Driving the Future: EV Market Trends and Innovations with Tiya Gordon and Olaf Sakkers

The most important trend that's happening is China is dominating the EV market.

Adoption matters because it is the second largest form of greenhouse gas emissions in the United States.

The growth hasn't slowed, it's just slowed in the US Market.

You want to think about electric vehicles as basically giant roving batteries.

Customers don't want to pay additional costs.

So for every dollar we spend to reduce pollution, we yield like 10 to $20 in health benefit.

Why do we care about EV adoption?

Welcome to the BC podcast, where today welcomed by Tia Go Gordon and Olaf Sackers. Tia is the co founder and COO of ITS Electric. It's a Brooklyn based startup delivering curbside EV chargers that tap into building power to eliminate costly utility work. And they provide revenue sharing with property owners, which is what I think makes them really unique. She has won many awards like the National Design Award from Cooper Hewitt, which is part of the south by Southwest Innovation award for Urban infrastructure, the Canada's gold lion for creative data. So she has a lot. A very impressive background. Olaf, if I understand correctly, you have 150 million under management at RedBlue Capital. You're an early stage venture firm focusing on mobility, logistics and energy and transition. Before finding Red Blue, you spent six years at Motive Mobility, a leading global mobility VC fund. So. Oh, and you're from South Africa, so. And graduated from Princeton and anth anthropology. So welcome to the podcast. All right, well, right now, like, where do you see the current trends in the EV market?

Should I take that? I think the most important trend that's happening is China is dominating the EV market. So you've got this new wave of Chinese companies that have come in. BYD is the most important one, but many others as well. And increasingly they're, they're, they're dominating the Chinese market. More than half of new vehicles sold in China now are with what the Chinese government calls NEB powertrains. But what's also happening is exports from China are growing mostly to emerging markets, but also to Europe. But the US has very high tariffs, so there's not much of that happening in the U.S. so that's the, that's the big thing on, on the automotive side. I think there's another way to answer the question, which is to zoom out and say, like, what are EVs? You can say they're passenger vehicles, which is how we think about them, because Most consumers buy EVs, but also includes on the one hand, EV trucks, which are, you know, moving goods across long distances. And then on the smaller side, you've got Bicycles and scooters and micromobility, which are substitutes for cars and also EVs, but we don't tend to think of them in the same bucket. So all of these things are playing out. There's a general shift towards more and more EVs across markets. The US is a bit slower than other markets. Some markets are faster and there's a lot of detail below that surface.

Okay, awesome. Tia, what trends are you seeing right now?

So trends that I'm excited about right now is this sort of what I'm hoping can be a nice little race towards a lower cost electric vehicle. So there is this really great stealth reveal of slate brand EVs. It was really fun how they did that. They just parked one in Venice Beach, California and they just parked it on the street and put some random advertising on it. It's bezos backed. So maybe it was a world in which we can get the billionaires to fight over who can produce the lowest cost, trendiest ev. And I think that's the unlock we've always known from J.D. power and from Bloomberg. Pardon me, from J.D. power, from Bloomberg, that the two biggest barriers for EV adoption in the US are twofold. It's the cost of EVs in the United States and second to that has been the lack of available charging infrastructure. So, you know, right now actually I think what's funny, there's this, you know, unintended consequence, unintended consequence of Elon in the White House. And the backlash against Tesla has actually somewhat flooded the secondhand market with used Teslas. So you can go onto any sort of auto mall, especially like, you know, Eco Auto, other companies that are really focusing on used electric vehicles and pick up a used Tesla for less than $15,000 right now. And you can combine that with the expiring EV tax credit or used EVs and you're basically walking away with a fantastic car for less than $10,000. So those are the trends that I'm looking at is sort of the secondhand market and the lower cost EVs that are going to start to enter the field over the next few years.

Okay, Peter, what about you? What trends are you seeing as a vc?

Yeah, it's a good question. I mean, one of the things that I think is interesting is the slowing growth of EV adoption in a lot of ways. So it's still growing, but not as fast as it has been. And going back to what Olaf mentioned is just watching it pick up a lot faster in other markets like China. So I think that's interesting. I think the other area that's kind of interesting is the electrification of a lot more stuff outside of vehicles too. So. And this kind of goes into like autonomy, but it's things like, you know, your lawnmower is becoming autonomous and EV and there's a lot of devices like that that are popping up that I think are really interesting.

Do you think right now that the, the growth has slown because of battery breakthroughs? Haven't happened as quickly like I think we're seeing autonomous driving, we're seeing electric cars.

