The Navy Leadership Lesson That Built a $450M Company | Blue Water Autonomy, Rylan Hamilton

Why the best founders never lead from a desk

00:00Right out of college, I joined the Navy. So, I was on ships in the Pacific and the Atlantic Ocean. The Navy that I was in 20 years ago, we had the world's most powerful Navy. And there's really no pure competitor. But when I first was on a ship in the Navy, and I was in charge of a division, I actually wasn't a great leader.

00:16In the Navy, you don't get to choose the people that are working for you. The Navy basically says, "This is your team, and you've got to make the best out of them." And so what you learn over time is you have to learn what motivates people and you have to understand people and you have to care about people and if you don't understand people then you can't understand what motivates them and then you can't get your mission your job done and then everything kind of unravels from there.

00:38What I learned in the Navy about leadership is leading from the front. When I was a junior officer in the Navy there's this sort of concept of deck plate leadership is that you have to be on the deck plates with your sailors and with your team and trying to help them solve the issue that you're not someone who that they report to.

00:52You're someone who's part of a team that's helping them solve the problem at hand. And sometimes that meant spending hours in an engine room trying to troubleshoot through [music] an issue. Sometimes we would lose steering at sea. We'd lose power.

01:04We'd have flooding. We'd have fires. We had many different issues that we'd [music] have to work through. But when your team saw that you were the person, you're standing in there, you're waiting with them, you're being patient, and you understood the problems that they were facing, and you understood any barriers that you could help remove, you would then get their trust.

The $60M mission to automate the US Navy

01:28My name is Ryland Hamilton. I'm the CEO and co-founder of Blue Water Autonomy. Our first customer is the US Navy. We're designing and building autonomous ships. Our focus is on the US Navy and building future warships for the Navy. Right out of college, I joined the Navy.

01:42I was on ships in the Pacific and the Atlantic Ocean. We were up in the Northern Gulf and we were looking for mines. In fact, we'd have lookouts on the front of the ship 24/7 looking for any mines that could be floating. There are a lot of really risky missions in the Navy that could be done by autonomous systems.

01:57There's no reason that a ship with 400 sailors on it should be hunting for mines, including having people with binoculars on the front of that ship. And to date, we've actually launched what we call our autonomous test vessel, which is a 145 ton vessel just outside of Boston where we're already testing our technology.

02:12Google Ventures and our existing investors put $50 million into our company which really helps turbocharge what we're doing.

How 9/11 changed my career path forever

02:23That is the World Trade Center and we have unconfirmed reports this morning that a plane has crashed into one of the towers of the World Trade Center. When I was in college, 9/11 happened and it definitely was a moment that kind of I think shook everyone and said, "What do you really want to do with your life?"

02:38And at that point, the traditional jobs coming out of college were to go into consulting or into investment banking and professional service careers. But I wanted to do something different. And I'm not the type of person who's well suited to be behind a desk from 9 to 5.

02:49And I was like, "Oh, well, my family had been in the Navy. My father actually went to the Naval Academy and served on nuclear submarines in the '60s. I had two uncles who also served in the Navy. So, I wonder what a career in the Navy would be like."

03:01And I joined the Navy, which was one of the best decisions I've ever made. We were up in the Northern Gulf and we were looking for mines. In fact, we'd have lookouts on the front of the ship 24/7 looking for any mines that could be floating.

03:11One of the most memorable experiences I had in the Navy was probably the first time I actually was on a naval ship out sort of in the, you know, open ocean. And I joined an amphibious transport ship. It was actually in the Persian Gulf when I met it.

03:24But in order to get to that ship, I had to fly in a helicopter and actually go to sort of an aircraft carrier first. And while I was on that aircraft carrier waiting to get transported to my ship, Iran actually fired some test missiles. Now, the Navy at the time didn't know if those were test missiles until the whole ship went to general [music] quarters, but here I was knew the Navy and because I had actually been traveling in the Middle East, I was still in my civilian clothes.

