Founders Fund Leads $80M B-2 Into Nominal | Trae Stephens, Cameron McCord

[00:00] Nominal is like one of these examples of you look at the ROI and you're like, okay, this isn't a nice to have. This is actually like saving us money. It's creating efficiencies in the business. If you are growing, then you're probably undervalued. I like frankly fell in love with this problem and was exposed to it was when I was at Anderil in the early days. So this was when Anderil was a much, much smaller company, like around 100 people. Wake up really early. We would go to Apple Valley, California. It's like the trailer in the desert. The trailer in the desert. [00:30] drone and the tower system and you drive up, set up in a trailer. You get like Wi-Fi pucks. It was really hard to get. That group of humans at Anderle, I think, has gone on to start incredible companies, new products. Like it was just an awesome group. Really, really smart people. I heard you barely even touched your $75 million Series B. You know what's better than $75 million? $155 million. Move fast and break things. If you move fast and break things, you're also breaking people. People are going to get hurt. I would say it's not magic. It's sorcery. [01:00] Mmm. [01:11] Cameron, Trey, welcome to Sorcery. [01:14] Thank you for having us. [01:15] - You're welcome. - I'm pumped to be here. [01:16] Well, it's been just 10 months since you were last on Sorcery for your $75 million Series B. Now you're back for your $80 million led by Founders Fund.

[01:30] What happened? [01:32] I always like to say if you are growing, then you're probably undervalued. [01:38] We were approached by the Founders Fund team, who's been on Omnil's cap table really from the beginning. [01:45] over [01:46] the sort of December holidays. [01:49] with a really, really attractive offer to lead [01:53] of financing. And I was sort of thinking about it in terms of [01:57] I think you always want... [01:59] the sort of external [02:01] realities to match kind of the internal momentum that we were feeling at nominal over the course of [02:06] In 2025, we had really a breakout year. And so when the Founders Fund team kind of approached us with a really good [02:13] proposition of leading a financing. It just made all the sense in the world. So yeah, we're pumped. [02:19] Might I add your last financing? [02:22] Happened in 10 days. This one was preempted. So there's some sort of magic you're working here. What do you think that is? I mean, I really think... [02:31] We sometimes joke internally at nominal, but like I think we're building in a time where it's hard to find a tailwind in the industry that I think we were like not benefiting from. And so I think... [02:42] reindustrialization, physical AI, people getting back to building hardware in a serious way. [02:50] All of those greatly benefit the business that Nominal is building. [02:55] And I think really, like, you know, in 2025, we... [02:59] we saw sort of this, the hockey stick, you know, inflection point in the curve. A lot of that, I think, cracking commercial, you know, motion.

[03:08] going from a product to really finding product market fit and starting to scale that. And I think [03:14] The good investors who are around the table can spot that. [03:18] So. [03:19] I would say it's not magic. It's sorcery. [03:24] Good, good, good, good. We love that. I'm going to clip that out. I am a dad. [03:32] Well, Dre, you've been tracking and Founders Fund has been tracking nominal for quite some time. You're involved in the seed round. So what exactly are you tracking throughout time to make this sort of preemptive decision? Yeah. [03:44] Yeah, I mean, we're in kind of a unique position in that we invest in a lot of industrial companies. We don't have a thesis, but we just feel like this is an area that needs increased attention. But beyond that, we're also we've incubated multiple companies that are kind of roughly in this sector that are customers of nominal. [04:14] about how [04:16] important and necessary this software stack is and that enabled us to lean in. Not only that, but Cam was actually [04:23] at Anderil for a couple of years in the very early days. And so he and I have known each other for a while. He has a strong relationship with many of the partners on the team. And so we were just kind of in a position where we had an information flow and we we knew [04:37] that it was a time that we wanted to come in and make a high conviction, highly concentrated bet.

[04:42] From an underwriting perspective, why was it worth taking the risk now versus waiting? And how do you kind of diligence this? [04:50] Yeah, I mean... [04:52] The answer is anytime you can get in earlier at a lower price when something to Cam's point is growing, that's the right time to do it. That doesn't mean that there won't be future bets in the future, you know, moving forward. We're still putting capital into some of the latest stage growth companies in Silicon Valley. We have a growth fund specifically intended to approach investments in that way. So we're just excited to be along for the ride at this point and we'll continue to be a part of that ride moving forward as well. [05:21] You've recently tweeted that you're an investor slash operator. And so with this specific. A slashy. A Zoolander reference for those of you that aren't aware. With this particular company and your involvement in Andrel, can you take us behind the scenes on what it's like from the Andrel perspective of working with Nominal and what they've unlocked for you? Yeah. You know, when I first started at Founders Fund 12 years ago, over 12 years ago, I had no idea what I was doing. Arguably, I still don't, but I definitely didn't 12 years ago. [05:51] And I think the only reason that I was useful in any way to Founders Fund or our portfolio companies is that I had spent the prior six years at Palantir. And so I had this kind of depth of experience gathered mostly from making a ton of mistakes in the early days of Palantir. I think that especially in venture, this is probably less true of growth stage investing, but in venture investing, earlier stage,

[06:13] Having operational exposure to startups in any given moment, you know, there's like epics that shift over time. The knowledge that I had from Palantir from 2008 to 2014 kind of becomes stale over time. But being in it at Andruil day to day gives you an incredible perspective of what tooling, what software is actually necessary to building a company in the modern day, [06:43] when you're out doing diligence and finding companies, sourcing potential investments. [06:47] So I think this is probably underappreciated. It's not a formal part of our strategy at Founders Fund, but it would be crazy to believe that having Peter as a co-founder at Palantir and Delian at Varda and Scott at General Matter and me at Andrel isn't a huge advantage in that specific way. I'm not saying we have every advantage, but in that specific way, we have a tremendous amount of operational exposure to Founders Fund. [07:11] building tech companies in 2026. [07:14] Before we go too far... [07:16] Cameron [07:17] For people who might not be familiar with nominal, can you explain what nominal is? Yeah, absolutely. And I'll actually hit with an and roll, like... [07:25] origin story vignette too, because it's really relevant. It's phenomenal. We're building a data platform all around hardware testing and hardware validation. [07:33] You can kind of think of us as like, [07:35] you know, go back in time. [07:38] If you for the last two decades have been building software and you weren't using

