Moonshots with Peter Diamandis - Why We Gave Away $500M To Solve Humanity's Problems (XPRIZE AMA) | EP #119

Episode Date: September 12, 2024

In this episode, Peter answers questions about the story of XPRIZE, shares anecdotes, and the power of crowdsourcing to change the world.  Recorded on Aug 19th, 2024 Views are my own thoughts; not Financial, Medical, or Legal Advice. The XPRIZE Foundation is a non-profit organization that designs and hosts public competitions intended to encourage technological development. Through incentivized competition, the XPRIZE mission is to bring about "radical breakthroughs for the benefit of humanity." Learn more about XPRIZE here: https://www.xprize.org/home   ____________ I only endorse products and services I personally use. To see what they are, please support this podcast by checking out our sponsors:  Get started with Fountain Life and become the CEO of your health: https://fountainlife.com/peter/ AI-powered precision diagnosis you NEED for a healthy gut: https://www.viome.com/peter  Reverse the age of your skin with Oneskin; 30% here: http://oneskin.co/PETER    Get real-time feedback on how diet impacts your health with https://join.levelshealth.com/peter/ _____________ Get my new Longevity Practices 2024 book: https://bit.ly/48Hv1j6  I send weekly emails with the latest insights and trends on today’s and tomorrow’s exponential technologies. Stay ahead of the curve, and sign up now: Tech Blog _____________ Connect With Peter: Twitter Instagram Youtube Moonshots

There are a lot of problems on the planet that if you can incentivize entrepreneurs, engineers, scientists to say, how would you solve this? And give them permission to go and try and solve it, that we can get a real engine of innovation going. I didn't know who the sponsor was going to be, so I wrote down XPrize. Where does XPrize go next? What other grand challenges? And out of that came the idea of having a target to shoot for and something you wake up every morning and you're like battling

against the problems and solving it is amazing. This is what I dream about and this is what XPRIZE aspires to do. Hi everybody Peter Diamandis welcome back to Moonshots. In this episode I'm gonna be answering your questions about the XPRIZE Foundation. It's founding the darkest moments, the funniest moments, the challenges of running a global competition. If you don't know, the XPRIZE Foundation is one of the most notable foundations worldwide. launched 30 incentive competitions over 30 years, $600 million in prize money, driving billions of dollars of R&D. I hope this episode inspires you,

gets you to think bigger than ever before. Enjoy, let's jump in. I've always been passionate about space and growing up on the heels of the Apollo program and Star Trek, I was really just dissatisfied with the speed at which we were opening the space frontier. It was in late 1993 that a dear friend, Greg Marinak gave me a copy of a book called The Spirit of St. Louis. It was Lindbergh's story. And as I'm reading the pages of this book,

I'm learning that in fact, Lindbergh in 1927 flew from New York to Le Brej, not on a whim, but to win a $25,000 prize. And this prize offered by this Frenchman Raymond Ortague sparked nine different teams who spent $400,000 to win the $25,000. And as I'm reading,'m like this is incredible you know Ortega didn't pay any of the losers he only paid the winner after Lindbergh had done it and I said that's an incredible business model and that's when it hit me what if I created a prize for private spaceflight and I didn't know who the

sponsor was gonna be so I wrote down X prize Right X was going to be the Nobel the Pulitzer the or tag It just took us so long to find the unsari family that the X stuck around and it became the unsari X prize And that was you know for me a ten million dollar prize was enough money to inspire entrepreneurs to go after this and and Ten you know, million Roman and world 10 X X experimental, it just really worked. You know, we announced the X prize on the stage on May 18th, 1996. We had media from around the world there to, you know, to carry the stories.

Front page news was extraordinary. And I was absolutely sure that someone would fund the $10 million. After all, you didn't have to pay until after it was done. It was like throwing yourself a touchdown pass. But after we announced this competition, and I'm going around and meeting CEO and billionaire and large corporations around the planet, they kept on saying no. And it was like the answers broke down into can anyone really pull this off?

