"Five percent is too low. No way," Nick said, shaking his head.
Sarah Gerstenmaier frowned. "You have to realize that five percent represents five hundred million dollars. You're getting five hundred million just for providing the tech. You don't have to put up a dime of capital or shoulder any of the risk."
Nick waved that off. "Who says we aren't putting anything up? This tech needs to be overhauled and optimized for real-world scenarios. That means my team is going to be neck-deep in R&D for the foreseeable future."
"Plus, if there's a data breach or a leak, we're the ones on the hook."
"Our engineers can handle the optimization. As for security, SpaceX's protocols are world-class; you won't have to lose sleep over that," Sarah countered.
Nick looked at Sarah with an expression of pure disbelief. "VP Gerstenmaier, you clearly didn't read your CEO's briefing."
"This tech is on the military's sensitive list. The core source code cannot be made public, and we can't let your staff touch it. We have to manage the entire backend ourselves. Do you get what that implies for our workload?"
Her face flushed. She had jumped into this negotiation at the last minute and had only skimmed the bullet points of the partnership. When it came to the gritty technicalities, she was clearly out of her depth.
Nick was actually a little stunned. Why would SpaceX send someone who didn't understand the industry to lead a ten-billion-dollar talk? He felt for Musk; it sucks when the home office sends a "suit" to override the person who actually knows what's going on.
"Six percent. My apologies for the oversight," Sarah said, recovering her composure instantly as if she hadn't just tripped over a massive detail.
Nick held up two fingers. "Twenty percent. We aren't being greedy, and we have zero intention of micromanaging the company."
"To put it simply: as long as our rights are protected, we'll stay out of your hair when it comes to the day-to-day operations."
Sarah's eyes lit up at that. She thought it over for a second. "Eight percent. That is our absolute ceiling."
"Twenty percent," Nick repeated firmly.
"Even at eight percent, if this company goes public, those founder shares are going to be worth a fortune," Sarah argued, her annoyance starting to show.
Nick leaned forward, hands flat on the table. "Look, we both know why you're really building this company. Don't nickel-and-dime us on the equity."
"Twenty percent is a bargain. If I took this to any other firm with deep pockets, they'd be offering me way more just to keep it away from you."
Bargaining with her was a marathon. She had a strange talent for dragging things out, and Nick half-wondered if she'd learned her negotiation tactics at a high-end flea market.
The talks hit a total standstill as neither side budged. Fortunately, everyone had nowhere else to be. Nick was annoyed, but this was his future on the line, so with Tyler backing him up, he held his ground.
Eventually, they both started gravitating toward a number around fourteen percent. Realizing they were reaching the "take it or leave it" point, they called a recess.
After a day to sleep on it, they didn't waste much time and settled on 14.3%. To keep the cap table clean, Sarah agreed to pay an extra thirty million cash to buy back that 0.3%.
Nick's crew was more than happy to take the cash. A fraction of a percent didn't change their leverage, but thirty million in cold, hard startup capital was a massive win for them.
With the equity settled, the rest of the contract fell into place like dominoes. Since Nick didn't want to run a logistics empire, he gave ground on the operational terms to keep the momentum going.
"VP Gerstenmaier, it's been a pleasure."
"Likewise."
Under the glow of several camera flashes, Tyler and Sarah signed the documents and shook hands.
For the ceremony, Tyler had dropped over a grand on a custom-tailored suit. Since he was built like a linebacker, off-the-rack wasn't an option, and the custom fit actually made him look pretty sharp—less like a college kid and more like a tech mogul. The rest of the guys were already making plans to get their own.
Nick had insisted on Tyler being the face of the signing. For one, Nick hated the spotlight. More importantly, it was a security move—the "engine room" guys are safer when people don't know their faces.
Besides, whoever sent that "X" to Miami was still out there. Being low-profile was just common sense.
The news of the SpaceX deal didn't actually set the world on fire. The logistics industry had been flooded with "disruption" announcements lately. UPS was bragging about an eight-hundred-million-dollar sorting hub, and FedEx was talking up its new automated warehouses.
To the general public, this was just another press release from SpaceX—just "corporate speak" about another project.
Inside the industry, however, people were definitely whispering. Everyone wanted to know what this "Super Intelligent Logistics Network" actually entailed.
Most old-school logistics guys laughed it off as a gimmick or a marketing buzzword. That was exactly why they hadn't bothered to bid against SpaceX for Nick's time.
SpaceX, for its part, was staying tight-lipped. They wanted to keep the competition sleeping until "Albatross" was ready to swoop in and take over.
In Nick's view, SpaceX was just being smart. They still needed the traditional carriers to move their packages for now. There was no point in picking a fight until they were ready to win it.
That was why they were willing to drop ten billion dollars to build this thing in the shadows.