[07:43] GitHub, like you would have been crazy. [07:46] And I think that that analogy is actually really apt to the moment in time we're in for... [07:51] software defined hardware. This is a new industrial sector, autonomy, robotics. [07:56] And I think I'll pull that thread a little bit more. [07:59] You know, used to be that. [08:00] VCS is, you know, version control systems for people building software like that. Those were just, uh, [08:06] They weren't like locally, like they were locally managed rather. They weren't centrally managed. So people were just building software and like, [08:13] you know, it was kind of the wild, wild west. People started to realize like, "Oh, we should actually standardize this." But it was also internally managed. [08:20] Then, you know, eventually that got productized and outsourced and venture dollars, you know, flew in a lot of what we consider like the modern stack for for testing and validating. [08:31] Pure software was built on top of that. [08:33] Bye. [08:34] billions in market cap created. Our whole thesis is that that exact same thing is happening for the software-defined hardware world and the new industrial world. [08:42] It's gonna rhyme, it's gonna happen, [08:45] really fast because there's a lot of prior art and prior learnings. [08:49] That can be ported over, but there's substantial differences in how that sort of data platform and that stack needs to look. [08:55] And that's exactly what Nominal is doing. [08:58] Where I like, [08:59] frankly fell in love with this problem and was exposed to it was when I was at Anderle. [09:04] in the early days. [09:06] So this was an annual is a much, much smaller company, like around 100 people. [09:10] And [09:11] The program that I was working on was the Counter UAS.

[09:15] the anti-drone system in its sort of infancy. [09:19] And [09:20] You know, you always get excited to build something when you, I think, experience like sufficient pain. [09:25] And just to get perspective about like what that looked like, it was like, [09:28] We would wake up really early. [09:30] we would go to Apple Valley. [09:33] California trainos like the trailer in the desert trailer in the desert and [09:38] You wake up super early before, you know, before the sun comes up, pack a lot of these Anvil people familiar, the Anvil Interceptor drone and the tower system. And you drive up, set up in a in a trailer. You get like Wi-Fi pucks is really hard to get, you know, get proper connectivity to do what you needed to do. [09:54] But like everything was it was just like highly manual. And obviously, like that group of humans at Andrel, I think, has gone on to start. [10:01] incredible companies, new products. Like it was just an awesome group. [10:05] really, really smart people, but like the software tools that the industry had available at that time were [10:12] insufficient right and so naturally people started building things tinkering like ideating and i just lived that it was a lot of [10:20] using Matlab. [10:22] It was a lot of using Excel to like track things. There's a lot of writing on whiteboards, like very manual workflows. [10:29] to sort of architect how you go through and really iteratively test and validate these products. [10:35] And just started thinking like there's got to be [10:37] there's gotta be a better way and why is this, you know, what's happening? And that was then, you know, 2019, 2020 timeframe. So, um, yeah, that's, that is where nominal is playing in the world. And we've seen, uh,

[10:47] A good bit of I think success and expanding on that vision. Yeah, I think like one of the the threads to pull on this is that I [10:53] with so many products, whether it's, you know, [10:56] software enterprise b2b sass or consumer software or even consumer hardware um you know there's like the old adage of move fast and break things it's like you know just try it out try it out try it out in the real world see what happens the problem is is that if you're flying anvils or road runners or something like that if you move fast and break things you're also breaking people like people are going to get hurt um it's going to be really messy um and then you're you're you know dealing [11:26] test ranges and stuff like that, which nobody wants to deal with. But more so, it's like once you get things productized and put out in the field, the important thing is that you're protecting lives. You're preventing the loss of warfighter lives. And so it is incredibly important in aerospace and defense in particular to ensure that your test and evaluation stack is preventing those edge cases from happening. And I think this is something that's like [11:53] has largely been unappreciated in silicon valley as we've been focused on new and better ways to share 140 characters with your friends or optimize ads and we're moving into a different paradigm now where we're actually much more concerned about like how do we preserve [12:07] you know our democratic and you know capitalist system for decades to come and unfortunately for better or for worse that means that we have to get much better at doing real world things we can't live in our software fantasy land on the internet anymore uh there's a real world out there and nominal is an incredibly important

[12:27] part of the stack to ensuring that we can do that test and evaluation stuff as efficiently and elegantly as possible. [12:32] Last time we talked [12:34] We went over the TAM and how when you were working with Sequoia, you had no idea how big the TAM was. And they put some work behind that and they discovered it. Have you started to lay out as you go across categories and customers where you are going to see... [12:53] I guess most customer conversion and how big those markets are. Molly, you're referencing a funny thing. And when we were raising the Series B, [13:00] after we had pitched Sequoia, I think Alfred Lynn pulled me aside or whatever and was like, really good. [13:06] You're like way underestimating the Tam. And I just thought it was really funny. I kind of smiled and I think he's right for what it's worth. But um, [13:13] I think on the tan piece, just because this comes up a lot, [13:16] where, you know, in Founders Fund, I'll make a Peter Thiel reference, because I think it's like a really good one. [13:22] is like, [13:24] you know, starting with small markets, that sort of philosophy is super powerful. And I think it's like, [13:30] you know, almost four years into the nominal journey, I'm very grateful that we started with [13:34] a like very simple problem that is like [13:37] There's very acute pain and we could make it 10x better. And I think that is [13:41] born out of this and real experience was particularly... [13:45] post-test analysis data review. This is a term of art. It's just like process. But because every time you test and validate a hardware system, you generate this like explosion of multimodal telemetry sensor data logs, video, audio, like all of this data. And that process just sucks.

