Co-Founder Chemistry - Toby Kraus - Lightship - Episode #59

A lot of people think about like Cash Runway, but actually what matters more and at least in his view, why companies failed, was that you run out of Emotional Runway and usually run out of Emotional Runway before you run out of Cash Runway.

Welcome to Not Another CEO Podcast. I'm your host, David Politis. Every week we talk to inspiring leaders and get the true stories, the ups and downs, the lessons learned, and come away with actionable advice for our own journeys. Today's guest is a mission driven entrepreneur who's building one of the most exciting and ambitious companies in the EV space. Before founding his current company, he was deeply involved in the electric vehicle revolution at Tesla. Starting in finance and then in product management where he helped bring the Model S to market and later as head of finance at Proterra where they build battery systems for EVs. In 2021, he co founded Lightship, a company that's redefining the future of RVs with the first all electric, aerodynamic battery powered travel trailer designed from the ground up. Please welcome co founder and CEO of Lightship, Toby Kraus.

I'm excited to be here. Thanks David. You should be doing the pitches for me. It's a better intro than I, than I do myself.

Well, I'm really happy to have you here. I'm happy that Nick made the introduction and we'll jump right into it. So first question, what is the one thing that you've done, big or small, that's had the biggest impact and you do again if you're CEO of another company in the future?

Yeah, this is a funny one. I would say it is hiring a co founder coach. I did this, probably I should say my co founder and I did this in our first week of getting together. And I'll tell you, one of the great boons of Lightship is the relationship I have with my co founder Ben. And I think I have a lot to do with investing in that relationship. I mean there's a lot to it. But pulling in that coach has, has been, her name's Natalie. Has been just wonderful experience and yeah, I would do it again and again.

So you literally did that right like right off the bat?

Yeah, yeah. I mean maybe to even back up and sort of like re answer the question a little bit. Like just having a co founder is like, is extremely important and then investing in the relationship. But, but yeah, it was, it was, it was right at the beginning we, we, we kind of hit the ground. It was like an investor who sort of recommended it and we were like, okay, like we don't Know what we're doing here. Like, we're going to. We're going to follow the playbook. And we did it. And it was. And it was the best. Yeah, I think it's the best decision we made.

And. And how does that work? You. So this is actually the first. You're the first person who's answered. I've had many people say coaches, therapists, like, in this answer, but you're the first person who's actually said. For both. Co found. Like, I. Right. And I just want to understand, like, does that mean you work with her in the session together?

Yeah, exactly. I mean, it's. It's kind of like couples counseling, but for. For a co founder. I think what. I think often what happens in a lot of, you know, coaches are sort of used to is, is. And probably a lot of, like, couples counselors is, like, you see them because something's not going well. And I think it's. It's maybe a little less common to do it proactively.

That's what I'm saying. Exactly.

Yeah. But it's. I mean, that's. That. That is what it. What it is. It's. It's, you know, couples counseling for. For co founders.

Wow.

And. And yeah, it's. It's. It's fun.

And so just very tactically, how often do you meet with Natalie?

We. It. It's. And we still see her today to this day, so it's four years in, and it sort of ebbed and flowed. But, yeah, I'd say, like, every two to three weeks is generally what we do. And then we've also brought her in to do other things to, like, you know, do sort of like more of, like, group work with our leadership team. But our sort of regular cadence for Ben and I is every couple weeks.

I love that. I love that. You know, one of the things someone said to me in one of these interviews, they said every professional athlete has a coach. Like, why would we think, as CEOs, as founders, as leaders, that you wouldn't want or need that? And I had never heard it put that way. And actually, when it's put that way, you're kind of like, yeah. And actually, a lot of times the coaches weren't as good athletes as the people they're coaching in some cases, you know, because sometimes when I. When I started, I was like, oh, they're a coach, but they never built a company. You know, they never got to some scale. And then you kind of realize it's not exactly directly tied to that. But having that coach. So I, I, I have become more and more, like, I push that more and more for founders that I talk to because I think it is like a therapist, which I know people also have and need, but it is, it's, it's to the business and, and this I love because it's the first time, but I like that concept because, and I have a lot of questions about you and Ben and how you met each other and everything. But for me, that's one of the biggest things that I hear from founders is the challenge with co founders and, and if that relationship is not working, it cascades all the way down, like through the entire org.

Yeah, absolutely. And I think what's unique about having a co founder coach, I guess, you know, speaking for myself personally, over the course of my career, what I found is the most difficult relationships are sort of peer relationships, at least for me. So, you know, relationship with my manager, relationship with somebody who reports to me, those have been a little bit easier. Like, you know, I'm trying to impress my manager. I'm trying to work hard. Like, I think I have, you know, developed good rapport with people who, you know, work for me and I kind of like, know how to do that. Pure relationships, man, are so weird. And I'm a competitive person. I think what typically happen has happened and is, you know, created some like, tension. Is my competitive, like sort of the worst competitive instincts instincts come out. And it wasn't guaranteed that, you know, me having a co founder on the one hand, like having a co founder for me was an absolute necessity in terms of being successful in doing what I'm doing. And yet it was not a given that having a co founder was going to go well because of that sort of competitive instincts. And so this has been awesome. And frankly, it's a testament to my co founder Ben too. He's just like a really, really good guy and like, we just get along great.

