The following interview is a conversation we had with Mars Geuze, CHO and Co-Founder of Hyperloops, on our podcast Category Visionaries. You can view the full episode here: Over €36 Million Raised to Make Hyerloops a Reality
Mars Geuze
Thanks for having me. Happy to join.
Brett
Not a problem. So, to kick things off, could we just maybe start with a quick summary of who you are and a bit more about your background?
Mars Geuze
Yeah, sure. Her. So, my name is Morris Herz. I am one of the founders of Heart Hyperloop. And before this, I basically, about eleven years ago, met four other students with whom we was building race cars, electric race cars, for a formula student competition. And that got out of hand a little bit. Did that for two years. Then we found out about this Hyperloop competition and thought that might be also be fun to join. Launched by Elon Musk. And from there, were pretty successful and grew into building a Hyperloop company. So it was really a process going from doing cool stuff during our studies, because we didn’t only want to study, but also wanted to build things into building out Hyperloops.
Brett
And can you tell us more about the history of Hyperloops? So, if I remember right, Elon Musk, at some point, like seven or eight years ago, kind of proposed the idea and put it out into the world. But he’s not building anything with Hyperloops, and others are building it. Do I have that right? Or what is the history of Hyperloops exactly?
Mars Geuze
It’s pretty much ten years ago, 2013, when Elon Musk wrote this paper, the alpha paper about Hyperloop, and that described a system where vehicles travel through tubes with a low pressure, and that would be a better solution for transport than high speed rail. And that was the main reason why he published that, because of the high speed wheel being developed between Los Angeles and San Francisco. It kept a little bit low from then. But in 2015, he launched a competition for people around the world to join and make a hyperloop vehicle. And that was also the competition that we joined. Now, since that moment, actually, the concept has changed quite a bit.
Mars Geuze
It started out technically with air bearings and compressors and so on, and now it looks completely different, but it’s still the same basic context of low pressure tubes and vehicles traveling through it.
Brett
And what’s your kind of unique differentiation in this market? If you want to maybe just talk a little bit about the company’s approach, I think that would be a great area to dive into.
Mars Geuze
And so we really were launched by winning that first Hyperloop competition. And the reason we initially won it was already because were a little bit stubborn in that we had different ideas than the original competition had. And so we already made a concept that didn’t really fit within the original competition, where we said, this is how we think a hype loop should be done. And that’s a concept that we’re still building on. And that really changes the concept from making it just possible to go from, say, one origin to one destination at a very high speed to turning it more into almost like a physical Internet, where you can go from any origin to any destination without having to stop in between and really changing the way in which you travel between cities and metropolitan areas.
Mars Geuze
And we, from day one, really said Hyperloop needs to be a network. It needs to be an open system. The infrastructure needs to be standardized, and we need to work together with other parties to define that standard and then make the pie as big as possible, and then find our position in that market, but not try to make it proprietary too early. And I think that was really what has helped us position us in this market, because governments are really looking for parties that open up a new ecosystem, a new industry, rather than launching a new monopolist.
Brett
And just to unpack that, then, so is the idea that the actual tubes that the Hyperloops are in, those would not be owned by an individual company, those would be owned by this network of different companies. And then those different companies have their different Hyperloops inside of those tubes. Do I have that right?
Mars Geuze
Exactly. I think it’s quite similar to how the current real network is also owned. Right. You’ve got different governments with real authorities or real administrators, and they own the real network. And then on that, you have different operators that operate the vehicles within the network, and you will have a hyperloop similar to that. Sometimes you may have privately owned infrastructures a little bit like toll roads. Most often you’ll probably have government authorities that own these Hyperloop networks. And then within it, you’ll have hyperloop operators that could run a little bit like rail, or with concessions on specific routes. But it could also be run with more services like aviation, where you have slots that you allocate, and parties that run vehicles through this network on routes that are maybe a little bit more flexible.
Brett
Do the established rail industry players hate you then? Do they hate this idea? Do they hate the hyperloop? In theory, is this going to put them out of business?
Mars Geuze
No, not at all, actually. And this is why such a positioning is also so strong, because we’re not really putting anyone out of business. We’re really also creating a new opportunity for these other parties. So for real authorities, one of their biggest challenges is capacity. A lot of the rail networks around the world are near or at capacity, and it’s very difficult to expand capacity for real because rail takes quite a lot of space. It’s noisy, it has a lot of vibrations. So a lot of people don’t really like to have real additional rail around their urban areas. But Hyperloop is a little bit easier to implement. There’s noise, no vibrations. It’s those tubes. You can relatively easily build it, for example, underground, or build something around it, have it grow over with pads and so on, so it’s less disruptive.