Growth hasn't slowed, Growth hasn't slowed. It's just slowed in the US market. Everywhere else it's roaring, especially in China.

What's the difference?

What's the difference? Chinese EVs are much cheaper and US has basically created a closed off market in which the domestic players and this is getting worse with the tariffs. So if you only care about one thing, which is EV adoption, which is obviously not the only thing that matters, the thing to do is just remove tariffs and you'll have BYD setting up factories and importing vehicles and you'd have a lot more adoption of the kinds of EVs, even the kinds of EVs that Americans like. Like I think EVs in Amer Americans like bigger cars and bigger cars are harder to electrify for a bunch of reasons. It's just, you know, the range limitations, etc. But if Chinese OEMs were selling into the US you'd have a lot of EV adoption. But I think with automotive industry in general, there are a lot of different competing interests. It's not just about how many EVs come onto the road. It's also about companies like car makers which employ a lot of people in protecting those jobs. That's always a political issue on both sides of the aisle. It's about national security. Like China has become America's primary rival internationally and so having Chinese technology widely adopted in the US and damaging existing industries is a challenge. So there's a lot of broad macro trends. I wouldn't say they directly affect vc, at least the stage we focus on on early stage directly because these are much more industrial companies at scale competing against each other for the market. But I don't think EVs are slowing down. And I think also the trend even in the US is for more and more EV adoption. Like Ford and GM are pretty committed to transition to EVs over time.

T what are you seeing in the space?

And like, yeah, I'm sorry, go ahead and finish the Question?

Oh no, you can go ahead.

I mean, you know, right now we're in a specific time and place in which EVs are highly politicized, which is gravely unfortunate. And what I always talk about is that if you're to list the states by EV adoption in the United States, obviously the largest is California, but what would you guess the second largest state for EV adoption is?

Texas? No, no, no, Texas, Texas and then Florida.

So you know, these are basically these states, dark green secrets where they know the benefits of this technology, they know the benefits to constituents by basically providing a vehicle which when combined with the fact that both of these states use high amounts of solar, are allowing these vehicle drivers to charge their EVs at home for basically like less than $5 for a full battery. Because of the utility rates that are afforded to people in these states, it really makes it a no brainer. And it's a question of basically, of basically just compartmentalizing, depoliticizing electric vehicles and putting them out there for what they are, which is a cleaner, more affordable mode of transportation, especially once that price point drops, per Olaf's points. You know, the costs right now are really the one barrier that's preventing this. But once you get past that and you can bring that lower barrier to entry, it really. You rarely hear of people going back once they drive an ev. When they do go back, it's happening in cities. So I hear a lot of stories of people who have bought an electric vehicle who live in the city. But the challenge of charging when they don't have home charging is so frustrating that they do sell their ev. And that's the area that I'm laser focused on is urban charging.

Peter, what do you think.

In terms of adoption?

What's blocking it? The political landscape?

Can I ask a spicy question?

Maybe Dasher always like, why do we.

Care about EV adoption as a, as a percentage of vehicles, like being fast or slow or medium speed? I think everybody agrees that over time the technology has advantages. The big challenges right now, the cost trade off, as you point out, tia, is not that appealing. And I think many consumers have real trade offs when thinking about switching to an ev. It's not necessarily always as convenient and in many cases EVs are quite expensive. So like, why does it matter if it happens faster or slower?

I'm kind of curious what you think, tia.

Why does it matter if it happens faster or slower? It matters because we're quickly moving into a mode and maybe this is relative in terms of venture where I'm seeing A lot of excitement or interest in investment around mitigation for climate as opposed to prevention. So I wonder if we've crossed a line, if we've passed that threshold where people feel like we've basically lost our opportunity. The climate is warming and now it's about building technologies that can help us now that we are living in this new age in which we have fires and flooding on a weekly occurrence across the United States.

States.