[14:00] Like, [14:01] After you've been flying drones for 12 hours, you then have to [14:05] figure out like what just happened. Like, is the system better? Did it improve? Um, and that, you know, was happening from, [14:12] 9:00 PM to 1:00 AM, right? Those hours and improving it. So really that is what Nominal started doing. We were just like, [14:20] Let's like build a product that makes that [14:22] much, much better. And knowing that we were building in this massive industrial, you know, market that was, one, growing, I think, very quickly and having software, like, collide with it in innovative ways and now AI. And I think that has sort of, you know, proven very, very true. In the earliest... [14:39] pitch deck slides of nominal, we said we were going to start with [14:42] hardware testing. [14:44] I think to the point you just made, Trey, like... [14:46] That is where [14:48] Like hardware testing is where... [14:50] software that is governing the performance of those hardware systems is first like meeting physics [14:55] So this beautiful like dance it's like that's when you figure out like is it gonna work is it gonna crash is gonna break? and so I actually think rather than you [15:03] simulation or design tools or other areas like that's actually [15:08] our belief is like that's the entry point to providing a ton of value to customers there. And then we're already in the process of expanding [15:16] in some more manufacturing production manufacturing testing and into more like deployed fleet operations and [15:24] The market just grows. I think the global manufacturing team is like, I don't know, 200 billion or whatever McKinsey would say. It's big. So like I'm not I'm not worried about the addressable market at all.

[15:36] You had some big customers at the last... [15:38] funding announcement. [15:40] What does that scale to today? [15:42] Well, Andrew is one of those now we we publicly announced the partnership with Andrew, which has been great. [15:48] Yeah, we are now working with four of the five [15:52] largest traditional defense primes. That's how people refer to them these days. But [15:57] Which has been great. I think really something that's changed in the last 10 months even since we spoke, I think is [16:04] you know, so at some point we just needed the clock to like run sufficiently. Like there's, these are heavily regulated industries. Uh, there's a lot of, [16:14] bureaucracy, there is rightfully so, like this is mission critical, the definition of mission critical capability. And so it's not a move fast and break things world. And I think we just needed the clock to run and to build [16:26] past performance that we could demonstrate both with commercial customers and the government and just build trust and like word of mouth is a real thing. And people start [16:35] I think talking and saying, oh, are you like, are you guys using nominal? They're using nominal? Everyone's like, oh, everyone's using nominal, right? So I think we're starting to start to like feel that that's a big kind of inflection point that's happening. [16:46] If you're not using nominal, you're not testing properly. Just one more time. [16:53] I love that. You heard it here. [16:56] Apart from Andrel, are there any other differentiated use cases? [17:01] that you could share. I mean, I just find this to be... One of my favorite shows growing up was like How It's Made. And I feel like this is very much How It's Made because you're really direct on the hardware and you're learning from the systems and you're helping them and you're helping...

[17:16] kind of, you're helping prevent [17:18] things exploding and things breaking. And I was just really curious, [17:24] Could you break down any more use cases? Yeah, let me give an example maybe of... [17:29] the [17:30] the [17:31] the federal testing landscape. I think that's actually a really interesting one. It's like, [17:35] What is the status quo today for how massive, you know, [17:39] uh government weapons and acquisition programs like perform testing because I think it's very [17:45] very eye-opening, right? And so I think [17:48] The process is designed for... [17:50] exquisite systems you'll hear that language a lot but programs that take 10 15 20 years to develop billions and billions of dollars [17:58] In those contracts, the government works in what are called test matrices, but it's essentially... [18:04] a massive series of [18:07] test points and conditions that these hardware platforms need to abide by. [18:12] The voltage must be between this and this. The angle of attack of this plane must perform this. The range, all these things. [18:18] When they go to then test those systems, [18:22] Everything is like sequential. There's really no concept of like parallelism and like multitasking. Um, and, uh, the tools that are used, the software that's used is quite literally, um, [18:34] Microsoft Excel. [18:36] MATLAB [18:38] for performing analysis, maybe Python to glue things together [18:42] software like it's called iAds. [18:44] It's been around for a really long time, performing flight testing.

[18:48] but PDF and PowerPoint. So I always think it's like crazy. It's like, [18:53] this cognitive dissonance of like you look at [18:55] an Android, Fury, or any just like new platform that companies are building the end capability. And then you kind of like pan over to the engineer. That's like performing the analysis. And it's like, [19:06] you rewind 30 years and it's just like so obvious to me, it feels like an inevitability that that has to change. [19:12] And I think it's like what that forces is I think it's. [19:18] This is an Elon type thing, but I think it's Parkinson's law that basically is sort of suggests like... [19:23] processes take [19:25] as long as you allow them to. And so I think that is the definition of why we have so much delay in how we perform testing. Like every... [19:37] every product, every weapon system is like is massively delayed. [19:42] I think unpacking that. [19:44] Parkinson's law sort of states like the effort that has to go into testing something is like, you know, proportional to time. [19:52] And I believe that I don't think there is maliciousness here. I think it is like... [19:57] software defined hardware systems today. [20:00] Generate. [20:01] petabytes of data. [20:03] and 20 years ago they didn't. [20:06] And so I think the tools have just not kept up and people are overwhelmed. [20:10] and not able to like, you know, keep pace. And that's where nominal I think comes into play is like, we can sort of flip that, the paradigm of effort in Parkinson's law and actually be like, no, it's actually a lot easier to do this. There's really powerful software.