So how did you, how did you meet each other?

We, so, so both, both of both, we're both Tesla guys and we're sort of connected through the Tesla ecosystem. However, we're, we're kind of different generations. Ben's about, you know, 10 years younger than me. He's a battery engineer. He's, you know, worked on the Model 3 battery, the Cybertruck battery. And then I, you know, more finance and business, business guy. And we actually never overlapped or if we did, we should probably pin this down. It was like a day or two days or something like that. But fortunately we had a sort of a shared, you know, connection friend. This guy Dorian west, who is the head of the very first head of the battery team at Tesla. And I was, I've been using this, this sort of way of describing my connections to people a lot. I was Dorian's finance guy. I was like everyone's finance guy. And, and you know, Ben was on the battery team. So, so Dorian put us together and that was, that was how. And actually Dorian became our very first angel investor. So he had a very important role in Lightship.

And how, how long did it take between when he put you together to when you knew that you were going to found the company with Ben.

It was pretty quick, which is also a little crazy. So I was, when Dorian put us together, I was what's called an eir, an entrepreneur in residence at a venture firm called Eclipse Ventures. And this is a little bit of a different story, but I loved the firm, loved the guy I was working with there. His name is Greg. But I was just a horrible eir. Like the point of an EIR is like, have the big idea, start a company, right? And I'm not the, I'm not the idea guy. I'm like the get shit done. Like, you know, like I want to like go dive in and do something. So I was cheating and I was just spending all my time networking. That was how I was doing the EIR thing. And then Ben was like actively looking for a co founder. He, he had the idea which would ultimately become Lightship. You know, he, he quit Tesla. He'd gone on a 6,000 mile road trip through the American west and in, in an rv. And he came back and is like, I want to start, you know, America's first all electric RV manufacturer. That is what brought us together. And then I think I was just so eager to, to jump into something. I should say, when we first met, I really liked Ben, but I was actually pretty darn skeptical of the idea. But I had nothing but time. So we spent a lot of time together. This is during the pandemic. And so it was just like.

Right, right in person. In person.

No, he was in, he was in California, I was in Colorado. I lived in, in the Bay Area for more than 10 years when I was at Tesla, but right before the pandemic, had moved my family back to Colorado because when I had kids and so we, we met in different states and we spent, you know, it was actually probably only about three weeks together. It's like co founder dating on the, on the, on the, on a zoom call.

Yeah. I think, look, I think the co founder relationship is. It's so important. So many things can go wrong, you know, and finding that right person, I guess also because you trusted. Sounds like you trusted the investor, the common connection. And that probably helped a lot in just getting past some of those like, hurdles of this is someone that I would want to work with, someone that would. I can trust.

Yeah, all of that. Yeah. I mean another, another sort of lucky thing happened. It felt. It was rough at the time, but it turned out to be lucky, which was Ben had re flip. This is. I'll try to tell a concise version of the story. We met, we co foundered aid for three weeks. We had this idea to make America's first electrical all electric RV manufacturer. We were going to demo or sort of like show for ourselves the problem of towing a towable RV with an electric vehicle to show ourselves that it was a real problem that needed to be solved. And at that time we kind of set up a pitch with the, with the firm I was at to, to, to. To. To raise money. And so we thought it'd be this really fun story. Like we're on a road trip from Colorado to California to do the pitch. And halfway through the road trip, the. I got a call from the partner and he said, the pitches, the pitch, the pitch is canceled. And the reason it got canceled was because Ben had. They had a relationship with a individual on the team there and it had gone poorly. Like nothing ultimately would, you know, nothing, nothing really bad happened, but it was. I was within three weeks of, you know, getting to know Ben and I heard, I heard this story and it's like this like combination of extreme disappointment because the pit, the, the pitch that was going to fund the company gets canceled. And then I'm like, what the hell? Like what in the world happened, Ben? Like, how did, like what the fuck did you like, do? And so then. And this was halfway through a road trip, by the way. So the thing, you know, we learned sort of technically as far as the problem is when you're towing an RV with an electric vehicle, the sort of Cliff notes is it sucks because you have to stop and charge every like 90 miles.

Right, right, right.

So what was supposed to be an 18 hour road trip became a 40 hour road trip. So Ben and I were 20 hours into a 40 hour road trip when, when this all happens, it. It had rendered our. The whole point of the trip to be pointless. So Now I had 20 hours in a car again. And so getting back to where I started though what was lucky about this is it for. It forced us to have some real hard conversations real early because. Because we were just sort of like. Like what? I. I mean, I. I'm probably paraphrasing, but it was just like, what the fuck happened then? Like, what in the world? And he was, you know, we got. We got deep, and I think that's.

What you need to do. I actually, I think. And if you're not forced into it.

Yeah.

I think that it's. It's what most people are scared to have, those deep conversations, I think just like when you get married, by the way, let's be honest. Like, most people get married with. Ever have. Without ever having that.

Yeah.

Deep, deep, deep conversation. And that's what leads to divorce.

