The technology industry has battled over where to live for years, now, and for good reason: network effects are critical, and while remote work does enable opportunity almost anywhere, higher concentrations of talent have always made for incredibly fertile ground to build. But there’s another important piece of the conversation worth discussing, which has nothing to do with geography. In public celebration of the place we live (or derision of the place we don’t), I think we’re mostly talking about identity. This is a separate subject, but no less vital, as identity is a precursor to shared identity, shared identity is how a culture forms, and culture shapes the world. Today, a portrait and brief, personal history of a reinvigorated identity in hardware, the place of its birth and home in Southern California, and a glimpse — I truly hope — of the future.

Scott Nolan is a former propulsion systems engineer for SpaceX, a partner at Founders Fund, and one of my oldest and dearest colleagues at the firm. He guests today for Pirate Wires with a dispatch from his home in Los Angeles, the glorious subject of his piece today.

-Solana

---

“Want to build rockets a mile from the beach?”

Thus, twenty years ago, I was introduced to El Segundo.

In town it’s sunny almost all year round, in the 60s or 70s, with just a bit of gray in May and June. That’s when the marine layer creeps in, and burns away a little west of Sepulveda. To the north, the area is bordered by LAX, less than ten minutes door to door. To the south, the huge Chevron refinery El Segundo is named after (“the second,” as in the second refinery Standard Oil built in California). Grand Avenue cuts through town from east to west, and at the end — down a big hill — is Dockweiler, a surf beach that used to be good before they removed a critical jetty and tried to make up for it with an undersized pile of sand bags. “Downtown” consists of a modest, well-policed, 1950s-looking strip of small shops and restaurants on Main Street, El Segundo’s north-south corridor. Last year, the town won the Little League World Series. Life is quiet here, and peaceful.

But this is also, in the words of Augustus Doricko, America’s hard-tech Florence.

Today, the lifeblood of Southern California’s tech scene is charged by an unapologetically optimistic pack of engineers, machinists, and entrepreneurs building at the frontier of atoms-based technology. This microcosm of the industry has quickly become the counterpoint, the alternative, the glitch in the Matrix of formalized, credentialed and institutionalized “tech,” and — for me — an oasis. The enthusiasm in El Segundo has reaffirmed my belief in the industry, and I’m grateful it exists. But it didn’t emerge from nothing, and, for people interested who don’t already live here, I thought it might be helpful to reflect on some of the area’s rich history, as well as my own long journey home.

In June of 2003, a few dozen people working at a company called SpaceX were headquartered at 1310 East Grand Avenue. The startup wanted to make civilization multiplanetary with reusable rockets, something almost every “serious” person in the industry considered a joke. But for me, this small team working to reduce launch costs was the only group in the country (world?) working on the most important problem in the universe. When they reached out for help, it wasn’t even a choice. I would build rockets.

With stakes so high as catalyzing multiplanetary society, and on a budget so tight, the company was looking for interns to help carry the load, and found me through an undergrad rocket development group I was running. We interns were cheap and energetic, an affordable way to amplify the work of brilliant, more experienced men and women, which was fine with us. We were working on the coolest thing in the world, and only needed enough money for rent and an occasional burrito. When I eventually joined full time, I even asked my boss for half the salary with twice the stock (it was a no, unfortunately). We weren’t there for a job, we were there on a mission, with a vivid sense of what was coming — what needed to come — five or ten years out. We all understood there was more work ahead of us than we had ever done before, more work than even felt possible to manage. But the older guys would share their wisdom with us. “How do you eat a dinosaur?” I used to hear on the shop floor. “One bite at a time.”

Back then, SpaceX was the only startup in town. Elon didn’t pick LA because it was a vibrant “tech” ecosystem like the one he relocated himself and his family from, but because of LA’s legacy. LA was, and remains, the aerospace and motorsports mecca, two industries that know how to build strong, light things at scale at the lowest possible cost. This wasn’t the “cool” place in tech, but in terms of the technology we all cared about, it’s where all the talent lived.

We worked long hours with our friends, under the radar, in a cluster of mostly unmarked buildings. There were no startup hangout spots, or fancy coworking spaces, and no exciting, venture-backed company next door where we could work if SpaceX died. Failure to launch meant either unemployment or a mediocre job at one of the stagnant aerospace giants, and after a brief internship at Boeing out in the Mojave desert I wasn’t sure which fate was worse.