[20:21] You can query. [20:22] across all of your generated data for this like hardware test and [20:28] Convince yourself, you know right then and there that you've like met all of the conditions in this this matrix just by flying and [20:34] your fury for, you know, 20 minutes autonomously and realizing that you actually put that platform in [20:40] all of these vehicle states. Like that's the paradigm that we're trying to shift. And I think it starts with like really, really good software. But... [20:47] um yeah that's that's an example on the the federal side [20:51] Sorcery is brought to you by Brex, the financial stack trusted by more than 30,000 companies, including one in three venture-backed startups in the U.S. Nearly 40% of startups fail because they run out of cash. Brex is literally built to help founders avoid that. Unlike traditional banks that let your money sit idle, chipping away at it with fees, Brex is designed to help you spend smarter and move faster. [21:20] powerful account. You can send and receive money globally at lightning speeds, get 20 times the standard FDIC coverage through their partner banks, and even high yield from day one. With same day and even same hour liquidity, access your funds anytime. Companies like Scale AI, DoorDash, Service Titan, HIMSS, Anthropic, Flexport, Robinhood, and Plaid trust and use Brex. [21:50] Turing is training the next generation of AI with tasks that require real expertise and real world judgment. That's why companies like NVIDIA, Anthropic, Salesforce, and Gemini partner with Turing. Turing builds realistic reinforcement learning environments and data systems based on real operational traces. The kind of infrastructure Frontier Labs need to train superintelligence. Visit Turing.com slash S-O-U-R-C-E-R-Y.

[22:21] How much time are you saving? [22:23] Oh my god. [22:24] A lot. I think like some fun stats are like some of these. [22:30] Some of these major test campaigns at some of the larger primes are like $3 million a day just for testing. Wow. And often those test campaigns can be three, four, five, six months. Yeah, we've been able to shave 50% to 60% off of those. So... [22:45] When you have those types of conversations with customers, [22:48] you're saving the minutes that compound to hours that compound to days. There's huge, huge cost savings. And so it really makes the [22:55] the like business discussion, I think a lot, a lot easier. [22:58] - Yeah, I think one of the things that is, [23:00] not talked about very often in the tech industry. [23:03] community is that enterprise SaaS [23:06] balloons unbelievably as organizations grow where these companies like you start off and it's like probably what as a consumer you're like well I have a Netflix subscription I have a Paramount Plus subscription and I have a Hulu subscription before you know it you're paying like [23:20] $500 a month for your entertainment. Whereas like if you had just had cable, [23:25] 20 years ago it all would have been done for 120 bucks or whatever um this is this this is constantly happening inside of [23:32] technology enterprises. And it usually takes years before the operations side of the business, you know, looks, takes a step back and looks at their spend and goes, this is crazy. Like, the amount of money I'm spending on all of these different pieces of software is [23:48] has ballooned to an extent that I have no control over it, I haven't negotiated any of these contracts. And so at Anderil,

[23:56] My co-founder, Matt Grimm, who's like, I think, maybe the world's greatest COO. He's very intense, but he's, you know, as dialed in as they come alongside our CIO, Tom Bosco. They have gone into this project of figuring out how to cut spend on SaaS because it's completely out of control, like it is at every other company at scale. You know, they go through and they identify stuff. They cut it. They consolidate. Like, they're going through this exercise. And usually what ends up happening is that. [24:25] you know, a lot of nice to haves are sacrificed on the altar of efficiency. It's like, okay, yeah, that was, that was cool. It was a nice experiment. Um, too bad. You're out of luck. We're not using that. Uh, everyone shut up and go back to work. [24:38] Um, [24:39] Nominal is like one of these examples of you look at the ROI and you're like, okay, this isn't a nice to have. This is actually like saving us money. It's creating efficiencies in the business. This is one of those things that you back up the truck to and really push to integrate it more deeply into the business. [24:55] I can honestly say like there's just not that many. [24:58] things that fit that level of commitment. Most things are begrudgingly [25:04] investments like legacy software that you literally can't get away from using because you're in the aerospace and defense sector or, you know, ERPs or something like that, that everyone's unhappy, except the legacy software vendor that realizes that you have, they have you over a barrel. But this is one of those unique cases where everyone feels super aligned, very happy. And we feel like we're getting the return on investment that we want out of out of that spend.

[25:30] And I think just, I mean, just building on that point too, I think, you know, Andrel is this amazing case of like... [25:36] you know, [25:37] we often in nominal, we're like competing with sort of internally built solutions or maintained tools. And I think really like satisfying and fulfilling for us, I think to sort of like know that what we do, [25:48] what we had built, we'll put it this way. I was very familiar, I think, with like the level of capability that existed just natively in inside of Andrel, having worked there before. And so [25:58] waited until I thought, you know, nominal had sort of hit escape velocity on the product offering and the capability to sort of bring it back and have it met with that type of reception that the traders described. So I think like, you know, this is an area where people will companies as they grow will will try to assemble sort of their [26:17] Frankenstein version of an internal stack. But at some point when you get very serious about scale and operations, you have [26:24] 30 different hardware programs and product lines. It makes sense to buy a productized solution and [26:31] and back the truck up around it. So, yeah. [26:34] And now you're saving Andrel billions of dollars. I mean, that would be great because if he was saving us billions of dollars, we would be profitable. We are not. We're doing our small part. Yeah, you're doing your part to helping us eventually get profitability. Yes. What a beautiful partnership. Yeah. Exactly. Yeah. Yeah. I'm so curious from both of your perspectives on this as AI rips through markets, public markets,

