Josh Giegel is hyperloop’s true believer — and its best hope

Virgin Hyperloop's new CEO has been working on the tech longer than almost anyone. None of it has been easy, but he's still convinced it's the future.

Josh Giegel and Sara Luchian

Josh Giegel (left) sits next to Sara Luchian in the first human test of the hyperloop.

Photo: Virgin Hyperloop

The first time Josh Giegel heard about the hyperloop, he was not impressed. This was 2013, and Elon Musk had recently dropped the Hyperloop Alpha paper, the concept document outlining "the only option for super fast travel" that would be "the best thing short of actual teleportation." Giegel's response was to pick up the phone and call one of the paper's authors. "I knew a bunch of the guys that wrote it," Giegel told me, as they'd worked together at SpaceX. "So I called up one of them and was like, your calcs are wrong, dude." Among other things, Giegel thought the hyperloop would require way more energy than the paper figured. "The concept doesn't work in the way that's presented in this paper," he told his friend.

But the idea never quite let go of Giegel. The more he thought about it, the more it felt too big to not at least try. If hyperloop worked — a big, fat "if" — it could be a game-changer for the environment, for economies all over the world, even for the everyday experience of life on Earth. "There really hasn't been a new form of transportation in 100 years," Giegel said. "And now you have the chance to build a new system, one from scratch, one that invokes the 21st-century principles of on-demand and sustainable? One that hasn't been conceptualized, and one that will be here long after I'm gone? Sign me up."

Since then, the now 36-year-old Giegel has made hyperloop his life's work. He co-founded Hyperloop Technologies in 2014, which became Hyperloop One, then Virgin Hyperloop One, and is now known as Virgin Hyperloop. Everything about the hyperloop, from the tech itself to the company created to build it, has been more complicated than Giegel or anyone else bargained for. (And the complications go way beyond the name.) But Giegel stuck it out. In November 2020, he became one of the first two people to ride in a hyperloop. And as of last week, Giegel is Virgin Hyperloop's CEO, running what most people agree is the most promising company in the industry.

Seven and a half years after Musk originally proposed the hyperloop concept, smart people all over the world continue to debate whether it'll ever actually work, and whether it's actually a good idea. Even Giegel hasn't always been sure. But he's ready to give everything to find out.

From the ground up

Giegel grew up in Pittsburgh in a family full of engineers, but fancies himself a bit of a polymath. He played trombone, ran cross country and played hockey, and those things seem to form his worldview — an appreciation for teamwork, a love of the outdoors, and an ability to push himself beyond his limits forged by endless weight fluctuations between sport seasons — as much as his engineering degrees from Penn State and Stanford.

Still, he was always going to be an engineer. Giegel family vacations were to places like Oak Ridge National Laboratory and the Air and Space Museum. And he spent countless hours working on cars with his dad, learning not only how cars work but how an engineer approaches a problem. "I remember thinking, 'How does he know how to do all these things?'" Giegel said. "And he basically said, 'I don't know how to do it. But I'm an engineer, so I just work through what is wrong.'"

In 2008, when Giegel was finishing graduate school at Stanford and debating starting a doctorate program, a former co-worker from a NASA internship reached out telling him to look into this little company called SpaceX. He interviewed for a job that September, on the exact week of SpaceX's first successful orbital flight. (Musk was Giegel's final interview for the SpaceX job, and Giegel remembered him as "quite the interviewer.") Giegel was immediately hooked.

One thing Giegel learned early on at SpaceX, from Musk and from co-founder Tom Mueller (who was Giegel's boss), was that it takes a toll to build a company. "I remember that excitement, that passion that comes with being a founder of something," Giegel said. "And if you don't live it, if you don't breathe it, if it's not fully consuming, it's not a passion story." That feeling stuck with Giegel: He poured himself into the work he was doing on the propulsion team. In 2012, he spent the first night of his honeymoon watching the Dragon craft dock with the International Space Station, which he says now was a little insane but also a good sign that his wife, Stephanie, was a keeper.