03:45So, I was on a ship, the ship was going to general quarters, and I didn't even know where to go. And so, I was just running up and down staircases, and someone grabbed me and said, "You

Surviving Iranian missiles in civilian clothes

03:53look like you don't know what you're doing. Come in here and kind of wait." And so, that was like my first like hour on a naval ship. But, I think that lesson told me it's like, you know, be aware anything can happen at any moment. It's important to have a plan, but then it's also important to understand that plan will never actually materialize exactly as you expected.

04:10And one of the things is when you're in the Navy, you don't get to choose. You basically hire the people that are working for you. The Navy basically says this is your team and you've got to make the best out of them. When I first was on a ship in the Navy and I was in charge of a division, I actually wasn't a great leader.

04:25And so, what you learn over time is you have to learn what motivates people and you have to understand people and you have to care about people. And if you don't understand people, then you can't understand what motivates them and then you can't get your mission your job done.

04:38And then everything kind of unravels from there. And so when I first joined the Navy, I was like, let's do this job because everyone cares about the mission and America. But at the end of the day, actually what people cared about, especially when you're in port, is they're like, [music] "Hey sir, I just want to go home at 3 PM."

04:51So if our division can get all of our tasks done and we can go home at 3 PM, that's what matters to me because at home I have a wife, I have kids, I have a lot of other stuff going on. And so when we're back at port, like it really matters for me to have this kind of balance between my work and my life.

05:07And I realized that over time. And then I said, "All right, when he showed up to at work, let's focus on getting the mission done and let's get everyone home." And then when you got people home, they were like,

Why sailors just want to go home at 3 PM

05:17"Hey, I'm motivated now." And so it's really like when you're in the Navy about understanding people, what motivates them. And that's not something that was innately obvious to me when I first uh joined the Navy. What I learned in the Navy about leadership is leading from the front.

05:29When I was a junior officer in the Navy, there's this sort of concept of deck plate leadership is that you have to be on the deck plates with your sailors and with your team and trying to help them solve the issue. That you're not someone who that they report to.

05:41you're someone who's part of a team that's helping them solve the problem at hand. And sometimes that meant spending hours in an engine room trying to troubleshoot through an issue. Sometimes we would lose steering [music] at sea, we'd lose power, we'd have flooding, we'd have fires, we had many different issues that we'd have to work through.

05:57But when your team saw that you were the person, you're standing in there, you're waiting with them, you're being patient, and you understood [music] the problems that they were facing, and you understood any barriers that you could help remove, you would then get their trust.

Transitioning from mission obsession to customer obsession

06:13I had a great experience served for four years and then when I got out I went to graduate school and I transitioned into warehouse automation and I got lucky and I joined a company that was called KA systems. It was back in 2011 when there are a couple thousand robots in the field.

06:29And after a couple years, Amazon came in and actually bought KA systems [music] and made KA systems into what we now call Amazon robotics where there now over a million robots all throughout the world in Amazon warehouses. [music] You know, my experience in Amazon robotics where it wasn't deck plate leadership, it was more like concrete floor leadership in a warehouse where you're spending a lot of time with the team in warehouses all throughout the United States and the world.

06:51and you're with your team when you're trying to commission these different systems and you were there. You're traveling, you're spending the time in the warehouse, it really showed the team that you cared and the team would kind of respond well to that.

07:00So those are definitely things that I've learned over time. And the other piece is in the Navy, we definitely had sort of mission obsession where we knew what the mission was and we had obsessed and just complete it at all costs. When I transitioned to KA systems, it was all about customer obsession.

07:14My responsibility at KA in my job was to be a program manager, a sales

The concrete floor leadership of Amazon Robotics

07:18team who would basically spend months or years kind of working through a deal and they'd get a customer to sign a contract and the contract would say we are willing to pay this amount if you hit these different sort of objectives or different milestones.