And so adoption matters because it is the second largest form of greenhouse gas emissions in the United States. And so after buildings, if we decarbonize buildings, that's one sector. And then decarbonizing lightweight vehicles is the second largest sector that we can attack to actually start to move the needle in terms of slowing the change that we're seeing that's becoming more and more drastic every year. And I rarely put on the climate hat. But this summer in particular, I think has been unfathomable in terms of the horrors that we've seen or this year, I should say, starting with the Alameda fires in January in California, which creating a $1 billion city deficit for the city of Los Angeles. The fires obviously were a result of the arid conditions because California hadn't seen that little rainfall. I think in. I'll have to send you the exact stat, but it was these factors that basically perpetuated the fires to the degree that they were, that they were able to spread so quickly. And you flash forward to the summer where we had obviously the flash floods in Texas killing 130 people, most of them children. So this is all climate related. And you know, no one necessarily wears their climate hat very proudly these days in the Trump administration. But that's where I do think adoption is important because it is still a lever that the consumer can pull to do something to help move our needle, to start preventing us from having to deal with air quality alerts on our phones, to have to start dealing with the fact that we can't go outside because it's too hot or because we're dealing with such flooding that it's actually destroying infrastructure in cities.

I mean, for me personally, one of my big holdbacks is accessibility. I'm also a high traveler, so I could charge at home, but I feel like my anxiety for longer travels on a multi, on a multi week basis becomes problematic. But so with what you're working on, I, I feel like that's really interesting. It's extending the power grid, making it much a lot more accessible.

Yeah. Where, where are you usually traveling from? Between what state and what State. What's your long, what's your long range travel?

Long range travel? I mean, I don't know. What, Keep track. I don't keep track of the miles.

Yeah, I know. I'm just saying, like, where do you live?

Vegas. From like Salt Lake City to Vegas. Salt Lake City to northern Utah.

Yeah. I have no idea how is the infrastructure on the highways over there, Peter?

You would know.

Yeah, I mean, so we're, we obviously have the Tesla infrastructure. So if you have a Tesla or you have a Rivian or you have something that can engage with that, that kind of works. But there are a bunch of spots in Utah that it's interesting. Like you go to Moab, it's pretty limited. You go to Logan, which is a decent size college town up north, there's like nothing, which just makes it really challenging to go, you know, far places. So everybody I know that has an electric vehicle also has a gas vehicle, because in order to get around you, you know, long distances, you need both. And if you want to pull a boat or something like that. So if you want to have any sort of leisure at long distance, that's really hard to do. Those aren't the same problems that exist in cities. I think my impression of the cities you have the challenge of you don't have a garage where you can, you can charge at home. And so you have a different set of, of issues that you're dealing with. For me, adoption, I don't know, like there's, I think there's global warming. The other one is in Utah, this doesn't hold true for everywhere, but in Utah we have inversion, which is basically when cold air gets trapped in the valley. And that also traps all of the pollution. And they've done a bunch of studies that show that the, the health cost is substantial enough that it's almost like 10 or 20 to 1 relative to the cost of reducing in pollution. So for every dollar we spend to reduce pollution, we yield like 10 to $20 in health benefit cost reduction. And so for me, like in Utah in particular, and I think other places that have similar dynamics. Getting more people to adopt EVs reduces not just pollution from a global warming perspective, but also provides significant health benefits to the community. I don't think that holds true obviously everywhere as much as it does in Utah, but I think that's kind of another area. And Utah, you know, I think the other thing to think about is there are a lot of communities like Utah that are really built for vehicles. So if you live in a city, there's a lot of public transit, a lot of walking, things are close together. But in Utah, everything's really spread out. And I think if you look at markets like Arizona, Idaho, Colorado, even places in California, you really can't get around unless you have a vehicle. And so those all contribute significantly to pollution and global warming and health issues. So for me, those would be like some of the reasons why I think EV adoption is important. I also think just like, maybe this is kind of an odd perspective, but having driven a Tesla for a long time, as well as still owning a bunch of gas vehicles, they're just really fun to drive. That just a much better experience that allows you to add things like autonomous driving a lot easier. You're able to update the vehicles more quickly because the vehicle, I think like the big innovation of Tesla was shifting this mindset of like your car is a car to your car as a computer. It's a peripheral. And as such you treat it like that. You can upgrade the software, you can add new features, you can subtract them, you can do a lot of things. Whereas the old model was, you bought a car, if you wanted to upgrade the maps in it, you had to bring it back to the dealer so they could flash it and they would charge you like two grand to upgrade the maps. Right versus now. It just happens automatically. Um, and because in part like the vehicle can be plugged in and operating and turned on, you know, 24 7. So you know, I just think there's a lot of benefits there. And you know, we just had a, you know, we just had a really good discussion around autonomy. I think there's a bunch of safety benefits that also come from being able to do autonomy through electric vehicles that are net benefit to society from a safety perspective. So I don't know, those are my perspectives. But I'm curious, Olaf, when you ask the question, you clearly may have like a differing perspective and I'd love to hear that.