Giegel left SpaceX soon after and spent a couple of years at an energy company called Echogen. "I wanted to move into something a little bit more terrestrial," he said. "Something that was going to help out us as humans that are on this planet, because this planet is pretty good." But it wasn't long before he was pulled back by the sheer ambition of the space business, this time via a new company called Virgin Galactic.

He started at Virgin in May 2014. After all of a week on the job, an old SpaceX co-worker named Brogan BamBrogan approached him about doing something with this crazy hyperloop idea. BamBrogan had been talking with an investor named Shervin Pishevar, and they were intent on building the next generation of faster, more efficient travel. (Neither BamBrogan nor Pishevar responded to a request for comment.) The more they talked, the more the story became too enticing for Giegel to walk away from. This was somehow both Earth-bound and outrageously ambitious.

By October, Giegel had quit his job to go do this hyperloop thing. But before he started, he went on a vision quest — "I'll leave how I attained enlightenment to readers' imaginations," he said — and wrote himself a personal vision statement with every word carefully chosen. It said: "I will change the world through the technology I build." Will, not hope to. Build, not ideate. Technology, not company. The world, not Pittsburgh or Mars. Technology can't solve everything, Giegel figured, but it can solve a hell of a lot of things. And he'd spend his life building it.

Josh Giegel in Hyperloop Technologies' first garage. Giegel, in 2014, in the Hyperloop World Domination headquarters — also known as a garage.Photo: Virgin Hyperloop

Fast forward (presumably one serious comedown later) to Nov. 2, and Giegel and BamBrogan were in a garage in Los Feliz, standing in front of a whiteboard, trying to figure out how to turn a great story and a mathematically-flawed paper into the future of transportation. They called the garage "Hyperloop World Domination Headquarters," only partly as a joke.

Giegel and BamBrogan knew roughly how this thing would work when it was finished — low-pressure tubes, fast-moving vehicles — but didn't know exactly how to get there. They started developing and patenting every idea they could think of, from the plausible (magnetic levitation for the tubes, a la the high-speed rail in Asia) to the substantially less plausible (a thing they called the "snail shell," modeled after the mucus a snail lays down to glide across). They started hiring people, searching for office space and raising money. Their company was on the cover of Forbes well before it had done much to deserve it, with Pishevar promising to have the hyperloop "up and running in five years." Hyperloop was hot, and so was Hyperloop Technologies.

Bad companies kill good products

And then everything fell apart. BamBrogan and Pishevar began to clash; Pishevar eventually claimed in a lawsuit that BamBrogan was trying to stage a mutiny while BamBrogan alleged Pishevar was wasting company resources giving tours to Katy Perry and padding his own wallet. BamBrogan came to the office one day to find a noose on his desk, placed there by Pishevar's brother Afshin; the company claimed it was actually a lasso and a nod to BamBrogan's "trademark cowboy hat." And that was just one in a series of wild stories about life inside Hyperloop One. Fights became lawsuits, lawsuits became settlements. BamBrogan left the company in 2016, Pishevar in 2017, CEO Rob Lloyd in 2018. The company that had become the poster child for the future of transportation was now better known for its internal chaos. Only a year after the Forbes story, Hyperloop One was the subject of a very different kind of magazine story.

Where was Giegel in all this? He is by nature the type to just put his head down and keep working, so he mostly tried to do that. Eventually things got so toxic he emailed Lloyd a letter of resignation, before ultimately agreeing to stay after being promoted and added to the company's board of directors. (Lloyd didn't respond to a request for comment.)

He's diplomatic about the whole thing now, comparing the early crew to bandmates whose egos collide and threaten to kill the band with creative differences. But it all taught Giegel two valuable lessons: that sometimes you have to stand up for what you believe in, and that when you do you'd better be in a position to win those fights. "I need to protect this idea of what we're trying to do, and protect it from things that can keep it away," he said. Of course it's better when everyone's pulling together in the same direction, he said, "but at the same time, there are moments where you have to just put up the walls, like, 'you shall not pass.'" He said he still doesn't like giving the "put up or shut up" speeches, but he's getting better at them.

