense spending. It's already happening. It's happening in Scandinavia as well. Um, other parts of Europe, um, may or may not increase it as much. Um, that I think we'll have to see. I'm not sure I would call it a boom, um, though. Uh, I think it's, uh, an increase that will go into fixing a lot of things that are broken at the moment, and then some of that increase, um, will go into new equipment spend as well, but only some of it. And of that, there'll be a proportion that will need to go urgently to, you know, what's called new defense, def- defense technology, but that will only be

8. 23:49 – 28:30

   How Helsing Chooses Who to Sell To

   1. TRTorsten Reil23:49

      a part.

   2. HSHarry Stebbings23:49

      Who do you determine who you sell to versus who you don't?

   3. TRTorsten Reil23:54

      You mean which c- which countries?

   4. HSHarry Stebbings23:55

      Yeah.

   5. TRTorsten Reil23:56

      Uh, I mean, it's a bigger topic, but the question is whether you should stop at export laws or whether you should, um, you should give it more thought. And, and what we did from the beginning at, at Helsing is we, we, we made a commitment to ourselves but also to the outside world that we would take ethics really seriously, and there are two reasons for it, is, is w- one of them is, uh, a- as a company that's based in democratic countries, we believe we have, we have a special responsibility to think about ethics and how our technology is used and who we make it available to. Secondly, we want to attract...We want to be a broad church. We want to attract all kinds of different people with, with different political views, um, backgrounds, et cetera. And to accommodate those people, you need to give everyone in the company the commitment that we think together carefully about the pros and cons of certain decisions. The decisions always have to be made eventually by, by the founders, but the decision process, um, you can include everyone. And that's what we've done from the beginning. So we have many ethics workshops, which are extremely well attended. We now have to br- have to break them up into, um, you know, several sub-groups and, and, and working groups. But it-

   6. HSHarry Stebbings25:05

      That sounds very exciting.

   7. TRTorsten Reil25:06

      They are really interesting, and if people want to join them, they're intellectually interesting because you have to deal with so many shades of gray and with so many pros and cons. And-

   8. HSHarry Stebbings25:14

      What ethical elements come up that you did not expect to come up? 'Cause there's obviously, like, the obvious, don't sell to bad people, sure.

   9. TRTorsten Reil25:22

      First of all, the... even the complexity around who do you sell it to, um, i- is interesting because there are very obvious ones that we'll all agree on, but then there are ones, uh, in between which a-

   10. HSHarry Stebbings25:32

       Uh, who do we... Sorry. Who do we agree on? Is that China? Fine. Iran.

   11. TRTorsten Reil25:36

       North Korea.

   12. HSHarry Stebbings25:36

       North Korea.

   13. TRTorsten Reil25:36

       North Korea. Yeah.

   14. HSHarry Stebbings25:38

       Yeah.

   15. TRTorsten Reil25:38

       For example, that, that we would agree on. And then there are others where it becomes a bit more complex. And so, so one of the reasons... one of the main reasons we, we, we do these workshops is that we get everyone to contribute to the decision process, but also for everyone to build what we call this ethics muscle. So you... because I- for me, everything was kind of there were red lines, everything was black and white, and it was kind of easy. The more you dive into a particular topic, the harder actually it becomes to make these, these calls and the more complex it becomes. And that is something that we didn't... we, we didn't just want to decide kind of in a small group of people or, or s- some small ethics group. We wanted everyone to contribute to it so that everyone had buy-in and understood the pros and cons. Not everyone may agree with the decisions that we eventually take, but everyone can see how we arrived at those decisions.

   16. HSHarry Stebbings26:24

       What decision did you take that was most unpopular?

   17. TRTorsten Reil26:26

       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 built 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, you know, everyone contributed to the thinking around this. Um, we managed to shine a line... light, um, uh, 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, concept of operations, 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.

   18. HSHarry Stebbings27:25

       Before we go to this very important news, I just wanna... so, so you don't sell to those three. Who are the ambiguous? Like, who's the like, "Mm"?

   19. TRTorsten Reil27:34

       Well, the easiest way to look at, um, clear and not clear is to check out The Economist Democracy Index. That's what we used initially.

   20. HSHarry Stebbings27:42

       The Economist Democracy Index?

   21. TRTorsten Reil27:44

       Exactly. So The Economist releases a list every year, um, and it ranks countries, um, according to how democratic they are, with 10, I believe, being the highest one, going down to zero. And so the ones at the top are easy, and the ones at the bottom are also easy. Um, and then, and then it starts becoming more complex in the middle because you have some countries, um, uh, even in the EU where, um, in the past, they haven't been kind of ranked that highly. Um, but then governments have changed, and they've ranked more highly again. So it's, it's, it's basically becomes a moving target. And then there are also considerations around are they parts or are these, some of these countries that are maybe in the gray, gray zone, uh, part of democratic alliances that become important for democracies to survive and protect themselves,

9. 28:30 – 30:54

   Navigating the Transience of Right and Wrong

   1. TRTorsten Reil28:30

      for example?

   2. HSHarry Stebbings28:30

      How do you think about the transience of right and wrong? And what I mean by that is like, you know, when, when Israel, you know... terrible, you know, um... the 7th happened. It was like the world got behind Israel, and now we've seen the backlash against what's happened in Gaza. And one could argue that they fought back with, um, too much force. And what was a worthy customer may become an unworthy customer.

   3. TRTorsten Reil28:54

      Yeah, I think these complexities are there with any conflict.

   4. HSHarry Stebbings28:57

      Yeah.

   5. TRTorsten Reil28:58

      And eventually, it becomes... it becomes complex, and there is no right or wrong. I'm always... I'm always aware that this sounds like a cop-out, and this is what I wa- I've always been afraid of, is that, you know, when, when, when you say it's complex, it sounds like a cop-out. But it isn't a cop-out. It is actually complicated and complex, and, and you also need to weight certain components in a way that can be arbitrary. And so... a- and, and so every conflict, I think, has these kinds of, um, complications, and it's our responsibility to navigate it. Again, we could just lean back and say, "There's export law that makes it really easy." But I think if you want to have people really engaged with these kinds of technologies and capabilities in a company, you need to go further than that. You need to build a view that goes beyond just what is quite static export law.