Why isn't NASA doing this? And the one that really cut off the conversation was someone's going to die trying to win this. And that just decimated me. So literally from 1996 through 2001, until I met the Ansari family, it was 150 nos every time. And what kept me going throughout that was a fundamental belief that this was possible

and that if we could transition human spaceflight from government only to commercial this is how we're going to open up the space frontier we're going to open up space for humanity because it had been 50 years and things had been so slowly progressing and meeting the teams right we ended up with 26 teams from seven countries around the world that were trying a whole slew of different approaches, you know, vertical takeoff, horizontal takeoff, behind an airplane, towed underneath an airplane, above an airplane,

a balloon first stage, a helicopter first stage. It was sort of Darwinian evolution of space flight. And all of that creative energy, the commitment these teams had was so inspiring and I was just fundamentally sure that it was something that was possible and it was a great idea to do this through a prize mechanism because prizes opened up aviation a hundred years earlier and I just refused to give up. I remember on October 4th of 2004 when Brian Binney had you know crusted way over a hundred kilometers altitude Came back and landed. It was like it's done. The prize has been won against all the naysayers

It had been won and I was like This is an incredible moment. But Question that was what's next? And the realization was that these ideas of large scale global incentive competitions where you challenge people around the world to come and demonstrate technology, to build something and show it to you

and you pay them on success was a mechanism that could be used to You know solve other problems and so at that moment in time there were two Futures that were important to us number one How do we commercialize private spaceflight because having this become a museum event? You know a trophy event where someone does it wins the money But it doesn't become an industry, that was of zero interest. And so when Richard Branson came in and bought the rights for Spaceship One to create Spaceship

Two and Virgin Galactic, that was critical. And then, you know, Elon Musk had joined our community as a benefactor early on and then ended up joining our XPRIZE board of trustees, along with folks like Larry Page. And it was like, okay, we're gonna get this commercial space light industry. I have to say, it's taken a heck of a lot longer than I expected it to, but it's there, right?

Especially with what SpaceX is doing, and now Blue Origin is doing, and of course, Virgin Galactic. The second avenue that was really important is how do we use this incentive prize mechanism to go and solve other problems? And I remember we had a board meeting and because Larry Page was on our board it was hosted at Google headquarters and Larry was there and Richard Branson was there, and Richard Branson was there.

I think maybe Elon was there. And we started a brainstorm session of where does XPRIZE go next? What other grand challenges? And out of that came electric cars as an objective, a Google Lunar XPRIZE as an objective, and a whole slew of grand challenges. That became our first global visioneering event. Very small, it was a dozen board members there, but it was a realization that there are a

lot of problems on the planet that if you could incentivize entrepreneurs, engineers, scientists to say, how would you solve this and give them permission to go and try and solve it that we can get a real engine of innovation going. Real quick, I've been getting the most unusual compliments lately on my skin. Truth is I use a lotion every morning and every night religiously called One Skin. It was developed by four PhD women who determined a 10 amino acid sequence that is a synolytic that kills senile cells in your skin. This literally reverses the age of your skin and I think it's one of the most incredible

products I use it all the time. If you're interested, check out the show notes. I've asked my team to link to it below. All right, let's get back to the episode. When I think about the impact XPRIZ prizes have, it really is on multiple levels. The first level is when we announce an X prize competition globally around the world, it changes the conversation from can it be done to when is it going to happen? And I see that over and over again. The second part, which is meaningful to me as an entrepreneur, is when we announce this finish line, this objective,

this goal and say, I don't care who you are, where you went to school, whatever we've done before, if you solve this problem, you win. And then we have out of the woodwork, you know, hundreds, in some case thousands of teams coming forward, that really blows my mind. So it was probably around 2002, 2003 that we announced our wildfire XPRIZE. Now I live in Santa Monica in Los Angeles and we have had all of these wildfires going on and you get these alerts, you got to evacuate your home, the wildfires, you know, these many kilometers away. And year after year, as wildfires are getting worse, this is continuing.