Yeah, basically. Yeah. So we didn't get, you know, we didn't get the money, which was the purpose, but we, We. We for, you know, forged a bond and that. That ultimately is probably more important than the money. We got the money later, you know, so I love that.

Well, so let's talk about the money. So you've raised, I think, 60, maybe 60 million.

Yeah, right around 60.

Yeah. So can you talk me through kind of as. As you just mentioned, this beginning part of the. The journey. How did you go out and raise that money? It's in the middle of COVID Right. Or I guess towards the end of COVID kind of period. And what was that process like? Was that very easy? Was like, was that an easy thing to do for you guys because of your connections and background and everything?

No, I wouldn't say it was easy. It was only easy when compared to the challenges of fundraising, you know, as we went further and further along in our history. But it sort of started hard and then got more and more hard. But so the early of the earliest fundraise, we were really lucky to get a seed round together with an investor named Andrew Beebe at Obvious Ventures, who is just an awesome and awesome guy. Really good investor. I had known him from my time at Proterra. He was a small investor in Proterra, and he was the first guy to really believe in us and what we were building. It was still hard. I mean, you know, he is an astute investor, and, you know, we had a PowerPoint deck in the two of us and not much else. So it took, you know, it took. It took some. Took some work, but that was. That was kind of the first. Yeah. The first milestone. And then. Yeah, and then we've. We've since done two more, you know, two more Capital raises. And like I said, like each one was I think, harder than the last.

Why? Why is it getting harder?

It's really funny because our business is, you know, like everyone says their business is crushing it and we're, you know, going to the moon or whatever. And I believe that. But I think objectively, every, every round we did, we were, you know, we, we did and are continuing to make incredible amount of progress. So it's like you think, you think it should get easier because it was like it was two guys in a PowerPoint deck. And then the next round was a real team, a good team and you know, some real technology. And then the next round was like a product and a really awesome team and a ton of, you know, a ton of commercial traction. And what I think is happening is, or this is my own sort of like education of the venture capital process. And the reality is that maybe a little jaded, everyone thinks venture capital is like a way of funding startups. And that's kind of true. But the expression I use of someone is like, I feel like venture capital is like Liam Neeson in one of those movies where like I have a very, what's his quote? It's like I have a very, you know, specific set of skills. And that's kind of what venture capital is. It's like it's not really meant to fund all sorts of companies or all like sorts of stages of companies. And you know, they're sort of like hype cycles and there's investor pattern recognition. And we are a company that I think we started out in a hype cycle. Like EVs were sort of on top of a hype cycle. Now they're very much on the downside of a hype cycle. Hardware is always really hard. As far as I can tell. The venture capital model is totally, you can sort of see it. It comes out of software, deep tech and some of this stuff is like get, you know, getting a lot of, a lot of airtime now. But it's more often than not it's sort of like some kind of hardware that's attached to software and like AI and you know, as some sort of like growth hack. So a long way of saying, I think like starting a venture backed RV business, like complex hardware is, it's a little crazy frankly. It's not right down the fairway by any stretch of the imagination in terms of what venture capitalists want to do. And then the later you get. My misconception was even though we were making so much progress, you just look at how the return map works for venture. They want to do early and the further you go and the harder it is for them to, to make a return, the fewer you have, you know, the fewer investors you have who want to sort of participate in that, that round.

One of the things, I mean I've never been in hardware at anything. You know, my career has only been in software services. And when I looked, you know, when Nick first told me about the company, I started researching it and like watching all the videos and I was like, this is the coolest looking. This thing is amazing. And like I can't imagine what it takes to build this and how long it takes. And like you can build a software, you can like vibe code a software product tonight and tomorrow like you've got like a UI and you're. But this thing, it's impossible. I mean I guess what are those stages? Pure curiosity of like what are those stages of venture when it comes to hardware? Like is it team is like that's, that's kind of team and a PowerPoint and a nice design and that gets you the first thing and the next one is showing prototype. You know, I'm curious about that because in software you literally could be like, here's my product. I just, especially now, like people are just like, here's my product. And the VCs like, I don't like that. The next day they're like, okay, I threw that one out. Here's my new product. Like you could do that. I've seen people do that. And when I look at what you're building, I'm like, man, this should takes fore. I mean it must take, you know, takes a long time. And I'm curious what you think or if there's some standards that are like out there for like the stages, you know, in hardware.

It show, it shows how deeply hardware I am. Because what I like vibe coding. I've like heard that word but I don't like, I don't even know what deep this is. It's funny. Yeah, I mean it's feel depends on what investor you talk to. And there are definitely investors that are better at doing hardware and more practice and sort of like get it and there's probably some similarities but you know, earliest stages it's like you know, team, Team TAM Traction. Right? It's, it's, it's, it's probably pretty similar to how, how, how software works but, but then I, but then the stages like getting up to say like your, you know, your Series A or your Series B, it's like showing that obviously the team like de risking the technology proving somehow and there's different ways to do it, that you have product market fit and ideally and especially in down markets like, like showing you have, you know, real, real commercial traction. And you have to do it in kind of weird, weird ways because it's not like a software product where you can have just like I, I have real customers who are paying real money. Like, like maybe there's some hardware is faster than others, but what we're doing is, you know, complex automotive hardware. We're like launching a vehicle platform. We're doing it in less than three years. And compared to like automotive, that is insanely fast. Like your average automotive development cycle for a new product is probably like five to seven years. And yet for a lot of, a lot of venture investors, like three years is like way too long.

