OODA Loop in City Hall: How El Segundo's Mayor Is Running America's Most Adaptive City | Chris Pimentel

Hard-tech by the beach might sound like a punchline—until you see how El Segundo runs. We sat down with Mayor Chris Pimentel to unpack how a square-mile city beside LAX became a magnet for space, defense, toys, esports, and pro sports by pairing clean civic norms with fast, predictable government. From refinery roots to rockets on the runway, the throughline is stewardship: keep the rules clear, the streets spotless, and the talent close, then get out of the way so people can build.

We trace a century of making, from Standard Oil’s second refinery to Cold War aerospace and the SpaceX era that minted a generation of founders. The mayor explains why density of PhD engineers rivals Silicon Valley, why suppliers and specialists cluster on the same streets, and how that proximity compresses iteration cycles for dual-use tech. We dig into the city’s strategic edge—speed enabled by transparency—and how staff helps teams “get to yes” safely while pointing truly hazardous work to the right test ranges. When companies outgrow local square footage, El Segundo plays honest broker with neighbors like Torrance and Long Beach to keep ecosystems intact.

Beyond defense and space, we explore the city’s diversification: training centers for the Lakers, Kings, Chargers, and Sparks; America’s toy capital lineage anchored by Mattel and Asian manufacturing ties; biotech that benefits from airport proximity; and a growing esports footprint. Vision 2050 rethinks zoning around outcomes instead of rigid labels, keeping land use flexible as markets shift. We also cover the SVB shock, when the city “committed the reserve” by curating service providers for young founders, and the fiscal turnaround from thin reserves and pension risk to a larger general fund, 25 percent reserves, and structural discipline.

If you care about building real things—satellites, sensors, life sciences, or new leagues—this conversation is a field guide to how culture, policy, and place can supercharge innovation. Listen, share with a builder friend, and leave a review to tell us which city should borrow this playbook next.

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Transcript

From Quantico To City Hall

Mark McGrath 0:21

Did you ever think 29 years ago that one day we'll be recording a podcast together and you were the mayor of a city in California? 100%, obviously. My Magic Eight Ball. This was the part of the hexagon that popped up. I was definitely on the uh definitely on the bingo card of uh young 21-year-olds at the time.

Chris Pimentel 0:40

Magic 8 ball, describe my 2020s. You will be in a mid-sized city on a podcast with the artillery officer next to you. I tell you, you're a 76er too, right? Uh in terms of birth year? Yeah. I didn't realize we were going to go into that level of depth on age. I've I'm obviously 27.

Mark McGrath 0:56

Well, no, I know that we both hit a milestone this year. Well, at least I do in May.

Chris Pimentel 1:01

Well, so what's the uh is it Joy Division's lead singer? It was like nothing good happens after 25, so it could be.

Mark McGrath 1:08

Well, I was I was actually for this, yeah. I I I normally wear this black hoodie and the and the you know the Yankees had it in like 99% of the podcasts we record, but I actually was gonna put on the 1976, you know, we have our official logo. Like if we were born in 76, we've got that star logo. And I have I have the t-shirt. This being the 250th, uh, you know, what a better time to wear it, I guess. But that's right. It is the year of the dragon. And yes, and this now we're the we're the fiery horse this year, I believe. I believe so. So all right, Chris Pimentel, mayor of El Segundo, Brother Marine, OCS classmate from the summer of 97. Here we are. I tell you, what wanted to get you on the show. I was out recording with a friend of mine, John Becker, on his podcast, The Debrief, and I flew out to LA, and then I had uh an extra day to stay out there, and I spent that with you in El Segundo, and I was absolutely floored of what's going on because I think there's what happens in California, and then there's like the rest of the world, what everybody thinks is happening in California, depending on where you get your news from. But what really blew me away was, you know, one, my my my buddy's the mayor, right? But number two, it's like, wow, there's a lot going on here. Like this is a thriving, hopping town. What is happening in El Segundo? What are you putting in the water out there?

