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Chris Anderson: Follow the Money

About this talk

In this talk, 3D Robotics founder Chris Anderson shares three lessons he learned transitioning from Wired Magazine editor to helming a 275-person drone company. From “paying” his children in juice for assembling the early prototypes to building a massive factory in Mexico, Anderson’s journey was random and often accidental. But thanks to some healthy ignorance, open source technology, and some rising tech trends, Anderson’s new venture is a successful one, boasting over 100,000 customers.

The key for building a company, he says, is to not wait. Ride the tides of community and macro trends, and keep iterating. “Everything we learned about manufacturing, about the products, we learned by actually doing it.”

Chris Anderson, CEO, 3D Robotics

Chris Anderson is the CEO of 3D Robotics and founder of DIY Drones. Before Wired he was with The Economist for seven years in London, Hong Kong, and New York.

Anderson is also the author of the New York Times bestselling books The Long Tail and Free as well as Makers: The New Industrial Revolution. Anderson’s awards and honors include: Editor of the Year by Ad Age (2005); Time Magazine’s Tech 40, The Most Influential Minds In Technology (2013); and Foreign Policy Magazine‘s Top 100 Global Thinkers (2013).

Anderson lives in Berkeley, California with his wife and five children.

Full Transcript

It’s a huge honor to get this award, particularly with Edison as the inspiration and with perspiration as the theme. I’m going to tell you a little bit about– Two and 1/2 years ago I was a magazine editor, and now I run the biggest drone maker in America. We make more drones than all the aerospace companies in America combined. And like, what the heck. I mean, how is that even possible? And the answer has very little to do with me and very little to do with inspiration, a lot to do with the era in which we live in when suddenly regular people can do extraordinary things.

I’m just going to tell you. I’m just going to go very quickly through a slide show of my story with three lessons that I think reflect what’s special about this era and what kind of choices we made that ultimately allowed us to be as successful as we are today. This is my daughter Erin. I have five children, and I’m always trying to get them interested in science and technology. So I started a site called Geek Dad, that was all about finding projects that were fun for kids and adults, as well. And one weekend at “Wired” we got these two products in for review. One was the brand new Lego Mindstorms robotics kit. Anybody here familiar with Lego Mindstorms? Yeah, so it just came out, it was pretty cool. And we thought we’ll do that on Saturday. And this other thing was this model airplane. We thought, OK, Saturday we build a robot. Sunday, we fly a plane in the park. One of these things will connect. So here’s Erin, following the instructions for the very first prerelease Lego Mindstorms. And you’ve got to build a Tribot. And there’s Daniel, her brother. And they spend all morning programming it. And after he did this and he pushed the button, it then did exactly what’s it intended to do, which is slowly move to a wall, detect the wall, and back away. And the kids are like, you’ve got to be kidding, right? We have seen “Transformers,” where are the fricken lasers? And we realize that Hollywood has ruined robotics for kids. You cannot compete with CG.

So that didn’t go well. Then we decided to take the plane to the field and we watched YouTubes of acrobatics, and it ended up like that. And that didn’t go well. And I had to– the kids were some combination of mortified, and of course, it confirmed all their biases about projects with dad, and ice cream had to be bought. And we get them home and I thought, how could that have gone better. We had a robot, we had a plane, and yet it completely didn’t work. And I thought, well, what if we had a cooler robot and a better flying plane. And I thought, well, what if the robot had flown the plane. That would’ve been cooler. And I literally googled flying robot, and the first result was drone. And I’m like, hmm, drone. Then I googled drone, and the first result was auto pilot. And then I googled auto pilot and there was like math. And so I stopped googling. And I got the kids– I got the kids around the dining room table and I said, let’s build an auto pilot. And they’re like, an auto what? I said, I think it involves a computer and a sensor and moving surfaces. So this is literally what the kids and I did. It is the Lego Mindstorms, but we couldn’t actually figure out– so the way airplanes are controlled is they having something call the servo, which moves the control surfaces– but we couldn’t figure out how to make the Lego control the servo. So we actually just built this thing so that they just moved the servo back and forth on this little sort of escapement. And we put it in a plane– and Daniel is there holding the plane– and we put this picture on the internet kind of took off. It became sort of like a Lego UAV, a Lego drone thing. And people were like, that’s awesome, you should totally fly that. And so we did, and it did not fly well. And so then we made a better one. And this is it, this is that third page of Google results, the one with all the math. We actually back to that page and actually read some of that. And it apparently had something to do with combining different sensors, accelerometers, and gyroscopes, and magnetometers, and combining them in some way. It’s called a sensor fusion, involving something called a common filter. And I really understand, but there’s some code I could find on the internet. And so we did it, and we put that one in a better plane. And that one did fly, and that one did work, and that’s now actually in the Lego museum as the world’s first Lego UAV.