Right, right.

So yeah, demonstrating that commercial traction, it's like it's. You got to be kind of creative. It's like, do you do pre orders, do you do like a MVP version of the product? Like you do like a Sounders edition that like you just try to sell a little bit and then ultimately, you know, you have to kind of like scrap along somehow and to the point of actually having the product. And then investors want to see just like what any later stage investor wants to see. Show me the money. Let's see the sales. We want to understand that you're on a path to profitability for where lightship is now. We're very much in that stage of like, okay, cool guys, you've raised 60 million. Get the product in the market. Customers need to like it. We want to see real sales and we wanted, we want to see you making money. And that's like, it makes sense. And I'd say it's, it's really reinforced by all the EV companies that have kind of gone before us. Many, many, many, many of them not profitable and you know, raising hundreds of millions, billions of dollars to fund losses. And that's not something that investors like much at all.

So how did you show have, I mean you, you've started to show commercial traction. Did. How did you do that like at the very beginning, Was that through pre orders? Was that how the Founder Edition? Like, like how did you do that at the beginning?

Yeah, totally. So, so yeah, we sell a, we sell, you know, towable rv. It's all electric. What all electric means is everything inside of it's electric. And we do something crazy which is we put a motor on the rear axle so it Pushes itself. Even though it, it has a motor, it's still considered a, you know, towable rv, something you're going to, you know, pull behind a truck or an suv. So think like an Airstream. This is, this is like, you know, kind of the, the brand that everyone knows. And our first product is, you know, absolutely sort of a, you know, a premium, you know, price point. I think of it as kind of like the mainstream premium. You guys spend a lot of money on an rv. This is for the first, the first segment where there's quite a bit of volume. And our product, we have a few configurations, but the average selling price is around like $165,000. It's a, it's an expensive product.

How much does an Airstream. I don't even know how much is an Airstream?

Basically the same. We, we, you know, we, we kind of price right on top of airspace, you know, maybe at a, like a slight premium if you kind of compare like apples to apples. But yeah, and so that, that, that all in the one was even harder. Right? So it's like, okay, cool, so you're going to sell something that's like close to a couple hundred thousand dollars, right? Like, you know, could people, people aren't going to, like, give you $200,000, you know, $165,000, like sight unseen because you have a PowerPoint presentation or some renders. And so what we did is we, we, we. The first two years we spent making a concept vehicle or a show vehicle. So it was like a real, a real physical demonstration what the product was, but not fully engineered and not sort of like ready to go into production. And we use that to, you know, we launched at south by Southwest, and we used that to then get a bunch of reservations. And on the sort of backs of that, we, you know, we got a ton of reservations, you know, fortunately. And that was how we then capitalized the business to go out and do the next chapter, which was, okay, actually go out and develop the product, set up a factory, set up a supply chain. And we're kind of like at the.

End of that chapter, they paid for the reservations.

They paid just a small amount, so it was $500 refundable. This is really kind of like a show of traction. So we wanted to get a list of people who really intended to buy this product, but we didn't need, nor would we have expected them to pay in full for the product.

Right. And then is it something, I mean, do you sell this now on an ongoing basis? Is it sold I don't know, online, someone selling. Like, you have a sales team or how does that work?

We have a, yes, small but mighty sales team. Yeah, we sell online, but we also have to sort of like show, you know, showroom. So as the company has grown, you know, we're now about 100 people. We have a factory in Broomfield, Colorado. We have a Service Depot and kind of showroom in the Bay Area in South San Francisco. And so. And we're, you know, a D2C business. So. So we're not, we're not trying to sell through dealers. You know, this is kind of more like the Tesla model. And so what we find is, you know, the order may happen on our, on our website, but behind that and through the hard work of our sales and marketing team, honestly at this point, we're a small business, like everybody, we're bringing customers in to see the vehicle, meet the team. We as the team and the company is sort of like a sales piece for these sort of like earliest customers. And that's kind of what closes the salespeople getting to know us, people seeing the product. We, at this point, we now have several full vehicles built, sort of like demonstration vehicles, and so they can come and see it.

Very cool. So you mentioned the hundred people that you have, or close to 100 people that you have. What is it that you look for when you're interviewing? To bring people. This is like a ballsy project, right? This is like a pretty crazy thing. And, and from an engineering, I get, I know nothing about building hardware, but when you look at it and you watch the videos, you're like, wow, the engineering on this thing, you know, the electric elements of it and everything. It's crazy. Like, when you go out to get people, what is it that you're looking for, you know, for someone who's going to come join Lightship?