   6. HSHarry Stebbings29:45

      Has there ever been a case where it's like, actually, there's European sovereignty and supporting Europe and making sure that we get great provisions of amazing equipment versus actually, "Fuck. The money is to be made elsewhere. Money needs to be made selling in the US, in other countries." And actually, you have a balance between European sovereignty and revenue optimization?

   7. TRTorsten Reil30:04

      Well, yeah, I mean, the, um... Helsing was founded to support Europe and to be a European company, also to be a European lighthouse company, and a company that helps Europe protect itself. So that's always the number one thing. And if, if kind of people ask like, "What is it you want to... you know, where do you want to be in five years with Helsing?"

   8. HSHarry Stebbings30:22

      (laughs)

   9. TRTorsten Reil30:22

      Or, "What is it you want to achieve?" It's, it's very simple. We, we want to make Europe safer.... uh, we want to be able to point at the difference that we've made in terms of, um, the geopolitical security of this continent. That is the goal of the company. Everything else has to follow from that. Obviously, it needs to be a company that's large enough so that it has leverage, that it can deploy a lot of equipment, that it can work with some of the most complex systems, like the Eurofighter that we're- that we're working on. But that's all a means to an end. The- the- the goal is always

10. 30:54 – 35:15

    Why Was Now the Right Time to Shift Focus to Drones?

    1. TRTorsten Reil30:54

       to protect Europe.

    2. HSHarry Stebbings30:55

       I do wanna stay on the drones because otherwise, well I- I'm gonna discuss Europe, but a little bit later. On the drone 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.

    3. TRTorsten Reil31:10

       Yeah, I mean, Helsink is a software company, is a software-first company, al- always has been, a- and always will be. Um, you know, almost everyone is a software engineer. Um, that's what 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, um, 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 10X 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 w- work in defense. Even though some people say it is impossible, uh, 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- a- a combat aircraft as a carrier, and 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 have a large number of drones, extremely precise, to provide a deterrent that doesn't exist at the moment. And so for that, you need to have large numbers of drones, you need to have the ability to manufacture those drones, uh, in a way that isn't the case right now. Most drone companies right now build small numbers of quite exquisite drones, they're quite expensive. Um, you know, it's- it's- it's sometimes a bit of a boutique business, um, where people really care about the hardware and the carbon and everything else. And that's great, but that's not what we need. What we need is really scaled-up production. And so when we looked at what's required in terms of capability, we couldn't, certainly on the western market, we couldn't find anyone who was able to produce these large numbers. And so that's when we started to look at, can we build these kinds of drones ourselves and can we think about it differently from a software-first point of view? Meaning that if we can shift a lot of the complexity from hardware into software, we can simplify the hardware and we can manufacture it in much larger numbers at- at lower prices. And that's what we did with the HX2, uh, which we just announced a couple of days ago.

    4. HSHarry Stebbings33:32

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

    5. TRTorsten Reil33:39

       It is, uh, 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, um, by shifting complexity into software, and you can also test hardware in software. And so we spend a lot of time building infrastructure for the entire company around, um, simulation platforms, for example, AI infrastructure platforms, et cetera. 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, is 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 the- these two things, uh, 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.

    6. HSHarry Stebbings34:46

       What can you not test in software that has to be tested in hardware?

    7. TRTorsten Reil34:50

       Well, sometimes s- software can, uh, with- with the right simulation environment, go really far. Um, but there will be some things that maybe you didn't expect that aren't covered in your simulation, um, that happens in particular when- when you're deployed, uh, as- as our, um, drones are in Ukraine. Um, then, you know, the- the realities, um, of conflict will throw things at you that you just didn't anticipate. And so that's something that you- you

11. 35:15 – 38:43

    Does Compliance Hinder Government Drone Procurement?

    1. TRTorsten Reil35:15

       have to test.

    2. HSHarry Stebbings35:15

       Can I ask you, I- I spoke to someone the other day while I was looking at a defense company, and they said, um, the challenge is compliance, especially around drones. Said a lot of governments cannot buy single-use drones because of the single-use nature of it. My question to you is, to what extent does compliance become an inhibitor to government procurement?

    3. TRTorsten Reil35:34

       It is an inhibitor, um, like many other things as well. But I think with- for the complaints that we have about procurement and everything else, a lot of these rules are also there for a reason. Are they always applied in the right way and in as timely a way as, um, you know, ideally would be, uh, pos- possible? Probably not. But th- the rules quite often make sense. And-

    4. HSHarry Stebbings35:54

       What's the craziest rule?

    5. TRTorsten Reil35:56

       Uh, to be honest, I don't know. I think there- there are lots of rules and it's frustrating, but, um, but if you enter defense as a company, um, that is what you've signed up for. And so you'll rarely hear us complain about how slow procurement is, et cetera, because in our experience, people want to do the right thing. The- the procurement officials also want to do the right thing. And by the way, I think politicians do too.It's just that eventually, you end up with a system that's going over a long time, where the incentives aren't quite aligned with the realities of conflict.

    6. HSHarry Stebbings36:25

       Well, this is my point. Are they incentivized to innovate or are they incentivized to continue longstanding relationships with primes, where there is zero risk of job loss if it goes wrong?

    7. TRTorsten Reil36:35

       So I-I think the system probably incentivizes the latter, but that doesn't mean that there aren't individuals, um, actually across, um, you know, different forces in procurement agencies, but also in politics, who really want to innovate. It does exist and-

    8. HSHarry Stebbings36:49

       How could the structure of this system be changed, where innovation and procurement of new innovation is encouraged, not job loss avoided?

    9. TRTorsten Reil36:57

       So there are all kinds of, I think, different things that you could do, but what we are suggesting, um, is that you introduce a mandatory 20% on new defense companies for defense equipment. That is the easiest way of doing it. So if your reserve of your defense equipment spends on not the stuff on maintenance and everything else, but actually defense equipment, um, if you reserve 20% of that to new defense companies, which you can define, um, that is a shortcut, um, to actually, to actually realigning incentives.