What was interesting is we– again, this is just me and small children doing this, with toy parts. And then as we googled further, we realized that what we’ve made here with an auto pilot is essentially controlled as a munition by the US government, it’s export controlled. And that when you export auto pilot technology, you have to ensure that there is 24 hour closed circuit television coverage, a TV coverage, and that there’s a check-in check-out log, so if any non-US citizens get contact to this. So this, of course, is the Lego auto pilot we just published on the internet. And so we realized, in that moment, is that we had done, in the eyes of the US government, we had weaponized Lego, which I think definitely counts, as it was not on my bucket list but should have been. And I was really looking forward to the moment where the congressional committee calls my children up to testify about how they could have broken national security in this way, because that would have gone viral, as well. But sadly they didn’t. Anyway, at that point the kids lost interest. And I got chills. I was just saying, how did that happen. Right, how did me and my kids end up weaponizing Lego? How did me and my kids end up building a drone out of toy parts, because that should not be possible.

And there has been three times in my life when I really got chills. I was the editor of “Wired,” I was exposed to a lot of technology, but I only got chills three times. One, when I first encountered the internet, or the web rather, in ’93. One, when I went to– I was with the Economist and I ran the operations in China. When I first moved to China in ’97 and saw what I think is essentially the model of the 21st century and how was everything I’d read was wrong. And this is really– they were going to pull it off. That gave me chills. And then when I made this robot fly, and using toy parts, that gave me chills. I realized that something– there was a disturbance in the force, there was a glitch in the Matrix, something in the world had changed, and so I created a website to basically figure out what that was. 2007 turned out to be the key year. Anybody who was paying attention, who was like measuring the force, if you will, woke up, that year. That was the year that the Wii controller came out. The Wii controller had sensors, accelerometers in it, and you could move it. And so the Fitbit guys, who just bought a Wii controller, and they were like, whoa, this is amazing, I wonder what else you could do with this accelerometer. And they came up with wearables. 3D printing started with Makerbot and RepRap. Arduino, the open source computing platform started that year. The maker movement started that year. We had Lego Mindstorms, which also came out there that year. And the iPhone was launched that year.

And what changed, what actually turned out to be the common factor across all of these, was two things. One of them with sensors– these little chips inside the Wii controller and the Lego Mindstorms and the phone turned out to have extraordinary applications outside. And the other was the open innovation model, the web. Then suddenly, these 20 years of doing things together on the web, we now had the ability to do it in the physical world. And what RepRap and Arduino and all those things were were open hardware platforms. They were basically taking open source software models and applying them to communities, and the maker movement became that.

So my community was just about this. I just created a website, as one does, because I wanted to ask dumb questions. And when you ask dumb questions in public, two great things happen. One of them is that people answer your dumb questions, which is good. But the other is that it liberates people to ask their own dumb questions. In 2007 everyone was dumb about some aspect of this because it was so multidisciplinary. There was the analog electronics, and digital electronics, and aerodynamics, and power systems, and RF, and GPS, and sensor fusion, and everybody didn’t know something in that moment. It was a beautiful moment where people could be childlike and open about things. Even if they were super experienced engineers in one domain, they had the opportunity to learn about other ones. And these moments, when everything is new again, they don’t happen very often where people are kind of willing to come together and be vulnerable and share. I think today we’re starting to see the payback from that brief moment, the early days of the maker movement.

Unfortunately, we succeeded all too well. This community started creating software and hardware technologies, flying robots with various source. Then the next generation comes along, and they say, OK, I’d like to do it. And so this first generation of hackers, which I was one, we think we were done. We documented the entire process. It’s like, here is an EAGLE file for a PCB design, just have that fab’d, then go to Digi-Key and order these surface-mount parts, and then solder them, and then of course build this tool chain, then compile the code. And they’re like, can I just buy one, please. That sounds really hard. We’re like, oh, yeah, that’d be a good idea, we need to make a kit. So here’s our first production line. We paid the workers with strawberries and juice. Important lesson from this, do not put the six-year-old on quality control. She doesn’t do a good job, and the customers are remarkably unsympathetic. This was the first product. It was a robot blimp. Those are pizza boxes. Blimp-duinos, you can say, built on Arduino The first lesson I learned here, which is not one of our meta lessons. But the first lesson is, the very worst thing that can happen to you when this is your production line is that they sell out in 10 minutes. Because then you’ve got to do it again. And I just could not get the kids to do it again. So that was the end of factory 1.0.

