Ross Dawson: Hello and welcome. I'm Ross Dawson, a futurist, speaker and author. Hosting the where the world's moving podcast series presented by OFX, the global money transfer specialists for where the world is moving. Through this podcast series, we explore our fast moving ever changing world and some of the extraordinary technological and social shifts that are shaping business and society, driving collaboration and globalization and supporting human progress.
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Ross Dawson: Humans love to travel. Over the centuries we have built boats, trains, cars, airplanes and rockets to help us move around. Now the next generation of transport is emerging with drones, electric and driverless cars and perhaps finally even flying cars, providing us with new possibilities for getting around. Tomorrow's transport options will stimulate mobility, tourism, and trade and enable a more connected global world for all of us. It's fantastic to be able to delve into this fascinating topic with Andreas Raptopoulos founder and CEO of Matternet, welcome to the program and Andreas.
Andreas: It's great to be here. Thank you.
Ross Dawson: I hear that you were inspired to start Matternet by seeking to have a positive impact on over a billion people. Can you tell us about what you saw in the world originally that made drone delivery or a choice to do that and tell us about. What Matternet does to achieve that objective?
Andreas: Yes, absolutely. In 2011 I started looking into the problem of extreme poverty and I realized that it's not necessarily a resource issue that we have to show in order to tackle that problem but maybe it's a logistics issue. As I started looking into the problem I realize that more than 1 billion people in the world they don't have access to all season roads. When they needed to get their goods to market it was very hard to do so and of course it's extremely unreliable transportation. A lot of times goods get rotten on their way to their markets and so forth.
Andreas: When there is some type of medical emergency in the family, it's very hard to reach that primary care. If the type of medication that you need to be on it needs to be given on an ongoing basis. It's very hard to ensure adequate supply for a long period of time. By the same token it's clear that we've achieved something amazing over the last 20 to 30 years with what happened cellular telephony. In many places in the world which in this amazing story of a leapfrog program. Many places didn't have to go through a few generations with technology putting copper lines in the ground, but they jumped directly into the paradigm of cellular telephony. And it's quite magical that you can be pretty much anywhere in the globe today. You can pull out the smartphone and you have access to the same internet that we have in the most developed places on the planet.
Andreas: Fundamentally I asked the question if there is a way to build these type of leapfrog opportunity. And I understood that it's going to take us decades. I think the estimate I was coming across that's going to take more than 50 years. For Sub-Sahara Africa to build up adequate road infrastructure to show all these logistical issues and it's going to take tonnes of billions of dollars. I thought these are something that we can do today to solve the problem and these technology stack that is mature enough or we'd be mature enough within time horizon of 10 years, to allow us to solve this problem differently. And this is where I discovered those new platforms these new flying platforms which are commonly called drones and this project started.
Ross Dawson: Tell us that was 2011. Where have you got to with Matternet today in terms of that original version.
Andreas: Took us probably a couple of years to get enough off the country together for us to be able to go and execute our first pilots in 2014. We've done pilots with the World Health Organization in Bhutan in Himalayas and also with Doctors Without Borders in Papua New Guinea. During those pilots I realize that it's going to take us probably $100 million to build a technology stack to the place where it needs to be to deliver on its promise. We decided to focus on a mature markets, commercial markets to allow us to basically be lot commercial traction in technology. And we started focusing in Switzerland. In 2015 we did our first project with Swiss Post, the National Postal Service of Switzerland to transport medical supplies in over rural areas. And since then we've been on a path to make these to the mainstream. In March of 2017 we begin the first company in the world that has been given permission to fly a full logistics operations overseas in areas in Switzerland. I think we've just crossed our thousandth delivery for a healthcare system in a Swiss city in Lugano. You have this massive advantage by using drones you can dramatically cut the time that it takes of medical supplies to flow through a city between hospital facilities. Primarily you're able to completely revolutionize the operational model of healthcare systems.
Ross Dawson: That's very interesting. The vision was to go into emerging countries in order to get there. You've gone into developed countries, obviously Switzerland again has places where it's very difficult to access.
Andreas: Yes, that's right and hopefully by leveraging those economies of scale and the capital that we flowing, the developer of technology we can reach a price point today and a point of reliability that would allow us to go back and we'll see that original mission. We are on this path to make this technology reliable, cost efficient, to break it to a level of user access that equates, I think to resembles our experience of how do I connect to the Internet today. I'm able to go to a shop and get a laptop and once I open up that laptop I just give it power and I'm able to connect. Basically, in be part of this venture that is the Internet. That's the ... we have a similar vision for the Matternet this idea that if you get those assets, you will be able to be connected and have bit of transportation network that would allow you to leapfrog road infrastructure and not have to rely on it.