    10. HSHarry Stebbings37:26

        What is the current spending on new defense companies?

    11. TRTorsten Reil37:28

        I think it's less than 1%.

    12. HSHarry Stebbings37:30

        Oh, my God.

    13. TRTorsten Reil37:30

        Yeah. It's incredibly low.

    14. HSHarry Stebbings37:32

        And so a shift to 20%. A shift to 20%, though, is just Helsing. I mean, there are not that many other defense startups.

    15. TRTorsten Reil37:39

        Not at scale, no. I mean, they're, they're smaller ones-

    16. HSHarry Stebbings37:41

        Yeah.

    17. TRTorsten Reil37:42

        ... um, but not at scale.

    18. HSHarry Stebbings37:43

        Okay. Uh, I have to ask, when we think about... We, we mentioned the compliance (laughs) element there. What are the other hardest elements of selling into government that are not often discussed?

    19. TRTorsten Reil37:54

        You, you have to then think about how do you deal with lobbying from industry. So, um, n- not every, uh, prime in, in, in the defense industry is, is, is yet our friend. I think we are... We want to reach out to all of them, but not everyone sees us as friends yet.

    20. HSHarry Stebbings38:11

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

    21. TRTorsten Reil38:13

        Well, probably Saab is a friend, for example. We work very closely with them. Um, their shareholder's in Helsing as well, so they're clearly close friends. Um, others, um, I think it can fluctuate. I, I, I, I don't mean this in jest. I think we all genuinely need to work together. I think we all have bigger fish to fry, and defense primes will always have a role. Um, we don't think that they, um, you know, they will disappear. Um, in fact, actually, I think they will grow if we do things right.

12. 38:43 – 39:46

    What Happens If Defense Faces a 'Tesla Moment'?

    1. TRTorsten Reil38:43

       The thing that we have to avoid is the Tesla moment, uh, for the defense sector. If... 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.

    2. HSHarry Stebbings39:12

       What does that mean if it happens? Like, why is that such a challenge?

    3. TRTorsten Reil39:15

       We're going to be faced with a large number of autonomous systems, uh, from our adversaries. That's going to be the focus that they're going to take. And by the way, um, it's quite likely that they won't have the same ethical red lines that we as democratic societies should have. So they have, from a functionality point of view, I think they'll have the ability to take shortcuts that we don't want to take. We always think that we have to earn the luxury basically to be able to really care about ethics and that means that we have to have technology leadership overall.

13. 39:46 – 41:20

    Are Russia and Iran’s Capabilities Underestimated?

    1. TRTorsten Reil39:46

    2. HSHarry Stebbings39:46

       Do we underestimate the capabilities of Russia and Iran specifically?

    3. TRTorsten Reil39:50

       I mean, they're quite clear for everyone to see. Iran is producing a large number of drones already. They've been, um, you know, using and working on the Shahed, for example, for a long time. They've licensed that design to Russia. Russia's now manufacturing it itself. The software is getting better over time. Russia has the Lancet, uh, the Zala Lancet, which is a capable strike drone, uh, quite different from a Shahed, which I think they've developed themselves. And the software for all of these is getting better as well. And so we're going to be faced, um, either through Russia alone or through partners like Iran, with adversaries that are committing to precise mass, large number of autonomous systems that we're going to have to counter one way or the other. And you can counter them, but you can't counter them with the current systems that we have. You can't just have exquisite systems like tanks, artillery guns that are not particularly well-connected, that take a while to take a shot. You need to work basically at the speed of software. You need to interconnect all of these systems, but crucially, you need to have precise mass on your own side as well. You need to have the ability, however horrible that sounds, to have thousands and tens of thousands of strike drones to deter.

    4. HSHarry Stebbings41:03

       Do governments understand this?

    5. TRTorsten Reil41:05

       I think some governments are starting to understand it, uh, to give them credit. Um, I think governments at large probably haven't understood it. There is a big wave coming towards us and it's, it is autonomy and software in defense, and it's unstoppable, and we're just going to be forced into that

14. 41:20 – 46:40

    How Will AI & Autonomy Shape the Future of Warfare

    1. TRTorsten Reil41:20

       race.

    2. HSHarry Stebbings41:21

       When you say like autonomy, software and defense, can you unpack just how you see the future of warfare and conflict with AI and autonomy in mind?

    3. TRTorsten Reil41:29

       So we have... We can already look at Ukraine and look at the trends there. And the trend, um... Even at the beginning, there were some drones that were being used. Remember the TB2s, for example, from Turkey, the Bayraktar ones. Over time, that's evolved towards more and more drones. Initially, it was to make up for lack of artillery munitions. Now, actually, the drones themselves have such good success that more and more are being built. And I believe Ukraine is building one and a half million FPV drones, the small first-person view drones a year. I think Russia is building roughly the same. So there's already a shift towards mass, um, and reasonably precise mass. What hasn't happened yet is that those drones are scalable, but that will happen in terms of their usage. At the moment, you have one operator operating one drone. That's going to happen.... it's going to happen quite quickly that that's going to change, and you'll be able, as a single operator, to control multiple drones. And that trend, I think we'll see, um, playing out as early as next year. Um, it's, it's not long now because the algorithms are all coming, and we know this because we have those algorithms too.

    4. HSHarry Stebbings42:40

       You said there about kind of drones having success. How do you measure success?

    5. TRTorsten Reil42:45

       I think it's the ability to hit a target, basically, and, uh, in, uh, you know, it's, it's hitting a target, um, that, um, i- itself uses, um, electronic warfare, so it tries to jam the signal of the drone. Uh, these are some of the bigger problems right now that, um, that Ukraine is facing, and that, that NATO will be facing in a peer conflict as well, or, or any other, um, country in a peer conflict. So drones themselves, if they're just remote-controlled drones, eventually have the problem that they can be jammed. That's GPS jamming, so it doesn't know where it is, or it's c- comms jamming, which means that the control inputs to the drone or the video feedback from the drone to the operator is, is jammed, and, and, and therefore you can't use it. So this is the problem. I mean, there's a, there's a, there's a jamming station at the, um, frontline every few kilometers right now, so it's almost impossible to, to get around jamming at the moment.