And I'm like, there's got to be a better way to do this. And I was able to get one of our benefactors, Dr. Richard Merkin, to fund the design of that prize. And we launched a wildfire detection and extinction prize, $11 million for the first team that could monitor a thousand square kilometers and detect a fire at ignition when it's small right you want to fight you want to fight a fire when it's very small it's like you want to fight a cancer when it's really small and you

have to detect the fire at or near ignition and put it out autonomously within ten minutes and if you can do that you it's incredible. So we get this prize funded and we announce it. And then I got a chance to meet Palmer Lucky, who is the inventor of Oculus and he built a company which is incredible called Anderil. And he became one of the first teams to register for this competition. And I went to go visit his facilities and I can't say much about what I saw, but he showed me the technology that he was going to enter to win this competition on wildfires. And I was like, mind blowing. It was like, oh my God, that is extraordinary. Something that was

completely unlike anything anybody else had discussed. And so for me, that moment in time where you are getting this creative genius to solve a problem within the constraints of that competition. And then we had him on stage at the announcement and he said, yes, I believe that when this prize gets won, we're going to see the end of unwanted wildfires. And that one-two punch of seeing his tech and seeing his proclamation with such authority and assertiveness for me was an amazing ex-prize moment.

When I think about entrepreneurs, I think of them as individuals who find a juicy problem and solve a problem. I mean ultimately that's what entrepreneurship is and I think what XPRIZE does incredibly well is it gives entrepreneurs a Target a goal to shoot for right without a target. You'll miss it every time our mission is to boil down and distill really big and meaningful targets people to shoot at. And I have every belief and experience that entrepreneurs can, in fact, solve those problems and do it much more efficiently and innovatively

than large corporations and governments. There's a saying that Burt Rutan had shared with me years ago, which I love, and I've adopted as well, which is the day before something is truly a breakthrough, it's a crazy idea. If you think about it, it's very true, right? If it wasn't a crazy idea yesterday, it wouldn't be a breakthrough today. It would be, you know, a computer is 10% faster, it's not a breakthrough, it's an expected incremental improvement. So if breakthroughs really require crazy ideas to be generated and pursued, the question then becomes is where inside of large governments are crazy ideas gone after? Where inside of large corporations are crazy ideas gone after? Now there are some elements of the government like DARPA. There are some companies like Tesla or SpaceX that are going after crazy ideas because they're experimentalist founder led companies.

But for the majority, it isn't the case. And so what I love around XPRIZE is inspiring entrepreneurs to go after those crazy ideas. And we see time and time again, breakthroughs coming from unexpected locations, right? We don't see breakthroughs typically coming from the existing players. They're mostly incremental. They're fearful of looking foolish in the public eye or you know an investigation or shareholder lawsuits But it's the entrepreneurs very little to lose that's willing to go after this

So, you know as I see in our hundred million dollar, you know Musk funded carbon Removal X prize I see thousands of teams coming in and building that in our health span prize, really to reverse the ravages of aging by 10 to 20 years. 400 plus teams coming in for me and seeing all the different approaches, right? There's no one approach. There's hundreds of approaches to solving that problem. That gets me excited and that gives me confidence that this engine of innovation is solid and is working.