Chris Pimentel 2:31

Yeah, you know, I think part of it, and and you touch on this a little bit, is you've got to carve out sort of the noise around you and say, what does what does our city do? And in a state that is bigger than Canada population-wise, bigger than Australia, there is a very besides the diverse demographics, there are diverse cultures, there's different ways to approach things. And we're fortunate in El Segundo that going back for a hundred years, this has been a spot in Los Angeles County, which has 88 cities, mind you, but a spot in Los

Mapping El Segundo’s Strategic Location

Chris Pimentel 3:00

Angeles County that people have always made things. And not just in a workshop manufacturing sense. It's a place where people have have viewed the world in a very almost classically American Western, like if I can imagine it, I can make it sort of thing. So we started out with Standard Oil's second refinery in California, which is the biggest refinery on the West Coast. And they put that right here on the dunes overlooking the ocean. And from that engineering talent and that sort of can-do spirit evolved a robust aircraft industry, and then from aircraft to space. And all of the things that go around that, all of the who's going to do the wiring harnesses, who's going to make the assemblies, who's going to make the fittings, all of those sorts of innovations have just grown and grown and grown. Uh, and with it the technological talent just attracts more talent. So it went from basically being a place that was sending six million gallons of jet fuel a day to to LAX to a place that now births SpaceX uh and Varta space and beyond meat, and you know, we host major sports teams. It's a it's a it's a really dynamic place, but what undergirds it is sort of irrespective of you know ethnicity, race, place of origin, state of origin. I mean, I'm originally from Kansas, right? What what what unites this place is the very cultural sense of we are in this together to make new things.

Mark McGrath 4:18

So one of the cool things, so so from layman's layman's perspective, or at least an artillery marine, I think we were standing on a roof at a uh at a party, and then like the so one side of El Segundo is the refinery complex, and then the other side is LAX, and then sort of the west side is the ocean, and the east side is LA proper or some of the other cities. Is that is that a fair assessment?

Chris Pimentel 4:42

Yeah, to orient to the map, if you if you fly into LA, you're typically going to land aimed at the ocean, right? LAX aimed at the ocean. And to your right is Marina del Rey and Venice Beach, and then Santa Monica, and sort of your classic city of Los Angeles stuff. On the left are the beach cities. So you'd look down the beach and see Manhattan Beach and Hermosa and Redondo. But right next to you, right on the left, would you lay it, is El Segundo. And it is totally contained between the ocean, the refinery, the airport, and then behind us, you sort of spill out into Hawthorne and then the city of Los Angeles. But we have that logistical advantage of being right in the heart of things. We have two heavy gauge railroads, we have two freeways coming in and out. We used to have a port. Now the port is just just services the uh the super tankers for the refinery. The port is is now in Long Beach and the port of LA. But we are logistically located centrally that has always sort of attracted you can kind of start here in Los Angeles. You can arrive and really start here. If you're coming from Asia, you will start right here.

Mark McGrath 5:41

And for like the for those of us out here and we think of places that have refineries and others, we're like, well, I wouldn't why I wouldn't want to live, I wouldn't want to live or hang out in any of those places. But what's really interesting about El Segundo is it's actually nice. Like you're, you know, it's like nice houses and nice, nice downtown and nice restaurants and nice, nice places to go. So again, the the eastern idea of a refinery area is not really a posh place, if you will. But but but also El Segundo seems to be doing something completely different, how it's laid out and set up. Was it always like that?

Chris Pimentel 6:12

Well, yeah, well, I think if you can imagine it, right? People say, look, we want to live next to a refinery. How do we do that? And I think part of it is is working with the refinery if it's completely ringed by air monitors, high-end air monitors. So at any time you can check air quality. We do a lot of emergency management

Culture, Norms, And A Kept City

Chris Pimentel 6:25

preparation for them. It runs quietly, it runs cleanly, it runs smoothly, it is well landscaped so you don't have to stare at parts you don't want to stare at. But that is just really an elemental piece of, you know, you can shake your fist at things and say it's going to be gross. Or you can say, how do we make this something that is enhances our quality of life and we have a great partner in it? I I I think there are a few spots in California that have done that very, very well. There's some that I think probably approach it and something that that you or I might have remembered as sort of a classic, I guess we're talking in sort of stereotypical pieces, like your classic East Coast. I live next to the steel mill, here's what the steel mill will look like.

Mark McGrath 6:59

Right.

Chris Pimentel 7:00

We just approached it differently.

Mark McGrath 7:02

And it's and it's sustainable. Again, it's like a place that you would go even if you weren't working at one of those firms or whatever, like it would be a great place to stop before you get on a flight back east, is to go to have dinner in El Segundo before you catch your red eye.

Chris Pimentel 7:17

Yeah, it it looks, I mean it would peace people sort of joke that it's Mayberry by the sea, but the joke lands because it's true. I mean, it is a main street that could have teleported in from 1950, just add a lot of fiber optic cable to it and Wi-Fi. But you know, the buildings are very intentionally maintained in a way that reflects sort of the way people want to live. And it it it is, you know, it attracts like any place that has a strong culture, it attracts people who are attracted to that culture, which kind of reinforces it. I tend to joke that as a city, we are a city with very few rules, but a tremendous amount of norms. The norms of how people treat one another in the sense of volunteerism. We can run a very lean city staff because people volunteer their time to do things. I don't have to contract out to pick up litter because no one litters. I don't have to have city staff run little league because little league runs itself. The soccer teams run itself. The parents run things here and run it effectively.