One speech of that kind happened in late 2019. Giegel called a meeting, and told everyone in the room to take a sticky note, write on it the name of the person they cared about the most, and stick it on their computer screen. (Giegel wrote two names: his wife and his son.) The names on those sticky notes, he said, were the people they were building the hyperloop for. They weren't done until they were willing to put those people in the pods. And then Giegel told his team it was time to start getting ready to put one of those people in a pod for a real-life test.

Giegel knew what everyone in the hyperloop business knew: that the whole industry was barreling toward a put up or shut up moment. This was either going to be a fun but fruitless scientific theory, or a real product with real potential worth real consideration. The only one way to prove the hyperloop's potential was to put someone in it and turn the thing loose. If it went well, it would change the conversation forever. If it went badly? "It's probably the end of the industry," Giegel said.

After lots of discussions, Giegel decided he should be the one in the first pod. "You always hear about leaders saying, 'If we succeed, it's because of the team, if we fail, it's on me,'" Giegel said. "Well, put your money where your mouth is. If we fail, I'll pay the price." If he didn't think it was going to work, how could he put anyone else at risk? He hoped choosing himself would be the ultimate vote of confidence in his team and the technology. So he started preparing his team and himself for the first ride, to happen sometime in the early summer of 2020.

Virgin Hyperloop test track Virgin Hyperloop's test track in the Nevada desert.Photo: Virgin Hyperloop

The pandemic beat Virgin Hyperloop to the punch. A week before the team was supposed to ship a pod out to the test site in Nevada to start preliminary testing, everything shut down. It wasn't until June that the Virgin Hyperloop team had the right safety and testing protocols in place to be back on site. They then spent several months with a smaller crew and more stringent rules, ironing out every detail down to the location of the fire exits. They ran hundreds of tests with dummies in the pod. A film crew was on hand to capture most of it, and there are dozens of hours of footage of Giegel sitting next to Sara Luchian, Virgin Hyperloop's head of passenger experience and Giegel's co-passenger for the first ride, just chatting and getting used to the place.

On the unseasonably cold and windy morning of Nov. 8, the Virgin Hyperloop team was finally ready to run the big test. That morning, Giegel said he wasn't worried about the test failing, or puking his guts out on camera, or the many things that could go wrong: "But I was petrified of the COVID test." A hundred or so people were coming to the site, including from the media, and a single positive test would shut the whole thing down. One by one everyone was swabbed, and one by one the tests came back negative. It was a go.

Not long after, Giegel and Luchian were loaded into an oblong white pod named Pegasus, and pushed into a depressurized tube at the beginning of a 500-meter track. Giegel, in a gray mock turtleneck and jeans, sat with his hands in his lap, headphones on, listening as his team counted down to launch. The moment the pod started moving, Giegel just grinned and said "Yes, yes!" Just 15 seconds later, after they'd accelerated to 107.5 miles an hour and then quickly slowed back to zero, the ride was over. "It was smoother than expected," Luchian said right after they unloaded. Giegel compared it to punching the gas in a sports car, with a quick lurch and then a pretty smooth ride. When the crew asked him how he felt, he just said, "amazing."

There's one moment, though, where it looks like a brief flash of nerves hits Giegel. When I asked him about it, he swore again that he wasn't nervous about the test. He was nervous about the video. "If we all looked too bouncy or whatever on the video, Ryan [Kelly, Virgin Hyperloop's communications chief] was going to make us go again and tell us to knock off whatever we were doing." There was even a plan for a second run to get better video. Giegel was confident in the tech, but needed the video to help convince everyone else.

After the ride was over, Giegel could barely contain his relief and glee. Not just that he was still alive, but that all this time, all this effort, all this chaos had been worthwhile. He thought back to the time he found out his wife was pregnant, when she texted him a picture of the test while he was in Dubai for hyperloop stuff. Or the first time he saw his kid, on his phone at London's Heathrow Airport on a business trip while she was in LA getting an ultrasound. He'd tried to hold the company together through so much chaos, because he needed all that sacrifice to be worth it. And when he got out of the tube in Nevada, Stephanie was there with tears in her eyes. "She's never worked at this company," Giegel said, "but she's been an integral part of its success the whole time."