Mars Geuze
So real authorities like this as a new solution to expand their capacity and then have it operated in a similar way that they already do it. Real operators can then transfer some of their intercity trains towards the Hyperloop so that they can make a more attractive service to their clients. Right, running sprinter services, going to a Hyperloop station, and then running a much higher street service than they can currently do with their rail services. But also, for example, for airlines, they currently make a loss to use feeders to bring people to their hubs to do the long haul flight with a hyperloop. They could run that with much lower operational costs and still operate that longer haul without needing additional airport capacity, which is also one of the big issues.
Mars Geuze
So it actually solves some of the big issues that some of these traditional operators have.
Brett
Is there a country that’s really leading the charge right now on Hyperloop? Are there any countries that have this functional. It’s being used in the daily lives of people, or is it more in the r and D and kind of like the development phase for most countries?
Mars Geuze
Yeah, it is still in the development phase. There’s not really one place in the world where you could already sit in the hype loop and just take a trip with it. There’s a few parties to highlight. In the Netherlands, you’ve got the ministries of infrastructure and economic affairs, who have really launched a public private partnership with 25 private parties to really codevelop Hyperloop. So it’s not just something that is in the private realm, but also the public sector that’s really thinking along about what should Hyperloop do, and making sure that what is developed by the private sector really fits with what the public sector needs. And they’re also co-financing that put around seven and a half million euros into the development and also into the test facilities.
Mars Geuze
But also around the world, you see some places, like in Spain, india and South Korea, where the government is really preparing to also substantially invest into the next step in the development program, building a next generation test facility. But if you look right now, where the biggest next step is being taken, that will be in the Netherlands. Right now, they’re building the four to 20 meters test facility, which will be open, so any Hyperloop company in the world can come and test there. It’s called the European Hyperloop center. And that will really be supportive in setting that standard, that open standard for Hyperloop.
Brett
I saw on your website, or I watched this beautifully produced video that lets you experience the hyperloop, and it was going from Amsterdam to Berlin in 55 minutes. Just for context there, for those of us in the United States listening in, how far would that take you, or how long would that take you if you’re on a normal train?
Mars Geuze
Well, it takes now around six and a half hours to go from, say, Amsterdam or Rotterdam to Berlin with the train. And just to give also some additional context, there’s been quite a few studies that with about four and a half billion euros or dollars, you could reduce that time from six and a half to about five and a half hours. But the interesting thing is that with that same amount of money, you could basically connect the Netherlands and the western part of Germany within about half an hour. And then if you take that part with the Hyperloop and the rest with the train, you’ve got a much shorter total travel time. And this is also a point that I really like to make, is Hyperloop is not really a new investment.
Mars Geuze
Almost always the budgets for expanding real capacity or airport capacity, and so are already there. But it’s more about shifting some of those budgets to a much more sustainable mode, rather than needing new investments into it.
Brett
That’s so fascinating, too, because if you just look at that time savings for people, that’s just staggering, right? If you imagine all of those people who are on a train, if you can go from over 5 hours or over 6 hours to 1 hour, that’s a lot of time returned. And the people who save that time are then able to go and have fun with it. They can work more, whatever they want to do with it, but that’s a lot of time savings that’s coming back to them. So we’d have to imagine that’s very meaningful. If you add up all of that time savings across all of travel just in Europe, it’s just an insane number, right?
Mars Geuze
It’s an insane number. And it’s also very difficult to imagine what it would mean for people’s lives. It would mean that you become much less fixed to where you have to work if you want to land that dream job, right? Or if you want to move somewhere else but are stuck to a certain location for work or family or whatever reason, those barriers wouldn’t even be there anymore. So I think what you will see is that also with more hybrid work, that people may live much further away from where they work, but that once in a while, they’ll just take the hype loop and be together with their coworkers and make it much easier to run also international companies that way.
Brett
Have you read the book the future is faster than you think by Peter Diamandis?
Mars Geuze
No, sorry, I haven’t read that.
Brett
Oh, you have to read it. I’ll drop you a link after the interview. But in this, he talks about, obviously the future and where things are headed. And to add on to what you were just saying there, how he described it, and this is maybe just a random tangent, but he was saying, we’re going to have to reimagine how we evaluate real estate, because right now, real estate is based on your proximity to the job or to the office, to your school, those types of things. But when technologies like Hyperloop become adopted, then all of a sudden all of those rules change. You could live three or 4 hours away from this main city, but still commute there every day, and that would be a reasonable commute.
Brett
So he paints this picture where we’re going to face a very uncertain future, and kind of all of the rules that we have exist today are going to be essentially rewritten. Was my take from the book.
Mars Geuze
Yeah, I’ll definitely check it out.
Brett
Super fascinating. This show is brought to you by Front Lines Media, a podcast production studio that helps B2B founders launch, manage, and grow their own podcast. Now, if you’re a Founder, you may be thinking, I don’t have time to host a podcast. I’ve got a company to build. Well, that’s exactly what we built our service to do. You show up and host, and we handle literally everything else. To set up a call to discuss launching your own podcast, visit frontlines.io podcast. Now back today’s episode. Do you have a functional hyperloop, then, that you’ve written in yourself, or what stage of development are you in right now?