[27:02] Hundreds of billions of dollars are being decimated. [27:06] Do you think the hype, the affect, and this kind of destruction or disruption from OpenClaw and Clawed and all these different types of new AI solutions that are causing autonomous agents and creating things instantaneously, is this going to affect you? [27:26] I think it will affect everything. [27:28] But let me actually go back to the I think the GitHub example is a good one. It's like when you whip out your cloud code and your, you know, vibe coding or whatever you're building, you're still in almost all instances, you're still referencing GitHub. I mean, it's GitHub, right? It's like interfacing and that that core infrastructure functionality like does not exist in this software for hardware space. Right. Like that is that is what nominal is building. [27:54] And so I think [27:55] Where we sort of see is like, we talk a lot about how we've like taken... [27:59] this like industrial software, uh, and software for hardware world from, um, [28:05] I don't know, 2003 to 2021. Like that's the crawl phase of nominal. And so much of that is just like. [28:13] good software engineering is like organizing data, [28:17] associating metadata, tagging it, storing it thoughtfully, you know, like all of those things that that enable the work that engineers can do using nominal. And now we think we have, you know, a pretty sufficient moat to sort of build the next phase. [28:31] So we're incorporating AI into our products. We already have beta features out there where if you're doing this post-test analysis, you can just...

[28:40] use a chat interface. [28:42] to start to interact with your test data, which is, and it blows engineers' minds, but you can say something like, plot the kinematics of the drone, right? You don't have to manually do that, right? And on the building blocks of nominal what already exists, it will start to just do that type of function. And so really like, [28:58] The paradigm shift, I think, is moving from this exquisite hardware system where 50 engineers had to be involved for one piece of hardware. [29:09] I think right now we're sort of in this zone of like one to one, you know, man on man. And I think nominal will help enable a world where one human engineer can actually start to affect and test and validate and interact with, you know, 50 pieces of hardware through like. [29:27] agentic workflows, a lot of parallelization distribution, like that. That, I think, is where the world is going. [29:33] I do not worry about the sort of de-sassification of nominal. I think [29:40] the software for hardware world is like, is... [29:43] is ripe for a lot of really, really good innovation. So, [29:46] What's your long-term defensibility? [29:49] I mean, I think being that sort of like core, you know, piece of infrastructure is that. I think continue to build closer and closer to the hardware as well, like getting more into the embedded, I think, you know, systems layer and stuff like that. And then ultimately, like, I mean, we've just... [30:06] we kind of have a pretty central North Star of like we will do [30:10] whatever it takes that sounds kind of ominous but um we'll do whatever it takes i think to like satisfy the north star for our customers which is like helping them build and validate hardware better

[30:20] faster and sort of cheaper. And I think having that like, [30:23] flexible, [30:25] mission, um, is really, really powerful. Um, as we, [30:30] adapt and react to like how technology is changing so [30:33] Whatever it takes. Write that down. Yeah. Whatever it takes. It's really important. Because customers are going to appreciate that at some point down the line. Yeah. No, I think to your point about the industrials is that the sector is it's different than like software companies building software where, you know, you can pretty easily in many cases, not in every case. You can kind of rip something out and replace it with an updated thing where you're just kind of integrating the data again via an API. [31:03] becomes the trusted kind of source system for the data. Not only are the partners and vendors going to also be plugged in and trusted, but the government, which is oftentimes the customer of these commercial organizations, they will look to that as a trusted system that they can rely on that data being represented in a similar way that they can track over time. So these things don't end up getting [31:28] pulled out and you can look at other companies that have demonstrated success in this space palantir most notably um palantir doesn't have [31:35] customer churn. Like once Palantir is in, it's sort of in. There's not a whole lot that the customer would want to do to change that. And I think that that is like a moat and defensibility, not only for nominal, but for like really anyone that's working in this space. [31:50] The downside, of course, is that these are really difficult customers. They're difficult customers to win, they're difficult customers to service, and it requires a bit more of a, you know, a bit more courage than going out and

[32:02] you know, being a YC company selling software to other YC companies. That's like a very different that's a very different model. Yeah. [32:09] I think on that point, I mean, just beyond that, I think like... [32:12] We [32:13] This is a this is a fun one, because I think I know Trey or categorically. [32:18] like is very skeptical of of dual use businesses. Is that a statement? Yeah. I think like I'm my nominal is going to be the dual use business that gets traded. Be like, OK, fine. That's fine. That's my goal. That's my single. No, but I think I'm on that point. Like I think it's been really we've we've done a really good job, I think, of. [32:36] engaging directly with [32:38] you know, federal customers, which are ultimately the ones setting standards, setting regulations, like interpreting that test data as the final sort of outcome and sort of like working with them, you know, building alongside things like, you know, deploying the product. [32:52] in the different environments where it needs to be, doing like high side deployments, getting credibility, having people be like, oh, actually, [32:58] Like I can look over the shoulder of vendors using nominal and be like, oh, that's like what industry is using the best. Like we've worked really hard, I think, to like connect those two audiences because. [33:08] I think to your point, when that demand signal is like coming all the way through the ecosystem, it's just extremely powerful. And I think we're really feeling that pull now, like we've already had some. [33:19] sort of organic hops where people are like, oh, this other program, you know, this vendor participating, this other program is using nominal. Like we should probably use nominal and like get it. And that I think we just like you start to move the market. So it's been a case where I think the strategic nature of of being dual use is working so so far.