    6. HSHarry Stebbings43:35

       The thing that Matt from Anduril has taught me is actually the different economies of conflict, and what I mean by that is that you can send one very expensive million-pound drone in, and it can be shot down with a 50,000-pound missile or whatever that is. And you can continuously have this mis-economies or mismatching cost versus kind of, um, breakdown.

    7. TRTorsten Reil43:56

       Yeah. The-

    8. HSHarry Stebbings43:57

       How, how do you think about that?

    9. TRTorsten Reil43:58

       It's the same thing with strike drones and tanks and artillery. A tank costs several million pounds, uh, euros. A strike drone is much, much, much cheaper. And, you know, depending on, um, how things play out, um, you need one or maybe two or three strike drones even with countermeasures, um, to, to actually overcome a tank. That's basically the danger. Same is true for artillery systems. They become very hard to defend, and the problem with mass, especially precise mass, is that you can solve almost every problem with saturation. So even if there were countermeasures, let's say, on the tank side-

    10. HSHarry Stebbings44:31

        So what do you mean you could solve every problem with saturation?

    11. TRTorsten Reil44:34

        It means that basically in send- instead of sending one, you send five. If they're cheap enough, you can just do that, and at some point, you just over-saturate defenses of an expensive system, and it's still very cheap to do it that way. If you just think about the economics of it, you still have a, a, a really strong asymmetry, and so it'll become harder and harder unless you find a way to really counteract these systems, which is hard, to send expensive tanks and artillery systems into battle, um, when on the other side, um, there are strike drones that are much, much cheaper.

    12. HSHarry Stebbings45:03

        Is the future of war contactless in terms of, like, human contact?

    13. TRTorsten Reil45:07

        Ultimately, yes. I think ultimately, um, again, you can already see the first signs in Ukraine. Some areas of the battlefield are essentially no-go zones for humans because you have drones buzzing over you all the time. I think that gives us a, a kind of a first indication of how conflict is going to evolve. You'll, it'll be impossible and I think ethically extremely problematic to send humans into a battlefield that is essentially facing, um, large numbers of autonomous intelligence systems on the other side.

    14. HSHarry Stebbings45:35

        What is the point of a battlefield? I know that sounds like a very strange and glib statement, but if it's just an empty landmass area where you have drones flying in conflict against other artillery, like, what are we, what are we doing here?

    15. TRTorsten Reil45:48

        Yeah, I mean, it's, it's usually not done in a way that there's some kind of, uh, s- sequestered field, and you know, you work it out, and then whoever wins, uh, wins the conflict. Obviously, it, it tends to be related to, obviously, physical proximity to areas that matter, um, you know, whether it's ports, um, uh, certain routes, obviously, or, um, other important landmarks. And so that's, that's where battlefields tend to, tend to be located.

    16. HSHarry Stebbings46:11

        Honestly, Thorsten, I listen to you, and I'm, I'm quite scared. (laughs) Um, like, when you think about autonomous swarms of drones, it is pretty terrifying. Does it scare you, and is it right to scare everyone?

    17. TRTorsten Reil46:24

        Y- yeah, I think it should be disconcert- concerning to all of us. I think we should think about it, um, and, and think about the implications, and we should think, and I don't think this is happening enough, I think we should think about how we want this technology to work so that we can still stay safe, but we don't have to compromise on our ethical

15. 46:40 – 49:05

    Is Public Perception of Defense Spending Changing?

    1. TRTorsten Reil46:40

       standards.

    2. HSHarry Stebbings46:40

       Are we seeing a change in public perception around defense spending?

    3. TRTorsten Reil46:45

       I think so. So if I look at, um, polls now, I think, um, for most countries, um, the population agrees that more needs to be spent on defense. I think when it then comes to looking at what is going to be cut, I think people probably will differ, and, uh, and being very concrete will make, I think, that kind of view a little bit harder. Um, but overall, I think, um, I think overall, populations get it. Whether politicians currently n- have the courage to, to actually implement it is a, is a different matter. I think in some countries, probably that's going to happen. We talked about Poland earlier. In others, it's taking longer.

    4. HSHarry Stebbings47:21

       If I were to say, "Here you are, UK defense budget, this is yours, and you are my new defense minister," what would you do? How would you allocate it, and what would you-

    5. TRTorsten Reil47:31

       Again, 20% to new defense. It sounds self-serving, but it's absolutely, absolutely required. If we just keep buying the same kind of equipment that we've bought before, uh, if we don't network it, if we don't give it AI, if we don't produce precision mass, um, we- we won't be able to deter, and we won't be able to defend ourselves in a conflict.

    6. HSHarry Stebbings47:50

       Are primes delivering what they should be? And Matt Grim very kind of articulately said that they simply just take too long.

    7. TRTorsten Reil47:57

       They probably do take too long. I think they're incentivized in different ways. Um, the US is probably, again, different to other countries. Every country is different, and the various primes are different as well. In general, they're not incentivized to spend a lot of their own money on R&D. Um, I think it's probably less than 5% or so. Um, for a company like Helsing, it's almost all of it, and we pre-finance almost everything. That's why we raised quite a bit of money because we need to be able to spend on-... developments before we actually-- because, uh, first of all, we have to prove that it works, um, and we can't wait for governments to eventually get it and then fund it, and then in eight years we have a system. We, we need a system in eight months, basically, or, or, or let's make it a year or two years.

    8. HSHarry Stebbings48:40

       So one, we have 20% to new defense. What else?

    9. TRTorsten Reil48:44

       I think, again, procurement needs to be reformed. Everyone knows that. Um, the, the reason we don't talk about it that much is because it will take a long time to do it. Um, it, it needs to be obviously faster. Um, probably less constrained and the incentives need to be aligned more again towards speed, um, which they are not right now, which makes it harder for the individuals there to do what's right

16. 49:05 – 51:31

    Is Defense a Standalone Category or a Broader Strategy?

    1. TRTorsten Reil49:05

       for-

    2. HSHarry Stebbings49:05

       What does the market composition look like in the future? 'Cause at the moment, we just have primes basically. What does that market composition look like in the future?

