to thank Elon for coming-- hungry.

You didn't even have dinner.

And we didn't even feed you properly.

ELON MUSK: No, sorry to be a bit late.

I just came from the Tesla factory in Fremont.

SAL KHAN: Yes.

Was something wrong?

ELON MUSK: There's always something.

SAL KHAN: Did you have to like--

ELON MUSK: At any given point, there's always something wrong.

SAL KHAN: Yes.

ELON MUSK: Because there's just too many things going on.

So one of the trickiest things about a car

is that there's thousands of individual components--

there are thousands of unique components--

and even if one of those things is missing,

you can't make cars.

So today's fiasco was-- I kid you

not-- we were missing a $3 USB cable.

OK.

So we could not complete cars, because--

SAL KHAN: So the whole line was stopped?

ELON MUSK: Yeah.

So essentially, because it's part of the wiring harness.

So you can't put the interior in without this cable.

And so we could either make a whole bunch

of cars minus the interior, which

means that you've got to stack them up in the yard.

SAL KHAN: The resale value would be no good.

ELON MUSK: Well, it can be done, but if then things go out

of sequence, and it's way more inefficient--

you don't have a moving production line.

Then you have to send people out to hundreds

of cars that are sitting in the storage yard.

And so this happens to be a particularly pernicious cable.

It's kind of routed under the carpet, in a difficult place.

And it's literally $3.

And so we basically had to send people throughout the Bay Area

to go and buy USB cables.

SAL KHAN: Like, literally, Radio Shack?

ELON MUSK: Like Fry's.

SAL KHAN: Oh, Fry's.

That's better.

ELON MUSK: You're going to have a hard time getting a USB cable

right now at Fry's, because we bought every one of them.

SAL KHAN: That's good.

ELON MUSK: And so we're able to continue production.

And I don't want to belabor the anecdote,

but essentially the supplier is in China.

And we had plan A and plan B. And plan A

was like the normal supply chain process.

But what the supplier did was instead

of sending our parts in their own package,

they grouped it together with a bunch

of other stuff for other companies

and sent that all via some extremely slow boat from China

to LA.

And when it got to LA, the other stuff didn't pass customs.

And so they wouldn't let our stuff through, because--

SAL KHAN: They put it like a barrel fruit or something.

ELON MUSK: I don't what they put it,

but something that customs didn't like.

And the paperwork wasn't in order or whatever.

So it got stuck there for like a couple weeks.

And then we had plan B. So we called and said,

look you've got to air freight some of these cables--

cause they're just little cables-- to us.

And we talked to their US subsidiary

and ordered from the US subsidiary,

who then communicated to China.

But then because this was another batch of parts,

so it was kind of double the order,

it exceeded the credit limit that we had.

So it bounced off the credit limit, so they didn't ship it.

SAL KHAN: Fascinating.

So someone's losing their job now.

This is-- no, I'm kidding.

You shouldn't fire anyone.

ELON MUSK: I mean, it's pretty farcical.

And, anyway, so, it's coming like tonight

at 11:00 PM or something.

SAL KHAN: Wow.

And these things are happening like all the time?

This was an unusual circumstance?

ELON MUSK: Yeah.

That's like one example, but there's many things like that.

SAL KHAN: I guess, I mean, that's actually

a really good example, because that

leads into what I've always been fascinated

by a lot of what you're doing.

Well, I'll start with, how did you get into this?

ELON MUSK: Into cars?

SAL KHAN: Into cars.

Into taking over NASA.

Well, not taking over NASA-- being a contractor for NASA.

ELON MUSK: Just for the record, we are not taking over NASA.

SAL KHAN: You're not taking over NASA.

They are an independent organization.

But you are becoming a major provider of services for NASA.

Obviously, kind of internet payments and payments

generally.

I mean these are three completely different spaces.

I think a lot of people would not take someone seriously,

if they had a business plan in one of these.

ELON MUSK: Right.

Sorry to eat.

SAL KHAN: Oh, yeah, take your time.

What was your-- did you always think

you were going to be doing this or-- when did it

dawn on you that you would try to revolutionize

three industries?

ELON MUSK: Well, when I was in college--

I didn't actually expect to do it.

So it was not like this is some long-fulfilled expectation.

But when I was in college, I thought

about what were the areas that would most

effect the future of humanity, in my opinion.

And the three areas were the internet, sustainable energy,

and space exploration, particularly

if humanity becomes a multi-planet species.