Mark McGrath 8:08

It was taken by the cleanliness too. That is that is definitely something that you realize when you're driving around the streets of El Segundo, that it is a it's it's it's not only it's it's kept. Like it's it's not uh it's it it's it's really well appointed in that respect.

Chris Pimentel 8:22

I mean, pride of pride of place is a thing. People here they love the fact that people build things and innovate. And innovators love the fact that it's a neat, clean town. So if even if you are making something that is a really dirty industry, if you're making a propulsion system, right? It's got oil and grease and hydrazine, whatever, people clean it up because they want, because they want the city to be the city they like.

Mark McGrath 8:43

Yeah. They take care of it. There is a so that's kind of a a good segue into, you know, you you're the leader of the city, uh, the city government of the municipal government. Um, and you do take a very well, I mean, you're you just described kind of a stewardship model.

Chris Pimentel 8:58

That's right. That's right. This is not, I do not pretend, and and no surprise to you because you've known me a long time. I'm not the world's most creative guy. And and I think that suits a city like this, that that we have a grand tradition of wonderful mayors who who who and wonderful city council people and wonderful city staff that don't show up to try and reinvent ideas. They do the things that that in a classic governmental sense governments are here to do, which is provide a safe and reasonably well organized society.

Mark McGrath 9:29

Are you term-limited or are are city council members term limited?

Chris Pimentel 9:33

No, you know, we're not. We're not. I think that like any place you have to don't be the last guy at the party, right? No when you've overstayed as part of the delegate balance. Yeah, because it is intoxicatingly fun to be involved in all of the cool things this city does. I mean, it's it's wonderful. You also have to know when it's time for for some fresh voices and and fresh ideas.

Mark McGrath 9:55

So speaking of that, you're bringing in a ton of people across uh various sectors. You've got some national security, some space, some some uh you know, hard tech. Give us a give us a feel of you know who's showing up to El Segundo and who's looking to hang a shingle out in El Segundo. Because it seems, again, that this is it again, it's evident when you're walking around. This is a growing, thriving place that people are flocking to that want to be a part of this. They want to be uh they want to be on the inn here in town. What's uh who who are they, and then let's let's go from there.

Chris Pimentel 10:30

Yeah, I'll I'll give like a two-second history snapshot to give a little bit of context for people. That the city when it started around the oil refinery in a hundred years ago grew rapidly. Then in the 90s, we had you know Howard Hughes and Alan Lockheed and Alan Boeing and Jack Northrop, and these guys show up and say, hey, we could build planes here, prevailing winds, good technical talent coming out of the refinery. So this sort of air industry was created and it thrived all

Century Of Making: Oil To Space

Chris Pimentel 10:55

the way through the Cold War and was joined by the space industry. We had a significant contraction that followed the peace dividend when the Cold War ended. So the city topped out at about 17,000 people in 1970 and then shrank with some part partly due to some tax reform in California. And at the end of the Cold War, we're down to about 13,000 people. But we still had this industrial base and a lot of facilities that were permitted in to do that. And that's where SpaceX started. And as SpaceX grew and matured, and in 2000, 2000, 2007, 2008, they had the big inflection point with government support. It grew rapidly, and then as it matured, it started calving off some high-end engineers. And those engineers were joined by the talent that already existed around Northrop and Lockheed and and these companies to form these new companies. So we had this sort of key base that goes in. So now we'll fast forward a bit to the start of the pandemic. The city was clearing out a bit. We had people who were staying away because people weren't coming to the office. And we as a city staff and city government were looking to sort of combat that, because that's a big part of our tax base. So we went to Silicon Valley, we started talking to a lot of the venture funds and said, if you have groups that are trying, if you have innovators who are not doing software and they're not doing crypto, if you have people who really want to make things, we've got room, we've got space, and we have this key piece of town. And we had some really key players come in. And I'll highlight Varda's space because Varda gave us a key data point. When they moved into town, if they had drawn an algorithm or created an algorithm that said, where can I find the highest density of PhD engineers in California? Number one was Silicon Valley. Number two is El Segundo. We played on that pitch, and we've started all of these people who have, with venture being willing to invest in dual-use technologies, some something that the only gov the only customer will no longer just be the government. It can be a it can go into space on a space edge space SpaceX rocket, uh really supercharged the amount of innovators we have down here. So we've got about $5.8 billion in venture investment into El Segundo since 2021. And with that, we've seen the population rebound here. I I think I I should have said when we were building airplanes heavily in the 80s, 90,000 people would come to work every day at El Segundo, on top of the 13,000 who lived here. Now we get about 55 to 70,000 come to work here every day, but we're back up to about 17,100 people and demographically younger people. So that's some of the energy that you and I saw on that rooftop that was just packed with people who were who are who are who have dreams of whether it's a new radar, a new UAS system, um, a new on-orbit capability. I was talking with a guy last night, and he's got a solar panel that's about two microns thick. I mean, if you think of that, that is what one sixtieth the the width of a human hair.