    3. TRTorsten Reil49:13

       I think it will be similar and, and the reason... As in, there will be primes and then there'll, uh, there'll be supplies to primes.

    4. HSHarry Stebbings49:18

       How many new primes will there be?

    5. TRTorsten Reil49:20

       A very small number. A extremely small number.

    6. HSHarry Stebbings49:23

       So for all those doing defense funds, building defense portfolios, is defense in itself a category or is it the classic, like, if you wanna invest in Helsing, don't do the next Helsing, just do fucking Helsing?

    7. TRTorsten Reil49:35

       Yeah. I, I think it's... So I, I think what happened is that the, um, the, the, the VCs that really get defense, and there are, there are a number, have already kind of made their bets on, on defense companies. There is now kind of a second or third wave of, um, VCs that, that go into defense and, and fund technology teams. Wh- which is, which is fine in a way, um, but my question to those VCs would be like, "Wow, what is the exit, um, route for those companies? Who's going to buy them?"

    8. HSHarry Stebbings50:04

       You or Anduril?

    9. TRTorsten Reil50:05

       Yeah, but we can't buy all of those companies and, and also the question is whether we would buy them at, um, VC valuations. I mean, the exit opportunities for companies are either an IPO. For that, you need to be a prime, you need to be multi-domain, you have to have all of the, all of the foundation of, um, you know, having built software infrastructure, everything around security, uh, physical security, cybersecurity, government relations, export law, uh, compliance, and everything else. That all has to happen. A- and then you have a shot.

    10. HSHarry Stebbings50:34

        I thought building a customer success team was hard. (laughs)

    11. TRTorsten Reil50:37

        (laughs) It is... I, I, I... Defense is so complex. I, like, having built a games company, which I thought was pretty hard, defense is just on a different level and again, impossible, uh, I think, if you don't have a founded team that already has experience in some of the, some of the areas. It-

    12. HSHarry Stebbings50:53

        Are the majority of VC dollars going into defense companies today gonna go to zero?

    13. TRTorsten Reil50:57

        I think for, um, some of the more fragmented tail, I think they're maybe not to zero, but I think they're going, going to go down. I, I-

    14. HSHarry Stebbings51:04

        Where is the biggest opportunity to deploy dollars in defense today for me?

    15. TRTorsten Reil51:09

        I think it is... So, I mean, I'm biased, but I think it is around those companies that have got to scale, that have programs of record and that are basically active in a conflict. The, the, the difference between a company that basically gets, you know, first of all, um, maybe R&D contracts and has a program of record, that is already a big difference because getting over that hump of getting a program

17. 51:31 – 57:24

    Program of Record

    1. TRTorsten Reil51:31

       of record is, is huge.

    2. HSHarry Stebbings51:32

       Why is the program of record huge?

    3. TRTorsten Reil51:34

       It's-

    4. HSHarry Stebbings51:34

       So what is, what, what is a program of record?

    5. TRTorsten Reil51:35

       It's, it's, it's an official program, um, by a government, um, that it has a certain size, rather than... And, and I mentioned the Euro 5 Electronic Warfare Upgrade, that was, that was officially awarded. Um, companies pitched for it and eventually, you know, a consortia pitched for it and eventually consortia wa- won it, uh, which is Saab and us, um, in the end. Um, those happen, um, regularly and they tend to be quite large, they run over several years. By contrast, there are innovation projects, which is quite often almost a parallel track to all of this, where, um, there are smaller pots of money to prove that certain forces or, or, or, or nations can do innovation in defense. The problem is you may kind of get 500K from, from one of these projects and you win it and you, and you show to your VC we've, we've made revenues. The, the jump from there to actually a program of record is, is huge because all of the apparatus that's required to pitch for these programs, that isn't required for these innovation projects. So, so these, these kind of teams have a feeling of, "I've now taken the first step, now the next step is a program of record." Not realizing it's a completely different kettle of fish. And again, I had to learn all of this because for me, it was natural ?

    6. HSHarry Stebbings52:41

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

    7. TRTorsten Reil52:46

       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 will be competing v- for a very small pool of people and I... It's just impossible to, um, uh, to, to, to have, turn them all into primes. It's, it, it will just, it, it, it's just not gonna happen. So y- 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. (laughs) 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. Wh- which Anduril has done, for example. It's a good example. Um, we- 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, f- I think for them, they quite often don't, don't get what it takes to actually build a large company.

    8. HSHarry Stebbings54:05

       Do you think naivety is a wonderful benefit in entrepreneurship or a danger?

    9. TRTorsten Reil54:09

       100%. 100%. Uh, most founders will say, "Had I known how hard this is, I would never have tried."

    10. HSHarry Stebbings54:14

        Had you known how hard this is, would you have tried?

    11. TRTorsten Reil54:17

        Helsing? Yes. Yeah. With NaturalMotion, I went through, um, some really tough times.

    12. HSHarry Stebbings54:23

        Why Helsing yes and NaturalMotion no?

    13. TRTorsten Reil54:25

        There's several reasons. Um, but the main reason now is that it, it-... as a, a three founders, it's easier to build a company even when you go through really difficult times, um, because you have each other to rely on, you have each other as a sounding board. It sounds a bit kumbaya, but it's very important.

    14. HSHarry Stebbings54:44

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

    15. TRTorsten Reil54:49

        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 the stuff. And in... There'll be more setbacks happening. Like with every startups, um, y- you just don't know what's going to happen and there'll be... Y- you know what it's like with a startup, that's what I experienced with NaturalMotion, 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're kind of already, "Fuck, I'm done," and, and, and it- and it's- and it's relentless. But the thing... The only thing I would say is that with NaturalMotion 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 ma-

    16. HSHarry Stebbings55:49

        Now that NaturalMotion journey's over, can you share one that's like an, "Oh, shit."?