You know, there's kind of like a pretty substantial bifurcation

in our future, if we're either out there among stars

on multiple planets, or if we're confined

to Earth until some obviously eventual extinction.

Not Not that I'm pessimistic about live on Earth.

I mean, things are likely to be good.

More likely to be good by far than bad.

SAL KHAN: Yellowstone's due for an explosion

every several hundred thousand-- Shandra knows about that.

It's been 700,000,

ELON MUSK: Right.

Right.

Yeah.

SAL KHAN: Super volcano for those of you who don't know.

It would envelop, but well--

ELON MUSK: Yeah.

Exactly.

I know exactly what you're talking about.

So--

SAL KHAN: We read the same books.

I can tell.

ELON MUSK: Absolutely.

I mean something bad is bound to happen

if you give it enough time.

And civilization has been around for such a very short period

of time that these time scales seem like very long,

but on an evolutionary time scale, they're very short.

A million years on an evolutionary time scale

is really not very much.

And Earth's been around for four and a half

billion years, so that's a very tiny, tiny amount of time,

really.

But for us that would be-- can you

can imagine if human civilization continued

at anything remotely like the current pace of technology ad

advancement for a million years?

Where would we be?

I think we're either extinct or on a lot of planets.

SAL KHAN: Yes.

We should--

ELON MUSK: Those are the two options.

SAL KHAN: But given that-- I mean,

one, that's kind of as epic as one

can think about things, literally.

How did you make that concrete?

How does that turn into SpaceX, Tesla and Paypal?

ELON MUSK: Well, so I thought about these things

kind of in the abstract.

Not from the expectation that I would actually

have careers in those arenas.

But, I wanted to be involved in at least one of them.

And at first I thought the best bet

was going to be electric cars.

And so the area that I was studying

was advanced capacitors.

So essentially capacitors that have an engine density

exceeding that of batteries.

Because they have a very high power

density, but a low energy density.

Maybe you have lecture to that effect, I don't know.

SAL KHAN: Oh, yes, no.

We should do that.

We'll get to it later.

ELON MUSK: Exactly.

So obviously, if you could make a capacitor that

had anywhere near the energy density of a battery

with this incredibly high power density

and this quasi-infinite cycle and calendar life, then

you'd have an awesome solution for energy storage

and mobile applications.

So I was going to try to work on that

and try to leverage the equipment that was developed

for advanced chip making and photonics

to create ultra-precise capacitors

at the molecular level.

SAL KHAN: And this was when you were

going to go into grad school?

You had a brief stint at Stanford?

ELON MUSK: That's right.

SAL KHAN: At a PhD in applied physics?

ELON MUSK: Applied physics, material science.

SAL KHAN: Right.

So even then you were thinking of trying

to do something in the space?

ELON MUSK: Actually, this was d to work on energy storage

solutions for electric cars.

And I'd actually worked at a company

in Silicon Valley called Pinnacle Research, which

did advanced capacitors.

There were electrolytic capacitors.

And they actually were pretty good.

They had like the energy density of a lead-acid battery, which

for a capacitor, that's a big deal.

But they used ruthenium tantalum oxide.

And I think at the time, there was

maybe like one or two tons of ruthenium

mined per year in the world.

So it's not a scalable solution.

But I thought there could be some solid-state solution,

like just using chip-making equipment.

That was going to be the basic idea.

But it was one of those things where I wasn't sure

if success was one of possible outcomes.

It's difficult to bound that problem exactly and say, OK--

SAL KHAN: So you're saying, I felt

like this was a destined failure is another way

to parse that sentence.

But anyway, sorry.

ELON MUSK: No.

I didn't think it would fail, but I wasn't sure

that success was a possibility.

SAL KHAN: OK.

Yes.

ELON MUSK: And generally you want

to embark on something-- it's desirable to figure out

if success is at least one of the possibilities.

SAL KHAN: Right, exactly.

ELON MUSK: Because for sure failure

is one of the possibilities.

But, ideally, you want to try to bracket it

and say success is in the envelope of outcomes.

And I wasn't quite sure if that was the case.

I think success on an academic level would have been quite

likely, because you can publish some useless paper--

and most papers are pretty useless--

SAL KHAN: We have a few-- don't take offense.

ELON MUSK: I mean, how many PhD papers are actually

used by someone ever?

SAL KHAN: That's a good point.

ELON MUSK: Percentagewise it's not good.

And so it could have been one of those outcomes

where you add some leaves to the tree of knowledge.

And that leaf is, nope, it's not possible.

And there goes seven years of my life.

So that was one path.