Yeah. This too was, I'd say, like a learning process. And I'll say we, I mean, Ben and I, obviously, we want awesome people, really smart people, like, you know, people who are, you know, culture. Not just culture fits, but culture ads. Like, you know, these are really important things. And I think we're really proud of the company and the culture and the, you know, technical aptitude of the folks that we have. But we've also established an interview process that sort of like, I think works well. And, you know, we have folks that are part of that process that are making sure that we're hiring really smart people, really capable people, really, you know, people who will thrive with, you know, in our values and have, you know, really high levels of ownership. That's all sort of happening. So for me, my job, or what. Or what I believe is my role in the interview process is asking the why question. And this, like I was saying, was something I kind of evolved to learn. Like, I wasn't always asking this question. In the very early days, I was interviewing everybody. And as we were growing really quickly, I had sort of stopped interviewing everybody, and that was a mistake. And now Ben and I have sort of re. You know, sort of rejoined the interview process. And when I'm interviewing somebody, the sort of, like, one question I ask or what I say is, like, I'm here to answer your questions, and I have a hidden agenda, but it's not going to be that hidden. My hidden agenda is I want to know why you want to work here. And the reason I asked that question is because over the four years we've been doing this, what I've learned is there is a very common failure mode for people who either don't perform well when they're here or they decide they don't want to be here. And what that failure mode is, there's sort of different aspects to it. I don't want to generalize everything, but the sort of most common theme is they didn't have a good reason for wanting to work there. And why that matters is we're crazy. All the things you said. This is like an ambitious, crazy, stupid, you know, insane hardware company. You know, in the world of AI, you know, we're building, like, the most, like, steak and potatoes. We're building recreational vehicles. There's no AI in it. And it's not defense tech. Like, it's. It's like. It's like, not. It's like, not the thing that's hot right now. And yet we're. We're still thriving. But it means it's going to be hard and there's going to be bad days, and there's also going to. Hopefully there's more good days than bad days. But, like, if you don't have a good reason for being here, you. You're going to have a bad day and you're going to be like, get frustrating your teammate, you know, decide. Don't. No, don't want to work here. Whatever it is, that doesn't work. So I don't. If people are listening to this and are trying to, like, cheat on the test for our interview process, that's totally cool because I actually, like, let you cheat on the. I tell you upfront. What I'm looking for, what I'm looking for is there's not a right answer. It's not like everyone has to have the same reason for being here. I just want people to have a authentic reason for being here. And I guess I'm a legend, have to believe it. And for folks that do, they do really well here. And I think it's a really cool place.

I, I love that. I was actually at a VC's office earlier today and we were having a conversation about early stage investing and everything. And I told him, I said, understanding a founder's why has increasingly for me become the only thing that really almost the only thing that matters. You know, and, and when you say it like that, it goes, it kind of, it. You start to think like if someone doesn't have a good. Especially when it's hard, when the, when the job is hard and it's. You face a lot of challenges and like a founder.

Yeah.

If you don't have like a real good deep down, like deep, deep, deep seated reason.

Yeah.

To be there, you won't make it. You just won't make it through all the challenging times. And I was saying to them, I think actually for early, early stage, it almost doesn't matter what the product is. It almost doesn't. You know, it's like at some case, it's like, what's that founder's why? And is it really authentic and real and strong enough? And if it is, they'll probably figure out the rest the things along the way.

Yeah, totally. I had a, A mentor before I attempted to start a company who. He. What he, it was the quote. He introduced the concept of Emotional Runway, which was basically like, a lot of people think about like Cash Runway. But actually what matters more and at least in his view, why companies failed, was that you run out of Emotional Runway and you usually run out of Emotional Runway before you run out of Cash Runway.

Such a good, Such a good. That's a good. You know, that's a good one. I never heard that. Actually. That's a good. And it's kind of on an individual basis and on a collective. You could make an argument, you know, on a collective basis as well.

Yeah. Yeah, totally. I mean, I, Yeah, I think about that one a lot. And it's, it's, it is, it is true. Maintaining your Cash Runway is also hard. Don't want to discount that as a, as a, as a, as a challenge.

But what do you think as you set out to start this company? What did you expect would be Hard, but actually turned out to be easy.

Yeah, it's a good question. So before lightship, I tried to start another company, which related to this question. I was so concerned and so nervous about building something hard and complex. I thought that was going to be the hardest thing, and it becomes very limiting, especially when you're not an engineer. So the company I started was a fitness company. It was actually pretty fun. I worked on it with a really good friend, and we did okay, but it wasn't the right company for me, and it sort of didn't go anywhere. And so coming to lightship, I thought the hardest thing again, I thought the hardest thing was going to be, like, a technology. And here it's like the order of magnitude difference and sort of the problem, the technical problem was so massive. Like, we're building a. A car and a house and a bunch of consumer electronics and, like, all of the software and it's like, got this, like, new novel, like, drive system that's, you know, somehow going to, like, mash the speed of the thing that's towing. It's like this, like, feels like it's insurmountable problem. I thought that was going to be impossible. Turns out, like, teams of people are capable of doing incredible things. It's like the human imagination. You almost can't understand it. You're sort of able to wrap your head around what a single individual or what you can do, but a team of people can do an incredible thing. And we were fortunate enough to hire really good engineers and, you know, really good technical folks and, you know, kind of throughout the organization, just awesome people. And I don't want to say wasn't hard, and I don't want to say that, like, you know, because ultimately what we've done is. Is pretty incredible. But in the scheme of things, in the scheme of company building, like, wasn't that hard. Like, like, we. We. We sort of like, we. We did. We did. We did the thing, like, and it's. And it's pretty awesome. And that isn't what keeps me up at night.