    17. TRTorsten Reil55:54

        One was when we did our integration into, into GTA IV with our technology Euphoria, which was a, um, animation runtime engine. Um, we had already optimized the hell out of it and, and we had great optimization people, um, for, for, for gaming consoles. And... But GTA was... I mean, IV was an amazing game and, uh, uh, you know, really pushed the consoles to its, to its limits. And I felt the technology was great, but there was a point where we got a call from Rockstar saying, "We don't have the performance budget for, for the, for, for, for your engine anymore. So you either... It either runs another ten times faster or we can't use it." And I remember putting the phone down and thinking, "We are fucked." And, and, like, I was sure we're fucked because we'd already optimized everything. And this was one of those moments where a, a number of our engineers, uh, eventually went to Edinburgh, um, to work directly with a team there. We just camped out there until they somehow managed to get that performance gain. And the engine stayed in there and it was the beginning kind of, of NaturalMotion proper because n- it was such an important game and it made everyone proud. Um, but it's, it's also taught me about how exceptional engineers can make just crazy things happen. And, uh, 'cause I was... I was convinced this wasn't gonna work out, and they made it happen. This is why I, like, to this day have so much respect for great software engineers. The best software engineers just make... They make all of us

18. 57:24 – 1:00:45

    Why Is Ambition a Bigger Problem Than Capital in Europe?

    1. TRTorsten Reil57:24

       look good.

    2. HSHarry Stebbings57:24

       Speaking of Mark, I spoke to Shak before the show and he told me I had to ask a question really focused around a quote of yours, which is, "Capital isn't the problem, ambition is," when it comes to Europe and our current state.

    3. TRTorsten Reil57:38

       Yeah.

    4. HSHarry Stebbings57:39

       Can you unpack that?

    5. TRTorsten Reil57:40

       Yeah. So I think the... Pe- people complain about all kinds of things, about Europe and, and in general startup environments. I, I don't think that there is a lack of capital in Europe, um, certainly not, um, seed series A, sometimes even series B.

    6. HSHarry Stebbings57:55

       There's too much.

    7. TRTorsten Reil57:56

       You could even argue there's too much. Wha- wha- what, what's missing is, is to some extent operational knowledge because, uh, we haven't had as many startups that became big, um, as the US, specifically Silicon Valley has had, but I think more important is ambition. It's ambition specifically on the side of a founder, ambition compared to, um... A, a combined with aggressiveness. And that aggression, that lack of aggression, and that lack of ambition holds almost everyone back, and it's still acceptable to build companies and, and sell them at a value of 100 million. And I understand why, um, because it's life-changing for everyone, but it's actually not what Europe needs. We need much bigger companies that actually, you know, create sovereignty around some of the key areas in ways that just currently don't exist. And for that, you need to have founders that have that ambition, first-time founders, or you need founders that are second-time or third-time founders who've already learned a lot and, and go back and, and do it one more time, because quite often you're actually much faster the second time around for, for reasonably obvious reasons. That doesn't happen as often in Europe as it does in the States from what I can tell, and I always wonder why that is. And sometimes maybe it's because Europe is a really nice place to retire in, you know, there's lots of things that you can do, have a house in Italy or whatever, and, and, and not work. And... But that is not good, uh, you know. We, we, we need all of those people back to start a second or a third company.

    8. HSHarry Stebbings59:19

       How do we change that?

    9. TRTorsten Reil59:21

       I think the founder community needs to talk about it more. Um, and, and... 'Cause it's, it's a mindset thing, um, I, I think... I personally think we all have a contribution to make and a, yeah, con- contribution to make to society as founders, I think we have a responsibility to actually contribute. And s- some of that contribution is to help Europe become sovereign, and particularly around key technologies.

    10. HSHarry Stebbings59:44

        Do you fear that we are falling further and further behind like everyone says we are?

    11. TRTorsten Reil59:49

        I... So I, I think we are falling behind and that... But that trend isn't 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, uh, behind but, uh, it doesn't have to be that way. So the things that we have in Europe in p- and particular talent, w- 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 9:00 to 5:00 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

19. 1:00:45 – 1:02:35

    What Role Does US Capital Play for European Companies?

    1. TRTorsten Reil1:00:45

       myth-

    2. HSHarry Stebbings1:00:45

       What role does US capital play in-... this journey for European companies? You obviously took money from GC, from Eli Gill, from some big US players. I think you get Excel as well. What role does US cash play?

    3. TRTorsten Reil1:00:58

       It plays an important role, I think later on. Um, the, the, the ability for European investors to provide growth capital, um, that's lower than it is in the US, but I don't think that's a problem. In, in fact, in, in many ways, I think that's probably a feature, not, not a bug, because I think exposure to US culture, um, but also investors, is extremely useful. I, I, I was lucky to have it. NaturalMotion Benchmark is our, uh, one of our investors, and w- with Mitch Lasky as our partner, and part of the reason why w- we eventually took off wa- was also Mitch and, and, and the way he thought about how big this company could be, um, how shou- I should think about portfolio, not think too small, that was extremely helpful. And so I think that injection of, um, US mentality to European companies at the right point is extremely helpful. And the cap table, you know, it's true for Helsing as well, it's, it's still Europe-dominated. You know, we did our seed round, um, you know, entirely, uh, from European investors. Then Daniel and Prima Materia came in, um, again, European. So later on, um, you know, we, we took American money, but the company's still a European company.

    4. HSHarry Stebbings1:02:06

       Is there anything you think people don't see about Europe from the outside? We have a huge US audience. The US just loves to say, "Hey, you guys don't work. Uh, you love to have espressos and, and have work/life balance, not ambitious, sell for 100 million." Is there anything they should know that they don't know?

    5. TRTorsten Reil1:02:22

       I, I think it's pretty clear that the current narrative is a caricature of Europe. It... You know, there are some elements of truth in it, but they've been extremely exaggerated over the, over the... In particular, over the last 6 to 12 months, I think, if you, if you go on X.

    6. HSHarry Stebbings1:02:34

       But

20. 1:02:35 – 1:05:39

    Is Europe Becoming Increasingly Uncompetitive?

    1. HSHarry Stebbings1:02:35

       when you look at where Europe is today, and i- I try and be positive. I'm in London, I built a career in London, I built a business in London, I'm staying in London. My challenge is, when you look at the German government, when you look at the French, when you look at the British, we're all just becoming further and further dependent on, you know, state subsidies, increasing public employment, and we're becoming more and more uncompetitive.