I think the question of EVs is a very American perspective of like, what is the powertrain of this large four wheel vehicle which is used about 4% of the time and when you use it like only one of the seats is occupied most of the time. So and, and should we have this powertrain or that powertrain in these vehicles? While we have much higher accident rates than other countries, for the most part at least developed countries. And, and I think the, the lens is often very narrow on, you know, the US runs on cars and like why, why does it do it this way? And then even More so it's focused on consumers, it's very self focused. Like what can we do? What is like our personal contribution rather than like purely analytical? Like if like tia, you're really worried about climate emissions and reducing those, I think commercial vehicles are really the place to focus. And I think also you want to get as many people out of cars as possible. Because if you get them from a car onto an E bike and get them to start using that in a city, for instance, the long tailpipe emissions, as in the power that's needed to charge the vehicle, is still significant. So you're only reducing some portion of the problem, but you still have this massive waste and inefficiency and maybe like rounding this back to an investor perspective. Like the thing I'm passionate about and really care about is efficiency. Like how do you give people more for less? How do you give them more trips to the places they care about to see their families, or sending children to better schools, et cetera, while using less money ultimately. But often that's downstream of less waste in the system. So I think the big problem is waste and inefficiency. And the thing that we should be optimizing around is having better systems that serve people better. And I think just focusing on car powertrain misses this much more important and broader conversation about how do you have abundance or better outcomes for people, rather than the kind of culture war issue. Because I think on both sides, EVs have become this kind of football that gets kicked around and it's kind of missing the opportunity to have a much richer conversation about what is how do you make great cities, how do you improve how people live and move in that direction. That's where I was coming.

I agree with that. Yeah. I mean, on that vision of investors or founders looking into the future and trying to imagine the best possible scenario in a city, especially around energy, the answer to that does not include fossil fuels. I think we can likely agree on that. And when you look at basically electrification as your energy source, not just for buildings, but for cars, you want to sort of think about it in a circular method. Right. So you have der, but how do you tie that into transportation and how do you tie that into an actually sort of more, you know, uniform system in a city? So, you know, we actually are working on the world's first bidirectional curbside charging system as well. So this allows, for example, let's say we're in a city like New York, we just had a blackout here in July from the heat wave that we Experienced Glendale, Queens, out in the borough, they lost power for 10 days. So imagine we're six years into the future and most of the city's fleets are electric. Citi can then go ahead, call the fleets and basically have them drive into Glendale, ask them to discharge power, assuming that those vehicles are enabled for vehicle grid, push that power back into the grid and then of course when they need it, they can pull it back out. You know, you want to think about electric vehicles as basically giant roving batteries that are able to move around the city. You're basically able to move this energy where it's needed. So you do need that absolutely larger thinking and not just kind of, again, like Olaf said, focusing on dryer train and adoption. You want to think about the best possible city that you can live in and what are the tricks that you can do now to start to push us towards that inevitable larger vision of the future. If we just all wait and say we need, you know, perfection is going to be the enemy of good. So if we say we have to wait until it's 2045 or 2050 and we're at mass adoption before we can start to do all these other things, we're going to be too late. So again, what we can do now is again start to increase more use of electric vehicles. As to Olof's point for fleets and on the commercial side and have that seep in obviously to consumer as well. That's a huge still number of vehicles. In New York city we have 2 million registered vehicles. 1 million of those park on the street. So of those 1 million street parked cars, they are basically parked and not driving 85% of the time. So you basically just have energy storage sitting there being untapped. If those were all electric. So this is the sort of, sort of connective thinking that we're trying to push cities towards. But again, not waiting until 2040 to have this master plan, but to start now and say what is the infrastructure we can put in now that will then be able to very easily convert to V2, V3, V4 as we start to progress and build cleaner energy cities.

For where do you think the opportunities lie either between as a vc, as a founder, to like to, to, to create these monumental shifts? Because like we talk a lot about infrastructure, we talk about policy, but where are the actual opportunities where we, the four of us could start tomorrow and.

Make a difference.

Or for like a new founder?