Mars Geuze
So what we have built up to now is we’ve done an integrated test. So we have a short test facility about 30 meters, where we have demonstrated the levitation, the guidance, the propulsion, the lane switch without any moving components in the track, all in a low pressure environment. So we really demonstrated all of the core functionalities. And what we’ve done to derisk the high speed is built all of these subsystem tests that simulate movement at a very high speed so that we can test, for example, that we can filter out all the vibrations with our magnetic levitation system, that when you’re traveling at, say, 700, that you don’t feel any vibrations as a passenger. So we’ve done all those subsystem tests and an integration test. That’s why now the next step is to build it on a longer scale.
Mars Geuze
400 meters include a proper lane switch so where the tubes really split up into two, so that we can demonstrate that a vehicle can select which tube to follow. And that’s a really crucial part, because if we can prove that, then that means that vehicles can follow each other very quickly behind each other. And then one can go right, one can go left, very much like a highway, where vehicles just diverge and merge into a main tube. And that makes it possible that you connect a lot of cities along a hyperloop route without having to stop at every station in between. So that’s really going to be a big milestone that we’re going to have early 2024.
Brett
And how far out are you, would you say, from having your first fully functional passengers can use it just like they could a traditional rail system or bus?
Mars Geuze
Yeah. So, realistically, it just takes a long time to develop fully a hyperloop system. It’s similar to developing an entire new airplane or a new real coach. It just takes time. By the halfway next year, we’re going to have all these tests done where we can demonstrate a fully integrated system without passengers, yet we’re going to take all those learnings that we have, but also that the other companies that are working in this space have to converge towards a single new specification for full scale passenger use, sort of around the end of 2026 where we can demonstrate moving a passenger as well.
Mars Geuze
But we won’t do that yet at the low pressure, and that will take the next few years to really certify it, so that before the end of this decade, so 2029, we can have a real first operational pilot route that will just be a few kilometers. So we’re going to start with something that just demonstrates you can build it, that people can safely get in, safely get out, but that really be the point from when it starts scaling up. So from 2030 onwards, I think you can really start seeing more longer routes being built. And from 2035, that you’ve got the first routes of tens of kilometers scaling up to hundreds of kilometers.
Brett
So you’re talking in very long time frames. And a lot of the founders I speak to, they are a little bit impatient sometimes, and that seems to be one of those traits that’s like, I think, good and bad that all entrepreneurs seem to have. How are you okay with these long time frames like this? You’re really dedicating your life to this, right? You started off when you were very young. You’re talking 2035. That’s a long time difference. There’s a lot of time that’s going to pass there. So it sounds like you’ve really dedicated a huge chunk of your life to this. What was it about this problem that made you say, yeah, this is it? This is what I want to spend my career focusing on.
Mars Geuze
Yeah, we knew when we started this is a marathon, and we are dedicating our lives to this. Right? This is the big mission, and to be able to make such a decision, I really had to make sure that were really building something that was going to take off. Right. I wasn’t going to spend ten or 20 years of my life developing a new transport system that wouldn’t take off. Like, for example, the magnetic levitation train.
Brett
Right?
Mars Geuze
So we spent a lot of time early on really understanding what is the problem. How do we make a transport solution that really solves a lot of the challenges that the current modalities and even their improved versions can solve. Right. If you electrify planes, if you electrify cars, they still make the same amount of noise, they take the same amount of space, they use the same amount of electricity. We’re looking for something that really solves all of those issues and can be built easier into the environment and really has a good business case once you build it out. So first point for us was really understanding, does this thing make sense? And does it make sense to dedicate our lives to it.
Mars Geuze
And when we did all the calculations, crunched all the numbers, and really saw how much this makes sense, I just felt like this is the most exciting challenge I could work on. It’s so complex. There’s many technical complexities, there’s social complexities, there are political complexities, and I just like big challenges. So, yes, you need a lot of patience, but it’s so much fun to work on these challenges and set milestones in between and getting those milestones every time, that it’s very energetic to have such a long term mission that you can just realize and make a big impact that way.
Brett
Do you ever have days where you’re like, shit, why didn’t I just go start an ecommerce company?
Mars Geuze
Yeah, of course, I have those days sometimes. But then again, I very quickly snap back, because I also know that probably wouldn’t be as fulfilling for me as what I’m doing right now.
Brett
Yeah, it makes a lot of sense. I can feel the mission that’s driving this as we go throughout this conversation. So makes sense. That’s what’s really powering you there. Now, let’s talk a little bit about critics. So whenever you have new technology, there’s always people who criticize it and have negative things to say about it. What do critics say about the hyperloop? Are there loud voices that are saying, this can’t be possible or it can’t be done? What are those arguments coming from that side?
