“Nick, are you ready to make a last attempt at changing the world?” That was what Rob Lloyd, CEO of Hyperloop One and former head of Cisco, asked his former Cisco colleague Nick Earle, who had driven the cloud and global services sales business for Cisco. Earle, who reacted, “Is it real?”, chose the Hyperloop One model, which claims to offer “a new way to move people and things at airline speeds for the price of a bus ticket.” Lloyd and Earle (Senior VP-Global Field Operations, Hyperloop One), who are in India to evaluate the market here, share with BusinessLine their thoughts on the challenges ahead. Excerpts:
The ‘common thread’ between telecom and transportation
Rob Lloyd: It’s the network effect. Having witnessed the fact that in our early days in Cisco, we were building a network that connected other networks. One thing was common — when I started in 1994, no one in Cisco had any idea what the technology will end up doing or the transformation that would follow. It was an exciting technology, there was a market to replace, but no one had any idea about the kind of impact the Internet would have on others’ lives.
Having witnessed that transformation, and countries like India leapfrog from wired to mobile broadband, I thought: “Wow! Can you imagine doing this twice?”
Only now — as we start the next revolution on Internet of Things”, as we digitise the physical things — we looked at the transportation infrastructure and realised that its backbone was built on technology that’s two centuries old!
So, wouldn’t it be cool if we followed an idea where we are the technology company building the infrastructure. But to be successful, we need to build networks around the world, we need local partners, jobs, manufacturing companies, firms that innovate around the system...
We also recruited the CFO from Uber, who had been through the 300 to 3,000-person high growth phase, raised $4 billion in a short period, was formerly with Google, had invested in Green Energy and, thus, knew of infrastructure. And my last great decision was to bring Nick Earle, a close colleague of 14 years.
Nick Earle: ‘Is it real’ was my first question? There were two models in the market. One was a crowd-sourcing model. What attracted me to the Hyperloop One model is different, and is very relevant to India. India, as a country, can leapfrog. You can leapfrog to technologies that are proven. So our approach was: We are not going to ask countries to take the risk . We will raise the money all round the world. Our focus so far: We are an engineering company.
On India and Hyperloop One
Rob Lloyd: We will do the innovation, do very rapid prototyping.
Every country will want several things — they want jobs. We will create local manufacturing capacity. We are building our company in a way that a large portion of the technology can be built in countries that invest in it. We will look at business partnerships with firms that have invested in telecom projects, ports, roads, IT. But it takes the government to fast-track this or it will get bogged down.
Within a few months, we will show to the world that we can build a full-scale Hyperloop.
We are here because last year, when we started the global challenge and asked people to solve transportation challenges, suggest routes where this could be implemented, we got more submissions from India than anywhere else.
Our team collaborated with them and we shortlisted five semi-finalists that are with us today. Now, we will start meeting government officials, as this is going to be real.
Nick Earle: Let’s say 50 years from now, Hyperloop is there in every country, just like broadband now, in rail, airplanes. Where’s the next Silicon Valley? Where’s the expertise? The first-movers have opportunity to create the engineering countries that then go around the world making people implement it... the universities that teach these students. We could move coast to coast the same day instead of putting them in a container ship that goes around.
Building infra for a company holding patents in a public utility space
Rob Lloyd: Three companies make equipment to be used in telecom infrastructure to be used in backbones. At one point there was one — Cisco.
In Hyperloop, we are the first ones, so far leading. No doubt there would be competition, and its important to create standards that can be used to create interoperability, because no one wants a gauge that will change halfway through transportation, as is the case in Russia.
We are working with governments and regional players to create standards. So, there is multi-protocol-label switching — a telecom network technology — an invention by one company that was turned into a standard.
We are 240 people today and we will be 500 people by the end of this year at Silicon Valley and Los Angeles. We have offices in Middle East and would imagine opening offices in India. Our bottom-up and top-down analyses of the market show that Middle East, India and North America are the largest opportunities in the world.
Nick Earle: We are educating the market on how real the technology is and will then pursue partnerships with government, industry, manufacturing entities to create an ecosystem that will create a massive job creation opportunity.
Long-term view of private investors
Rob Lloyd: Our investors have not been traditional venture capitalists. Our investors have been GE Ventures, DP World, who build ports for centuries.
We do have investors with a longer term view, and they want liquidity in a super-highway term. We are discussing with investors in our companies today on current activities that see production and Hyperloop systems working somewhere in the world. That somewhere has not been answered yet. It could be here or some place else by 2021.