    2. TRTorsten Reil1:02:58

       So I think th- that is a trend right now. The, the question is... And again, e- even three and a half years ago when we started the company, that, that trend was already there. The question in... with all of these situations is, what can we do to change it? What are you doing to change it? Like, we, we, we felt we had agency by looking at, for example, the problem of European sovereignty and specifically around defense, and we felt, as founders, you have the privilege of having a massive lever, which is if you can build a successful company in this space, you can actually make a difference. And I'm, I'm pretty sick of people just commenting. I mean, there's a wh- you know, there's li- there's a whole LinkedIn, um, economy built around just complaining, same is true on X, and just commenting. And, and th- like, those comments are... the- well, they're worth nothing. I mean, no of the, none of the commentary is worth anything. The only thing that matters is if people actually, you know, do something. And that, that is start a company, build a company, is go into politics, start a new party, whatever it is. But the current attitude of just complaining is... drives me crazy.

    3. HSHarry Stebbings1:03:59

       All right. Okay. Got it.

    4. TRTorsten Reil1:04:00

       (laughs)

    5. HSHarry Stebbings1:04:00

       Point taken. All right. Come to my studio-

    6. TRTorsten Reil1:04:04

       (laughs)

    7. HSHarry Stebbings1:04:04

       ... and point fingers. No, I, I completely agree. I was actually at a dinner the other evening and they were talking about, you know, policy, and it was kind of a rich person's dinner talking about policy, and it really pissed me off because it's like pontificating means nothing.

    8. TRTorsten Reil1:04:15

       Exactly.

    9. HSHarry Stebbings1:04:16

       And actually just build companies, invest in companies, support your founders, be founders, just do it.

    10. TRTorsten Reil1:04:21

        Yeah. It's interesting. I also think that people overindex on, uh, the environment and, uh, and, and about having the right regulatory settings and tax and, and everything else around it. I actually think, um, none of this stuff really matters that much. I think what really matters is founder quality and founder ambition. So I think for a com- for a country to be successful, they should attract the most aggressive founders, and, and everything else is a lot less important.

    11. HSHarry Stebbings1:04:46

        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 sectors?"

    12. TRTorsten Reil1:04:57

        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 convention technology, some of it may be in computer... uh, 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 where they will be able to create those companies kind of in the next two or three years to a point where they provide sufficient, um, uh, sovereignty, but I'm very sure we can do it over the next five to 10 years.

21. 1:05:39 – 1:07:47

    What Will Happen To Russia-Ukraine & China-Taiwan

    1. TRTorsten Reil1:05:39

    2. HSHarry Stebbings1:05:39

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

    3. TRTorsten Reil1:05:44

       It is very hard to predict. I think there's some... We, we just don't know how things are gonna pan out over the next few months and, and 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, in Germany and, and other countries. I think Scandinavia, the Scandinavian countries take it a lot more seriously, as do the Baltics, take it ex- 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.

    4. HSHarry Stebbings1:06:16

       You mentioned China/Taiwan earlier as the second needle-moving moment in the kind of inception of Helsing. What happens in China and Taiwan?

    5. TRTorsten Reil1:06:24

       Again, hard to predict. Um, I... Again, I think it's plausible that there will be a conflict. Um, when? It's hard to, hard to tell. I don't think it's 10 years away if it happens. It's probably quite a lot sooner than that. Um, but it depends on how the next, again, few months and years are gonna pan out. Again, I think there is a danger, and it's, it's obviously clearly stated goal of China to reunite, as they, as they put it.

    6. HSHarry Stebbings1:06:50

       What are you worried about-... that we haven't discussed or is not discussed enough.

    7. TRTorsten Reil1:06:55

       I think, generally, we are not sufficiently alerted to the- the danger of conflict. Um, we've- we've- we've lived in conflict for, um, well, forever basically and then had a period of time where- that- that wasn't one. And I think we- I'm worried that we don't take it seriously because we don't want to think about it. And by the way, I don't want to think about it either. Um, you know, it's- it's- it's not nice to think about conflict and, like I said, all the suffering that- that comes with it, but we're not taking it seriously.

    8. HSHarry Stebbings1:07:21

       That's buggy you founded a defense company then, isn't it?

    9. TRTorsten Reil1:07:24

       (laughs)

    10. HSHarry Stebbings1:07:24

        I mean, no- no offense. "I don't wanna think about conflict." "Well, you know, that one's on you." (laughs)

    11. TRTorsten Reil1:07:29

        (laughs)

    12. HSHarry Stebbings1:07:29

        Uh, stay in enterprise SaaS. We're doing AI sales tools here.

    13. TRTorsten Reil1:07:32

        (laughs)

    14. HSHarry Stebbings1:07:32

        So, you know. Um, uh, the- the- the final one I just want to ask, which I always find really interesting, I hope it's okay for me to ask, with NaturalMotion, you sold, you make a little bit of money yourself. Um, I think mindset to finance is fascinating.

22. 1:07:47 – 1:08:37

    Relationship to Money

    1. HSHarry Stebbings1:07:48

       How do you think about your relationship to money? Does money make you a better founder? Does money make you happy?

    2. TRTorsten Reil1:07:54

       Uh, I think money can give you security and, to me, that's by far the most important thing. So not having to worry about money makes a big difference in terms of how, I think, you lead in life, you lead your life in general, but also what risks you take, um, with a- with, let's say, your next company. And in order to- to build a successful company, you have to take risks. And, you know, being safe on the money side makes it easier. I don't think it's not the only thing that you require, but it does contribute to it.

    3. HSHarry Stebbings1:08:21

       What little things make you most happy? I think about this a lot and it's, like, an espresso in the pot.

    4. TRTorsten Reil1:08:26

       Uh, yeah. I was just gonna- Uh, self-made espresso. We just bought a new espresso machine. I think, uh, a walk, a long walk every day makes me happy. Um, can't put a price on that. (laughs)

23. 1:08:37 – 1:14:07

    Quick-Fire Round

    1. TRTorsten Reil1:08:37

    2. HSHarry Stebbings1:08:37

       Listen, I'd love to do a quick fire round. So I say a short statement and you give me your immediate thoughts. That sound okay?