07:29And so my job was to hit those milestones and one of them was to get the customer to accept the system. And so there was a ton of crossunctional work that had to happen but part of that was to really [music] just do whatever it would take to kind of get the deal done and to make the customer happy.

07:42Sometimes I would mean traveling to warehouses in remote parts of Nevada and actually trying to convince someone to go run a fiber line from the street into the warehouse [music] into the data room. And sometimes that would mean saying, "Hey, I'll pay you a hundred bucks right now in cash.

07:57I don't know if that will incent you, but you just do whatever it takes. Just [music] we just have this customer obsession and be like think outside the box about what it would take to actually get the job done." For me, startups have always been a passion project.

08:07It's probably not the best way to kind of like a balance [music] between your work and your personal life. I wouldn't recommend startups, but if you want to find something where you show up every day and it's the best job in the world and you love what you're doing, you love your customers, then there's nothing better than getting obsessed over a startup.

Why choosing pain was the best decision of my life

08:28I took that experience from being sort of in warehouse automation and actually started a company with some other people from Amazon Robotics, company called Six Rover Systems, and we made collaborative autonomous mobile robots. to basically self-driving vehicles in warehouses and we created a new form of automation and we sold that a couple years later to Amazon's competitor Shopify.

08:45When I left Six River Systems, I really take Jensen's advice at Nvidia to heart that he probably wouldn't go back and start another company because it is so hard. But I found myself [music] kind of itching to do something. I like taking a hard problem and solving it.

09:00And if it's an easy problem or an easy path, it's just not interesting to me. So I think throughout my career I've probably taken the hard path more often that have taken the easy path. Many [music] other people can take the easy path. But it's the hard problems that where if you solve them or if you solve them with a team the gratification that comes from solving hard problems is amazing.

09:18[music] I had a a period of time to just go explore. I was looking into a lot of different verticals. I knew someone who actually worked at Androl which is a really impressive defense tech startup. And I realized at the time that like you can actually start a company and then sell into the defense market.

09:31And that wasn't sort of a concept or framework

Facing the 230x China shipbuilding gap

09:34that I had 10 or 20 years ago when I was thinking about different sort of startup opportunities. But I started exploring and before I said I want to go start something, I said let me just go learn more about the space. And I really just try to get smart about the opportunity [music] set within sort of defense and within the Navy.

09:48And what was amazing is if I started the first idea that I came up with, I would not be here today. But I just had an open mind and just wanted to absorb as much information and get really smart about the opportunity. The Navy that I was in 20 years ago, we had the world's most powerful navy and there's really no pure competitor.

10:05But today, as we think across the world, China builds half of the world ships. China [music] possesses a ship building capacity over 230 times that [music] of the United States. When it comes to just building like raw tonnage that we can put in the Pacific, China is like definitely a competitor in that space.

10:24[music] So, we need to rethink the problem. I definitely spend a lot of time trying to understand is this market big enough? Is this market big enough that I can spend the next 10 plus years building a transformational company in this space?

10:36And so every week I would have 10 to 20 different conversations with people. I learned about some of the delays that we have in some of the large ship building programs. I learned about how big of a painoint it is and how [music] we're not going to overnight change our ship building capacity in the United States.

10:52And so we need to rethink the problem. We're not going to compete on ship building, but we can compete on tech. The United States is really strong on autonomy and technology. And so we can

Why retrofitting old ships is a technical trap

11:02take that strength and then apply it to our today's [music] Navy. We're not retrofitting existing in vessels to make them autonomous. We're literally redesigning a ship from the keel up. Part of that reason is my experience in the Navy was that today's naval ships and commercial ships have engineers that are on the ships that are standing watch every day and they're maintaining and repairing the vessels.

11:22[music] So to take that commercial design or that naval design and try to make it unmanned for months at a time just won't work. There too many single points of failures and we've got a lot of good feedback that you can't take a commercial design and do a retrofit for the missions that we're focused on.