Yeah, I think I kind of want to push back on some of the things Tia said. Like I, I don't know exactly what the vision of the future we need to get to. Like, I don't think necessarily EVs as energy storage mechanisms because they're parked on the street is necessarily the right direction. Like, why are those cars parked on the street in the first place? It's because they don't pay for parking and all that space in the city. New York's a little bit different to other parts of America, but is being given away for free and could be used for housing or for lowering living costs. I also think in any future we're going to have a mix between clean and like pico plants with natural gas and all sorts of other different solutions. I'll talk about two investments we've made because I think it concretely answers your question, John, which is, I think what's really interesting is a shift that's happening in terms of business model. And the shift is happening from this ownership model where people own cars and they're totally underutilized. And they also expect free things like parking or construction to include space for cars to live in or be housed. And the model that's alternative to this ownership economy is a trip economy, where more and more we're living in this world without necessarily realizing it. When you order goods on Amazon, you're using an app to buy something, and instead of going to Walmart or Target or wherever to buy those goods, groceries or supplies, they're coming to you, they're being delivered, and those companies that are delivering them care about making that cost of delivery as close to zero as possible. That's happening with Doordash, it's happening with Instacart, it's happening with Uber, and it's also happening with Waymo. And the more we can accelerate this trip economy, the more we get the best of all worlds. Because you have a model in which much more efficiency is incentivized across the system because businesses care about reducing costs to customers and customers don't want to pay additional costs. We don't think of driving in a car as expensive because we've already bought the car and so the marginal cost is zero. But as we shift to this kind of trip economy, the marginal costs go down. So two ways in which we made investments. One is a company called Navoya, which is building a fleet of electric trucks. And logistics is a massive marketplace in which goods need to move and buyers and sellers are transacting. And it turns out they're getting to the point where EV trucks are cheaper to move goods over medium distances. And so they're seeing massive adoption in the market and rapid growth that just raised close to $10 million from lower carbon capital. We seeded them and I think this is a great example where what's driving this is not like a moral decision on the part of a consumer that I want to make a personal change, but rather just cold blooded business calculations that this is a cheaper way to operate. And I think you can get much greater scale through rational, logical decision making when the unit economics work in this way. And this is going to drive a large portion of where emissions are coming from or where diesel is used today is in long haul trucking just by shifting this model. Another very unexpected place where the trip economy is flourishing is in East Africa. So if you go to a city like Kenya, there are millions of people that drive motorcycle taxis. And Uber and Bolt are these two marketplaces that have flourished in these markets. It's like an essential service. They don't have transit, they don't have alternative ways of getting around. It's quite a cheap way to get around. But these drivers are spending up to $2,500 a year on petrol, on gas. And so they're like a very wealthy European or American buyer in that their wallet spend is very high and they have a very strong incentive to switch to an electric powertrain where the costs are much lower. It's actually very compelling because EV powertrains work best on small vehicles. So one of our portfolio companies, Zeno, is building electric motorbikes built specifically for this kind of use case you need to be able to carry a heavy load on the back or three people up a hill, over potholes, up a bad road. So you need to build a very specific type of vehicle. The founder comes from Tesla. His name is Michael, Michael Spencer. And he's done an incredible job in delivering a vehicle in a very short amount of time that meets the market needs. And so there are all these unexpected ways in which EVs can really meet a market need by satisfying very simple calculations of I can run in the petroleum vehicle, but it's actually going to cost me more. And switching to an EV makes a lot more sense. Okay.

To you, where do you see the opportunities for founders and VCs moving forward?

That's a very broad question. Can you narrow that down a little bit?

How about we cut off the VC side and focus on the, on the founder side? Like where, where, where, where can we attack, like Olaf says, and get these marginal benefits to, to get wins? Because I think we talk about the power structure a lot. We talk about politics a lot. But like if someone was either going to make an investment or, or, or, or make a difference, where might, where, where might they, they look? You know, beyond where you're currently focusing on, on the infrastructure.