Yeah. What. On the opposite.

What.

What is the biggest. I ask everyone this question, like, what is the biggest challenge you've faced since starting lightship? And how have you overcome that challenge?

Yeah, there's so many. How long is this podcast supposed to run? You got, like, a few more hours. I mean, so. So probably the biggest. The biggest thing that ended up being, you know, pretty challenging. I mean, there are some. There are some technical things for sure, but. But, yeah, I think probably the things that have been the hardest, have been more related to like people and culture and, and building a company in that, in that respect. So like for, for instance, okay, so as a team, as a team grows, like you're capable of more and more things, like I was saying, which is, which is pretty cool. But also as the team grows, it's like harder and harder to keep everyone really motivated and marching to the beat of the same drum. And I didn't come into this job having I had a fair bit of management experience, but I'd never run a big organization. I think the biggest team I'd had before was 15 people. And there it's like you have really collegial relationships and kind of know everybody and you're almost like friends. A little bit like my management style, 100 team and many steps along the way, that's, that's pretty different. And I kind of had made some false assumptions that everyone was going to sort of be like me and you know, require a little direction, not even want a lot of direction, and be very like, you know, self motivated and sort of like know what to do. And you have, have a lot of that motivation kind of like come from within. And we have a bunch of people like that. Not everyone's like that. And this isn't even like a value judgment. Like that's not the right way of doing things. That's one way of doing things. And so getting everyone to do the thing and learn, like learning how to navigate all these different styles towards a common goal as a person who hadn't done it before and then, then, then as well, like was, was really hard.

What you said there. But assuming or coping or that everyone was going to be like you. You know that if I think about the kind of, the most frustrated periods of time I've had as a founder and that I've seen other people have as founders, is that exact, I think that exact moment where they realize, yeah, maybe the first 10 people, 15, whatever the number is that I hired, yeah, have that passion. They're with me in the trenches and they have, even though they're not the founder, they kind of have that energy. And then you get to 90, 100, 200, 500, and you're like, why doesn't that person operate like me? And you're like, that person's job is not like they're not even in the same realm. And I think that that moment of clarity is one that some people get to and just assume that they can make everyone like them. You know, I have founders who are like no, that's because we didn't hire well, I'm like, well yeah, maybe, but no matter what, they're never going to be you, they're never going to be the founder, they're never going to have a passion about this problem at the same level as you. Even if they're the most passionate person in the world.

Yeah.

And I wonder how have you. Are there any things you found when you talk about getting everyone to be, you know, walk to the same beat everyone to. Have you found anything there that has been an unlock for you?

Probably. Actually what I'd say is giving up control a little bit. And I don't mean like, you know, be totally delinquent on your responsibilities as a leader of a company. But early on I think I tried to control things a little too much. So an example of this would be I was really opposed to like remote and hybrid work because I like being in the office and I wanted to work closely with people. There's like you know, an adage and it's hardware and you need to be there. And, and yeah, and I'd say this is like showed up in a, in a, in a few different places. But what, what, what you learn is like especially as you in this, this. I guess you really can only get this if you're bringing in people that you really trust. Which I've been really, you know, fortunate in having gotten convinced awesome people to come in. But I, I sort of at a company level and then at a sort of like management team level have just sort of relinquish control. So on the hybrid and remote work thing, it was sort of like the signals I was getting from the organization were different from what I had in my head. And we hired a really awesome head of people. Her name's Ali. And she didn't agree with it, like my perspective, she listened to it but didn't agree with it. And um. And eventually, you know, I guess like she won that battle like that won that argument. You know, I, or she convinced me and I, you know, kind of like let that one go and it's like unequivocally better. Like you know, just like I think that it works better per way of doing it or. And then this happens like kind of like on micro level, it's like a meeting I own or like a piece of work that you know, you know, I'm, I want to like dive in. I want to do the thing, I want to have like ownership over the thing. But like I'm good at some things and I'm not as good at other things. Like, I, I, the way that I ran our team stand up every Monday was like my way of doing it was a little like casual and you know, whatever. And, and like again, after this is Allie again, she was sort of like, we need more structure. Let's follow a format. Let's put together slides. I'm like, ah, slides. Like, you know, she's like, I want to record it so people can listen to it later. I'm like, I want it to be like, I don't even know what I was going to be about. Like, I, I don't want it, I don't want it recorded. But it's just like she was better. She's better at setting that up and then the meeting is better and. Yeah, yeah, I guess the short, the.

Short answer is like giving ownership to other people.

Yeah, that's, that's actually. But you're describing it better. It's like giving ownership to other people. That was the, that was the cheat code, right? Like, particularly when, when you are not sort of like the expert. Like, don't assume you're the expert at everything. Like some people are actually better than you at a lot of things.

Yeah. So on Lightship, last question that I want to transition to your background for, for a couple minutes, but for Lightship, where, where are you in 2028, three years from today? What does the company look like? The product, you know, where are we?