[33:35] So what is your sales strategy? [33:38] oh um sell software yeah sell software no yeah really do whatever it takes yeah yeah i mean i think big big picture like we we have a portion of our business we call emerging where we're trying to work with the the newest company we think any company in 2026 building a hardware product should use nominal it should be approachable out of the box walk up [34:08] and a bunch of power laws and stuff. Some of those companies might not make it, but we want the industry to be using nominal. And a lot of those smaller customers, as they're growing, like they push new product innovation, right? So we have a business for that, but really I think what is [34:21] You know, the success we experienced last year, I think, was moving upmarket into these larger, like hard to service and very bureaucratic industrial organizations and having, you know, success there, which I think has been, yeah, has been really big. So that we call it this like bifurcated go to market. But I think that is like really, really key to our success because we're able to take a lot of those learnings, productize it and give it to these companies that need it. [34:49] and sort of deploy it at scale. I think another thing that we have invested a lot in is... [34:55] It's kind of funny because [34:57] you know, [34:57] There's so many ways in which nominal is like not like traditional enterprise SaaS, like in most cases. But there are there's still the set of like enterprise SaaS features that like you have to build. And so I think things like.

[35:12] role-based access controls and sort of some of the security features and just like collaboration. It's like solved problems. But doing that really, really well has been a big accelerant to Nominal's ability to [35:25] kind of organically... [35:28] spread within an organization um we would see it at places like andrel but just like new users like you know stumbling upon nominal someone sends them a link it's in their it's in a confluence page it's in a slack channel there's like a link to right and like people just click up they can you know sso they can sign up they can like start to get into the product and i think that is actually how you build like a business that's going to grow and get the manual touch it like high touch nature out of out of the growth [35:54] To be clear, the reason that I don't like dual use is that [35:58] your customers, the big defense primes, [36:00] they use those terms as a pejorative. - Yeah. - They try to like box new entrants to the market by saying like, oh no, no, this isn't a defense [36:08] company. This is a dual use company, which is their way of saying it doesn't matter. They're just like, they're these little irrelevant vendors and sure, like we'll work with them sometimes, we'll partner with them sometimes, but they can never do anything core. And so I just wish there was a different term that took that power away from them to be able to use it as like a bludgeon against the technology ecosystem. But I agree that there's good utility in selling both on [36:38] And I think... [36:40] As much as I am, I'm saying that to be spicy. I think, um,

[36:44] I. [36:45] do advise in almost all instances, dual use does not make sense. Um, [36:51] Sort of a distraction. When I talk to people that ask me about... They're like, oh, nominal does seem to be selling to both these markets. I answer them like, that is very intentional. We picked a product that, by definition, would do that. It is not something that you stumble into, especially in the early days. I think you don't just... [37:11] build a commercial product and then like it's a big distraction. I think it is like not generally speaking something that you should do until you are like a [37:18] multi billion dollar, you know, company. So like, yeah. [37:22] I'm curious from both of your standpoints, how has the new administration, we're almost, what, is this already been a year or is it two years? A year and a month. [37:32] It's been a year and a month or two. [37:35] It's been a year and a month. Yeah. January 20th of 2025. So, yeah. [37:39] You're correct. How has the evolution of this new administration embraced or challenged growing in this market for you? [37:50] I mean, I'm happy to share. I'm obviously super curious for trade thoughts, too. I think there's been a lot like there's been a ton of positives. I think there's been no shortage of discussion around acquisition reform and different things. [38:04] software acquisition pathways for us and just doing things differently, picking new entrants, like doubling down. [38:10] all of this like portfolio with it. Like that I think has been constant, um, in the past, I don't know.

[38:16] three administrations. But I think this admin really seems to be like, [38:21] Taking action on it in a way that's like really really refreshing. I think particularly I [38:28] a layer lower down, like there's a lot of really interesting discussion around. [38:34] portfolio acquisition reform, but I think restructuring at a high level, I think restructuring the way that the acquisition organizations are structured to be more like, [38:44] businesses, I think, like give people more power and let them sort of like work cross-functionally to allocate resources to get a capability outcome, um, rather than just having things organized because like they all happen to fly. It like makes sense. It's like, you know, you should actually like, what's the warfighting capability. That's like a really good tailwind phenomenal because I think our software helps, um, [39:05] you know, provide insight into the [39:08] the performance of these hardware products, the sort of TRL, technical readiness level. And so we can surface that, make it very data driven. I think it's something that we've had a lot of like positive feedback from, you know, from the admin on. But [39:19] um, [39:20] I don't know, Trey, I feel like you're the world expert in this. Well, you know, I think that defense is not partisan at all. The defense budget has gone up every year, crossing Democratic and Republican administrations for over a decade now. You know, it's the National Defense Authorization Act is like the only bill that passes with a supermajority on an annual basis without... [39:42] there are very many delays at all. It's really not about partisanship, it's about people.

[39:46] And that's the place where I think we've seen more leverage. If you look at like the Undersecretary of Defense for Research and Engineering right now, it's Emil Michael, who is the COO at Uber. [39:56] That's going from like an academic under the Biden administration to the former CEO of Uber. That's a major shift. And individual people, as it turns out, can make a difference. And too often we've like looked at the government within this sort of hands off perspective or like the bureaucracy will do bureaucracy and it kind of is what it is. No, that's not true. There is agency in the world. Individual people can make a difference. [40:26] has [40:27] really, really strong, highly motivated, mission aligned people that understand the value of technology and understand the importance of acquisitions reform. [40:34] And that is a huge lever. It has nothing to do with partisanship. It doesn't matter that they're Republicans or Democrats or, you know, far right activists or socialists. It doesn't matter. [40:46] Individual people are the ones that make the difference. And I think we're really lucky to have really good individual people. [40:52] in place right now. [40:53] And I think particularly... [40:56] People that, uh, by intention, like understand how businesses run. I think that's been a big thing that I've like noticed as well. I mean, with conversations, um, some of these like cost sharing, like deal agreements and things that are like Palantir had a big one for ship OS. I think Hadrian has like one, like, um, [41:14] I think we're in some discussions on what that could look like. But people that understand, particularly venture-backed businesses,