11:40At any early stage startup, you need to be super focused on one customer with one product. But I don't think it's obvious to a lot of founders kind of when they're starting something. Sometimes they see a cool technology and they try to force fit it or try to create a market.

11:52When we're thinking about the opportunities on the commercial market for autonomous ships and then on the defense market, the commercial market is super interesting, but there's still some regulatory sort of hurdles and obstacles that need to be overcome.

12:03But when you looked at the defense side and we looked at some of the geopolitical threats that are happening in all the areas of the world, especially around the Pacific, we saw a critical need. We saw a customer with a willingness to pay and we didn't see [music] any of those sort of regulatory obstacles that you have on the commercial side.

12:18And we said, we believe in maritime autonomy. We want to accelerate it, but we're going to focus on the defense market. We've seen a [music] ton of support from the Navy. We've even seen Congress allocate over $2 billion to what we're building.

12:29And so the lesson learned was focus really matters at an early stage company. Now that doesn't always scale, but I think when you're an early stage company, you're not trying to figure out how to scale. You're trying to figure out how to solve a problem.

Build your team like a Navy

12:46The other part about being on ships and in the open ocean is it's a beautiful experience being out in the middle of the open ocean. You don't necessarily have control over everything. You just have a lot of respect for the ocean. If you're in a large storm or something like that, there's only so much you can do.

12:59What you can do is you can rely around the people that surround yourself that are on the ship and you're a team. When you show up to a job and it's 9 to5, you can go home at the end of the day. Well, when you're on a ship in the middle of the ocean, you don't go home at the end of the day, you're on the ship.

13:12And then they also remind you that it's a team effort and that it's not

Designing ships that solve their own problems

13:16about you being successful in your job on a ship. It's about the whole ship being successful. [music] And those are some of the thrilling moments about being at a startup. If you have teams that don't trust each other, then the interfaces between the teams aren't necessarily healthy.

13:28And what'll happen is that every team will have contingency that's there and then when you don't hit a date, they'll basically create a lot of conflict between the [music] different teams. But if the teams trust each other, then you can kind of remove a lot of that contingency [music] between the different teams.

13:41So what's super important to me is integrity. Especially at a startup, there are a lot of things that could go well. There are a lot of things that could go wrong. And one thing I learned in the Navy is that bad news does not get better over time.

13:53And I want [music] people to feel comfortable sharing good news and bad news, but it doesn't help to kind of like heard a little bit of bad news internally and not tell other people because it just doesn't help the startup. [music] And so transparency and being truthful

Why bad news never gets better with time

14:10is definitely helps a startup make the best decisions at the moment. So when you're a founder and you're thinking about a plan and never does your plan go perfectly. In fact, there are a lot of times when the outcomes aren't what you expected.

14:20And that's the beauty about being sort of a founder is basically you're trying to get the best out of everyone because at the end of the day, you'll have so many resources, [music] you have so many people, and your goal is to get the best out of your resources and your people and to produce the best outcome.

14:35It might not exactly be the plan, but just embrace that there going to be some downsides, but there are also a lot of upsides and things you moved a lot faster than you ever expected. So today we're in San Francisco and when I think about what I want Blue Water to be by describing it to like my family or friends and what the long-term vision is, I really want to be the Whimo for the open ocean.

14:52I think Whimo is this type of technology in this company where we're now coming to the fact that we accept getting into a car without people in it. We don't think about Whimo less

Becoming the Waymo of the open ocean

15:01as a vehicle company and more as a company creating these softwaredefined vehicles. And so when I think about what I want Blue Water to be is I want Blue Water to basically create every ship that's out there and for people to think about them as being software defined.

15:11A lot of the dole and jobs can be kind of replaced by software. So it can actually maybe become one of the best jobs that's out there where you're basically on a vessel doing different types of you know tasks, chores or missions and it's kind of a beautiful experience just like being in a Whimo car.