When Virgin Hyperloop published the video the next day, it became a global news story, and Giegel's life got even crazier. "People have become more open to the idea that the hyperloop is potentially viable," Rick Geddes, a Cornell professor who has worked on a number of hyperloop projects, said. "And there's been growing interest, globally, in attempting hyperloops in various routes." Seventeen states applied to be the home of a new Virgin Hyperloop certification center (West Virginia came out on top), while governments around Asia and the Middle East, particularly in India and Saudi Arabia, are investing huge sums in building hyperloops between cities. And under Elaine Chao, the U.S. Department of Transportation began the process of figuring out how to regulate hyperloop. Pete Buttigieg, the country's new transportation secretary, said in his confirmation hearing that he viewed hyperloop along the same lines as automated vehicles, and that he was eager to make sure "these new technologies can flourish in a safe way."

Virgin Hyperloop render The first hyperloops are likely to be for cargo and in the Middle East.Photo: Virgin Hyperloop

Living proof

On Feb. 15, Sultan Bin Sulayem, Virgin Hyperloop's chairman, announced that Giegel had been promoted to CEO. "Josh has been a consistent visionary at Virgin Hyperloop from the early days when hyperloop was just an idea drawn on a whiteboard in a garage through being the first passenger on our system," the company said in a statement. "During the last six years, he has taken that vision and turned it into a reality." The next phase of hyperloop is about making sure that what worked once on a test track in Nevada can work anywhere and everywhere, all day everyday, for decades to come.

The first practical use for the hyperloop, almost everyone seems to agree, will be for cargo. It's much easier to build and regulate a system for quickly moving fish from port to warehouse than it is to shuttle people from LA to San Francisco. But Giegel doesn't want to stop there. "If there's one hyperloop in the world by 2030, it's like a drop in the bucket," he said. "If there are 100 hyperloops by 2030? Now we're making some serious inroads."

Getting there will likely be even harder, and will both take longer and cost more than it has already. Just getting the land required to build ramrod-straight tubes over hundreds of miles between crowded cities is going to be something near impossible. "We've done the proof of concept," said Jay Walder, Virgin Hyperloop's CEO from November 2018 until Giegel's appointment last week. "How do we actually move to this being a real transportation system? How do we move to industrializing? And how do we move to having a regulatory process and a certification process that gives us comfort about it?"

There are plenty of critics who still say this is just a bad idea, too. "Technically it can be done, but safety and cost are a very big concern," said Douglas Hart, an engineering professor at MIT. "Is the additional speed worth it? I tend to think not." Critics have long said that hyperloops, even if they work, will be too fragile, too expensive, too intrusive and too complicated, all in the service of what amounts to a somewhat faster train.

Giegel is unfazed by these arguments. Critics said the same about the car, the train and the plane, he likes to say, and those turned out OK. Hyperloop's been through a lot already, and Giegel trusts his ability to sort through any problem he encounters. He said he often meets with leaders and partners who ask him how he's so sure this is going to work, when their advisers say a hyperloop is decades away.

"And I say: 'Well, I rode on one.'"

Image: Yuanxin

Yuanxin Technology doesn't hide its ambition. In the first line of its prospectus, the company says its mission is to be the "first choice for patients' healthcare and medication needs in China." But the road to winning the crowded China health tech race is a long one for this Tencent- and Sequoia-backed startup, even with a recent valuation of $4 billion, according to Chinese publication Lieyunwang. Here's everything you need to know about Yuanxin Technology's forthcoming IPO on the Hong Kong Stock Exchange.

What does Yuanxin do?

There are many ways startups can crack open the health care market in China, and Yuanxin has focused on one: prescription drugs. According to its prospectus, sales of prescription drugs outside hospitals account for only 23% of the total healthcare market in China, whereas that number is 70.2% in the United States.

Yuanxin started with physical stores. Since 2015, it has opened 217 pharmacies immediately outside Chinese hospitals. "A pharmacy has to be on the main road where a patient exits the hospital. It needs to be highly accessible," Yuanxin founder He Tao told Chinese media in August. Then, patients are encouraged to refill their prescriptions on Yuanxin's online platforms and to follow up with telehealth services instead of returning to a hospital.