Sure. I mean, to tie it back to what Olaf was raising. And those people aren't going to make decisions based on it being the right thing to do. Right. They're going to make decisions with their wallets. And what you need to do as a founder is you need to make it easier for people to make the choice. And that choice happens to be electric then, then great. Right. So like you're, you're slipping the medicine underneath the syrup. Right. So I think that founders can kind of see that the technology is already here. Right. We have the vehicles, whether they be two wheel, three wheel or four wheel. We have the political will happening on at least a state level, if not a federal level in the United States. And so I think an area that's interesting to focus on is where are things getting stuck? Why couldn't we, for example, have more two wheel delivery systems happening in the United States? As OLAP is saying in other countries, it's a lot more economical, it's faster, it helps people get their goods faster, which is what everybody wants. And so you have to look at sea about how do cities help those last mile delivery systems actually be more productive, more cost worthy and also safety as well. There's a great company here in Brooklyn called Pop Wheels and they're addressing the issue around Deliveristas. Right. So you have this delivered delivery community, which a very large Venn diagram overlap with the immigrant community where they're driving E bikes to make deliveries for Uber Eats, for seamless, for DoorDash, for all of these companies, for Amazon. And what's happening is that they're often finding very low grade and not certified batteries for their bicycles. They're then taking these batteries into their apartments overnight and charging them in their kitchens. These are lithium batteries which are then catching fire. And once that happens, it's often fatal. So Pop Wheels came up with the invention of putting a swappable battery cabinet on the sidewalk on public right of way, allowing delivery drivers to come to find these batteries and to swap theirs out. And they never have to take their battery inside to the apartment where they live. But that's just not just tech, that's also govtech. Right. How do you convince a city to allow you to put this technology on the sidewalk? And I think that's an area that's really interesting for people to Lean into, like where are the areas? What are the connective tissues that's required for this? This technology exists to actually be able to live inside a city and to find the right ways to do that. And that's the hardest part right now. Like I always joke and say, I say that for our chargers. Putting an actual charger on the sidewalk is like putting the cherry on top of the sundae. It's super easy for us. It's less than two days of actual construction and installation work. It's all of that work we have to do in advance with the cities. Understanding permits, understanding thresholds, understanding how different departments work together, which is the real crux of what we're doing, which is our real secret sauce is also our superpower.

How long has it taken you to get a permit for some of these installs?

Lots of great questions. So for example, you know, we're first of a kind in Boston. The first permit we pulled in Boston took four months to pull that permit. Now we have it down to three weeks because we basically built these systems and we built these rails for the city to be able to run new permitting systems on. And that's a very interesting space as well. It's not sexy, but it's required.

So that's your course, your core secret sauce.

Yeah.

Maybe just to zoom out. I think the space is a very hard space to build in. And VCs are not that focused on EV opportunities, to be clear. And it's part of a broader kind of malaise in the US right now, which is all the stuff that TIA is describing is city level bureaucracy that makes your life really complicated and hard and is the enemy of innovation. And I think broadly across the opportunities for changes in transportation, it's just an extremely bureaucratic regulated with massive entrenched interests and paradigms that people are very set in. And so to make meaningful change is quite challenging. One example is like, I think micromobility is fantastic in terms of benefit to society. Like you have much less space being used. Even though people talk about accidents in micromobility, like when you have a collision, it's much less likely to be fatal if it's just small vehicle on small vehicle, it's the big cars that kill people. The emissions from a E bike or scooter, even if it had a internal combustion engine that was powering it, it would be using less energy than an electric vehicle in terms of emissions. But yet people get really upset when these things aren't parked in a very orderly way along the sidewalk. I mean, you don't have micromobility in New York City besides City Bike. And it should be just, you know, an avenue dedicated towards small vehicles having, like, a protected lane and a lot of access. But the paradigm and the reaction to something new being introduced is very strong. And so it's quite hard to actually transform the landscape in terms of what we invest in. A lot of it's focused either on things like Zeno, which are, you know, in a market where a lot of things haven't been laid in stone yet, you don't have high rates of car ownership, you don't have regulations around, you know, supporting car ownership in various ways, or it's in spaces like logistics, where you've got established marketplaces where all the. All the actors are strongly incentivized to adopt new technology, whether it's, you know, EV trucks or AI for running logistics services, et cetera. There's a lot more investment and opportunity in that space because it's much easier to actually change the reality on the ground. But when you're dealing with infrastructure in cities, and this goes back to a broader debate about housing and cost of living and generational upset where younger people can't afford to buy houses, et cetera, there's a whole nexus of things that have gone wrong in America around making these things easy and doable or even possible, and have created a lot of bad incentives that make innovation hard but also make any kind of change difficult.

Yep.

I think our cars and our houses are the size of our egos.

Well, and I think part of it, too, is free. I mean, it's just what a car represents. Right. And this is definitely changing as fewer, you know, Gen Z's individuals are buying cars or, well, not buying cars, but having an interest in driving. You've seen some drop in that. But. But historically. Right. Like, a car is freedom and a car is power. And that's the perception culturally. And I think those are really hard things to. To overcome. And then it's also this, you know, talking out of the other side of my mouth, which is millennials and Gen Z can't afford homes. And so when I talk to individuals in those demographics, they look at the car as like, this is our. This is my biggest asset, my biggest purchase. And to John's point, is, you know, a symbol of my prestige and my accomplishments in life too. And so you have all of these, like, emotional, cultural things that, like, go into having a vehicle that even though it's not the most efficient, to Olaf's point, there's a lot of, like, Cultural tailwinds that push people into buying those cars. And then you have an infrastructure that's built for it that you would have to figure out how to unwind to a certain extent. I don't know, I'm curious, like, why, why don't we have more EV bikes in, in the US for example? Like I, I actually own several, but you know, I use them more for recreation than I do for, for transportation.