Andreas: The capability that we’re building is you're able to ship anything within a city from point A to point B typically within a time or 15 minutes. That's the mark of capability building. Where it gets interesting is how do you build the interfaces that allows you to connect to other types of transportation systems that fullfill different niches. When you think about logistics of day when it comes to eCommerce. The backbone of logistics is one what if you were able to integrate with the fleets of trucks that roam our streets and either feed them on demand urgent packages. Imagine like UPS truck getting that is out on its route to deliver packages that have been loaded at 6AM in the morning. Imagine that truck getting a 12:00 PM package that needs to be urgently delivered to that neighborhood that is being served by that UPS truck. Maybe it's being dispatched from a location in the city at 12.00 PM it arrives at the [inaudible 00:07:54] at 12.10PM and at 12.20 PM you can have a delivery.
Andreas: The focus there is not the speed but also what is the energy footprint and how overall do we make our city systems. When it comes to logistics much more efficient they are today and much more prepared to meet the needs of our own demands eCommerce.
Ross Dawson: Yes. And this creates a completely fluid way of anything being able to get to anywhere. And as you say, you can optimize that not just for speed but also for environmental impact or other factors. Going a bit more broad since you have focusing on ultra lightweight packages, we've also seen the rise of personal drones. Drones that are big enough to carry a human with trials going on in L.A and Dubai and some talk of that happening in Australia as well. And the model which has been suggested as similar to what you've just suggested point to point for the personal drones and then other local transport on either side. Do you see this as feasible? Do you think that this could happen at scale or what is the timeframe where we will actually have these personal drones to move us around?
Andreas: I think we're witnessing a renaissance in aviation it's an amazing expositional possibility within the industry and in general we’re seeing type of development that we show. I think in computing a few decades ago moving from centralized systems when computers used to be buildings to be centralized systems. That can be the use of which can be democratized and we'll see the same in aviation right. We're moving from this complex aircraft that needs very well to I think in reasonably intense operationally intense entities operate them at large operating aircraft. We are moving to more distributive systems where you have enough technology in smaller assets for them to be able to be served with the general population. I think it's an extremely interesting space to be in and there's a lot of activity currently in it. There are a couple of things that are difficult in my opinion to figure out.
Andreas: The noise footprint of these machines is generally elevated and currently when we're thinking about city transportation. We are at the point where with the electrification of cars or popularity of the road we are reclaiming silence. Our cities are now becoming silent again, which is going to be a magical experience. I think the tolerance to this elevated noise footprint will be lower and that's definitely a challenge of this new systems will have to face and solve. There are challenges that challenge could be solved with the technology the other way they could be solved is of course operationally. You can figure out ways in which you perhaps occupy certain noisy corridors and noise there is accepted because we get a sort of benefit of maybe it the transportation link between Palo Alto and San Francisco and it's like a train in the sky.
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Ross Dawson: In a nutshell, do you think will be commonly flying around in drones is individuals in the near future.
Andreas: We will see, I think the equivalent of helicopters perhaps and there will be much easier to fly or they will be highly automated with some sort of remote operate or supervising operation. I think that we see, I'm not quite sure that we will see them in a widespread way in the next five years. If we were to project out where that [inaudible 00:11:36], they think we'll figure out the technology and use case combination that will allow us to do it. The other thing that perhaps the drone will solve, but it's another big challenge, is the whole concept of comfort, both like physical and emotional comfort right. When the area is slightly turbulent and you can get these type of turbulence when you're flying low, it's all going to be the most comfortable experience for someone in a machine that the flying machine.
Andreas: I think that there is the societal challenge that we need to figure out and technologists usually miss that. There is the technology that kicks in and you think that yeah sure. It's going to be so magical that everyone's going to love it. A lot of times the first pass at your first try out to make something like this work. You come across these problems where you figure out not quite ready to scale and then maybe you have like the [inaudible 00:12:37] of the solution coming afterwards and then the seconds of rise of technology you can see something much more mainstream. I feel like maybe in the next five to 10 years we see this first approach in the space. I personally don't see it scaling today within that timeline.