From there, Yuanxin has built a large product portfolio that offers online doctor visits, pharmacies and private insurance plans. It also works with enterprise clients, designing office automation and prescription management systems for hospitals and selling digital ads for big pharma.

Yuanxin's Financials

Yuanxin's annual revenues have been steadily growing from $127 million in 2018 to $365 million in 2019 and $561 million in 2020. In each of those three years, over 97% of revenue came from "out-of-hospital comprehensive patient services," which include the company's physical pharmacies and telehealth services. More specifically, approximately 83% of its retail sales derived from prescription drugs.

But the company hasn't made a profit. Yuanxin's annual losses grew from $17 million in 2018 to $26 million in 2019 and $48 million in 2020. The losses are moderate considering the ever-growing revenues, but cast doubt on whether the company can become profitable any time soon. Apart from the cost of drug supplies, the biggest spend is marketing and sales.

What's next for Yuanxin

There are still abundant opportunities in the prescription drug market. In 2020, China's National Medical Products Administration started to explore lifting the ban on selling prescription drugs online. Although it's unclear when the change will take place, it looks like more purely-online platforms will be able to write prescriptions in the future. With its established market presence, Yuanxin is likely one of the players that can benefit greatly from such a policy change.

The enterprise and health insurance businesses of Yuanxin are still fairly small (accounting for less than 3% of annual revenue), but this is where the company sees an opportunity for future growth. Yuanxin is particularly hoping to power its growth with data and artificial intelligence. It boasts a database of 14 million prescriptions accumulated over years, and the company says the data can be used in many ways: designing private insurance plans, training doctors and offering chronic disease management services. The company says it currently employs 509 people on its R&D team, including 437 software engineers and 22 data engineers and scientists.

What Could Go Wrong?

The COVID-19 pandemic has helped sell the story of digital health care, but Yuanxin isn't the only company benefiting from this opportunity. 2020 has seen a slew of Chinese health tech companies rise. They either completed their IPO process before Yuanxin (like JD, Alibaba and Ping An's healthcare subsidiaries) or are close to it (WeDoctor and DXY). In this crowded sector, Yuanxin faces competition from both companies with Big Tech parent companies behind them and startups that have their own specialized advantages.

Like each of its competitors, Yuanxin needs to be careful with how it processes patient data — some of the most sensitive personal data online. Recent Chinese legislation around personal data has made it clear that it will be increasingly difficult to monetize user data. In the prospectus, Yuanxin elaborately explained how it anonymizes data and prevents data from being leaked or hacked, but it also admitted that it cannot foresee what future policies will be introduced.

Who Gets Rich

  • Yuanxin's founder and CEO He Tao and SVP He Weizhuang own 29.82% of the company's shares through a jointly controlled company. (It's unclear whether He Tao and He Weizhuang are related.)
  • Tencent owns 19.55% of the shares.
  • Sequoia owns 16.21% of the shares.
  • Other major investors include Qiming, Starquest Capital and Kunling, which respectively own 7.12%, 6.51% and 5.32% of the shares.

What People Are Saying

  • "The demands of patients, hospitals, insurance companies, pharmacies and pharmaceutical companies are all different. How to meet each individual demand and find a core profit model is the key to Yuanxin Technology's future growth." — Xu Yuchen, insurance industry analyst and member of China Association of Actuaries, in Chinese publication Lanjinger.
  • "The window of opportunity caused by the pandemic, as well as the high valuations of those companies that have gone public, brings hope to other medical services companies…[But] the window of opportunity is closing and the potential of Internet healthcare is yet to be explored with new ideas. Therefore, traditional, asset-heavy healthcare companies need to take this opportunity and go public as soon as possible." —Wang Hang, founder and CEO of online healthcare platform Haodf, in state media

Zeyi Yang
Zeyi Yang is a reporter with Protocol | China. Previously, he worked as a reporting fellow for the digital magazine Rest of World, covering the intersection of technology and culture in China and neighboring countries. He has also contributed to the South China Morning Post, Nikkei Asia, Columbia Journalism Review, among other publications. In his spare time, Zeyi co-founded a Mandarin podcast that tells LGBTQ stories in China. He has been playing Pokemon for 14 years and has a weird favorite pick.

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