Mark McGrath 13:40

Yeah.

Chris Pimentel 13:41

I mean these remarkable sheets of of aluminum. And those are the sorts of people that are coming in here. It's really remarkable. I I don't want to ramble too long before we get to your next question, but that is on top of that is not our only industry, right? I mean, this is America's toy capital. 200 toy companies.

Mark McGrath 13:57

So when you think about like, you know, starting up businesses and moving your business someplace, um a lot of times you're gonna run into the obstacles and the bureaucracy and the red tape that comes with setting up. And El Segundo's taken a really revolutionary uh approach. Their orientation is completely different from a lot of places. I'm sure you could add some color on maybe compared to other places in California, but certainly across the states, you don't hear about speed being part of the process for companies moving or st or building something in the town. What's what's tell us about that?

Chris Pimentel 14:30

Yeah, I I I think for us this goes a bit to our overarching view of what government is here to do. And so for that, with but we provide services, police, fire, you know, the plans, plan check, permitting to do those, we want to tax you as little as possible. We want to justify all of those spends. So our tax plan is based on how many employees you have and how big your your your building is. That's what it takes us to provide services. With that, we don't tax gross receipts, right? We don't tax your revenue to take it. We don't, I think uniquely in California, treat our businesses like ATMs. We treat them as partners who we want to succeed. We have a really I know everybody says their staff is great. Our staff is great. I mean, they uh they understand the culture of the city that they're in. And when someone wants to come up with an idea, they're happily say, what do we need to do to make this safe? And if it's safe and if it works, then we're gonna get out of your way. And I I know I shared this story on the roof with you. A week I show up with a bag of yellow cake uranium. Say, hey, there's nothing in your city code that regulates uranium. Can I use this? And nobody panics, they're

Pandemic Pivot And Talent Density

Chris Pimentel 15:30

like, hey, well, I mean, we want to make sure that's 238. Right. That's less radioactive than bananas, like it's it's it's a stable isotope. But uh, you know, that that I think underscores the way we approach things. And it's a how do we get to yes? And if there's a real issue, if there's a if there's a no, we want to highlight that. If someone wants to do energetics and test bombs, like we probably can't do that. Uh we can do the RD piece, we can do the digital twins, we can do the modeling and those things. But if you want to do that, here are some suggestions we can make for them. Here's where China Lake is, there's Arizona, those sorts of pieces. But as a as a city, we try to work quickly. We don't have undue delays, we provide lots of almost consultative support where if someone has an idea they just want to bounce off us, you know, we can say, look, this is this is what we think will work and this probably won't, and really help people get their their idea off the ground and off the ground quickly. And I will add, I will add, you know, the city council, the way it is laid out, has a five different sort of well, four different expertises, and me who's an expert of none, but which are super helpful. I mean, we have a the mayor pro tem is a land use, right? Well then is a land use attorney. Like he can provide some some really good insight. The former mayor is a credible entrepreneur, right? He can talk about the challenges of doing things in California in a way that resonates with people who are starting things.

Mark McGrath 16:43

Yeah, I mean it's interesting. Speed becomes your strategic edge, right? You you're you're oriented effectively and downstream from an effective orientation is is speed, and you're able to get people in there quickly.

Chris Pimentel 16:56

Well, and the speed, the speed is enabled by the speed is enabled by transparency and predictability. Because people know there's not they're not dealing with a fickle and variable government, yeah, that speed is enabled by that predictability that helps us, that positions us, right, is a is a is a orientation um on the battlefield that that's really successful and resonates.

Mark McGrath 17:18

So I mean you don't have to name names, but I mean I imagine that a company that's going to start up, they look at a list of they yeah, they probably have a slate of candidate places where they want to set up or whatever. You know, what are some of the success stories that El Segundo edge somebody out? I imagine the the ability to permit fast and get things done quickly, I imagine that's a massive edge on top of the other things that you you mentioned. I mean, it seems like that clearly there's uh you know the tracks are already laid from an environmental standpoint to to be there. But what are what have been some of the scenarios where you know a company would be like, yeah, I'm gonna look at five cities, and yeah, we we chose El Segundo because.

