The Hardware | Matt Dalio

So we hired an industrial designer, brilliant designer, everything he touches is magic and he was a sophomore in college. We hired him for a summer. And the journey of finding the people who knew how to build the hardware, I won't walk you through that journey for the sake of time, but here is what I will synthesize out of it. is that building an operating system is easy. Building hardware is easy. Building a rocket ship is easy. All you have to do is find the rocket scientist. If you can find the person for whom it's easy, it's easy. Until you find that, it's basically a fool's errand. So we built hardware. That user researcher who became our COO then became head of hardware. She was like, I have no idea what I'm doing. Oh my god. Figured out tooling and finishing and oh my god, oh my god. We took those products in the field. It was basically the functional equivalent of taking a Raspberry Pi. Literally, we just took an off-the-shelf board and we wrapped it in 2 pieces of plastic. And this was my line. Being a hardware company is easy, you just take 2 pieces of plastic and slap them around an off-the-shelf board. And that was wrong. And so we took that in the field, again, same as the earlier days with the operating system, people loved it, except it fried because of the voltage spikes. It used a form of storage, this off-the-shelf board, flash storage, not eMMC, which meant that the operating system would burn the SD card after 3 months of use. And there were thing after thing after thing like this. It wasn't meant to be a real computer. So we began a very, very long process of finding a manufacturer, finding the people who could help us build it. As soon as we had that, it's easy. So I'm going to show you our first product. And I'll show you. So this is a CPU tower. This is a computer. Oh, pretty. So we had a premise that we need to build something that would get that reaction among people who could afford the best. I want one. And the interesting thing about plastics is plastics are really cheap. Nice plastics, ugly plastics, they're almost the same price. cheapest computer in the world, a luxury. So that is the computer. This is the hardest thing I've ever done in my life, being able to hold this in my hand, to hold something that went through real tooling, Something that went through real electrical designs, something that runs a fully functional desktop operating system that we built. I have 10 minutes left, so I will jump to the next product. This is still an Intel processor. This did not fulfill the mission of making a computer that is truly affordable to everybody. So the cheaper version of this is $189. That for a lot of people, for about a billion people, solves the internet connectivity issue, but it's still not yet cheap enough. So the ARM processor, we had to work on the next one, and that's here. So this is the same thing that this is. And it's half the price. Anyone wants to pass this around? I'll pass the other one around too, and you'll see that details matter. Oh my God, if you could have seen The Chinese manufacturers, they wanted to put for thermals holes in the top of this thing like a salt and pepper shaker. I mean, really terrible things. But every detail had to matter. The way the injection molding of this— we didn't want rubber feet. OK, you can't have rubber feet, but you can't have it sliding across the room. What do you do? It took us about 3 months to figure out a design and engineering answer to that. So I'll pass these around. You can take a look at them. Hey, you won the lottery with your industrial designer, right? We did. We really did. More than a lottery. We did. I think we changed the world with that industrial designer. And we won the lottery with the person who leads our engineering team. So he is the person who built the engineering team at Red Hat. He literally built the whole stack that we're built on. We— the number— so here are a few— I'll sort of bring it to conclusion. So where we are today. We have a long road ahead of us. We have just built an operating system that pretty much everyone in our target market who uses it prefers it to any other product on the market. The answer is they love it. But we have a long road ahead. With that said, I want to end on a few of the really exciting things that we've got, because I think it's It's just sort of fun to end on a high note. And then I want to take questions for the remaining 5 minutes. A few updates. These are confidential, so please do keep these confidential. The Brazilian Ministry of Education in about a week, after Carnival, after they finish partying, is about to sign an agreement to make us the default operating system to educate the country of Brazil. A few other things. So ASUS has begun shipping Endless already in Colombia. They want to expand to Brazil and Indonesia. Remember that CTO of the Linux contracting firm that Google goes to when they find hard problems? This was his first week at Endless. He now works at Endless. That's awesome. Wow. Remember that Positivo, that company that wouldn't— CEO, no, we're not doing this? The phone call I had on the way down here was that we just had a meeting with them today and they have given us the go-ahead. We're shipping with them. The largest carrier in Latin America, which was América Móvil, was like the dream, the dream. Sell to the carriers. They'll sell us data plans. They have the largest distribution network for computers in Latin America. Not only are they shipping Endless, but their founder and CEO has left 2 years ago, and he is investing in Endless. That's so cool. It has been a long, hard journey. It will still be a long, hard journey. Um, but it sure as hell is worth it.