The Closest I’ve Ever Been to Changing the World (4) — How Do They Make Money?

Continuing from the last post, Troy said they now have two business models.

The first is called the BOOM model — Build, Own, Operate and Maintain.

It’s essentially a real estate developer model: they dig the tunnels themselves and own the properties, just like building highways underground, and anyone/anything that pass through the tunnel has to pay.

He said they currently have three private underground transmission projects using this model, which can deliver 6 gigawatts of clean energy to the grid, and they’re planning to expand to Europe and Asia afterward.

I asked, “Is 6 gigawatts a lot?”

He chuckled: “That’s a lot — roughly equivalent to 600 nuclear power plants.”

Then he introduced the second model, called the Badass model (we both laughed when he spelled the name).

He said “Badass” stands for Boring and Drilling (or Digging) as a Simple Service.

In other words, they sell their service the same way others sell SaaS.

They don’t sell their plasma tunnel-boring robots — instead, they own the machines and use them to dig tunnels for other developers.

He said their R&D has been going on for seven or eight years, and they now have around 1,200 trade secrets plus 162 patent claims.

For different types of rock (like granite, etc.), they have different melting formula ratios — each rock type requires a unique composition of 7 or more variables.

These melting ratios are not patented, because patents would require public disclosure.

Instead, they are trade secrets.

Only three people in the company know these formulas, and all three must agree before any information can be shared.

I said, “That sounds like cooking — you have your own secret recipe, and if others want to eat this dish, they can only come to your restaurant.”

He laughed too and said, “Pretty much.”

He said the Badass service model has an extremely high gross margin — between 60% and 200%.

Because the technology is so exclusive, many contractors, general contractors, and developers simply don’t have vibration-free, pollution-free, noise-free technology.

If they want to bid on projects, they have to use blasting — but blasting isn’t allowed near schools, residential areas, or substations.

So basically, almost no one else can do it — they’re practically a monopoly.

Between these two models, BOOM means developing, owning, and operating the tunnels themselves —and anything that flows through those tunnels — electricity, data, water, cables, goods, even people — can be a revenue source.

At the same time, Badass model means providing the tunneling service and charging high margins as well.

He said, “With this model, we can even collect tolls for the next hundred years.”

I laughed: “That’s totally passive income — you don’t have to do anything, just sit back and collect fees.”

Then I asked: “But those margins sound insane — can you share more detailed numbers? How are those margins calculated — how much do you invest, what’s the output, what’s the return?”

To be continued next time!