Mars Geuze
Yeah, there’s a few misconceptions about the functioning of hyperloop that really caused a lot of people to be skeptical about it. A lot of people think that hyperloop has very little capacity, that you can only run, say, three vehicles through a hyperloop tube per hour or something like that, and that you can almost move no people. We’ve had all of that checked by parties like Deutsche Ban, and according to their calculations, hyperloop is competitive in the amount of passengers that you can transfer per direction per hour. So about 20,000 passengers per direction per hour. So that’s one of those things that people really misunderstand about it.
Mars Geuze
The other thing is that hypen really started out as this very high speed solution, and a lot of people immediately then think that you always need to be in straight lines, and you cannot really fit straight lines into the landscape. We reason in a different direction. Basically, what we say is we follow existing railways and existing highways as much as possible, because we can bank into the corners quite well. We can go about 50% faster than traditional modalities while following those infrastructures. So it has all these other benefits, like low noise vibrations, ease of implementation and so on. And it is faster. So it’s not the being very fast that’s leading, it’s all those other benefits that lead, and it’s also very competitive in speed. And finally, I think it’s about the safety. A lot of people see that because you add a vacuum.
Mars Geuze
That’s a big safety issue. Of course, it’s a new type of hazard that hasn’t really been in any mass transit yet. But we do see quite simple solutions to solve these hazards, like having valves in the infrastructure that when there’s a leak, that you can quickly repressurize the system so that there’s never really a hazard for the passengers. So I think all of these things are good critical points, but we do see solutions for each of them to make the system solve everything that people see as potential hazards.
Brett
From a fundraising perspective, I mentioned there in the intro that it’s over €36 million in funding. What’s that like to have conversations with investors when the time frames are so long? I think if you’re just looking at a venture fund, the lifecycle is what, typically, like seven years? You’re outside of that. So what are those conversations like when you have to go to the investors and say, yeah, it’s a 20 year plan, but we’re going to make a lot of money in 20 years from now.
Mars Geuze
Yeah. So the first thing, of course, most traditional vcs simply don’t fit with us, and that’s fine, right? Not every investor has to fit with what you’re doing. So we are really looking for these longer term visionary investors who also don’t get too troubled by some changes in the economics, but they see that things are going to change in the long term, and they take a stake into that long term potential. On the other hand, it can also. An exit for a company can be sooner than you might think. So we don’t really need the entire hyper network to be operational for us to be able to make an exit. What we see is that more and more governments are now developing hyperloop routes, are going to commit to building hyperloop routes and networks from the 2030s onwards.
Mars Geuze
And what that means is that we will have a growing order book for our technologies, for the vehicles we will supply to that. And around the time where this market will really take off, there will be many vehicle makers, from aerospace, from rail, who will be really interested to strategically buy a company like us. So that means that we can really have a strategic exit already within the coming seven years or so. So it’s also not decades away. The exits that we can realize makes.
Brett
A lot of sense. All right, now, final question for you. Let’s zoom out into the future. So, three to five years from today, and I know you touched on this a little bit, but can you just paint a picture for us to wrap up here? What does this look like five years from now?
Mars Geuze
Five years from now, there’s a very clear, standardized infrastructure. People will understand this is what a hype loop is like, and so there’s no risk anymore. What kind of vendor or technology app you choose, because the technology is standardized, you will have a functioning prototype where you can sit in it, you can travel in it, you can really tangibly feel what it is to travel in a hyperloop. It won’t be at very high speeds yet, but it will demonstrate the reliability of the system. And you’ll have the first governments building short routes to really integrate it into specific use cases. For example, airport connections between new neighborhoods and existing rail stations to demonstrate the first real use cases.
Mars Geuze
And I think you’ll feel a lot of positivity of the rail and aviation parties to become part of this new industry where they will also play a massive role. Amazing.
Brett
I love the vision, and I have a lot of admiration for founders who really tackle the big problems that are facing society. So thank you for all the amazing work that you’re doing, and thank you for taking the time to join the podcast to talk about everything that you’re doing and educate me a little bit on Hyperloop. It’s one of those things where I’ve read about it many times over the years, but haven’t really dug into it too much. So I’ve learned more in the last 30 minutes about Hyperloop than I knew in the last ten years. So thanks for taking the time. Really appreciate it.
Mars Geuze
Thank you for having us. Have a good day.
Brett
You too. This episode of Category Visionaries is brought to you by Front Lines Media, Silicon Valley’s leading podcast production studio. If you’re a B2B Founder looking for help launching and growing your own podcast, visit frontlines.io podcast and for the latest episodes. Sir, search for Category Visionaries on your podcast platform of choice. Thanks for listening, and we’ll catch you on the next episode.
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