Today, at first glance, it doesn’t look like much in town has changed. SpaceX’s original HQ is now occupied by a food distributor, and Main Street is a little more lively, although still the closest thing to a Norman Rockwell painting that exists in LA. The Chevron refinery, Rite Aid’s ice cream counter, and Rinaldi’s are all still there. But that isolated spirit I first felt twenty years ago has since spawned hundreds of new projects. Now, beneath the surface, the scene is fundamentally transformed.

When you’re working on hardware, you need two things: talent and space, ideally space with a good electrical connection and polished concrete floors. The city of LA covers 10x the area of SF, making square footage abundant, and now the talent, which was always there, is liberated from LA’s dichotomy of boring oligopolies and cottage industries in perfect competition. Yes, the taxes are bad, but that only matters when you’re looking to liquidate, not when you’re building, and while California-style regulation is certainly capable of killing things, towns like El Segundo have always seemed a little wiser than their neighbors, and supported all the locals building at the edge.

With all these details working in its favor, it’s possible that El Segundo’s hardware scene was always inevitable. But my sense is SpaceX demonstrating what was possible, amidst all that space and talent, was like a lightning strike in the dry, California foothills. And that fire has been burning now for years.

Today there’s Anduril, an hour south, and more recently Varda, Radiant Nuclear, Impulse Space, Hadrian, Freeform Future, Cover, Senra and HGen — just a handful of the local companies Founders Fund has invested in since SpaceX. The Boring Company and Panthalassa both started off in LA. Peeking out of corners all over town, a few minutes’ drive from point to point, robotic pizza trucks weave among electric drivetrains, automated casting foundries, small launch vehicles, rocket engines for carbon sequestration, cloud-seeding drones, and containerized nukes built in a glorified garage.

Then, there are the memes.

The ecosystem here in The ‘Gundo, or Gundo (“it’s cleaner”), is real. Those here are proud of what they’re building, both individually and as a kind of new tech culture. They’re looking to make an impact more than they want fame or fortune. The memes aren’t an attempt to will something into existence, or some expression of following the herd. They follow real excitement. But with the memes has come an e/acc of hardware hype, which begs for a bit of caution.

Even just in recent memory we’ve seen hype cycles fully play out, from social media and SaaS to AI and (a few times now) crypto. There was and remains exciting promise in all of these spaces, but too much hype means too many speculative investors and too much capital, which leads to more companies than can be sustained by the talent pool or customer base. In a dynamic like this, reality tends to fall short of expectations, pain follows, and important work can die. I don’t want this for Gundo, because, frankly, this is the only place this work is being done, and nowhere else for people building here to go. Fortunately, there is a silver lining. Hardware doesn’t work like social media, where the winner takes all and colocation becomes memetic. A hardware ecosystem’s geographic network effects are positive sum. In other words, if hype inspires new companies who draw talent and enhance local capabilities — in addition to drawing capital and generating great tweets — then it can still work in our favor.

In 2018, after a stretch of time up north with Founders Fund, I moved home to help represent our team in LA. By then, the hard tech SoCal ecosystem had already grown well beyond SpaceX. Now, I live in El Segundo, back where everything began for me, and I’m excited to be some small part of the most exciting thing I’ve seen in years — not just one company, or many, but a real and nascent movement.

I’m happy for everyone working on artificial intelligence in San Francisco, and crypto in San Juan, but I prefer the physical world. For me it’s always been the grit and grime of real objects, assembled by hand alongside my friends, and the product of a week or month or year’s work in front of us — in 7071-T6, Inconel 625, and stainless steel.

I sometimes wonder if this is what it used to feel like in Palo Alto: technologists tinkering, hacking, building because they want to solve a problem, or create something genuinely new, and they’re having fun. In any case, I’m home. This is the only place I’d ever build a hardware company, a type of company that’s always been a little more difficult. Not a place for status, or a salary bump, or to get rich quick. And as far as lines on a resume go, building a tank in a parking lot is probably not what Microsoft is looking for (to each their own). Gundo isn’t where you go to “be somebody,” Gundo is where you go to build a modular nuclear reactor in your basement. And that’s more than enough for me.

-Scott Nolan