None of the stuff that we do is going to happen without the benefactors who underwrite the foundation and underwrite these prizes. I remember when I launched the original XPRIZE in 1996, it took us five years to find Anusha Ansari, who's now our CEO, to underwrite what is the $10 million Ansari X-Prize. And then as soon as it was funded, things moved very quickly. The money for these prizes isn't the only reason that teams do this, but the money credentials the prize. They say this is a real problem. Right. So another example is the wildfire X prize. I had worked with the team to come up with this idea of a wildfire X prize and set the rules. And literally it was, you know, year after year, year after year, fires are getting worse, but we were unable to get the capital. It took five years to get the money, but once the money, the 11 million dollars in prize money and the operations for that prize were there, we had hundreds

of teams enter and now we're in the early stages of the competitions and people are building technology. Again, the money credentials and you can imagine the entrepreneurs out there saying, listen, if it really is important, why aren't people funding this work? And so putting the prize money up there and creating a large public excitement about this prize money up there and creating a large public excitement about this is key. And so, you know, for me to the benefactors who have underwritten now almost $600 million in incentive prizes that XPrize has launched, which has driven, you know, 30X in different variables of return, right? We've demonstrated like over $6 billion of

research and development going into the areas driven by these prizes. Think about this if you're a philanthropist, it is the most efficient, highest leverage philanthropy you'll ever get. Most philanthropists, when you donate to a foundation you're hopeful if 10 or 20 cents of your dollar actually goes to building the product or solving the problem or delivering the service that you want right there's overhead and coordination I completely get that but that's you know 10 or 20 percent for x-prize we're not happy unless for every dollar you put in, you're getting $30 of value in the market. It is highly leveraged philanthropy.

And then again, because you're paying the majority of the capital after the prize is won, it's the most efficient philanthropy ever. Everybody, I want to take a short break from our episode to talk about a company that's very important to me and could actually save your life or the life of someone that you love. Company is called Fountain Life and it's a company I started years ago with Tony Robbins and a group of very talented physicians. Most of us don't actually know what's going on inside our body. We're all optimists.

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It's one of the most important things I can offer to you as one of my listeners. All right, let's go back to our episode. If you're an entrepreneur, an engineer, a marketer, whatever area, but you want to compete in an X-Prize, I believe it's the greatest journey you'll ever take on. You have one criterion for getting involved. Is this your purpose in life? Does this prize resonate with what I call your massive transformative purpose? Because it's going to be an incredible journey of, of challenges and failures and successes. And it's,

you need to have that emotional energy that keeps you going, that keeps you in love with solving this problem. And if you have that, this will be one of the greatest joys of your life. I'll never forget, for the original prize, the Ansari X-Prize, opening up space was my heart of hearts. And I remember a friend of mine said, Peter, you'll never know the joy of competing for an XPRIZE. And you're right, I was not allowed to compete as as founder and chairman of the organization, but the idea of having you know a target to shoot for and something you wake up every morning and you're like battling against the problems and solving it is amazing. So I think I would say go for it.

Having, you know, we humans do our very best work when we're competing. We do our best work when we are, you know, going for the Olympics or in a business. And what Xprizes do is they give you a clear target to shoot for and they pull the best out of you and your team. Also, say on the other side, one of the things that we do is we create an incredible community. And we have these team meetings every year

where all the teams competing for prizes of a particular prize come together. A lot of times we see prizes, teams merge, we see teams share technology because it's in their heart, it's their their heart. It's their most important purpose in life. If they can't win, the next best thing is that someone does win this competition.

Wow. So, as I think back 30 years ago, I remember where I was reading Lindbergh's Spirit of St. Louis book and underlining in the book how much money these nine teams were spending to win this $25,000 prize and I added it up at the end, it's like $400,000 and I'm like that's incredible leverage. You know I'm an entrepreneur and getting you know 16x leverage amazing You know, I'm an entrepreneur and getting, you know, 16x leverage, amazing. And I said, I'm going to create a prize for space flight. And I wrote in the margin, X prize. And, and it just, it came to me, okay, 100 kilometers altitude. Actually,

I started 100 miles altitude, backed it off to 100 kilometers, because that was going to be achievable with with composites and knowing full well most Americans are the difference between 100 kilometers and 100 miles anyway and I remember calling two people Greg Marinak who'd give me the book another guy Jim Burke who was at JPL and they both told me it's a crazy idea to do a prize and maybe it'll work. You really want to do this. And they're a little bit of doubt got me more inspired than ever. And, uh, no, I did not believe that this would be a 30 year journey. And it was, you know, believe me, along the initial years between