I mean, the one.

Obviously it sounds like you have a.

Go ahead. The. I remember being in Florida and talking about a bill to create bike lanes and the bike lanes were just painted on the highway on the side, and that was their policy around bike lanes. So I think a big reason is you're much more likely to die if you ride a bicycle in the US Than doing most other activities. But I think the kind of spicy point that's worth making here is the US thinks of this as freedom, but it's actually a kind of servitude. And America likes this idea of capitalism and freedom and choice. But in terms of car ownership, you are forced in many ways by structural and governmental incentives. And I'll give you an example from the last administration. There was a $7,500 credit on purchasing an EV under the Biden administration. There was no subsidy towards purchasing an E bike. You could buy multiple E bikes with the amount of federal dollars that were going into subsidizing people to transition to EV cars. But there was no backing for that. There was no incentive. And so there's a lot of money that's going into subsidizing transportation directly and indirectly through parking and construction requirements, et cetera, that people are paying for. They're just paying for it indirectly so they don't notice it. So there are lots of levers to pull in order to change the culture. But there isn't a consensus or an awareness on the social level or the political level that these are problems and changing them would lead to better outcomes.

I was going to say, Peter, it sounds like you have a lot of vehicles. You have lots of E bikes and cars.

Too many vehicles.

Too many vehicles, yes, but. No, but to the point of the last few minutes, if you look at warmer climate communities. So maybe in Florida, Olaf, where you were, there's a lot of families that actually give up their second vehicle for a golf cart. And guess what? Golf carts are electric, right? So there are these other companies that are coming in, like Tello Strut, that are basically creating these very cute high end, for lack of a better term, golf carts that These families can use that aren't rated to go on highways, but are able to drive on standard, standard causeways and not fast, fast highways that again reduces sort of, again this, this big car ownership and makes all of that last mile local shuttling of kids groceries whatnot, emission free. And I think that's an interesting space to look into as well. And a lot of communities especially support this. We all have the image in our head of let's say a retirement community in Florida. And of course the golf cart use that's widely spread and normal. And if we can just kind of turn the key a little bit more and just have those not be quote unquote golf carts, but just short range vehicles, it solves for an amazing amount of, you know, sort of mileage that's currently creating emissions that can just be switched over quite easily. And the teles and the struts are adorable, adorable if you haven't seen them already.

So, dude, we should, the four of us should create a waymo for golf carts. And that's the new business.

Well, well, I mean also, I mean again, like here. So. All right, so found founder. Founder of Product Ideas. Right, let's, let's lean into the over 70 consumer class, right? These are all boomers. They have expendable income. A lot of them don't want to have to drive everywhere. A lot of them are having their licenses taken away. So how do you get them to where they need to go in a way that's clean and easy and affordable for them? You know, I was at a great conference called Commotion, if you haven't heard of it. It's fantastic coming together of everyone that's working in different levels of mobility, micromobility, multimodal, electric, evital, everything above, everything below. And you know, they were talking basically just make something called, you know, like these little tiny express vehicles that can pick people up on demand that are all basically just like, you know, Ubers for golf carts in these communities, right, that can basically pick people up, take them to the grocery store, take them back home. These are areas that are really interesting that are basically below the radar right now because they're not these larger autonomous solutions that are rolling out in different cities, but are more direct needs that are happening. And I think they're very scalable and are something that I would be interested to watch as well.

I mean, I looked at both of those companies on the investment side and I think as an investor it's just hard to underwrite the market because I agree Florida has these use cases and it's quite a high spend category as well. Like the margin on the vehicles can be quite big, but in terms of where the addressable market is, it feels like autonomous vehicles is the kind of panacea solution that can scale and meaningfully change how people operate. But around that, given the policy constraints, it's actually quite hard to make massive change, at least from a VC returns perspective. You're underwriting something that should be able to get to a billion dollar valuation or something like that. If you're just selling into the state of Florida, that's not necessarily enough. And trying to scope out how many communities there are that are going to adopt these. And there's also a company from China that's making cheaper ones and even with tariffs they can still be cheaper and there's a lot of commoditization risk. So yeah, I think these are the kind of challenges in investing directly into the kind of EV or transportation space.