Chris Pimentel 17:55

Yeah, I think that what's what's really interesting and one of the the difficult challenges of being a small city is knowing your role. So we overrepresent, and I'll use a an imperfect parallel here with with Dubai. Dubai is a very small place, it's not resource-rich in and of itself, although the Emirates have some resources. They over-represent themselves in regional bodies, and they over-represent themselves with the UN because they want to be able to guide their future a bit. So we over-represent in regional bodies, and that allows us to almost be a coordination point from some of our bigger, bigger neighbors like Inglewood, uh or Long Beach on the other side, and that provides us a unique piece with our business. Come back to what you said. When people choose a place, we're happy to engage with a company and say, here is our part of your ecosystem. I'll use Vast as an example. Vast, which builds, which is building private space stations. Vast has a piece in El Segundo. So, hey, we're going to start in El Segundo, but as they grow, you know, we don't try to hold them hostage to find them a bigger facility in El Segundo. If they are we know once they need 150,000 square feet, I can't probably provide that, but we're happy to work with them as they go to Torrance or eventually to Long Beach for a much larger facility. And we coordinate with those other cities. So part of what I think when someone chooses a location they know they get from us, apart from the sort of speed and predictability, is also a little bit of the honest broker that we're we're here to be a little bit of a mentor in a way or a a facilitator of your growth. And and in that, we're very clear about what our piece is. Like you will not find a more dense talent location. So we have a company right now, I what I don't want to use their name without their permission, but they went to New Mexico to grow because it's cheaper and they could test things out there, but the density of talent wasn't there to facilitate all the things they needed. So they came back. Like they moved back and said, Hey, we want to come back into El Segundo to this piece. We're not going to be there long because we hope to grow. And we're just happy to have that conversation with them. Like, look, yeah, let's get you back off the ground here and they can regrow again at a place with all of the sort of amenities and service providers and ancillary talent that you need to really take off.

Mark McGrath 19:59

Aaron Powell I mean the the tempo that you have is really good because I guess I think that stewardship model

Speed, Predictability, And Permitting

Mark McGrath 20:05

is highly adaptive. And then you you create an environment that's frictionless either to come there or to return to Elsagun, that example that you just gave.

Chris Pimentel 20:15

Yeah, to go to a bit to our maneuverist roots, right? You you can't fall in love with your plan. If you fall in love with your plan, you are creating it enabling friction, right? You will never be able to reorient. This you know, Franklin, which is our street around which a ton of these smaller innovators live. 2018, we thought that would all be creative office. Like, look, we're gonna have designers come in, we're gonna have people doing SaaS platforms, we want to enable this as creative office. We quickly flexed off of that. We didn't fall in love with the plan. You know, we reoriented around what the market demand was and what our specialty was and just reinforced that. So to your point, like avoiding friction, that's a that that that is the friction is in is often self-created by saying this is my system. And if your system is imperfect, you have to be able to flex off of it.

Mark McGrath 21:02

That's the that's the big word, right? So we say all the time, you know, systems drive behaviors. And if Ponch was here, that's exactly what he would say. You know, systems drive behaviors, and I think that that's really the thing to point out is what you're uh leading in El Segundo is the creation of a very adaptive infrastructure that's allowing not only uh citizens to thrive, but those that they host or collaborate with or partner with through the the companies that are doing business there.

Chris Pimentel 22:31

Yeah, I will say there there will always be challenges on the public sector and municipal side because unlike you know, I I can't task organize in the same way you would an infantry battalion. You know, you can't reshuffle and say, hey, I'm gonna do with this mobility, I'm gonna do this with my reconnaissance, you know, do this with my weapons company. Um you just don't have that ability because the roles are defined in California, it's a unionized environment, right? The the employees of the city are unionized, and those union roles have left and right limits. So I can't control that level of organization, and I can't always control the tasking. But I think what as a city we have always done, and and I'm just like the latest curator of is you can control the sort of the the ethos, right? The the maneuver statement. What's uh what's our final result desired? Right. And and so you can continue to reorient around that. Even if some of your systems will have some friction built in because of the the the job rules.

Mark McGrath 23:23

What do you think are the biggest uh components of that? Like where the where citizens have had to buy in, you know, maybe they maybe they had seen the uh the end of the Cold War and they'd seen it kind of slow down and now they're seeing the you know, you you used on a video I'd seen the you know, it's like a renaissance. Like you're you know, you're you're you're building a renaissance there. How uh how have people generally reacted to that? And I mean my sense, again, having been there and seen it, I'm like, everybody's pretty, pretty into this.