We are a kick ass, profitable company shipping just a shitload of RVs, I think in three years. We're, now is a really cool moment because we're just starting production. We're just, you know, getting first vehicles out in the field. We're going to see customer reactions. The product is honestly even cooler than I thought it was going to be. And getting to see like all the iteration, you know, it's like, it was like, it was cool, but not everything worked. And now it's like, what's, what's coming down the line now? It's just like freaking awesome. So that's, that's, that's a really cool moment. And honestly, it's, it's hard, it's hard to look a month, six months, you know, a year. So this is, this is like a academic question a little bit, but, but no, absolutely, like three years. It's like I want to be from like, you know, we're shipping our first units to like, we're shipping a lot of these things and I'm a recovery finance guy and I think this is so Important to the sector we're working on and build. Building a business, just period. But we got to be profitable. The reason we in particular have to be profitable is because we're a hardware manufacturer. We're not super capital intensive. We're a little capital intensive. I've said this many times now. We're not AI. We're not going to get, like, we're not going to get that big free money. So we got to secure our own destiny. And there's a lot of things in our favor. The RFE market is more profitable than typical automotive. You can be profitable as a manufacturer at a pretty small scale. So there's a lot going for us that help us, but we got to do it. We got to be a profitable company. And then. I know you didn't ask this question over 5, 10 years. Where we want to be is we really think of ourselves as a sustainable travel company. Even beyond just the vehicle. There's so much that is sort of beloved in the pastime of camping and RVing, and yet there's so much to be solved. There's so much opportunity there. So in the long, long arc, we are not just a vehicle manufacturer. We are a sustainable travel company.

I love that. I love that. Feels like a lot of greenfield there to go for a long time.

Yeah. There's. In our industry, it's, you know, in particular, like, there's. There's so much to do with the product, but RVs fundamentally get used like two or three weeks a year. And, you know, you don't need to be a genius to think about business models where you have that level of utilization. Like, what should you do about that? Like, what types of businesses have been made and. And have been super successful to deal with that problem.

Awesome. All right. About you. So where. Where are you from originally?

I grew up in Boulder, Colorado.

And what, when you think about your career, was there like a. Or, I'm sorry, your childhood? Actually, I want to. Let's go all the way to the beginning.

Yeah.

Did you know that you wanted to be an entrepreneur one day? Did you grow up around entrepreneurs? Did you. Were you always a leader? Like, in your childhood, was there something there that you could have guessed that this is where you'd end up?

Nope. I was always kind of like a pain in the butt and like, wanted to be in charge, you know, sort of thing, but I didn't know what entrepreneurship was. My dad, you know, was a. Worked for the Social Security Administration as an attorney, and my mom was worked at a. At a bagel Restaurant. She was like the office keeper or like kind of like office manager for a bagel restaurant called Moe's Bagels. So yeah, not no entrepreneurship there. We were very kind of just regular middle class family.

But in our, in our conversations and Nick who introduced us and my conversations with him, like, my. It sounds like you have like a crazy internal drive.

Yeah, yeah.

Where does that come, where does that come from? What is your why? Let me say like in the interview, you know what, what is your why?

Yes, the funny, the funny but, but honest answer is I don't know. I, like I. My entire life I have, I've always had a really strong sort of like internal motivation. Like it comes, it comes from somewhere inside me. I was not like, it was not my parents, like, you know, leaning on me. It was not like, you know, aspiring. I don't know, like having some like awesome like mentor when I was a kid. It was like something inside of me really pushed me hard and funny. I was texting with my, my wife this morning and our. We have a seven year old and she is like so much like me. She was at the playground and she's like in gymnastics and she was trying to do a, like a flip on a bar or something. She was like, couldn't do it and she was struggling to do it and my wife was just like, what do I do? She won't leave.

She.

She's like, she's not. You try to do it over and over and she's like crying, getting frustrated, but she won't stop. Like this seems like you, like what, like what do I do? She's got a PhD in psychology. Like, she's like, I have a, like my PhD is worthless against this like hard dis. And I'm like, I don't know, like it's, you're. That's a tough situation.

So you don't know where it comes. You don't, you know, it's not, it's.

Just somewhere deep seated, like somewhere inside of me. Yeah. It's just. Yeah. Comes, comes from somewhere within.

Yeah. Do you, but you're talking about your family. Like, do you, how much do you include them in the business building? Because you're talking about having very little kids at the start of this, you know. And your wife, like, how, how much are they included in this? Do they come there with you? You know, do they see the factory? Like, how does that work?

Yeah. You have two young kids, a seven year old and a three year old. I had a kid while. Wow. Lightshift is four years old. James is three years old. Sometimes I say I have three kids. Two of them are humans, and one of them is an RV company. You know, thankfully, Lindsey, my wife, and I are really different. There was a joke when I was just starting my career. I was an investment banker and came to like that Lindsey didn't know what the stock market was or how it worked. And that is sort of held true our whole relationship. She's a psychologist. She thinks what I'm doing is really cool, but doesn't understand it a lot or get super involved or necessarily want to be super involved. I guess I can't say I'm the type of guy who. I'm carting around my kids and my wife to all the work stuff. They. They. I'm in. I'm speaking to you from San Francisco right now, and I live in Colorado. I'm just. I'm out here for a few days and I did actually bring them for this trip, but that's not. That's not common.

