One theory of American innovation over the last fifty years is that it’s largely a battle between atoms and bits, with bits winning the war and monopolizing progress. This framing is too simple though, because cooperation between atoms and bits has given us Tesla, SpaceX, Samsara, Flexport, Anduril and a host of incredible companies that transform the physical world with software. The better critique of innovation is that financialization causes abstraction from the real problems, as the movement of atoms is often diametrically opposed to a spreadsheet economy that shifts numbers around cells but can’t actually ship a rocket. That we’ve convinced ourselves that creative finance can be a cure-all for real-world problems is a dangerous myth. By now, we should know that you cannot solve real problems without building new things.
This is why the origin story of Hadrian is so powerful, as it is an outright rejection of abstraction in favor of the harder, physical path. Founder Chris Power arrived to this country a few years ago focused on solving advanced manufacturing challenges in America. A student of both history and finance, he saw the opportunity and need that many private equity shops have identified in rolling up machine shops to create greater supply chain efficiencies, particularly in critical infrastructure such as aerospace. The defense industrial base is served by a network of thousands of small machine shops across the country, often run by very talented machinists who have spent a lifetime honing their craft. The average age of a lead machinist in America is now hovering around the mid 50s, and like other skilled trades, the coming retirement of the Boomers is leading to a dangerous labor shortage in an important industry. Beyond even the lack of skilled labor to make critical parts, there’s the thorny question of security and supply chain transparency, which our commercial aerospace industry is desperate to see fixed as it grows in scale and importance.
Chris’s initial attempt at solving this problem was more in line with a well-trodden path from the private equity world: raise a small fund that could work with existing mom-and-pop shops to introduce more efficiencies across factories. But Chris’s realization after talking with hundreds of machine shops and even more machinists is the hard truth we can’t ignore: financial engineering doesn’t solve the core problem of making aerospace and defense parts faster and cheaper. And most importantly, it won’t train a new generation of machinists to produce high-quality parts for a growing critical industry. You need to build automation and solve a complex engineering problem in the physical world to truly shore up the aerospace and defense supply chain. Chris returned capital to his early investors and started building Hadrian, introducing automation to the machining process as well as transparency to its critical customers. Now Hadrian serves three of the largest space customers and will soon serve a host of companies in commercial aerospace and new defense.
When we set out to build the American Dynamism practice, we understood that many of the companies we backed would be singular and simultaneously difficult in mission. Hadrian’s primary mission is an obvious definition of dynamism: shoring up American manufacturing for aerospace and defense industries. Automating and reshoring manufacturing is among the most critical national security issues facing the country, and as we watch the most devastating invasion to hit Europe since WWII, it is clear that deterrence is once again a strategic priority.
But we are equally excited about the secondary mission of the company, one that is less obvious— ensuring that a generation of young people with basic technical skills can learn machining and support their country across Hadrian’s factories. When Chris and I discussed the major question of the decade– “What will it take for Americans to care about decline?”–we agreed that part of the problem is a lack of meaningful work. A lack of seriousness of mission and purpose. Giving young men and women the opportunity to build meaningful skills and take pride in building new things is one of the most important missions technologists can build for. And Hadrian has pulled together a team of the best software engineers, manufacturing operators and machinists from all walks of life, moving from all across the country to join this important mission. That Hadrian has embedded this meaning into the company from day one–pairing machinists and engineers to solve a complex, physical problem– is the most inspiring aspect of the business.
At a16z, we recognize that building in the physical world is hard, but hard things are worth doing and fighting for. We’re honored to support the Hadrian team as they build the future of American manufacturing.