Chris Pimentel 23:54

Yeah. It's like I said, the the cultural dynamic is very forward-looking in that regard. And I think that the the the things that you have to guard against are the people become enamored with yesteryear a bit. And so you have to say, like, look, I this aspect of our lives may change, this one aspect of life, and that might be that there'll be a restaurant over here, or I think we joked about we got rid of our pool table ordinance to allow more places to have two pool tables in the same spot. But if you But if the the value system and that culture remains consistent and and people are assured that you are defending that, then you can move ahead with the other aspects. It is it can be very seductive for people generally, but but government in specific to try and be too deterministic on the future. Like, oh, I could predict it, it looks like this, so we're gonna reorient around our concept of the future. I I just don't think that's always the right answer because it's unknowable in a market environment. You know, you have to reorient around possibilities and reorient around sort of your your your cultural, and I hate the term north star, but I'll use it here, your cultural north stars, uh, and then let sort of the the development around it be things that that you can shape to your best of your ability, but but largely reorient around and then make decisions based on on what pops up.

Mark McGrath 25:07

Other than space defense, um what are what are some other industries uh you know, other than uh the refinery, you know, what are some other industries maybe in the non non-defense sector or whatever that are taking hold or looking at coming there?

Chris Pimentel 25:22

We are the only city in America with four major sports teams. No, we're the only city in America with three major sports teams, right? We're home to the Lakers, the the LA Kings, the Chargers, and then the LA Sparks will be moving here. We also have rugby, World Surfing League, and well, World Surfing League just moved, but they'll be back. So so those sorts of amenity pieces, I think part of that honestly is is the advantage of twofold. This is gonna sound I don't want to bore you to pieces. We're in the middle of a giant

Regional Coordination And Honest Broker

Chris Pimentel 25:47

area that has research universities, right? UCLA, USC, Caltech, all those things are around here, right? So we get both engineering talent out of that, but also biomedical talent. So we host UCLA and UC USC Health, and with those facilities, the sports teams come with that. And the sports teams like our proximity to the airport. Uh, they like the ease of doing business with us, building a facility because those are unique kinds of facilities, and we do that much faster than anyone else. The charges facility went up in a year. I mean, that's a $125 million facility. Um it's within literally Raytheon's parking lot. Satellites being built over here, NFL team over here. So those parts we have those, we are America's toy capital. I said we have 200 toy companies because we have where the creative economy of the West Coast, all the design and purchasing and creation, you know, principally started from Mattel, and I'll show my Barbie cup. But also the the East Asian manufacturing prowess needs a place to meet them. And we're better than Los Angeles, right? It's it's the short, it's 11-hour flight. Come over here and we become the nexus for those things. We have some robust biotech, not a huge piece, but a pretty robust one, particularly because we're by the the airport, so samples can get in and out on airplanes faster. Uh and we also will be hosting the uh the eSports World Cup, which is incredibly exciting. It's a gigantic industry. But we were selected over Riad to host the esports World Cup. So it's uh there's there's just lots of interesting things. Uh, Beyond Meat, right? I mean Beyond Meat, which I love. You know, it's it's it was founded here. So literally Beyond Meat uh was founded in the same dance studio that later became Pico Grid, which is a great defense startup, and is now a host yet another startup in it. I mean, the sort of dynamism you see. Mike Tyson's weed brand used to be based here in a very small office, which turned over it became Castellian, which is a successful missile business, which became Vast, which is space shuttle or space station business. It's a really dynamic place, and industries of various stripes come in here.

Mark McGrath 27:43

What's uh so I'm uh you know, I'm uh building a startup or uh, you know, I'm looking to move. Tell me about Vision 2050.

Chris Pimentel 27:49

You know, Vision 2050, one of the interesting spots, you know, city governance, we have to organize land use. And historically, imagine a quilt, and it's like this will be commercial office, this will be industrial, this will be research and development. In 2050, we're taking a novel approach to this, and our zoning is going to be concept-based. We think we're testing this out, we're gonna solidify this, but have areas where we can list you know, this is the kind of thing we want to accomplish here. Now, there'll be a few uses we don't want, you know, we don't want to do like I'll beat up on doggy daycares. I love doggy day, everybody loves dogs, but doggy daycares are cash cows, they're loud, they're not great neighbors because they're loud and they're hard to get rid of because of cash cows. So there might be something that we don't want in there, but instead of trying to say this will only be a commercial office, we instead would say we want something, we're open to businesses here that are dynamic and accomplish the following outputs. So that'll be a really interesting take on how a city does its general plan. Cities typically do those every 10 or 20 years. It'll be our first take on trying to be less, like I touched on before, less predictive and deterministic about what we want, because otherwise you become inflexible, right? You add the friction, which is which if I add friction, my my Jomini and Clausewitz and Heinz Gederian t-shirts will be taken.