2000, between 1994 and 2004, that decade, the X prize died, you know, hundreds of deaths. When, when the Columbia shuttle, you know, broke up on reentry, people like forget about this. It's not going to happen. When I had my 150 nos that no, I'm not going to fund your prize. So it was only, you know, this deep seated emotional belief and the work that I was doing with folks like Greg Marinac and Eric Lindbergh and Bob Weiss and eventually Unsari family. And then, and then seeing the work that these 26 teams from seven countries,

that they were mortgaging their homes, they were building all kinds of different approaches. And it was like, that energy, it worth the birth of something extraordinary, with the birth of the commercial space flight revolution. And I just refused to give up and it succeeded. And even in success, I didn't know that 10 years later, I didn't know that this would be going on for 30 years. I remember the very first board meeting after the fries was won, Larry Page had just joined the board

and the conversation we had was, okay, we succeeded, we did it. Do we shut down the foundation and call, you know, success, you know, because very few organizations, you know, close themselves down after they succeed their goal. Or do we leverage this and create an organization that is inspiring entrepreneurs to go bigger and bolder. And we now have three hundred million dollar plus X prizes and we're 30 years in with 30 prizes and I know it's mind-blowing for me and and I'm so proud of the team and this engine we've created. 30 years and 30 prizes in you you know, I can start to think about where we go over the next 30 years. If I think about the legacy of XPRIZE, I want us to be

going big and bold. I want us to be like the Nobel Prize, something that kids in high school or kids in college or graduate school, you know, go to our website and look at the prizes and say, okay, what matters in the world? And what should I focus on? Where should I go start a business? What degree program should I go and study? You know, my objective is that we're inspiring people to go bigger, to go bolder, to go and do things that matter. In the words of, you know, of Steve Jobs, to make a dent in the universe. So I hope and intend that XPRIZE will have the global brand of a Nobel Prize and will be something that inspires people to dream as big as possible. You know, we're about to enter this incredible period of exponential growth where, you know, not just AGI, but digital super intelligence and

nanotechnology and humanoid robotics are coming on and are going to allow us to have most of our needs in life met. So what's going to give us purpose? I think that having the ability to dream and up level our ambitions in life, to up level what we think is possible in the world, in the universe is so important and I think XPRIZE is going to play a pivotal role in helping humanity see you know beyond the horizon of this is possible for us. And in fact, this is where we need to go. Imagine a future where XPRIZE has driven solutions to the global climate crisis. Imagine a future where XPRIZE has given birth to the technology to reverse the ravages of aging by 20 years. Imagine a future where X-Prize has reinvented how we educate the world.

This is what I dream about and this is what X-Prize aspires to do. Did you see the movie Oppenheimer? If you did, did you know that besides building the atomic bomb at Los Alamos National Labs, that they spent billions on bio-defense weapons, the ability to accurately detect viruses and microbes by reading their RNA? Well, a company called Viome exclusively licensed the technology from Los Alamos Labs to build a platform

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If you want to join me on this journey, go to Viome.com slash Peter. I've asked Naveen Jain, a friend of mine who's the founder and CEO of Viome, to give my listeners a special discount. You'll find it at Viome.com slash Peter. The year is 1995. I am frantically raising money to try and make this X-Prize thing real and I have learned that there's one guy in St. Louis, a guy named Al Kurth I have to meet, that he is the person who could help fund this prize and Really make it real so I am flying from LA on my friend's private airplane He gave me a lift and we stopped in Colorado to refuel and I have a meeting in st