And how do you handle that? You know, I don't. I hate the term, but work life balance, or how do you handle that sacrifice? Because back to the point, building any company is very difficult. This company sounds even more complex. Like, how do you handle that? Is that, is that, is that something. Do you think there is work life balance? Let me ask you kind of that. That question.

Yeah, I think there is. And I think. I think there needs to be one of Lightship's values. I probably do. The. Ben and I both probably do the worst job of following it, but we try to follow too is. Is stay balanced. We're, you know, we are a recreational vehicle company. Right? Like, like, we have to. We have to do that.

Good value. I know, I've never heard it. That's a good. Yeah, it's a good value.

It came a little bit out of Tesla. Like, we. We loved so much about Tesla and some of, like, the greatness that. That Tesla was able to achieve. And this is not a common or this is not uncommon thing you'll hear, but, I mean, the culture was a grind. Like, people burned out. There was like too much. And so here we're trying to, as best we can, recreate some of, like, the awesomeness of, like, the technology and the. And the drive, but not some of the other stuff. So, yeah, I would say for me, I'm not great at this, and if you ask my wife, she'd probably have a different view, but it has definitely been necessary to find balance between work and my family and really Try to invest. I will always get drawn to work that's like, easy to do. So I have to really focus on investing and focus and spending time with my family. It's not hard to do because I love them, but it still takes intention. And what I would say is like, that actually makes me better at work. Like, you know, some of the, the hardships that I'm sure have been discussed a lot, you know, on, on, on, on this. Like, I, I, I wouldn't be able to sort of handle that without having kind of like a, a strong other thing in my life which, which is, which is, which is my family now. The, the sort of place where the balance falls apart and, and where, where you might say we're like life balance kind of breaks down. What I found sadly, is I basically have time for work and my family and exercising three times a week and nothing more. I have no hobbies. I painfully have very few friends. Like, I have like, you know, friends I love dearly from college and, you know, close folks I've met along the way. But like, man, I, I, like, I wish I had more time to spend with friends and I wish I had more friends, but I just don't. And I, I, like, I don't, I, that's, that's kind of what has had to, has had to give. Like I can do work, family, nothing else.

Yeah, that's why I asked that question, because I, I think I talked to too many early, early stage founders who I think just don't. That what you just said is the reality. Even the fact you get to go to the gym is like, you know, some founders who, it's like I have my work, a little bit of my family, and I don't even take care of myself. I hear that a lot, you know, and, and I think that when you're going down this path, you really have to be aware of what you're walking into. And it's not for like, you know, a year.

Yes.

For many years. It's actually the emotional Runway that you, that you talked about or that you, you know, the, the person, you know, said, it's really like, how far do you have of that? Because that's, that's what runs out.

Yeah. Yeah. 100. Yeah. And I, I, it wasn't like I innately knew this, this, this, this. Like, I, I, I, I, I learned, you know, it's like I, if you, if we'd done this a few years ago, I would have not known that I needed to do that, like, force that level of balance. With respect to my family, if we talked six years ago, I would have not known that I had to force that level of balance with, with exercise. And now I've learned those things. And, and, and I know that, like, I am a way, you know, higher functioning person and member of the team, leader of lightship because I have the balance with family and because I, like, I'm taking care of myself. And yeah, that's, that's sort of where I'm involved too.

So knowing, knowing. Last question. Knowing everything that you know today, all the experiences you've had across your whole career, what is the one piece of advice you would go back and give yourself before you started your first job ever in investment banking?

I thought about this one a little bit from listening to your other shows. I, this is a bad answer. I think I would tell myself nothing. Like, I, I, I would like, maybe like, you know, give a little affirmation, like you're gonna, you know, you're gonna be good. Like, you know, so my, my, my, like, you know, previous self knows that my future self isn't like, you know, whatever, dead, but, but, but I don't know. Like, it's like, you know, it's not made a bajillion mistakes. Like, I hated investment banking, but like, I wouldn't, I wouldn't go back and advise myself not to do investment banking. Like, I, I don't, I, I feel like everything I've done, including the things I didn't, poorly or in the mistakes I made, I, I don't, I don't think I would change it. I think it's led me to where I am. Banking sucked, but it was what got me a job at Tesla. Tesla was an incredible experience, but it was insanely stressful and it created a network, allowed me to start a company and hire great people and know what I didn't want to do later on. Yeah, boring answer. But I'd say, I don't think I would, I don't think I would say a thing. I would just say, like, keep on trucking, baby. Toby.

Well, Toby, thank you for doing this with me. I can't tell you how much I appreciate the transparency and sharing these lessons. And it really, it is why I do this show literally, is for conversations like this. So thank you very much for doing this.

Yeah, happy to do it. This is, this is a fun one.

Awesome. Well, anyone who's listening, I hope you enjoyed. I There's a lot to take away from this episode. Please share with your networks and we will see you for the next episode of Not Another CEO Podcast. That's a wrap for this week's episode of Not Another CEO Podcast. Thanks for joining. For show notes and more, please Visit not another CEOPodcast.com we'll see you next week.

Sam.