[41:20] that [41:21] I get to have conversations where I'm like in 2026, like we will probably invest [41:25] 80 million, $100 million into like software product R&D and development. That's like unheard of, um, for a lot of the companies that are, that are working, um, you know, with the government and they understand that and they're willing to say, Hey, [41:38] Nominal is willing to like take a risk on itself, bet on itself. And as long as there's, you know, a good story and there's, you know, gold at the end of the rainbow, so to speak, like that is a really, really like. [41:49] um collaborative model that i think achieves like good good outcomes and averages private capital better business incentive alignment for sure yeah by the way i heard you barely even touched your 75 million dollars series [42:02] B, [42:03] So with $80 million, how are you going to be using the capital? You know what's better than $75 million? $155 million. Okay. [42:13] Yeah, Trey, how much is in the annual coffers right now? I couldn't possibly comment on that. Exactly. So, yeah, I mean, that is true. We have not used that. We're assembling a nice, I think, war chest. I mean, things that we are thinking about in 2026 here, I think, [42:31] Um, you kind of touched on, I think, strategic M&A. [42:35] And I think we want to be positioned to do that. We're not... [42:39] I'm not saying we have any big moves on the horizon, but we want to be positioned. And mostly, I think... [42:44] I think the winner in the market that we are playing in like will build [42:48] a platform. [42:50] ultimately. And I think it is this, like, how do you sort of expand your market incrementally and like not get ripped into a million pieces? And I think we're at this, this phase where as a business, we need to do whatever it takes, but we, we think like,

[43:02] we can acquire additional... [43:05] products and capabilities that will move the needle for our for our customers [43:09] You know, I think particularly having the ability to [43:12] you know, maybe it's even if it's a small aqua hire or just like acquire a product or a team that's building something really interesting, but might not have cracked the commercial code. I feel like we have. And so having them kind of come under the nominal umbrella makes a ton of sense. [43:28] And then I think [43:29] I, uh, [43:31] Really love... [43:33] bringing in [43:34] you know, former founders. [43:36] Um, I think they're just some of the best people to hire. Um, I think. [43:41] Like Ramp has done this extremely well. Like there's companies that have made a practice of like bringing those those people in. And I know people like that are amazing. And I'm I am obsessed with like knowing what they know. I think that's like that's where a lot of the value is, is like someone who's who's poured their heart and soul and engaged with hundreds or thousands of customers. [44:03] even if ultimately [44:04] whatever the outcome is, is like not hockey stick inflection. Like I want to know what that person knows. Like that's that's where value is. And so. [44:14] Um, you know, coming in and being a part of this like broader, how do we fix? [44:19] software for the industrial world is like, that's the mission. And the doors are wide open. So.

[44:49] that scan every single US stock, evaluates them, and instantly builds a custom index around your thesis. What really stands out is how clearly it explains why each stock is included. And before you invest, you can even backtest your idea against the S&P 500, so you're making decisions with real context, not just guessing. And beyond generated assets, Public lets you invest in stocks, bonds, options, crypto, all in one place. They'll even give you an uncapped 1% match when you transfer your investments over from another platform. If you want to build a portfolio [45:19] actually reflects your thesis, visit public.com slash sorcery paid for by public investing full disclosures in the description. [45:27] Founders ship faster on deal. Set up payroll for any country in minutes, hire anyone anywhere, get visas handled fast, and get back to building. Visit deel.com slash sorcery. That's deel.com slash s-o-u-r-c-e-r-y. [45:43] Do you feel pressure from your competitors? [45:46] I really think the competition for us is... [45:51] navigating [45:53] bureaucracy. [45:54] And, you know, [45:55] It is to Trey's point, it is like. [45:59] delivering enough value that you rip out the prior generation of [46:04] really sticky product. [46:06] The National Instruments, Emerson, Siemens, ANSYS, MathWorks. [46:09] companies doing billions in software revenue is like, [46:12] that's the competitive landscape for nominal and we have to reach we are doing it now we have to reach an activation energy where it like makes sense for them to actually you know like shift over um but uh but i think we're doing it so

[46:25] Apart from potential acquisitions, with this funding, are you going to be hiring more? [46:30] Yes. [46:31] We are around... [46:34] It's that stage of company growth where I don't actually know the actual number, which is really exciting. I think we're around 125 people right now and plans to go to around... [46:43] 220 or 230, right? So pretty significant. [46:48] growth this year headcount growth like is not the objective of a company by the way um the companies exist to [46:54] to make money. But I think the human beings that help power that are really, really important. You know, you've reached the point of scale. [47:02] There's no return from when one of your new employees walks up to and introduces themselves and ask how long you've been there. Yes, that's that's how you know Yeah, I feel like that was happening I feel like that was happening to you too Trey when you like walk around even when I was there at and roll like walk around and people be like [47:21] But yes, yeah, we're we're I think starting to reach reach that zone, but um, I mean that was another reason I think for a [47:29] going full circle for like doing the, the fundraise now, I think was to like, um, [47:33] this sort of cost, if you will, of talent acquisition is a real thing. And so like going into this year, we knew that we needed to really like put our foot down on the gas. And so doing another financing, you know, growing the company makes all the sense in the world to get behind that. [47:48] For both of you, [47:51] andrel side investor side and also nominal side [47:55] How do you recruit and find talent that meets the criteria of this new environment? I mean, it's completely changed to some degree of understanding of new tools and...