Louis with Al Kirt the next morning And it's like this guy's been built up and he truly was my guardian angel as it turns out later on It's the reason we ended up getting our first few million dollars in st. Louis but we're refueling had a private airport and it's like 10 o'clock at night and the guy puts the wrong fuel in the airplane and I'm like I'm stuck in Montrose, Colorado And my meeting is at 10 a.m. The next morning and I'm like just pulling my hair out It's like this is the meeting I've been told no so many times. This is the meeting and

so I Literally find out that if I take a taxi from Montrose to Denver there's a 6 a.m. Flight that will get me there at 930 and So I end up driving through the night, getting in, getting on that flight, getting to that meeting like without a shower, exhausted. And I'm pitching my heart out to Al Kurth at the St. Louis Science Center. And in the middle of the pitch, Al stands up and he goes, I get it, I get it. this is amazing. Yes, we're going to get this thing funded here in St. Louis. And he said, come have a scotch with me tonight at the racket club,

which I did. And he laid out a plan for getting 100 St. Lucens each to kick in $25,000, our first 2.5 million. And that led to us announcing the X-Prize under the Arch in St. Louis and the rest of course is history. But that was a harrowing few hours getting there to that meeting. The year is 2010, the BP oil spill is going on in the Gulf of Mexico and I get this text message from Jim Cameron, the producer, who was on our board of trustees at the X-Prize. He goes, Peter, we've got to do an emergency X-PriE. We've got to do something to solve this. This is decimating the oceans. We've got to fix it.

And I remember putting out a message to our community. And Eric Schmidt, who is one of our benefactors, writes back and says, our family foundation will do it, Wendy Schmidt will fund it, and so we've got this Wendy Schmidt oil cleanup X-Prize. And just the speed at which this occurred was amazing. But then we have teams around the world, I remember we were like 340 teams around the world are building these technologies. And we had to narrow down to 10.

And these 10 were then going to be put into a shipping container and shipped to a facility in New Jersey where the world's largest oil spill cleanup testing zone existed. And it was never something that these small companies could get access to. And so as I'm meeting the teams who are competing for this prize, I'm like blown away by who they are. So one of those 10 finalists is a fisherman from Alaska who mortgages his home and employs his family and his friends

to build this oil spill cleanup facility. Of course, he had been impacted by the Exxon Valdez oil spill. Another one, which came in second, was a team out of Las Vegas. And their story just shocked me. So it's like, who are you and what background do you have in oil spill cleanup? And the guys have no background. And these two guys, one of them was a tattoo artist, and the young one was his customer. And his customer and the tattoo artist are meeting while he's getting his tattoo on he says, Have you heard about this oil spill

cleanup competition? He goes, I have an idea how to do it and so they enter this conversation and they end up literally building a scale model in that tattoo artist jacuzzi and testing it out and then building a full scale model and shipping it to New Jersey. And I'm like, hold it. It's like, you know, no background in this. You're a tattoo artist and a guy who thought he had a good idea. Again, just, you know, like I say, the day before something is truly a breakthrough, it's a crazy idea.

Just the diversity of teams is amazing. One of the funniest XPRIZE stories took place in our ocean floor mapping competition. So this is a competition that's funded by Shell and by NOAA and teams had to build autonomous autonomous technology to go down 4,000 meters and map the ocean floor as rapidly as possible. We know more about the surface of the moon and Mars than we do our ocean floor. The physics of sea light make it very difficult to image anything down there. We had a large number of teams, we were holding this competition off the main coastline of Greece because it was at the perfect depth. And one of the teams entering this competition was doing with a fleet of autonomous robotic submersibles. So they'd have like a dozen of these submersibles and they would, they would submersed, they'd

go down, they'd map, they'd come up, they'd send their data burst up via satellite, they'd go down, they'd do more. And so one day we get a call that one of their submersibles is missing, followed by a call from a Greek fisherman who has kidnapped the submersible and is holding it ransom. I mean, you can't make this stuff up. And they wanted some ridiculous amount of money, right? And like a million dollars and they ended up agreeing on like $10,000. And so there is this exchange at the open sea for the submersible and $10,000 in currency back then. Haven't had that happen again, but yeah, that was a funny one.