One of the things that I think might be interesting is investing in services around EVs. So for example, John and I have a friend here in Utah who's building a whole dealership network that just sells EVs of all different kinds and then attached to that is EV service services. Huh.

It's called EV service, EV Auto and EV service.

Yep. Because most mechanics shops are not really equipped or built to handle EVs and so I think that's interesting. We're also looking at a company that does mobile like repairs and maintenance and that sort of thing and does it on some. Yeah, one of them does it as a like Uber type model. So peer to peer marketplace kind of thing. I think those are kind of interesting. I think the, the investment that you brought up, Olaf, around kind of medium. And I think also last mile Delivery solutions with EVs are really interesting. We've, we've backed companies in and around that space. So. And like what's interesting about it is not even necessarily the drivetrain as much as it is just like all of the things around uplifting the vehicle, managing it, maintaining it, leasing it, all those those types of services. And then the end result is that you get these vehicles that can be used for a day and they have sufficient range to cover that day for all their deliveries and so forth. So a lot of the stuff like what Rivian has done with Amazon I think are kind of interesting. But yeah, I think you bring up some really good points Olaf, in that like it's really challenging in this space given all of the government restrictions and policies and everything else to really drive innovation, which in my seat as a vc, like, definitely scares me away from a lot of these types of deals. And the other piece is just hardware is hard and costly and hard to do. And so that also, like, when you layer on the complexity of regulatory with the challenges of building physical stuff, I think it scares away a lot of VCs, which maybe that actually alternatively creates solutions, or not solutions, but opportunities for those that are willing to venture in and have some way to kind of crack those nuts. Kind of like what Taya was mentioning of, like, now you're really good at being able to crack the nut of getting stuff deployed, right, because you know all the forms, you know how to work with the government. That's now become a bit of an edge for you that somebody new to the market would have to have to create and relearn how to do. Right?

Yeah, sure, I think. Go ahead.

No, after you.

I think what's interesting about Elon Musk, despite his kind of controversies or whatever, is that he's one of the few people that's been able to build industrial companies in the US against kind of the headwinds of how hard it is to do things. The other thing that's really hard about the automotive space and not just like tied to your point about its hardware, which means it's hard, is the incumbents are not that fast moving, are not looking for technology. So I started my career investing in Israeli startups that were selling technology that was being developed in other areas, like sensors and cybersecurity, and trying to sell it into the automotive space. And it's quite hard to sell into this space because these companies move slowly. They've got a whole supply chain that moves slowly. This is why China's winning overall. And so one of the strategies that's kind of exemplified in company like Lavoya is you want to reduce your dependencies on the existing market. Because this market has been so restricted by regulation, et cetera, for so long, you actually want to have your own supply chain, you want to have your own software, not depend on what exists in the market today. And that's where I think the big opportunities are. I don't know if it's in selling EVs directly, but you kind of want to ask yourself the question of what are you dependent on and how much is it slowing you down and how do you make yourself less dependent on those things? And to the extent that you've got a good answer to those questions or a real pathway to doing it, then you can build a big and successful company. But given the barriers, there are not that many people that have succeeded in overcoming these challenges. You see it on Waymo, it's like a decade of scaling and it's still going slowly. There's definitely challenges there. You see it with Ruby and it's expensive and difficult to scale up. But I do think there are many, many opportunities. Also, when you look at the space, you look at the software that's used, you look at the technology that's used. And our kind of core investment thesis is that the real economy, this whole area is ripe for disruption. But you have to be very particular about what kinds of opportunities you back because a lot of them have challenges with market size or regulation or supply chain, et cetera.

It's definitely a very, very tricky space. Well, thanks Olaf and Tia for, for joining us today. We had some really good thoughts about the, the ev, the market and changes are happening to you. I'm a big fan of what you're doing. I think making it accessible and focusing on incentives of how to get a power grid more accessible for the EV market, I think is. It's very challenging and very good for the environment. So that's amazing.

Yeah. And just to kind of close out on the Elon comment, in terms of his ability to build a company, never forget that the Department of Energy gave Tesla $465 million loan to build the Tesla brand. So, you know, government does have a role to play in this.

He lives off government grants and loans, whatnot, and funding between SpaceX and Tesla and whatnot.

Yeah, he's, he's not bootstrapping here. Thanks, guys. This was fun.

All right, thanks.