Ross Dawson: Part of the issue that some people might be comfortable being in a small drone and a strong winds and other people might not.
Andreas: That's right. And it's going to be easier of course, to make the argument that we'd be strong adoption new technology in certain verticals. Would go back to this leapfrog scenario. For an organization like Doctors Without Border having these vehicles in their standard equipment when they go out and roll when your operation and your mission, maybe it's a standard practice. I think when you see the Democrat technology we see flying on change being much more cost effective than they are today in requirements much less skills because it's not something to do with pilots. To receive this type of service and it's going to be a question of what would be the ingenuity of entrepreneurs that wouldn't be kicking in to figure out what are the right value propositions for what the technology can deliver within a timeframe?
Ross Dawson: Absolutely. So part of the big frame here is around this idea of mobility as a service. Instead of owning a car or having your own van or so on you can just say I want to get myself or something from some place or another it's all dialogue. And some car manufacturers are saying that they are no longer car manufacturers. They are providing mobility as a service. Do you think this will become pervasive? Do you think that we might stop owning our own vehicles and we will just expect that to come to us whenever we wanted?
Andreas: Yes. I think being in Silicon Valley, I don't think you can find anyone around here that we've claimed that any other ownership, like anyone ownership model will survive. I think the prevalent thinking is, are those business policies would prevail. It's an extremely interesting area in mobility right now. We're going to see a fast formation of mobility systems unlike what we've seen for several decades. I think there is a wave of change is as big as the internal combustion engine or maybe bigger with electrification and economy coming into play especially the autonomy. And it's going to be very interesting to see how the business models would play out with all that technology change not withstanding.
Andreas: Perhaps the biggest shift in the thinking in the space has come from companies like Uber and Lyft who really made a point that when you operate fleets and if you don't own the assets you can create a different relationship. That your mobility architecture just changes. This concept of how do we innovate on the business model and how do we build the shared mobility platforms is the thing that most people are worried about and I'm trying to figure out how do we craft these experiences at the like end to end experiences that are going to be the backbone of this new model.
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Ross Dawson: We've talked a little bit about how transport is changing, making it more fluid, creating more possibilities. What does this give us in terms of individual, in terms of economies, in terms of societies?
Andreas: If I was to put in simply we've seen an amazing transformation happening over the last two, three decades with the Internet and what it meant for access to information. And I think it is reasonable to assume that we may see a similar transformation happening in the field of how do we move atoms applying both to goods and people.
Andreas: Fundamentally those reasons become much more fluid. They have mass less friction and this has effects that are unknown. It will have been impossible to imagine at the start to the internet that you could have a platform like Twitter and effects on even democracy. Then effects on our lives daily on a daily basis. I think it's equally difficult to imagine what is this new platform for mobility would we meet for our everyday lives. At Matternet for instance we hope that our work will enable new types of consumption models.
Andreas: The concept of storing physical items was eliminated in the same way that the concept of storing information is largely eliminated. Right now I have daily on demand access to information and I don't even think about storing it anymore. At the back of my activities happening have that of demands domain and other access. What if it was the same for goods. What would it mean for the planets? What would it mean for the efficiency of ... and rationalizing of use of resources. And you can apply this in many different domains. When you look at for example food consumption and how much food goes bad by transit and in shelves of grocery stores. When did you look at cars? What is the percentage of the day that they are not utilized? In some cases over 90%.
Ross Dawson: You're obviously working hard to make all of this happen. So what else needs to happen? What do companies, governments, societies, what else do we need to do to help make this vision come true?
Andreas: I think the biggest thing is a human factor. Being open to change is I think the biggest thing. And that applies to different components and make this happen. For example, if I take an example that is very an everyday I guess a point of discussion for any company that is in aviation is the regulatory components. These types of systems that we are building required different regulatory framework. We are now seeing those regulatory frameworks emerging. We've talked about Switzerland before. We've talked about the US most of Europe, Australia, we see these types of regulatory frameworks coming into play. That's one big change.
Andreas: How do you basically change your concept of safety, your definitions of safety? How do you look at this new technology and how do we evaluate it for safety is a fundamental question. And how do you craft regulations that allow this industry to grow? And then once you have that framework there you can expect this effect of investment, value proposition, adoption by the general population and then it's feeding on itself and you have the knowledge affects the technology.