Mark McGrath 29:06

Well, we should close with that. I'm not ready to close just yet.

Chris Pimentel 29:10

Never close with the Wehrmacht. Don't close with a Wehrmacht, edit that part out. Don't edit that part out. Stick with Clausewitz. Sit with Clausewitz.

Mark McGrath 29:15

I was just thinking for the listeners that you know that follow our work here and you know read our Substack and you know, our our clients that that bring us into their companies. I mean, you're a really good example of someone in a in an industry, in a in a sector, you know, a government, um, showing that these concepts that we teach actually work. You know, and they can work only where humans make decisions. And humans

Maneuver Thinking Over Master Plans

Mark McGrath 29:37

make decisions in municipalities just as well as they do inside of a hedge fund, inside of a manufacturing company, inside of anywhere else. You're you're you're dialing into that. And hopefully what you learned uh, because that's what I'm trying to do, but what I learned starting on the uh on this on the steamy planes of Quantico and Brownfield, you're you're putting those concepts to really good use and you're showing that this dynamic does does work. And I imagine not everybody that you work with and that you partner with has any military experience. And they're able to leverage the uh the benefits of these ideas and how they work in real time.

Chris Pimentel 30:12

Well, look, I think on that, and and and uh obviously they're imperfect, imperfect allegories, but you know, you do want to know when to commit the reserve, right? Reinforce the main effort. If our main effort is make if we have a point in time where we are making things, and I'll use this, we have we have companies coming over who are innovative and starting this a few years ago, uh, and we have something that's really taking off, and we see this as a main effort piece. Well, all of a sudden Silicon Valley Bank collapsed or retrenched at the time. Silicon Valley Bank provided all manner of services bespoke to startups, right? They could they could help you with treasury service, help you find a lawyer, help you find a realtor, all those things. Suddenly we have all these 25-year-olds starting businesses who are bereft of those sorts of services. So this is in in military parlance, we kind of committed the reserve. Like we flooded that and said, look, we cannot give you recommendations of who to use for these services, but here are a list of people that we know in the area that do it. So you can continue to work on what you work on. And if you need advice or attorneys or realtors, here are some things so we can fill that gap. So in in in sort of military parlance, like we kind of committed our reserve and them to reinforce the main effort and it was successful. But of course, anytime you commit your reserve, you've committed the reserve. So you know, it's it's a matter of of you lose some flexibility. And at the time we we did and we had some concern about doing it, but it has worked.

Mark McGrath 31:31

Tell anybody listening too that if you want to, you know, go into an infrastructure that's innovating, you also want to have one that's financially strong. You know, paint that picture because you you guys have done really amazing things in that respect.

Chris Pimentel 31:45

You know, it is it is uh goes I'll I will dovetail off that when you commit the reserve, you lose a little bit of flexibility and you have to quickly reconstitute it, right? So you have that flexibility on the field. We had seen, you know, the lesson of the of the 90s here was when the Cold War ended and the peace dividend concurred, all of a sudden, you know, we had enormous contraction in our defense sector. And you could argue that the city was somewhat overcommitted to one source of revenue, which was which was making airplanes and space spacings for the government. So when I bring up the toy industry, pivoting and understanding that there was a gap in how the toy global toy industry was working. It's traditionally based in New York. People weren't going to New York after COVID. They tried Dallas and it wasn't attracting sort of the global populace in the same way. So we so we went to the toy industry and they they approached us initially with a concept and we grabbed a hold of it and said, look, these are ways that we can anchor and continue to diversify our economy. You know, these are things that we can add. It's the same reason we we've looked at biotech too, and we look, these are other things in life sciences that can that can happen here because we are continually trying to reduce our risk, you know, de-risk the battlefield a bit by having a diverse and robust economy. So if any one of those suffers a significant retraction, you know, we we'll be a little bit more durable. If you commit the reserve and culminate, like that's the worst. You commit to reserve and hit the culminating point, and then then you can no longer re-re-constitute.

Mark McGrath 33:11

No, and I mean you know, we we do have other people that listen to this from the investing world, you know, triple A, triple A-rated city. So it's it's amazing to see a city that's financially stable.