    3. TRTorsten Reil1:08:42

       Sounds great.

    4. HSHarry Stebbings1:08:43

       So what do you believe that most around you disbelieve?

    5. TRTorsten Reil1:08:46

       Most people believe that, um, you can- that the environment, in terms of taxation, regulation, et cetera, has a big impact on whether you can build successful startups in the country. I don't think it does. I think it's- it's- it's minor compared to attracting the right founders. Uh, so I think the discussions that people have around, how can we make a particular country a better place for entrepreneurs, you know, who are already there, I- I just don't think it makes a difference. It's the fact that the company needs to shed its skin, like, every 12 to 18 months because it's progressing at such a pace that you- you just have to think about the org structure again, you know, repeatedly. You have to think about whether your processes are the right ones, whether you're talking to the right people.

    6. HSHarry Stebbings1:09:28

       What did you not see in org structure change that you wish you had seen?

    7. TRTorsten Reil1:09:31

       I- I think we- I think we're- I think we've been on top of it. Um, we- the- the biggest unlock for us was to have these quarterly founder offsites, where we basically reflect and think about in a- in a safe space basically what's working and what isn't working and- and how do we change it. And so I- I didn't, never did that previously and- and stuff just gets warmer and warmer until it's too hot.

    8. HSHarry Stebbings1:09:55

       "The heaviest things in life are not iron or gold, but unmade decisions." What's the biggest unmade decision?

    9. TRTorsten Reil1:10:01

       I actually- I'm not sure I agree with the- even with the statement. I- I think it's perfectly- There's this trope that, you know, an- an- uh, uh, any decision is better than no decision, and I- I- I've never believed that. I think there's some times there- You have to make a lot of decisions as a founder all the time obviously.

    10. HSHarry Stebbings1:10:16

        Well, I think no decision is a decision.

    11. TRTorsten Reil1:10:18

        So this is the thing. If you- if you make a conscious decision not to decide on something because you don't have the information right now that you're required to make it, I think it's totally fine. And I think people should make much more use of that rather than randomly going, "I'm gonna go for this one." It's just- it's just one of the many things that LinkedIn screwed up. There are so many pieces of wisdom on LinkedIn that are wrong. (laughs)

    12. HSHarry Stebbings1:10:42

        You just go through LinkedIn every day going, "Bullshit, bullshit, bullshit."

    13. TRTorsten Reil1:10:45

        It's just, like, all- all this work smart, not hard, um, stuff, being a servant leader, all of these, um, I think-

    14. HSHarry Stebbings1:10:52

        Why is work smart, not hard bullshit?

    15. TRTorsten Reil1:10:54

        Because you need to do both clearly. You know, you're always out-competed by someone who works smart and hard if you're a work smart, not hard person, just does-

    16. HSHarry Stebbings1:11:02

        Why is servant leadership bullshit?

    17. TRTorsten Reil1:11:04

        You need to lead a company, and you should not be afraid to say that. You know, if you're the founder of a company- We made the decision for Helsing as well that we are a founder-led company, and we are all here to basically serve the company, to make the company successful. That's what we do. And the founders basically provide the vision and the direction and, you know, if you like it, great. If you don't like it, you don't have to work there.

    18. HSHarry Stebbings1:11:29

        What have you changed your mind on in the last 12 months?

    19. TRTorsten Reil1:11:32

        I used to think that- that you needed to make sure that there was always a degree of process, um, when teams work together on something, uh, including something new. I have now learned that it's possible with exceptional people to let- just let them get on with the job without any stand-ups, any predictions on deadlines, nothing. You just let them get on with the job. And it- in a- in a very fast-changing environment that we had to deal with, for example, over the last few months, it is probably the most efficient way of- of actually making progress rather than being structured about it. And then eventually, you have to move to structure obviously, but I probably wouldn't have thought that two years ago.

    20. HSHarry Stebbings1:12:13

        CEO of any other company for a day, which company would you choose?

    21. TRTorsten Reil1:12:17

        Probably ByteDance, and I would shut down TikTok immediately.

    22. HSHarry Stebbings1:12:20

        Why?

    23. TRTorsten Reil1:12:21

        Because it's crack cocaine for basically our societies. Uh, it is ............................

    24. HSHarry Stebbings1:12:28

        Respectfully disagree. Social media is crack cocaine in a way, but it's also not. If you go to my social media, it's protein recipes, it's gym workouts, it's inspirational content that's made me a fitter, healthier human who doesn't drink and has a great relationship with his mum. I proactively choose the content to be good for me, just like f- food is poisonous or very good for you.

    25. TRTorsten Reil1:12:52

        But if it is very compelling, which i- yours is, it becomes a, i- it becomes something that people will consume too much. I think-

    26. HSHarry Stebbings1:12:59

        Same with food.

    27. TRTorsten Reil1:13:00

        Same with food. I think food can be dangerous too, but I think, um, TikTok is a lot more dangerous than hamburgers. Uh, it is, it- we are ev- like, so many, like large parts of society are wasting so much of their time on something that has been highly tuned. I mean, I'm, I'm saying this as someone who, who used to make games, and we know what dopamine looks, loop- loops look like. Um, the TikTok loop is the best, and you cannot get out of it.

    28. HSHarry Stebbings1:13:25

        Why is it the best?

    29. TRTorsten Reil1:13:26

        Because it, it has just the right combination of timing, uh, um, you know, the, the, the flick, um, and the content that immediately comes up. And it's, it's perfectly tuned, and, uh, and obviously they have all the metrics to know what content to show you. It is super addictive. It's incredibly dangerous. It also obviously becomes a potential tool for manipulation, political manipulation. Whether that's happening or not, I don't know. But it is extremely powerful if you wanted to, to use it. And then thirdly, it has the same problem as all social media. The content that works the best is the content that's the most extreme, and so we have a problem of basically radicalizing political views where just almost by definition radical content will just work better.

Episode duration: 1:17:28