Andreas: And other part which is I think extremely crucial is adoption by the general population. Right now it's not easy for me to think of me sitting in my living room at 10:30 PM at night and my neighbor getting an on demand delivery via drone of the [inaudible 00:19:53] package.Will this be like that in 10 years from now? Will it change with myself level of tolerance be completely different? Who will regulate that with communities? Self regulate I think we were hearing a couple of years ago that Berkeley had declared itself as a no-fly zone for drones. We have a lot of sensitivity around noise. We're operating in Switzerland, of course, an extremely sophisticated environment in that respect. And we take a lot of care on how we craft our routes to avoid a noise footprint. But this is like an example and I think as you introduce these technologies, technology has this amazing capability to remap our reality. You are creating a new map, a new balance of resources and perhaps power using that with technology.
Andreas: So you are disrupting a system that is in existence and you're putting a new rules set for a new system that we exist and that change is always tricky. I think of our work and the work that others are doing in aviation right now as we've been discussing mobility in general. As falling under this theme of the Fourth Industrial Revolution and then are some tectonic shifts that will be happening through technology in our societies of the next 10 to 12 to 20 years. That's will require those pieces regulatory and public adoption to also happen and those frameworks to be changing with capability building.
Ross Dawson: In order to tap the potential of connectivity and being able to bring people and things together. It requires that attitude then of accepting change and being able to look for making change happen in a way that works for everyone.
Andreas: Yes, that's right. One of the fundamental questions that we were asking when we were starting Matternet was that it was quite obvious to us that in an environment. For example like in Papau New Guniea when we were we worked with Doctors Without Borders the level of need was so high that there was this incentive to adopt change and promote change. That would promote the use of this technology. We were not sure that we would see the same type of willingness to adopt in places with lower level of like Europe or the US. It's great to see it now. The question is how much energy is there in the system? To allow us to really show this technology is giving providing their potential.
Ross Dawson: Do you think this is going to change the nature of cities, the fact that we are so connected.
Andreas: That's a good question. I think that the general trend is that for whatever reason or urbanization and will probably continue. We see an amazing urbanization for it now. And there's I think a lot of human energy that is driving that like there's this potential of relationships in the new ways that we're connected that is driving us to go into cities. I lived in London before coming here to Silicon Valley. I remember one day when central London, Oxford and Rita's street where car free. It completely changed the experience of the city. Suddenly you can hear birds chirping. He was a much less stressful environment. It was a much more beautiful environment to be in. I believe that the technologies are coming out will take some of that stress away. We'll make our cities way more livable compared to what they are today. And I think that's going to be a massive shift upward shift in quality of life. I'm very hopeful that these types of technologies will help make our cities and our mega cities way more attractive than there are today and by their population, growth and live should continued to be happening.
Ross Dawson: You had this vision of being able to connect people in emerging countries to things which they didn't have access to because there's a lack of infrastructure. Has Your vision grown bigger? Is there anything else in which you'd like to see happen in terms of being able to create that future which is enabled by this incredible transport and travel options?
Andreas: I think the vision probably remains the same. And the mission is that same mission of how do we enable these leapfrog. The story that I would love to be able to tell that to my children and my grandchildren is how the work that we've done here now since 2011 as helped with these new foundational piece in our civilization.
Andreas: First of all it's enabled these billion people that are disconnected from a quality health care as are disconnected for markets to come and participate. We equalize the playing field and I hope that's when we look back in 2018, 10 or 20 years from now it will seem insane, but they were these huge areas on our planet that were disconnected. And hopefully I believe that these technologies will have something to do with holding up a challenge.
Andreas: That's the other mission. Whenever you're working on a foundational piece of technology you can't predict where it's going to go. And the story of the technologies one where improvements amplify on themselves and you get into this kind of effect where things get a way better over time. When you think that's what has enabled our conversation today and you can just look at one core point as we saying let's say electricity. How amazing is the fact that you can ship a light bulb somewhere and they say at least a few days a centralized system of can make a life at work. And that is now a foundational component in our civilization. I think the same can happen with this type of technology when it comes to how do we move up or other planets and help make our planet way, way more efficient compared to what it is today.
Ross Dawson: Well, the story of Matternet and what you're doing and all of these possibilities are incredibly inspiring. You're just seeing amazing potential. Thank you so much for your time and your insights today. Andreas it's a great pleasure to speak with you.
Andreas: Thank you. It was really a pleasure to speak with you as well.
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