But fortunately I now had built this community on the internet. And there was this one guy who was just the best. He was flying this helicopter with a Wii controller and Arduino and he was posting code and YouTube videos, and he seemed to be super, super smart. And his name is Jordi Munoz. And I said, Jordi, would you like to build these boards? And he said, sure. And I’d never met him before, but he seemed he was open to doing it. And so he sent me a picture. And here’s factory 2.0. And he’s soldering the boards, and I’m not, and that worked pretty well. And what he did there was, he wasn’t just soldering board, he told me something important. He said, you should switch to Arduino There’s this thing called Arduino. It’s this computing platform, and it’s really cool, you should do that. Now, I’ve been using other things– Lego Mindstorms and tried with cell phones and things like that. And what Jordi recognized is that Arduino had an essence that was right. And the essence was not technical. Arduino was based on an 8-bit microprocessor. It was not a 16 megahertz. It was not very fast. There were tons of faster technologies out there. But what Jordi recognizes is Arduino is cheap, and it was easy. And he recognizes that cheap and easy was more powerful than feeds and speeds. And so he steered me towards Arduino. And then what I realized is Arduino was not about the technology, it’s about the community. Because it was cheap and easy, it had the biggest community, a people. It was a social force, not a technical force. And that meant more people writing code, contributing libraries, willing to use it. And so by using the worst technology with the best community, we ended up coattailing on the Arduino movement, which made it much, much easier to get things started. We weren’t starting something from scratch, we were adding drone functionality to Arduino, which made it an adjunct to an already hot movement. So that was an insight that he had. I had no idea about this, and he just sensed it with this sort of animal instincts.

Then he sent me more pictures. He said, we’ve got a new space. This is our factory 3.0, if you will. And I looked at this, and I thought, shelves, oh my God, that is so pro. And then he sent me another picture. And he said, so we bought these pick and place machines off eBay, these used ones, and we downloaded the manual from Google. And I’m like, pick and– you can do that? And yeah, so it turns out that you can. And Jordi– at this point, if the editor of “Wired” is going to start a 21st century aerospace company, you would not expect he would co-found it with a Tijuana 19-year-old he met on the internet. And yet, that turned out to be exactly the right person to do it with. Because what a 19-year-old Tijuana teenager who I met on the internet had is, number one, he had, again, these animal instincts about what was hot in technology. He was a child of the internet. Number two, because he was 19, he was completely fearless. He didn’t know that you’re not supposed to buy pick and place machines and reflow ovens and stencil printers and seam machines on the internet and teach yourself how to use them. And number three, and this is the really key thing, Tijuana teenagers think that building factories is just something you do. It’s in the air and in the water. Actually, quite literally, in the air and in the water. But Mark Zuckerberg, when he was 19 at Harvard, was absolutely the right person to start Facebook. But he probably wouldn’t have been the right person to start a factory. And yet Jordi Munoz in Tijuana was the right person to start a factory. What do I know about this? And yet it was just the most natural thing for him.

So he sent me more pictures. He says, now we’ve opened our second plant. This is the one in Tijuana. This is the clean room. And here, I’m thinking, smocks. They’ve got uniforms with our logo on it. We’re not even a company, yet. This is really just working off cash flow, and i sent him $500, just in case he might need it. And you can’t see it in this photo, but I posted this photo on Twitter and at higher resolution. And the way these factors work, it’s very important to avoid electrostatic discharge– sparking– and which will blow the chips. And so what you do is you put a ground, a little cable, it’s a wristband, and then this little ground cable attaches to the machine. And people saw it, and they’re like, you chain your workers to the machines? Technically, yes. And so he sends– then there’s this picture. And at this point, it’s like, OK, time to quit my job.

So this is just all built organically with teenagers. And now they’re not teenagers anymore, but in their early 20s. And at this point, I’m like, this is real. So we made a real company. I took over as CEO, that’s 2 and 1/2 years ago. And this is just one of our five factories right now. This is the Tijuana factory. And so what we learned there was everything, everything we learned about manufacturing, about the products, et cetera, we learned by actually doing it. Today, we run big factories in China. It’s all contract manufacturers, outsourced. But the fact that we actually did it from the ground up, from the garage. I mean, those early boards I soldered myself and loaded the code and my six-year-old did QA. And I have a really kind of intuitive sense about what this means now. And when you look at all the really interesting hardware companies right now, they all started like Edison did– actually doing it themselves. You know, Square started with Jack Dorsey and Jim– last name I forget– But, he only question here is: Do you have time?

The reason I am able to do this is because of smartphones. It’s because of Apple, Android LG; they’re doing all the work.We just recognized something special is happening. We just picked one of the things that are changing. Follow the money. We can compete with the biggest companies in the world by being smarter about the trends around us. Thank you.

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