[48:06] kinds of stuff like that. But I'm curious how you're thinking about recruiting from that standpoint and continuing to find like the top quality of talent as the game and like [48:16] I guess the rules keep on changing. [48:18] I mean, I can start with, I think, something that I believe will be common amongst both our answers, but like the mission matters. I think that is like a huge issue. [48:27] advantage that like nominal we get to build software that we have an office in New York. It's like the greatest talent arbitrage. New York is obviously it's expensive, but like there are turns out there are tons of really good software engineers in New York who've been working in. [48:41] the sassification world and they're like wait i can build software that helps people with like [48:46] you know, [48:46] autonomous aircraft and fusion reactors and, you know, UUVs and, you know, humanoid robotics, like sign me up. Right. And so I think for us, it's like this certainly it's defense, but I think it's even a broader mission of like helping people build build real real world things like have a real impact. So the mission is huge. And then oftentimes, you know, if we're competing with like a larger company or [49:09] an AI lab or something, I'll just sort of say like, dude, is your life's? Do you think you're like life's work is to be the [49:15] I don't know. [49:17] 3000 person at Company X and then just sort of like leave them thinking about that and pondering it or do you want to come join something like. [49:26] early you know in a nominal world where we're growing like that's an advantage that we have at this the size that we're in but [49:31] Yeah, God forbid they become the 3,000th person at Anderil. Yeah.

[49:36] They're an exception. Well, I think we ran this campaign last year, the Don't Work at Anderil campaign, where the whole point was not to say, we want to massively increase top of funnel or something like that. There's a lot of people that are already applying. The point is that like, [49:53] Most of the things that are out there right now are pretty dumb. And, you know, there are a lot of really brilliant founders that walk in the doors of Founders Fund here. And, you know, they'll start by saying, you know, we're mission focused. We want to make the world a better place. And then, you know, they pitch an ad optimization software company. And it's like, man, I'm having a really hard time squaring the thing that you drew on the whiteboard with like, [50:19] the words that are coming out of your mouth. [50:21] And so I think to Cam's point, yeah, I mean, the mission matters a lot and it needs to be believable. You can't like have some, you know, voodoo sorcery that you try to convince people of like. [50:33] you know these people are smart they're they're gonna see through the bs and uh so i think [50:39] Actually doing something that matters it makes recruiting a lot easier choose your choose your quests choose good quests. Yeah, that's right Don't be a sheep [50:48] Don't be a sheep. That's right. [50:49] How many can we keep going? [50:53] As we wrap up, [50:57] I want to know, what is your biggest piece of Anduril lore? [51:03] Trey, you got to go first. I got to go in the way back machine. I mean, there's so much general lore.

[51:08] Um... [51:09] yeah i think funny apple valley story since you brought that up um you know in the very early days uh we had this test site that was on private land out in apple valley california not a place you want to spend a lot of time um and we just had a trailer um that everyone would pile into uh it would it smelled terrible it was so hot and uh you know [51:32] It's not San Francisco. So at the end of the night when everybody retreats to what the hotel was it was like a Double tree or something like that. I like you know one of the interstate highway hotels and people would be like guys tonight and [51:46] Chili's. Yeah. We are going to live... [51:49] The Luxe life we're gonna eat at Chili's tonight. Chicken Krispers. Chicken Krispers. Yeah, the potato skins the cheesy potato skins and [51:57] Yeah, I mean, [51:58] Those are the days. Smelly trailers and... [52:01] Crappy food from Chili's. Yeah, I slept at that trailer [52:08] Brian yeah, Brian Schimpf had many early mornings there as well. So yeah, there's a that's lots of lots of crazy stories in the early days We had the towers that we now have, you know, they're deployable out of the back of a pickup truck They're deployed all over the world actually at this point That was originally literally the all the sensor payloads everything was literally on a telephone pole [52:31] in Apple Valley. We didn't even have a collapsible tower. It was just like, [52:34] Wooden telephone. I remember we had oh I'll add to this one and then I remember we had um, I

[52:39] Like the most this thing was like, in my opinion, was like kitted out like ATV. [52:44] that we would use to go like [52:46] If you had a successful intercept, obviously, you'd have to go find the drone in the desert, all these bushes and shrubs and stuff. And the best job was getting to put the helmet on and hop in and go GPS locate. You'd literally be like, boop, boop, boop. And you're ripping, like 35 miles an hour. Just going over bushes and stuff. Obviously, that's what you needed to do. You needed to have. Of course. That was definitely the best job. Required. Professional metal detector. Matt's out in the desert. [53:16] Yeah, I'll do that. I got it. Yeah, yeah. Lastly, [53:21] Anything we miss that you want to share with the world? [53:23] um i mean i'll just i'll i'll uh i'll really double down on um we're gonna hire probably 120 130 maybe even 140 people this year um potentially even more um [53:33] And the mission matters. I think if you want to be a part of something that's going to redefine how [53:40] the next industrial wave is like is built. Um, [53:43] for the next, you know, three, four or five decades. Um, would love to have you at nominal, um, be a part of the team. [53:50] He's speaking to you, by the way. Thank you. Are you hiring a podcaster? [53:58] Worst decisions have been made. You do have $185 billion. I don't know what Trey would think about use of funds. He'd be like, do you guys really need a podcast or no? But maybe. Maybe.

[54:11] Okay. Well, thank you so much, Cameron, Trey. [54:14] Congratulations. Thank you. [54:16] Thanks, Bobby. All systems nominal. [54:19] Delta call. [54:20] hey it's molly if you enjoy our interviews check out our newsletter sorcery.vc where we deliver a once a week top deals and tech headlines email and also go deeper on our podcast interviews subscribe to sorcery today and don't forget to subscribe to the podcast on youtube spotify apple or wherever you listen link in description to sign up