Chris Pimentel 33:23

It didn't start that way. I will tell you, in 2018, when when I was elected, we had a $63 million general fund, basically a 5% reserve, and a $483 million pension obligation that was unfunded.

Beyond Defense: Sports, Toys, Biotech

Chris Pimentel 33:37

That doing that work, you know, in con in parallel to shore up the finances of the city and close that pension liability piece, some of that uh is really a lot of hard, hard staff work and and frankly some political risk that we had to take to build our roadmap out of that financial hole. But you know, now our general fund is about $107 million. Uh we have 25% reserve, and we have a structurally balanced budget, and we've evened out that that pension obligation. So instead of taking 40% of our general fund by 2028, which was going to do, now it's just a flat $9 million a year fee that we pay. That's seven, seven and a half percent of our general fund until 2038, and we'll be out of it. Building that, I mean, that's the classic, I guess for to use more military stuff. I mean, that's that's doing the sit-ups and the push-ups and the pull-ups and the running at home to make sure that you know you are able to fight the fight you want. You know, that's the that's the training and the that's the kid. What do we say? Training is get the continuous training or what there's a term for that. What do we have?

Mark McGrath 34:35

Now in the sweat, uh a pint of blood or whatever.

Chris Pimentel 34:39

No, there's one of those that's like uh continuing operation. What is that? That's a continuing operation, right? Yeah, financial stability is a continuing operation. Chat was continuous, yeah.

Mark McGrath 34:48

Fiscal prudence is a continuing operation in El Segundo, I think.

Chris Pimentel 34:52

Look, it's it's not easy because there's always someone with a good idea that especially once once you restore fiscal probity, people see that as dry powder, like hey, we can put this here. And you have to be disciplined as a city and say, these are what cities do. As a small city, we're we have a luxury that we don't do a lot of social stuff, right? That's the county kind of takes care of that, so social programming. But you have to be disciplined because there's always a good idea of where to spend that that can get you in trouble.

Mark McGrath 35:18

Well, we'll bring it home. I know you gotta keep your schedule moving out there. Where would you now I would tell everybody that's listening, when you're in LA, go to El Segundo, go grab coffee, go to or go to some of the restaurants, look around, drive around. You will be you'll be blown away. Which is also too fascinating for someone that lives in Manhattan. The sun shines in uh in El Segundo. Uh and I had to say it at least once, I did not leave my wallet there when I when I went there. There's another uh Gen X reference. Where would you send where where do people need to go? What websites are there any initiatives that you have that people could check out?

Chris Pimentel 35:54

Yeah, so with El Segundo Business, so if you go to Elsegundo.org, which is our which is our our our webpage, there there's a series of very helpful links. And if you're curious about the business environment, it will take you right over to our business page and give you both the lay of the land, what the zones are, the permits, what the costs are, who to contact. And if you reach out, we we will respond. So there is there's things that we try to make easy for you, besides the fact that we don't charge for parking. So that would be one thing that we parking.

Mark McGrath 36:23

Yeah. Well, because as you know, I was driving all over Greater Los Angeles those days that I was out there, and I I really did feel like like El Segundo, I mean again, I'm biased because you're you know, we've been friends for so long, but I'm like, wow, this is really like an oasis. Like this is really different than everybody else, everywhere else I was.

Chris Pimentel 36:40

So no one believes it when they get here. I you know, I'm from I I I know I've told you this this, but I tell my parents like El Segundo is is how Kansas thinks it acts. Like it's so nice. It's just so nice.

Mark McGrath 36:51

All right. Mayor Chris Pimentel, the mayor of El Segundo, California. Thanks for uh for coming on No Way Out and uh thanks for showing us how uh job boy zoodoloop sketch even works in uh municipal government.

Chris Pimentel 37:04

It works. It works. Moose, thanks for having me as always. Guy, you look great, you're aging in reverse.

Mark McGrath 37:08

Uh I know, but we we go to the same barber, you know.

Chris Pimentel 37:11

We go to the same barber, but it looks like you go to a better gym or have a better cook at home.

Mark McGrath 37:16

I will tell you one thing. I I showed the one picture that we took to a lot of people, and they're like, you two aren't related, are you? Like they thought we were cousins, you know. But anyway, you know. We'll stop the recording.

Chris Pimentel 37:27

Portuguese, Irish and Puerto Rican. It's basically that's right.

Mark McGrath 37:30

An Irish Portuguese and an Irish Puerto Rican. They I have a I have a little somewhat of a height advantage over you, but we do we do kind of look like cousins. So anyway. All right. I don't know. We'll stop the recording. Thanks so much, Chris.

Chris Pimentel 37:43

All right, thanks, Reese.